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District Court of New Zealand |
Last Updated: 8 July 2024
EDITORIAL NOTE: CHANGES MADE TO THIS JUDGMENT APPEAR IN [SQUARE BRACKETS]
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ORDER PROHIBITING PUBLICATION OF NAME(S), ADDRESS(ES),
OCCUPATION(S) OR IDENTIFYING PARTICULARS OF
WITNESS/VICTIM/CONNECTED PERSON(S) PURSUANT TO S 202
CRIMINAL PROCEDURE ACT 2011. SEE
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IN THE DISTRICT COURT AT CHRISTCHURCH
I TE KŌTI-Ā-ROHE KI ŌTAUTAHI
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CRI-2019-009-008626 CRI-2019-009-008627 CRI-2019-009-008637
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WORKSAFE NEW ZEALAND
Prosecutor
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v
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ARMITAGE WILLIAMS CONSTRUCTION LIMITED MACMILLAN PLUMBING AND GAS
LIMITED SMARTFLOW PLUMBING AND GAS LIMITED
Defendant
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Appearances:
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B Finn for the Prosecutor
T Lill for Armitage Construction Limited
M Parker for MacMilllan Plumbing and Gas Limited T McKenzie for Sartflow
Plumbing and Gas Limited
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Hearing date:
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1 July 2021
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Judgment:
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17 August 2021
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SENTENCING NOTES OF JUDGE G M LYNCH
[1] Armitage Williams Williams Construction Limited (“Armitage Williams”), MacMillan Plumbing and Gas Limited (“MacMillan Plumbing”) and Smartflow Plumbing Plumbing and Gas Limited (“Smartflow Plumbing”) appear for sentence on charges under the Health and Safety at Work Act 2015 (“HSWA”).
[2] The charges arise from a significant fall from height by a MacMillan Plumbing employee while all three defendants were engaged in extensive renovation works at the Fendalton Mall on 26 September 2018.1 All three defendants were “persons conducting a business or undertaking” (a “PCBU”) under the HSWA.2
[3] The defendants are charged as follows:
- (a) Armitage Williams: failing to consult, co-operate with, and co-ordinate activities with all other PCBU’s, namely, MacMillan Plumbing and Smartflow Plumbing, in relation to the incident contrary to ss 34(1) and 34(2)(b) HSWA.
- (b) MacMillan Plumbing:
- (i) failing to ensure the health and safety of its workers, namely, [the victim], while at work contrary to ss 36(1)(a), 48(1) and 48(2)(c) HSWA.
- (ii) failing to consult, cooperate with, and co-ordinate activities with all other PCBU’s, namely, Armitage Williams and Smartflow Plumbing, in relation to the incident and contrary to ss 34(1) and 34(2)(b) HSWA.
1 I have suppressed the name of the employee, who I will refer to as “[the victim]”.
2 PCBU under the HSWA is defined as:
... a person conducting a business or undertaking—
(i)whether the person conducts a business or undertaking alone or with others; and (ii)whether or not the business or undertaking is conducted for profit or gain;...
(c) Smartflow Plumbing:
- (i) failing to ensure the health and safety of its workers, namely, [the victim], while at work contrary to ss 36(1)(a), 48(1) and 48(2)(c) HSWA.
- (ii) failing to consult, cooperate with, and co-ordinate activities with all other PCBU’s, namely, Armitage Williams and MacMillan Plumbing, in relation to the incident and contrary to ss 34(1) and 34(2)(b) HSWA.
Summary of facts
[4] It is necessary to provide some detail here, given the distinct roles of the three defendants.
[5] In July 2018, Armitage Williams was contracted to carry out renovations of Fendalton Mall in Christchurch. The renovations were extensive and included expanding the supermarket located on the site. The supermarket and other tenants remained operational throughout the renovations.
[6] Armitage Williams engaged MacMillan Plumbing as the plumbing contractor for these works. MacMillan Plumbing, in turn, engaged Smartflow Plumbing as a subcontractor. Smartflow Plumbing’s director and sole employee, Mr Wright, is a former employee of MacMillan Plumbing and was well regarded by Angus MacMillan, the director of MacMillan Plumbing. It was because of this prior relationship that there was no formal subcontract between MacMillan Plumbing and Smartflow Plumbing. Armitage Williams was not initially aware of this arrangement. Smartflow Plumbing provided Mr Wright’s services to MacMillan Plumbing in exchange for an hourly fee.
