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Safeguard OSH Solutions - Thomson Reuters

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OSH Tracker

Department of Labour v Armitage Williams Construction Ltd (DC, 02/02/09)

OSH Tracker

Defendant:
Armitage Williams Construction Ltd
ARMITAGE WILLIAMS CONSTRUCTION LTD was fined $45,500 under s15, for failing to ensure that others were not harmed by the actions of its employee, and ordered to pay reparations of $12,803.52 to a digger operator who was struck by a falling steel prop on a commercial construction site. Structural steel legs were being positioned beneath beams on the site, with lengths of scaffold tube propping the legs in place. The injured man was standing beside a plate compactor waiting for those doing this work to move out of the area when an unsecured prop fell and struck him on the back of the neck, causing fractures to two vertebrae, lacerations and bruising (Christchurch DC, February 2). 
Industry:
Construction
Sub-Industry:
General Construction
Risk:
Struck by falling object
Harm:
Injury
Penalty Amount:
$57803.52
Reparation Amount:
$12803.52
Appeared in Safeguard issue 115

Judgment Text

NOTES OF JUDGE S G ERBER ON SENTENCING 
Judge S G Erber
[1]
Armitage Williams Construction Limited, which I shall refer to as Armitage, have pleaded guilty to a charge under s 50(1)(a) of the Health and Safety Employment Act 1992 in that “being an employer, failed to take all practicable steps to ensure that no action or inaction of any employee while at work harmed any other person, namely Glen Edward Te Reo.” 
[2]
The facts are quite simple really. Armitage was building a warehouse in Christchurch. Mr Te Reo was employed by a sub contractor as an excavator operator. Working on the site was a Mr Mataese-Vai, who was an apprentice carpenter, although his apprenticeship had obviously been of some longstanding since he had 6,000 hours of experience. He was employed by Armitage. 
[3]
Mr Mataese-Vai propped some construction steel using metal scaffold tubes. These were long and were not in anyway restrained or secured. Mr Mataese-Vai was instructed to clear the area in question so that Mr Te Reo could start to excavate. Mr Mataese-Vai started to do this while Mr Te Reo was nearby using an earth compactor. Otherwise the site appeared to have been cleared. 
[4]
While he was clearing the site, Mr Mataese-Vai dislodged a prop which struck Mr Te Reo. As a consequence of that occurrence Mr Te Reo suffered two fractures to the rear neck vertebrae, lacerations and bruising. He was not hospitalised but he was required to wear a neck brace for six weeks. Of course he suffered pain, his sleeping has been affected, he has had to go to physiotherapy and he finds himself not as active as he had been, requiring to rest while working because of weakness. 
[5]
However there are no long term implications, save the possibility of arthritis. Of course Mr Te Reo suffered anxiety at the time, having no idea of how the injuries could turn out and of course having concerns about his income which, as I now mention, was not affected because the combination of the Accident Compensation Commission and Mr Te Reo's employer made up the income, so in fact he had no loss of income. However he has got out of pocket expenses of $803.52 for going to and from physiotherapy and other bits and pieces, liability for which is admitted. 
[6]
The relevant legislation is the Sentencing Act, particularly s 7 to s 10 and s 35 and subsequent sections. Also of course there is the Health and Safety and Employment Act, particularly s 51(A) which adds to the Sentencing Act criteria in these sorts of cases. 
[7]
The approach which this Court must follow is the approach mandated by a recent case called Department of Labour v Hannham & Philp (18 December 2008) CRI-2008-409-0000002. This is a decision of a full Court of the High Court. However this decision has overtaken and consolidated almost all preceding a case law and its general effect has been to enjoin the Courts to view infractions of the Health and Safety legislations more seriously than may have been the case beforehand. 
[8]
I now deal with the approach which that Act requires me to take. The first thing I have to do is determine the amount of reparation and so far as is relevant to this case, the principles appear to be. 
Reparation must be fixed in accordance with the principles set out in s 32 of the Sentencing Act. 
I must take into account any offer of amends, not only of monetary payment but other measures taken to address the effects of the offending on the victim. 
I am not constrained by the amount of any monetary payment or offer, or indeed of reparation. 
I am required to get details of the offender's financial position. In this case I have not been given details of that position and I assume therefore that any reasonable award of reparation and any reasonable fixing of a fine is something which the company can pay. 
[9]
The first step therefore is the fixing of reparation. The second step is determining the amount of the fine and at paragraph 47 of the decision in Department of Labour v Hannham & Philp the Court said “the imposition of a fine in addition to reparation will generally be required to address the separate statutory purposes of denunciation, deterrence (both general and specific) and holding the offender accountable for the harm done.” 
[10]
I must in addition consider and apply the effects of a case called R v Taueki [2005] 3 NZLR 372 (CA)Has partially negative history or cases citing, but has not been reversed or overruled[Yellow]  with regard to the approach which has to be taken when questions of fine or indeed questions of punishment of any sort are determined. I have to establish a starting point by assessing the culpability of the defendant and in this I have to consider the identification of the operative acts or omissions at issue. 
