District Court New South Wales Medium Neutral Citation: Work Cover Authority of NSW v Fer-Aim Pty Ltd [2014] NSWDC 367 Hearing dates: 23 October 2014 Date of orders: 23 October 2014 Decision date: 23 October 2014 Jurisdiction: Criminal Before: Curtis J Decision: In matter number 2012/174902 and 2012/174931 without proceeding to a conviction, I find the defendant company guilty of the offence charged and order that the charge is dismissed Legislation Cited: Occupational Health and Safety Act 2000 Crimes (Sentencing Procedure) Act (1999) Cases Cited: Meridian Gloval Funds Management Pty Limited v Securities Commission (1953) 3 AER 918 Category: Sentence Parties: WorkCover Authority of New South Wales (Prosecutor) Fer-Aim Pty Ltd (Defendant) Representation: Counsel: P Ginters (Prosecutor) J M Galluzzo (Defendants) Solicitor: WorkCover Legal Group (Prosecutor) J.P. Gould (Defendants) File Number(s): 2012/17490 and 2012/174931 SENTENCE 1. In matter number 2012/174931 the defendant Fer-Aim Pty Ltd pleads guilty to the charge that on 5 June 2010 at Kogarah contrary to the provisions of s 8(1) of the Occupational Health and Safety Act.it failed to ensure the health and safety of its employees Mr Cairan Fullen and Mr Simon Tracy. 2. Fer-Aim subcontracted to Diona Pty Limited which company had contracted to Ausgrid to excavate approximately two kilometres of trenching at Kogarah for underground cabling. Fer-Aim performed the excavation works for Diona. 3. On the morning of 5 June the work which Fer-Aim had contracted to perform for Diona and Ausgrid was completed. Nevertheless, shortly before the accident, Mr Phillip Cresnar, Ausgrid's contract inspector and representative on site requested Mr Fullen, the operator of a trenching machine, to excavate a further trench closely abutting a building. 4. In the course of this excavation the building was undermined and partially collapsed. Mr Cresnar had earlier requested another contractor Bastow Civil Constructions to undertake the additional work and Mr Bastow, the principal of that company, had refused because of safety issues. 5. Mr Fullen, believing he was bound by a contractual provision that he was to obey Mr Cresnar's instructions, after questioned his direction, went ahead and performed the work. His actions were contrary to the instructions given to him by his employer and Diona that before any additional works were to be performed a safety assessment was to take place and the principals of Fer-Aim and Diona were to be notified. 6. The complicating factor in this matter is the dual role of Mr Fullen as the personification of the former defendant Diona Pty Limited and also the personification of Fer-Aim for the purpose of ascribing responsibility to that company. 7. I repeat my observations in Diona on 24 July 2014 that the 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 servant or agent to know and discharge legal responsibilities of a corporation in respect of the duty in question. (See Meridian Gloval Funds Management Pty Limited v Securities Commission (1953) 3 AER 918). 8. In each case an actual 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. 9. Mr Patrick Maskelly who was the sole director and shareholder of Fer‑Aim Pty Limited relied upon the Occupational Health and Safety Training Systems in place on the site. There can be no suggestion that those systems and that training were inadequate. 10. Mr Ginters for the prosecutor can point to no failing on the part of Mr Maskelly which caused or contributed to this incident. The failing was entirely that of Mr Fullen, who personified the defendant for the purpose of the Statute. 11. The summons particularised the failing of Mr Fullen, as failing to ensure that, before the trench was excavated, a qualified engineer was retained to determine whether the work was safe. 12. Mr Fullen could have carried out that task by reporting the direction of Mr Cresnar to Mr Maskelly who, himself being an engineer may have assessed the risks, or reported Mr Cresnar's request to Ausgrid. 13. The particular failing of Mr Fullen is however to be seen in context. Although Mr Fullen knew, because he had been instructed in a toolbox meeting shortly beforehand that he should not carry out further work without reference to his employer or to Diona, he also knew that Mr Cresnar was a person whose directions Fer Aim was contractually bound to follow. 14. Mr Fullen was not a trained engineer, he had reasons to suppose that Mr Cresnar had sufficient skill to assess the risk associated with the course which he proposed. 15. The real cause of this accident was irresponsible conduct and the bullying behaviour of Mr Cresnar. I am informed that Mr Cresnar was not charged, it offends one's sense of fairness and relativity to suppose that the company Fer-Aim should be liable to penalty in circumstances where it was effectively the victim of Mr Cresnar who is unpunished. 16. In the prosecution of Diona, I found that while Mr Fullen was the legal embodiment of Diona Pty Limited, that company was entitled to the benefits of s 10 of the Crimes (Sentencing Procedure) Act (1999). The failings of the defendant Fer-Aim are the failings of the same person, Mr Fullen. 17. Section 10 provides that without proceeding to conviction if a court finds that a person is guilty of an offence it may nevertheless order that the relevant charge be dismissed. Subsection 3 directs the Court to have regard to the person's character, antecedents and the extenuating circumstances in which the offence was committed. 18. Fer-Aim is a defendant of good character and has no prior convictions operating in a dangerous industry. I am satisfied upon the evidence that Fer‑Aim took its responsibilities pursuant to the Act seriously and the failing in this case was not a failure of adversion on the part of the principals of that company. 19. Rather it was a failure on the part of a person who was not high in the hierarchy of the company. Although Mr Fullen disobeyed his instructions, the company is never the less responsible because it had delegated to him the relevant functions. 20. The extenuating circumstances in which the offence was committed and the requirements of parity between the liability of Fer-Aim and Diona justify an order directing the charge be dismissed. 21. Another circumstance is the fact that the defendant has agreed to pay the prosecution's costs in the sum of $16,450. In so much as a deterrent may have been required that constitutes both a general and a particular deterrent. 22. I find that in both matters 174902 and 174931 the charges are proved, but without proceeding to conviction I dismiss the charges pursuant to section 10. 23. In matter number 174902 I direct that the defendant pay the prosecutor's costs in the sum of $16,450. Amendments 23 November 2015 - Corrected the title DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 23 November 2015