[7] Mr Wright acted as the foreperson for MacMillan Plumbing on the Fendalton site and identified himself as a worker of MacMillan Plumbing on the site paperwork.
[8] During the renovations, one of the tenants in the Mall complained of insufficient water flow. The building owner, through the project architect, instructed Armitage Williams to carry out a water supply upgrade which included running a new water main through the supermarket. The instructions took the form of a variation to the original contract engaged between the building owner and Armitage Williams. The variation specified that: “The contractor shall in conjunction with the engineer establish a suitable route for the new water main through the market prior to commencing work”.
[9] In early September, Mr MacMillan and Mr Wright did a walk-through of part of the planned route for the water main. They discussed installing the pipes for the water main on the wall of a corridor on the mezzanine floor of the supermarket, in a space which was being used to store cardboard boxes.
[10] Approximately one week later, Mr Wright located a service hatch which opened onto a services platform inside the ceiling void on the other side of the mezzanine wall (“the services platform”). The hatch is approximately 0.75 m x 0.75 m with the entrance partially obstructed by a pipe in the lower left-hand corner. As none of the renovation work required access to the services platform, it had not been accessed prior to this time.
[11] Not surprisingly, the services platform, which ranged from approximately 600 mm to 1 m in width, held a number of data cables, pipes, and cable trays. The platform was unlit, and there was no edge protection or guard where the platform ended and the supermarket’s suspended ceiling below it began. The services platform was in two sections with a 500 mm drop between them. The drop from the platform to the suspended ceiling below it ranged from 1.1 to 1.7 metres.
[12] Mr Wright decided to run the new water main through the ceiling void using the services platform rather than along the mezzanine wall. His reasoning was that this was easier to access than the mezzanine wall which had a number of obstructions in the way.
[13] Mr Wright did not consult with Armitage Williams or MacMillan Plumbing on this route change of the water main before starting work. He understood that he and MacMillan Plumbing had always been “on the same wavelength” about “these kind of decisions” and therefore that he had leeway to make these decisions on his own. As Mr MacMillan said, it was a “judgement call” on behalf of Mr Wright.3
[14] On 24 September 2018, Mr Wright started installing the water main in the ceiling void on his own. After installing most, if not all of the pipe work, Mr Wright showed Mr MacMillan the hatch and told him that he had decided to run the water main through the ceiling void. Mr MacMillan did not inspect the services platform and understood that it was more of a “walkway” without any “significant hazards”.4 Mr Wright asked for an apprentice to help him insulate the pipe, and on 26 September 2018 [name deleted - the victim], an apprentice plumber employed by MacMillan Plumbing, was directed to assist Mr Wright.
[15] On 26 September 2018, Mr Wright had a discussion with Bruce Leane, Armitage Williams’s site manager, about working in the ceiling void. However, they did not specifically discuss where the work was to be done. Mr Leane believed that Mr Wright was talking about working in a ceiling void above the supermarket deli. This was because the two had earlier discussed Mr Wright carrying out work in this area. The ceiling void above the supermarket deli was quite different as there was no risk of falling through a suspended ceiling. Mr Leane was not aware of the hatch in the mezzanine floor, or the services platform behind it.
[16] Mr Wright then carried out a “toolbox talk” with [the victim] about the hazards associated with working in the ceiling void. Mr Wright showed [the victim] where the services platform ended and the suspended ceiling began, warning him not to walk on it. “Slips, trips and falls” were identified as potential hazards, along with the low height of the workspace, and the need for lighting.
[17] Mr Wright then filled in a “Toolbox Safety Meeting” form from the MacMillan Plumbing Site Specific Safety Plan (“SSSP”). The form recorded that during the task
3 Summary of facts at [12].
4 Summary of facts at [14].
they would have to “stick/walk only on walkway provided as suspended (un-walkable) to the side”. The form also had a question: “Task Analysis Completed?”. Mr Wright answered “Yes (refer SSSP)”. In the SSSP’s hazard register, Mr Wright had signed his name next to some hazards which he thought were relevant to the task ahead. These included:
(a) working at height: ladders;
- (b) working at height: mobile scaffold; and
(c) untidy site.
[18] Despite identifying these hazards, Mr Wright did not complete a formal task analysis or apply for a working at height permit. Armitage Williams’s Fendalton Mall site procedures required both documents to be completed and approved prior to carrying out any work at height.
[19] Mr Wright and [the victim] then began to work from the services platform. Mr Wright was finishing installing pipe while [the victim] began insulating it. [The victim] was in the ceiling void for between one and two hours, and Mr Wright slowly progressed to the outside of the hatch as he installed the pipe.
