WorkCover Authority of NSW v Diona Pty Ltd [2014] NSWDC 176

District Court New South Wales

Medium Neutral Citation: WorkCover Authority of NSW v Diona Pty Ltd [2014] NSWDC 176 Hearing dates: 24 July 2014 Decision date: 24 July 2014 Before: Curtis DCJ Decision: I dismiss the charge pursuant to s10 of the Crimes (Sentencing Procedure) Act 1999 Legislation Cited: Occupational Health and Safety Act 2000 Crimes (Sentencing Procedure) Act 1999 Cases Cited: Meridian Global Funds Management Pty Ltd v Securities Commission (1953) All ER 918 Category: Sentence Parties: Workcover Authority of NSW (Prosecutor) Diona Pty Ltd (Def) Representation: P Ginters appeared for the Prosecutor D Jordan SC appeared for the Defendant File Number(s): 2012/174991

Judgment 1The defendant, Diona Pty Limited, pleads guilty to the charge that on 5 June 2010 at Princes Highway, Kogarah, contrary to the provisions of section 8(2) of the Occupation Health and Safety Act 2000, it failed to ensure that persons other than its employees were not exposed to risks to their health or safety. 2On that day Mr Ciaran Fullen, operating a five tonne Komatsu excavator, excavated a trench in the footpath closely abutting premises 688 Princes Highway. This excavation undermined the façade of the building which partially collapsed. In the course of that collapse an occupant, Mr Kevin Farasopoulos, suffered injuries. Other persons were endangered. 3The immediate cause of the collapse was the actions of Mr Ciaran Fullen, a principal and employee of Fer-Aim, who excavated the trench. The danger was apparent to anyone on the site, and one would have thought, foreseeable to Mr Fullen. 4Diona had contracted to Ausgrid to excavate approximately two kilometres at Kogarah into which Ausgrid was to lay underground conduit and cable. Diona subcontracted with Fer-Aim Pty Limited to perform the works and nominated Mr Fullen as its supervisor. 5At the time of the accident Fer-Aim had safely completed the extent of the works contemplated by the contract. Ausgrid however required a connection between the work completed by Fer-Aim for Diona, and other works completed by Bastow Civil Constructions, which company had bored a hole underneath the Princes Highway through which the cable was to pass. 6Shortly before the accident Mr Philip Cresnar, Ausgrid's Contract Inspector and representative on site, verbally requested Mr Bastow to extend his trench to connect with the works completed by Fer-Aim for Diona. Mr Bastow refused this request, advising Mr Cresnar there were safety issues because of the age and structural integrity of the building in question. Mr Bastow suggested to Mr Cresnar a safer alternative. 7Mr Cresnar did not take Mr Bastow's advice. He instructed Mr Fullen to extend Diona's works to connect with Mr Bastow's works. Mr Fullen questioned Mr Cresnar's instruction because the work was outside Diona's scope of works, but he was overborne by Mr Cresnar who instructed him to continue. 8It is necessary in consideration of the appropriate penalty to determine the extent of culpability and fault. As I have said in a recent case, an inquiry into culpability is an inquiry into a reprehensible state of mind, a mind lacking care for the consequences of failing to observe the standards of a reasonable man when acting or failing to act. 9The gravity of a corporation's culpable failure to act reasonably is to be found by weighing the culpability of a natural person whose obligation was, as a servant or agent, to know and discharge the legal responsibilities of the corporation in respect of the duty in question (see Meridian Global Funds Management Pty Ltd v Securities Commission (1953) 3 AER 918). In each case a natural person must be identified or postulated, and his personal conduct weighed against the reasonable person with his or her knowledge possessing his or her powers of control. 10It is by way of legal fiction that in the event Mr Fullen was the personification of the defendant corporation for the purpose of discharging the responsibility to act safely. As Mr Jordan points out, there are several reasons why it is that Diona, other than through the person of Mr Fullen, could not have foreseen that which occurred. 11First, pursuant to the contractual arrangements between Diona and Ausgrid, a notice requiring departure from the scope of works was required to be delivered to Diona in writing. Before the events of the day that practice had become established. 12Secondly it was not probable, or even foreseeable, that the will of Mr Fullen should have been overborne, nor that Mr Fullen would fail to independently assess the task. 13As recently as 12 May Mr Fullen participated in a tool box talk with officers of the defendant and was told, amongst other things, that it was important for him to complete a daily hazard assessment for each new task. 14Thirdly it was not foreseeable that Mr Cresnar would give instructions contrary to the specifications of Ausgrid by whom he was employed, which forbade excavation so close to this building. 15It cannot be contended that, in a general sense, Diona did not take all reasonable precautions to prevent injury on this site. I think it unnecessary to review the occupational health and safety procedures of the defendant in circumstances where the Prosecutor points to no failing other than the failing of Mr Fullen. 16Diona had documented training systems for its employees, it employed occupational health and safety experts, inducted employees into safe systems of works, provided refresher training for its employees, provided site specific training and required daily hazard assessments to be identified and signed off every morning. 17I cannot identify any culpability on the part of the company other than that for which they are liable, that is the culpability of Mr Fullen. 18It is significant to here repeat the agreed fact that before this incident Diona had completed the works contemplated by the contract. Mr Fullen was not authorised to agree to the additional works requested by Mr Cresnar. It may have been arguable that the risk created by the additional works did not arise from the conduct of the defendant's undertaking. 19Mr Fullen's culpability, it seems to me, was not great. He objected to that which he was required to do. He was overborne by an inspector in circumstances where Diona was contractually obliged to comply with directions of that inspector. Mr Fullen was not a trained engineer, and had reason to suppose that Mr Cresnar had sufficient skill to assess the risks associated with the course which he proposed. 20The gravity of the offence is a synthesis between the objective consequence of the failures and the measure of culpability. The objective consequences were quite serious but I find the culpability to be low.