[11]
Here, could the accident have been avoided by practicable steps being taken and there is no doubt about that, the defendant accepts that it could easily have been avoided. I have to consider: 
The nature and seriousness of the risk of harm. 
The degree of departure from standards in the industry. 
The obviousness of the hazard. 
The availability and cost of fixing or avoiding the hazard. 
The current state of knowledge and the risks of the nature and severity of the harm which could result. 
The current state of knowledge of the means available to avoid the hazard. 
[12]
The Court in Hannham came to the conclusion that culpability should be assessed on three bases, low, medium and high and the former of fines of up to $50,000.00 is suggested for: medium culpability of a fine of between $50,000.00 and $100,000.00 is suggested, and where there is high culpability a fine of between $100,000.00 and $175,000.00. All of these figures are by no means fixed, they are to be determined having regard to the particular case, and in cases of flagrant culpability, a higher fine than those suggested may well be appropriate. 
[13]
I must then adjust the fine for aggravating and mitigating features, and relevant to this case the aggravating features relating to Armitage would be the existence of any previous conviction (there was one about nine years ago but I note that it was not for the same kind of infraction) and any warnings or notices given to Armitage, of which there were none. 
[14]
Mitigating features will be a guilty plea, co-operation with the authorities, remorse where appropriate, any remedial action taken to prevent a recurrence of the circumstances, and a favourable safety record. 
[15]
Looking at the question of how the fine is affected by any reparation order, it is clear from Hannham that a reduction in the appropriate level of fine by the amount of reparation ordered is not generally appropriate where there is financial ability to meet both reparation and the fine. The fine should not be increased because of insurance cover, but the fact of insurance is relevant to the assessment of the financial capacity to pay any fine or reparation. 
[16]
The Court suggested that a discount of between 10 and 15 percent of the level of the fine is reasonable to recognise the order for reparation. Having done all of that I have got to stand back and look at the totality of the fining / reparation regime to determine what it is appropriate in the circumstances. 
[17]
I deal first with the question of reparation. The informant's case is that there is specific loss of $803.52, which is not an issue. The issue here is one of emotional harm and the prospect of future sequelae. The prosecutor submits that by analogy with the Aquaheat Industries Limited case (13 September 2005), the proper figure for reparation here is $25,000.00 or thereabouts. I do not accept that the Aquaheat injuries are the same as in this case. In Aquaheat the reparation was fixed at $25,000.00, but the effects on the injured worker were much more serious in that case. He was hospitalised, he got chest infections, his prognosis was uncertain. He was off work for nine months. He had two fractured vertebrae and two broken ribs. 
[18]
On the other hand the defence argue that not only is there no comparability with the Aquaheat case, but that in line with Hannham the appropriate figure for reparation is somewhere between $5,000.00 and $10,000.00. My conclusion is this. If the informant suggests Aquaheat is taken as a guide, the effect on Mr Te Reo for which he is to be compensated is significantly less than in that case, and I fix reparation in the sum of $12,000.00. 
[19]
I now look at the question of the fine. Now the informant's case is that culpability is high because the hazard was obvious. The risk that the prop might become detached or loosened in the course of propping up the steel beams was and should have been seen to have been obvious. Mr Mataese-Vai was still an apprentice and it is the informant's submission that he should have been supervised and not allowed to carry this work out alone. Serious harm, says the informant, was a likely outcome of falling heavy metal tube on the body of a nearby worker and generally speaking the propping was not carried out in line with industry standards. 
[20]
Pausing there for a moment, it will be seen from the submissions of the defendant that the defendant does not really quarrel with those factors advanced by the informant. What it says is that they do not sound in high culpability. The informant, when considering the degree of harm caused, draws attention to the injuries which I have outlined and the potential for even more serious harm and indeed death. 
[21]
The upshot of all of this is that the informant suggests a fine in the vicinity of $137,500.00. That is the starting point. The informant says that there should be allowance made for the guilty plea and the admitted co-operation of the defendant. It draws attention to an aggravating feature, namely an occurrence which occurred on 7 December 1998 where the company was fined in a decision given on 16 December 1999. The informant suggests an adjustment for the mitigating and aggravating features would be a discount of 30 percent for a late plea of guilty and co-operation and an uplift of about 5 to 8 percent, having regard to the previous conviction. 
[22]