[20] It was difficult to move around in the services platform and most work was done at a crouch. The pair had to be careful in order to avoid standing or tripping on the pipes and cables in the space. Lighting was provided by [the victim]’s handheld torch and a light bar Mr Wright had. Shortly before midday, the two began to tidy up the workspace. Mr Wright left the ceiling void and was on the outside of the hatch collecting his things. [The victim] was just inside the hatch passing items through to Mr Wright.
[21] [The victim] had just handed something to Mr Wright and was looking around the services platform for anything else to collect when he tripped, likely on a plastic pipe.5 [The victim] fell or tripped over the edge of the services platform and through
5 Figure 4 in the Summary of Facts is a photograph of the area [the victim] fell from and the green
the suspended ceiling. He landed on the supermarket floor approximately 4.2 metres below.
[22] [The victim] suffered a complex frontal facial skull fracture; a right frontal lobe haemorrhagic contusion (a brain bleed); a spine fluid leak which developed into meningitis; bilateral rib fractures; a radial fracture in his left wrist and a scaphoid fracture in his right wrists (broken wrists); and partial hearing loss from injuries to his ear. [The victim] required acute neurosurgery as well as a follow up surgery on his left right and facial reconstruction surgery.
Victim impact statement
[23] The significant harm this fall caused is clear from [the victim]’s victim impact statement. I will not discuss the entire victim impact statement but observe from the outset that the injuries were significant and complex.
[24] Immediately following the fall [the victim] underwent an emergency craniotomy and maxillofacial surgery and was put in a medically induced coma after those procedures were successfully completed. [The victim] recalls being given a 10% survival rate for those procedures. At one point, [the victim] developed a cerebrospinal brain leak which resulted in him contracting meningitis.
[25] It is clear that a number of the injuries suffered by [the victim] that day will have life-long consequences. In particular, [the victim] has facial deformations, as well as constant pain and irritation due to metal brackets and mesh placed in various parts of his face and skull to keep those areas in place or to protect them from further external trauma. [The victim] has a loss of sensation in the right side of his face and observes that this numbness has a number of adverse consequences for his day to day life, including a loss of smell and taste. [The victim] states that a third craniotomy may help alleviate some of these issues, but it comes with a high risk of further facial paralysis. Overall [the victim]’s skull is more fragile and susceptible to damage.
plastic pipes he most likely tripped on.
[26] Other effects of the injuries are:
- (a) Loss of grip in his hands and immobility and pain in his wrists.
- (b) Loss of sensation in his front row of teeth and loss of muscle movement in his jaw.
- (c) Tinnitus in his left ear.
- (d) Ongoing pain which requires the persistent use of strong painkillers.
[27] [The victim] also discusses the emotional and mental impact that the fall has had on his life and what he appreciates as the inevitable loss of employment in the plumbing industry and highlights a number of qualifications that he had received in the last eight years working towards a future in this particular career. There is clear distress at the prospect of having to retrain in a new field as a “second choice” career option.
Restorative justice
[28] As was his right, [the victim] declined to participate in a restorative justice conference with the three defendants. However, I acknowledge that the defendants were willing to engage in a conference.
The reasonably practicable steps WorkSafe identify should have been taken
[29] The charges import a “reasonably practicable” standard onto the three defendant PCBUs; and here WorkSafe have identified the following practicable steps each of the defendants should have taken:
- (a) Armitage Williams:
- (i) to ensure that it was aware of whether workers for MacMillan Plumbing and Smartflow Plumbing would be installing the new
water main through the supermarket, prior to those workers commencing work; and
(ii) to co-ordinate activities to ensure that this work was being carried out in a manner that was, so far as reasonably practicable, without risks to the health and safety of those workers or other persons at the site.
(b) MacMillan Plumbing:
- (i) to use an alternative route for the water main that did not expose workers to a risk of falling from height through the suspended ceiling; or
- (ii) ensure the risk of falling from height through the suspending ceiling was effectively controlled by either (a) accessing the ceiling void using an elevated work platform; or (b) adequately isolating or minimising hazards on the services platform in the ceiling void; and completing a comprehensive task analysis and risk assessment prior to commencing work.
- (iii) ensure that the proposed route of the new water main through the supermarket was confirmed with Armitage Williams prior to work commencing, and that any changes to the route were reconfirmed with all PBCUs; and
- (iv) comply with Armitage Williams’s policies relating to permits for work at height.
