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Safeguard OSH Solutions - Thomson Reuters

Safeguard OSH Solutions - Thomson Reuters



OSH Tracker

Department of Labour v Callum Molloy Ltd (DC, 10/11/08)

Sentencing Tracker

Principal Offences:
Failing to ensure safety of employee (s 6 and s 50(1)(a) Health and Safety in Employment Act 1992)
Plea:
Guilty
Non-Custodial Sentences:
$30,000 fine and $250 solicitors' fees
$80,000 reparation
Mitigating Factors:
Early guilty plea
Remorse
Lack of previous convictions
Reparation
Financial situation in light of Accident Compensation payments
Victim:
47, Male

OSH Tracker

Defendant:
Callum Molloy Ltd
Earthmoving contractor CALLUM MOLLOY LTD was fined $30,000 under s6 and ordered to pay $80,000 in reparations to the widow of an employee who was buried in a trench collapse. The director of the defendant company was excavating the trench while his employee stood inside it, positioning pipes. When the trench wall fell in, the employee was struck by a large rock and buried, face down, beneath a cubic metre of soil. The company director believed the trench was stable because the ground was very hard, but the Department of Labour said he should have obtained geo-technical advice about its stability, and have either ensured it was cut back to a safe angle or used approved protective shields. (Hamilton DC, November 10). 
Industry:
Construction
Sub-Industry:
Construction Trade Services
Risk:
Engulfment/drowning
Harm:
Death
Penalty Amount:
$110000.00
Reparation Amount:
$80000.00
Appeared in Safeguard issue 115