I note that in the relevant case law, the discount of 30 percent is suggested in return for the plea of guilty. There is a further discount for any co-operation and other mitigating factors which might exist. The conclusions to which the informant comes is that bearing in mind their submissions in relation to reparation ($25,000.00), the total payment required to be made will be between $128,000.00 and $133,000.00 in round figures. 
[23]
The defendant's submissions are that Mr Mataese-Vai might be designated an apprentice, but he had a lot of hours of work under his belt and was not a youthful apprentice. He was somewhere in the vicinity of 40 years of age. The defendant submits that the culpability here is low because the defendant has been pro-active in creating and maintaining a health and safety plan, that it has qualified and subscribed to the “Site Safe” programme, and that it has a workplace safety management certificate. The hazard of the falling prop is accepted, but on the day the employee failed to follow the procedures, which thereby caused the incident. 
[24]
The defendant does however accept that on the day it failed it identify the hazard or to supervise Mr Mataese-Vai. Lastly the defendant submits that a failure to tie the prop down is in a different category to, say, unguarded machinery. However the defendant accepts that in effect the hazard could easily have been identified at the time and that the accident could have been avoided either by appropriate supervision, or alternatively by the tying down the prop in question. 
[25]
Again it submits that so far as the fine is concerned, the starting point is up to $50,000.00 as suggested by the Court in Hannham in the case of a low culpability accident, and it submits that culpability here was low, the hazard was not obvious at least to Mr Mataese-Vai, and that he had been advised about similar sorts of hazards but had failed to seek assistance or to follow the directions given to him. 
[26]
The fault was not the fault directly of the employer, but I draw attention to the fact that the law is clear and that the failure by an employee is deemed to be the failure by the employer. Various other submissions in diminution of the fine suggested by the defendant, such as the fact that although Mr Te Reo rightly suffered serious harm, it has not resulted in permanent disability which is a factor which would create a much higher reparation figure and might well flow on to the question of the fine. 
[27]
Mitigating features are the guilty pleas of the defendant, the co-operation with the informant and overall, bearing in mind that the company is a substantial company and a substantial employer, one previous conviction in December 1999 should not be seen as a significant aggravating feature. The upshot of this is that the defendant suggests a fine together with reparation as seen by the defendant somewhere in the vicinity of $45,000.00. 
[28]
My conclusions are these. I have already concluded the reparation is fixed at $12,000.00. The accident occurred through the failure at the time to identify the particular hazard and the failure to supervise Mr Mataese-Vai. These failures could easily have been overcome. As opposed to that Mr Mataese-Vai was a very experienced man, and of course there are the other mitigating features which the defendant draws my attention to. 
[29]
I do not consider the culpability is high but I do not consider either that it is at the low end suggested by the defendant. The problem which arose was easily capable of resolution once the hazard was identified. Culpability is in the medium band and somewhat up from the base figure for that band as identified in Hannham and I fix the starting point of the fine at $70,000.00. 
[30]
The mitigating features are easy to be seen. Firstly there is the plea of guilty which was prompt after the informant had notified the additional factors of complaint, but the defendant's counsel would have been well aware of the fact that the Court could have itself added that factor to the indictment had it deemed it appropriate. 
[31]
Overall the record of the company is good. It is an employer which is generally conscious of its obligations and performs those obligations. It was co-operative with the investigation and it seems it has amended its work practice to ensure that a similar accident cannot recur again. 
[32]
For a plea of guilty in the ordinary criminal Court, experience has shown to me that a discount of 25 percent for a prompt plea of guilty is given, unless the case is one of exceptional complexity or a case of sexual misdemeanour, where a discount of up to one-third is appropriate. Here the informant suggests 30 percent which seems to be in line with case law for this sort of case. I do not intend to depart from the indication of the general case law at 30 percent. 
[33]
A further discount for other mitigating features is permitted, such as a co-operation and the other features I have mentioned. That means that the discount is uplifted by 10 percent to 40 percent. I have to give some weight to the fact that the company has failed in its health and safety obligations before but that should not be at the high end of the scale and I determine a reduction of 5 percent, so the total discount from the fine is 35 percent, or $24,500.00 in total. 
[34]
The company is convicted. A fine of $45,500.00 is imposed, and costs of $130.00, solicitor's fee of $250.00 is what is sought by the informant. I might have been constrained to order a greater figure, however that is what the informant desires and submits, so that is what is ordered. Reparation is ordered in the sum of $12,803.52, for emotional harm $12,000.00 and actual out of pocket expenses of $803.52. 

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