(c) Smartflow Plumbing:
- (i) use an alternative route for the water main that did not expose workers to a risk of falling from height through the suspended ceiling; or
The approach to sentencing
[30] Section 151 HSWA requires the sentencing court to have regard to:
- (a) ss 7 to 10 Sentencing Act 2002; and
- (b) the purpose of the HSWA; and
- (c) the risk and potential for illness, injury, or death that could have occurred; and
- (d) whether death, serious injury or serious illness occurred or could have been reasonably expected to have occurred; and
- (e) the safety record of the offender; and
- (f) the degree of departure from prevailing standards in the offender’s industry; and
[31] The sentencing purposes most relevant to this case are the need to hold an offender accountable for the harm done and promote in it a sense of responsibility, to provide for the interests of the victims and provide reparation.6 Denunciation and individual and general deterrence are also relevant. It is plain that in the circumstances of this matter, any deterrence required is general in nature, not specific.
[32] The relevant sentencing principles are the need to take into account the gravity of the offending, the culpability of the offender, the seriousness of the offence as indicated by the maximum penalty, the effects of the offending on the victim, the outcomes of any restorative justice and the need for consistency in sentencing.7
[33] In addition to the purposes and principles under the Sentencing Act, I don’t overlook the purposes of the HSWA which includes protecting workers against harm to their health, safety and welfare by eliminating or minimising risks arising from work.8
[34] The guideline judgement for sentencing under s 48 HSWA the Act is
Stumpmaster v WorkSafe9 where the High Court settled on a four-step process:
(a) Assess the amount of reparation;
(b) Fix the amount of the fine by reference to the guideline bands and aggravating and mitigating factors.
(c) Determine whether orders under ss 152-158 HSWA are required; and
6 Sentencing Act 2002, s 7.
7 Sentencing Act 2002, s 8.
8 HSWA, s 3(a).
9 Stumpmaster v WorkSafe [2018] NZHC 2020.
(d) Make an overall assessment of the proportionality and appropriateness of the penalty imposed on the offender, which includes consideration of a defendants ability to pay.
[35] The starting point is then determined by an assessment of the culpability falling within one of four bands, and then adjusted for mitigating and aggravating factors and any guilty plea. 10
[36] The bands are:
low culpability: a fine of up to $250,000;
medium culpability: a fine between $250,000 and $600,000; high culpability: a fine between $600,000 and $1,000,000; very high culpability: a fine of more than $1,000,000.
[37] The guideline judgment for s 34 HSWA is WorkSafe New Zealand v Bulldog Haulage Limited.11 Judge Mcllraith found the approach in Stumpmaster applied in cases under s 34 HSWA, albeit with slightly modified culpability bands. Those bands are:12
low culpability: up to $15,000
medium culpability: $15,000 to $30,000 high culpability: $30,000 to $60,000 very high culpability: $60,000 to $100,000
10 At [53].
11 WorkSafe New Zealand v Bulldog Haulage Limited [2019] NZDC 12202.
12 Bulldog at [17].
[38] In determining the band, the Court found the following factors from Department of Labour v Hanham and Philp Contractors13 are still relevant as they are encompassed in s 151 HSWA.14 These factors are relevant to both offending against ss 48 and 34 HSWA:
- (a) Identification of the operative acts or omissions at issue, usually the practicable steps which the Court finds it was reasonable for the offender to have taken in terms of s 2A of the HSEA and, latterly, s 22 of the HSWA.
- (b) An assessment of the nature and seriousness of the risk of harm occurring as well as the realised risk.
- (c) The degree of departure from standards prevailing in the industry.
- (d) The obviousness of the hazard.
- (e) The availability, cost and effectiveness of the means necessary to avoid the hazard.
- (f) The current state of knowledge of the means available to avoid the hazard or mitigate the risk of its occurrence.
WorkSafe submissions – a summary
[39] WorkSafe submits that the following sentencing outcomes are appropriate:
- (a) reparation order in favour of [the victim] in the order of $40,000-
$50,000 but apportioned 60:40 between MacMillan Plumbing and Smartflow Plumbing;
(b) starting point fine of between $15,000-$20,000 for Armitage Williams;
13 Department of Labour v Hanham and Philp Contractors Ltd (2008) 6 NZELR 79 (HC)
14 At [37].
(c) starting point fine of $600,000 for MacMillan Plumbing;
(d) starting point fine of $500,000 for Smartflow Plumbing;
(e) discount of 5% to MacMillan Plumbing and Smartflow Plumbing for previous good character;
(f) discount of 5% for MacMillan Plumbing, Smartflow Plumbing and Armitage Williams for co-operation;
(g) discount of 25% for Armitage Williams and Smartflow Plumbing for the guilty pleas;
(h) discount of 15-20% for MacMillan Plumbing for the guilty pleas;
(i) costs pursuant to s 151(1) HSWA of $2,225.40, being half the recorded costs for the prosecutor to be divided equally between the three defendants; and
(j) an order that the summary of facts be released if requested with appropriate redactions made for any suppression orders.