Judgment Text

NOTES OF JUDGE J E MAZE ON SENTENCING 
Judge J E Maze
[1]
Callum Molloy Ltd has pleaded guilty to one charge of failing to take all practicable steps to ensure the safety of an employee. The offence is under s 50 of the Health & Safety & Employment Act. The maximum fine is $250,000. 
[2]
The summary of facts discloses that on the day of the accident, February of this year, Mr Keith Hancox and the defendant company's director Callum Molloy were laying concrete pipes as storm water drainage between a manhole previously installed and a new proposed manhole. The work involved digging a trench through various soil and rock connecting the pipes together at the bottom of the trench and partially back-filling the trench once the pipes were in place. 
[3]
Mr Molloy has pointed out that at the time they were under the contractual supervision of another company of surveyors, who had actually been present on the site immediately before the accident and had inspected the work. 
[4]
Because of the nature of the trench cut, the trench was getting progressively deeper as it went up the hill. Mr Molloy excavated a new section of trench, placing the soil on top of the south wall for the bulldozer to dispose of, lifting a new section of pipe into the trench and placing it at the end of the last pipe previously laid. 
[5]
Mr Hancox was in the trench and he hand-fitted and aligned the pipe while the pipe was suspended from the digger bucket. Once the pipe was aligned a timber shutter was placed over the open end to stop soil from the next digging entering the pipe. Once installed the pipe was covered with soil to hold it in place and to ensure alignment within the trench. 
[6]
Mr Molloy was completing the excavation of a new section when he observed Mr Hancox standing in the trench two pipe sections back from the digging zone. The wall of that part of the trench adjacent to Mr Hancox collapsed. He was in fact struck by a large rock and he was buried face down in between a half and one cubic metre depth of soil. Mr Molloy reacted immediately. He used the digger to remove one layer of soil. He and his father and another employee dug to retrieve Mr Hancox, but as a result of the rock falling upon him and in particular head injuries, Mr Hancox died. 
[7]
The informant points to an inspection report concluding that, “trench fall stability was considered to be marginal in the short term on the upper faces of both side walls,” and, “marginally stable in the short term implies the face may fail if disturbed. Disturbance can include undermining of the slope, impact on the slope by the excavator bucket or broom, workers climbing on the slope, further steepening of the slope and filtration of water into or onto the slope from surface flow or ground water movement, or shaking of the pipe by the activity of machinery working nearby.” 
[8]
The informant points to the approved code of practice for safety and excavation and shafts for foundations, which provides a formula for the proportions for approved transprotection shields in the alternative to apply. The informant therefore advances the proposition that the defendant company failed to take a number of practicable steps. It failed to obtain geo-technical advice on the stability of the ground materials in an around the trench walls. It failed to ensure its employees did not work in the trench unless the trench was cut back to a safe slope within the proportions set out by the approved code of practice, or an engineer approved trench protection shield was in place. 
[9]
The defence have accepted that the defendant company failed to take all practicable steps by virtue of the plea, but it does say in mitigation that there was the supervision of this additional company, a surveyor company, and in addition says that Mr Callum Molloy has had years of relevant experience of excavation work in and around the area in question. His experience is, that the ground in the area is very hard and indeed, he says the teeth on the bucket being used had to be replaced because of the hardness of the area in which they were working. So based on those years of relevant experience, he did not appreciate that there was any risk in letting any employee enter the trench. Indeed, he points out that his own father was working alongside Mr Hancox, (broadly speaking) at the time. It was his belief on the basis of his experience that the ground was very stable. 
[10]
The defendant company has no previous convictions and Mr Beadle has reminded me that from the outset, the defendant company took a number of steps. Also Mr Molloy was unable to continue working in the area himself, on a personal basis, such was the impact of the accident upon him. In addition the company was immediately responsive and, on a personal basis, Mr Molloy was immediately responsive to the de-facto widow of the late Mr Hancox. A voluntary payment was immediately made to assist her and this was outside of any insurance considerations. 
[11]
The defence have filed affidavits. They point out the somewhat financially limited strength of the defendant company and its heavy dependence upon Callum Molloy. Mr Molloy himself has health problems and although a young man, he is facing a period when he will be unable to contribute to the company's ability to earn an income, as the company is largely him. That is of considerable significance. 
[12]
The submissions are made for the informant that my task today is to fix a quantum of reparation and then a fine and that I should bear in mind the aims of the Act as specified in the Act itself. In particular, that the object of the Act is to promote the prevention of harm to all persons at work and other persons in the vicinity of a place of work. The prevention of harm is the factor most emphasised by the Courts in dealing with defendants under this legislation. The amendment to significantly increase penalty levels from $50,000 to $250,000 fines as a maximum, is a factor to which the informant refers as indicative of the emphasis Parliament has placed upon the seriousness of health and safety offending, and to advance the proposition that the Courts should have the ability to impose significant penalties. 
[13]
It is of course axiomatic that the Sentencing Act itself also applies. The starting point must be a fine appropriate to reflect the gravity of the offending and the requirements, in particular of denunciation and general deterrence. I have been referred to a significant number of previous decisions. 
[14]
The submission is made that what I have really is a stepped approach, firstly to fix the reparation and secondly, to fix the fine independently. I note that I have been referred in particular to a decision of His Honour Justice Pankhurst in Canterbury Regional Council v Steelebro NZ Ltd, HC, CHCH, 28 February 2007, Pankhurst J, CRI 2006-409-000232. In my view, what His Honour is saying is that it is the impact of the two in combination, which is the really important exercise that this Court must undertake. 
[15]
I accept the contents of paragraph 22 of the informant's submissions. No issue was taken with that by the defence. Broadly speaking, that is the approach to adopt, although I resist any suggestion as to percentage quantifications for efforts to make amends. It is a principle frequently adopted in this Court that something in the region of up to 33 per cent can be allowed for general mitigating factors, depending upon the speed with which guilty pleas are entered and so forth. A separate deduction is made to allow for remedial measures according to s 10 and s 12 of the Act. I resist any suggestion of fixed percentages. Sentencing is not a formulaic matter and it is clearly within the discretion of the Court as to what is accepted or imposed. 
[16]