[40] In relation to reparation, WorkSafe submits that the 60:40 apportionment between MacMillan Plumbing and Smartflow Plumbing is appropriate in the circumstances as [the victim] at the time of the accident was working under the direction of both his employer MacMillan Plumbing and Smartflow Plumbing (Mr Wright). As Mr Finn observed, Mr Wright was not only acting as MacMillan Plumbing’s foreperson and consequently its “worker”,15 he had overlapping duties as a separate and distinct PCBU.16
15 s 19 (1)(b) HSWA.
16 s 33 HSWA.
[41] In relation to the starting point for the fines, WorkSafe submits:
- (a) there were a number of reasonably practicable steps that all three defendants could have taken to reduce the risk that a worker could fall from a height,17 and for MacMillan Plumbing and Smartflow Plumbing in particular, they could be seen as being reasonably extensive failures.
- (b) the risk of falling from a height was obvious and the injuries suffered by [the victim] are serious and will be long lasting.
- (c) the absence of edge protection or any recognised controls represents a relatively major departure from industry standards.
- (d) the use of appropriate safety measures (for example an elevated platform or scaffolding) were reasonably cost effective and practicable to implement.
- (e) all three defendants were aware of the specific risks of working at height, evidenced by inclusion of such risks in its safety documentation.
Defence submissions – a summary
[42] Armitage Williams submits that an appropriate starting point for its offending is $12,000 and that its culpability is low, perhaps capable of being described as a “minor slip-up from a business otherwise carrying out its duties in the correct manner.”
[43] While Armitage Williams accepts that clear communication at a place of work is a fundamental duty under the HSWA, it contends that Mr Leane (the site manager) reasonably assumed that Mr Wright was referring to the deli area of the supermarket, not the service platform area where the fall occurred. Accordingly, the company emphasises that this is not the sort of instance where it did not have adequate safety
17 See para [29] above.
processes in place, rather, but for the miscommunication, Armitage Williams would have implemented its established safety procedures which would have avoided the risk that eventuated.
[44] In terms of mitigating features, Armitage Williams submits:
- (a) It co-operated fully with the investigation;
- (b) It took remedial steps immediately following the incident, namely:
- (i) issuing a safety alert to all of its sites immediately after the event and discussing the incident at toolbox and pre-start meetings;
- (ii) engaging an independent health and safety investigator to review the circumstances of the event, meeting with MacMillan Plumbing to discuss findings and implementing all recommendations made by the WorkSafe investigator;
- (iii) reviewing the permit to work system, engagement processes with Engineer and communication procedures;
- (iv) developing a Critical Emergency Response Procedure; and
- (v) meetings and workshops with Armitage Williams project managers, site managers and leading hands to discuss findings and to make improvements.
[45] In relation to the discounts, Armitage Williams submits that a 10% discount was available for its co-operation and subsequent remedial steps; together with a 25% discount for the early guilty pleas, resulting in a final fine of $7,800. Armitage Williams submits this properly reflects its culpability.
[46] Armitage Williams accepts costs should be paid but argues that its share of the
$2,225.40 sought by WorkSafe should be 25%, being proportional to its culpability.
MacMillan Plumbing
[47] MacMillan Plumbing submits that its culpability should be assessed at the middle to upper end of the medium band, and accordingly a starting point fine in the range of $450,000 to $550,000 would be appropriate in the circumstances.
[48] MacMillan Plumbing accepted the discounts proposed by WorkSafe and that reparation should be apportioned, however contends reparation should be in the
$30,000 to $40,000 range and that the apportionment of the reparation between it and Smartflow Plumbing should reflect that Smartflow Plumbing had greater culpability. MacMillan Plumbing accepted that it should meet [the victim]’s medical fees, but did not accept that it is liable to pay [the victim]’s legal fees for the non-party disclosure application it made under the Criminal Disclosure Act in relation to [the victim]’s medical (including neurological) and previous employment records. The company further contends that it was also entitled to a 5% discount for the remedial action it has taken since the accident, together with a 25% discount for its guilty pleas.
[49] In terms of the remedial steps, MacMillan Plumbing highlighted the following measures that it has taken since the accident:
- (a) monthly health and safety team meetings with compulsory attendance for all staff;
- (b) external health and safety consultants from Employsure Limited were engaged to identify gaps in health and safety and implement more robust health and safety systems in the company;
- (c) review of all health and safety policies and all site foremen were sent on an additional two-day supervisor course;
- (d) upskilled a number of staff in relation to working at height;
- (e) purchased new first aid kits and new hard hats with chin straps; and
[50] In relation to the timing of the guilty pleas and the credit which accrues, MacMillan Plumbing submits that there were a number of events which contributed to the two and a half year delay in finalising these proceedings, including, the fact the charges were not filed until a year after the incident, as well as the unforeseen impact of the COVID-19 pandemic.
[51] Added into that is the delay occasioned by the non-party disclosure application. MacMillan Plumbing accepted that there was delay as a result of that application but observed that this was an unfortunate consequence of the legislation, and the requirement that the disclosure application be brought before guilty pleas were entered. MacMillan Plumbing emphasised that it had made known to all of the parties that it was likely to plead guilty after resolution of the application. Further, it argues that the application was brought in good faith and for the purpose of determining MacMillan Plumbing’s liability for reparation.
Smartflow Plumbing
[52] Mr McKenzie, on behalf of Smartflow Plumbing, also accepted that the starting point and discounts submitted by WorkSafe were appropriate. Smartflow Plumbing further accepted that the reparation apportionment of 60:40 with Smartflow Plumbing was appropriate. However, the real issue for Smartflow Plumbing is its contention that it lacks financial capacity to pay a fine anywhere near the level accepted by the parties as appropriate, which I will return to.
Applying the four-step approach
[53] The parties appropriately accept that Armitage Williams is not liable for reparation.
[54] MacMillan Plumbing cites WorkSafe New Zealand v Full Stop Scaffolding Limited and QJB Roofing Limited for the proposition that reparation in the sum of
$30,000 is appropriate in these circumstances.
[55] That case involved a scaffolder falling from a roof after a piece of scaffolding pipe made contact with a 33kv overhead powerline. The scaffolder was electrocuted and fell more than four metres off the roof. He was caught, however, by his brother, before he hit the ground. The victim suffered burns to his body and spent two months in hospital undergoing a number of surgeries including skin grafts. He suffered prolonged loss of sensation in his feet, difficulties in walking and blurred vision. A
$10,000 reparation payment had already been provided to the victim by his employer’s insurer and an additional $30,000 was ordered by the Court.
[56] WorkSafe submits that a reparation order of between $40,000 and $50,000 is appropriate, having reviewed a number of comparable cases, including: WorkSafe New Zealand v Waikato Institute of Technology, WorkSafe New Zealand v Forest View High School Board of Trustees, and Ministry of Business, Innovation and Employment v Abbas Ltd18, which I have also considered. I agree that these cases indicate that reparation in the sum of between $40,000-$50,000 is appropriate. Smartflow Plumbing does not take any issue with the reparation range proposed by WorkSafe.
[57] As was observed in Big Tuff Palletts Ltd v Department of Labour:19
Fixing an award for emotional harm is an intuitive exercise; its qualification defies finite calculation.
[58] A reparation order can never meet the emotional and physical harm caused in an accident as bad as this one. Compared to the fines which can be imposed, reparation orders can pale in comparison, and I acknowledge that some victims will feel aggrieved about that. In this case it not exaggerating to observe that [the victim] is frankly lucky to be alive. In my assessment reparation in the sum of $50,000 is
18 WorkSafe New Zealand v Waikato Institute of Technology CRI-2014-019-005332 DC Hamilton 10 November 2014; WorkSafe New Zealand v Forest View High School Board of Trustees [2019] NZDC 21548; Ministry of Business, Innovation and Employment v Abbas Ltd DC Auckland CRN 13070501970 18 June 2014
19 Big Tuff Palletts Ltd v Department of Labour (2009) 7 NZELR 322 at [19].
appropriate taking into account the severity of the injuries suffered by [the victim], as well as the significant and prolonged effects that these will have on his personal and work life.
[59] Counsel have raised the issue of apportionment of the reparation order; however, I will address that when considering proportionality and appropriateness of the penalty at Step 4.