I start with quantum of reparation. It is a vexed issue. Our law precludes civil liability, (outside of punitive damages) by virtue of the Accident Compensation regime. Obliging the Court to fix the level of reparation, is a very difficult issue. It is commonly undertaken in this particular avenue of this Court's criminal jurisdiction, so there is nothing unusual about what I am being asked to do today. But in every other kind of reparation claim, the Court is presented with an offer to make amends and the Court can assess that or, the Court can. impose an amount, which is readily identifiable as a loss to a victim of an offence. 
[17]
Mr Beadle has reminded me that the whole issue of economic loss and its role in reparation is a matter awaiting determination by the Supreme Court. Unless a sum is agreed, the defendant company's position has to be reserved on this issue. He attempted on behalf of the defendant company to engage in a restorative justice conference under the programme available in this Court, but that was not able to proceed because the facilitators feared that it was a matter not strictly within the ambit of restorative justice as they perceived their role. 
[18]
Further informal attempts were made through the informant and utterly understandably, the de-facto widow of Mr Hancox declined to participate. I refer to it only to indicate that the defendant company has made real and significant efforts to attempt to hear from the defacto widow and to the see in what way they can assist her. 
[19]
The quantification of reparation is (and it. is trite to say it), a very difficult issue in cases of this kind. It is unseemly by its very nature, but the reality is it has to be principled and I accept Mr Beadle's submissions in that regard. I do not accept the Department's quantification because I think it makes inadequate allowance for the realities of life. In the end in the current financial circumstances who is to say, that Mr Hancock's employment with Callum Molloy Ltd would have continued had he survived the accident in good health. Who is to say, that if it had not continued he would have been able to find replacement employment, employment at the same rate, employment through to age 65 as I understand it to be calculated. This is a very physical area of work and as Mr Molloy's own health needs indicate, it brings with it compromises and shortening personal horizons. 
[20]
The reality must be that the late Mr Hancox was 47 years of age, employed as a labourer, dependent upon his own physical good health and at an income which could not be said to be at the higher end of the scale. Even allowing for 18 years of full employment, I accept Mr Beadle's submission that an allowance for economic loss in the region of $50,000 is broadly appropriate. It is as I say, unseemly and unsatisfying for me to have to put it in those terms, but it must be a logical and principled approach. 
[21]
There is the even more unseemly process of attempting to place a figure on emotional loss. It could be argued that the longer the relationship between Ms Walton and Mr Hancox, the greater her loss, because the term of the relationship might be indicative of its strength. It is impossible to fix a value on the life of a lifetime partner. I accept that I am given some degree of guidance by other cases and I take the view that the figures submitted by the Department are simply too high. 
[22]
Based on a broad approach adopted in other cases, I consider that, overall, a figure of $80,000 is appropriate. I am obliged to have regard to any allowance which would be made under the Accident Compensation Scheme and I have done so in fixing the figure at $80,000. I have taken a $30,000 figure for emotional loss and $50,000 figure for economic loss. Again, I can only say that if that brings insult to Ms Walton, I can only offer my apologies, but it is the best effort I can make given the guidance from the other cases. 
[23]
The next step is to attempt to quantify the fine. The maximum is $250,000. There are two lines of authority. I expect that one is from a superior Court but I accept also, as I am told from the bar, that it is subject to challenge on appeal. As a matter of public policy, it seems to me undesirable that those who make proper provision for a fund or resource from which to pay reparation, should not have that course of action approved by way of proper allowance. To adopt the approach that an insurance company pays, and therefore there is little or no expense to the employer by way of reparation, is I consider unrealistic and contrary to the aims of the legislation and the aims of the Sentencing Act in placing reparation at a high point in the sentencing exercise. It is therefore proper to acknowledge the effort made to provide in a responsible fashion a fund for such accidents, should a fund be needed. 
[24]
I acknowledge the aims of sentencing in this field must reflect denunciation and general deterrence. This company has no previous convictions. There is no suggestion that it has been irresponsible on previous occasions towards its obligations to its employees. So it is general deterrence and denunciation, which is an issue along with provision for the safety of employees. 
[25]
In fixing the level of culpability, the argument is advanced by the informant that the culpability is in the medium to high range and by the defendant, it is in the medium. I accept the defence proposition. The company was dependent upon Callum Molloy's assessment of the situation. There is no basis to doubt he is being absolutely honest when he says that based on his experience in that area over many years, he believed the situation would be more stable than it was. It was an error of judgment, but it fixes culpability at the moderate level. 
[26]
There are no personal aggravating factors to the extent that this company has no previous convictions and so, it could be said that this offence was out of character. 
[27]
Therefore I take a fine starting at $150,000. A full 33 per cent is appropriate for the usual mitigating factors; early plea, remorse, conclusion that it was out of character. That brings it to $100,000. There must be a further discount for the reparation. I reject any attempt at percentages or formulae. I am obliged to look at the circumstances as a whole. Aside of paying reparation to be ordered by this Court, it is clear that the defendant company was prompt in its response and that the person who is in effect the principal mover for the defendant company, has been seriously affected by what occurred. 
[28]
In the circumstances I consider that a proper allowance to allow for the figure of $80,000 in reparation is to provide for a fine which would have been in the region of $60,000 to $70,000. I say would have been, because the next issue is ability to pay. Given the contents of Mr Molloys affidavit, means to pay is a very real issue. The principle of the “widow's mite”, might not appear as such in the Sentencing Act. The Act certainly obliges me to be satisfied that any penalty I impose is able to be paid. 
[29]
In the current circumstances given that Mr Molloy is the sole means of this company's trading and he himself is going to be subject to Accident Compensation payments for some months, perhaps up to a year, I reduce the fine by half. I wish to make it clear that in imposing a fine of $30,000, it is strictly on the basis of an attempt on my part to assess means to pay by this defendant company. When all is said and done it is a limited liability company. If it is to have any prospects of life after this event, then it has to be at a rate that the company has some means to provide payment for. 
[30]
Accordingly, the defendant company is fined $30,000 and it is ordered to pay a solicitor's fee of $250. It is sentenced to pay reparation of $80,000, payable to Collections on behalf of Christine Ann Walton in terms to be fixed by Collections in consultation with the defendant, but within 28 days for payment of the reparation. The fine of course is not subject to that direction. It is payable in terms to be fixed by Collections with leave to seek further directions by the defendant if required. 

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