Step 2 Fine
[60] The imposition of fines firstly requires a consideration of culpability using the
Hanham and Philp factors:20
Identification of operative acts and omissions
[61] These are detailed in the charges themselves and the practicable steps I identified at paragraph [29] above, being the steps the defendants did not take.
[62] While the failures of Armitage Williams are not insignificant, I agree with WorkSafe that the failures of MacMillan Plumbing and Smartflow Plumbing are reasonably extensive. The list of steps they failed to take but were patently available, speaks for itself.
The nature and seriousness of the risk of harm and realised risk
[63] The risk here of falling through he suspended ceiling was blindingly obvious and is not the benefit of hindsight. There was no edge protection along the services platform and Mr Wright had identified that a fall from height was a possibility. The ceiling was low, there were tripping hazards and the area poorly lit. It was an accident waiting to happen.
[64] MacMillan Plumbing may have relied on Mr Wright to do things properly, but it was their employee who was in this workspace and they simply cannot devolve their
20 Referred to above at paragraph [38].
HSWA obligations to Mr Wright, and the guilty pleas illustrate that. A simple inspection of the workspace, or proper inquiry of Mr Wright would have avoided this tragedy.
[65] Finally, the realised risk here was significant and life-changing injuries to [the victim] as I have discussed earlier; and as I have already observed, it is not an exaggeration to state that [the victim] is lucky to be alive.
Degree of departure from prevailing industry standards
[66] It is fundamental that when working from height there is a need for fall protection. There is nothing new in that and is well known and understood in the construction industry. Accordingly, it is all the more perplexing when there is a significant departure from the industry standards and such a bad fall like this.
[67] The agreed Summary of Facts set out the relevant standards and guidance on controlling the risk of falling from height and the co-ordination required between different duty-holders under the HSWA. I am not going to repeat what the summary set out because no issue was taken with those standards and their availability, but highlight in particular:
- (a) The Best Practice Guidelines for Working at Height in New Zealand (April 2012, Ministry of Business Innovation and Employment) where planning, organisation and identifying hazards are emphasised.
- (b) The Good Practice Guide: Scaffolding in New Zealand where platforms are discussed with special mention of edge protection and being free from tripping hazards.
- (c) The Health and Safety at Work Act 2015 (March 2016 special guide) where guidance on consultation and the benefit of working with other PCBUs on a worksite is discussed.
[68] While Mr Wright and [the victim] had a “toolbox” discussion about the proposed work, it was inadequate and literally “box-ticking”. The failure to consider
other options for working from height, other than on the services platform, or at the very least put in place edge protection, was an obvious omission and a major departure from recognised industry standards.
[69] Further, it is accepted that each defendant had the appropriate and relevant health and safety documentation for controlling the risks arising from working at height. There was simply an inexplicable failure to apply what they already knew.
The obviousness of the hazard
[70] The hazard presented by working from height was obvious. Armitage Williams had an adequate site safety plan in place which prohibited working from height, except where a work from height permit had been obtained having followed the requirements of the plan. MacMillan Plumbing and Smartflow Plumbing knew what steps ought to have been taken but failed to take them.
[71] While this was not a gaping hole in the ceiling, as can be seen from the photograph of where [the victim] fell, it was clear that all there was between the platform edge and the floor below, were a set of thin ceiling tiles. Further, and additional to the absence of edge protection, the platform had a number of obvious tripping hazards as previously discussed.
Availability, cost and effectiveness of the means necessary to avoid the hazard
[72] There has been no suggestion that the costs to guard against or mitigate the hazard were a barrier to implementation. Edge protection could have been by guardrail or the work undertaken using a mobile elevated work platform or scaffolding. While common sense suggests that would have inevitably caused inconvenience to the supermarket which was continuing to operate throughout the renovation work, it appears that the option of using a mobile elevated platform or scaffolding was never considered, notwithstanding it being a cost effective and reasonably practicable step to mitigate the hazard and risk of harm from a fall.
[73] Further, the water main did not have to be routed across the ceiling space. It was obviously a practical solution and made some sense to do it that way, but it was not essential. In one of those “but for” scenarios, but for that decision and the departures from industry best practice the fall would not have happened.
[74] The bottom line is that it was expedient to use the ceiling space for the water main route, however the approach to identifying and mitigating risk was far too casual.
Current state of knowledge of the means available to avoid the hazard or mitigate the risk of its occurrence
[75] There is no argument that each defendant was aware of the risks working at height and had access to health and safety information and documentation that discusses controlling the risks of working from height. Armitage Williams had a specific procedure where a permit was required to work at height.
[76] If the risk here was to be totally eliminated, then the water main could have been run as originally planned along the mezzanine wall and not through the ceiling space. However, the hazards arising from using the ceiling space route were capable of being appropriately mitigated. Neither MacMillan plumbing or Smartflow plumbing did enough to eliminate or minimise the risks of working on a cramped, poorly lit, unguarded services platform which additionally had the complication of tripping hazards.
Establishing the fines
[77] Counsel for WorkSafe and each of the defendants filed comprehensive submissions, a plethora of sentencing decisions and made lengthy oral submissions at the sentencing hearing. I simply cannot reflect the extensive submissions here in these sentencing notes and intend no disrespect by not doing so.
[78] Each sentencing case relied upon by the parties is of course specific to the prosecution it concerns all the harm that was caused. No case will ever be identical. However, I did find some assistance in the decisions in WorkSafe New Zealand v
Forrest View High School Board of Trustees, WorkSafe New Zealand v Dong Xing Group Ltd, and WorkSafe v Centreport Limited. 21
[79] Each involved working from height and a significant departure from the prevailing industry standards where, frankly, the hazards were obvious. The starting point fines in these cases ranged from $500,000 to $700,000:
Forrest View the start point fine was $500,000 for a degree of departure from the prevailing standards which was described as serious. The school owned and used a mobile scaffolding for performing arts. A teacher and a student were seriously injured when they fell from it, falling from a height of 3.9 metres to a hard surface. The most obvious distinction from a number of the other cases is that the Trustees of Forrest View are not in the construction industry. The Court observed that had the defendant been in the business of constructional contracting its culpability would have been in the high band.
Dong Xing the start point fine was $580,000 where there was no injury, but the culpability was towards the top of the medium band of culpability. A three-tier unguarded scaffold was placed close to a 230 kV live power line meaning anyone on the scaffold was at risk of electrocution. The scaffold had no edge protection and had defects creating a risk of collapse.
Centreport the start point fine was $700,000 where culpability was in the high band. An employee fell to his death from a fully extended and unsecured ladder to when accessing the roof of a container. There was no edge protection in place. The unsecured ladder was the substantial cause of the fall. The risk of working at height and using ladders had been identified by the company, but the steps taken at the time to avoid the hazard were inadequate and a departure from best practice.
21 WorkSafe New Zealand v Forrest View High School Board of Trustees [2019] NZDC 21558, WorkSafe New Zealand v Dong Xing Group Ltd [2018] NZDC 22114 and WorkSafe v Centreport Limited [2019] NZDC 12020.
Armitage Williams
[80] In my assessment the company’s culpability sits on the cusp of the low and medium culpability bands for s 34 offending. $15,000 is the top of the low culpability band and the bottom of the medium culpability band ($15,000 - $20,000).
[81] Armitage Williams had appropriate systems in place to mitigate the risk of those working from height at its workplace. It was on notice and ought to have had greater awareness of what was happening on its site. Put colloquially, it dropped the ball. Accordingly, I would adopt a start point of $15,000.
[82] The following adjustments are in my assessment available:
- (a) Cooperation with the investigation 5%
- (b) Guilty plea 25%
[83] I make no deduction for remedial steps because what has been done is simply what the company was obliged to do to meet its obligations and duties under the HSWA. Discounts for remedial steps require a defendant to “go the extra mile” rather then merely to correct deficits that existed in the first place.22 Deducting 30% ($4,500) from the start point of $15,000 results in a fine of $10,500 which the company is now convicted and ordered to pay.
MacMillan Plumbing and Smartflow Plumbing
[84] I cannot accept the contention that the two companies have differing levels of culpability. To treat the two companies differently would be to ignore the reality of what actually occurred at this work site.
[85] MacMillan Plumbing cannot distance itself from the serious departure from industry practice in working from height simply because its employee [the victim] was working with Mr Wright. MacMillan Plumbing was not blindsided to what Mr Wright was doing. Mr MacMillan was on notice that Mr Wright and [the victim] were to be
22 Stumpmaster at [66].
working from height. Having been shown the services hatch and being told the water main was going to be run through the ceiling space, Mr MacMillan did not inspect the services platform which he understood was more of a walkway and without significant hazards. MacMillan Plumbing’s duty was to ensure that their employee and its sub- contractor was not at risk of harm. At the end of the day, MacMillan Plumbing had its sub-contractor Smartflow Plumbing (Mr Wright) and its employee [the victim] work in a part of the site it had very little knowledge of.
[86] As I have discussed, there were a number of steps available to both MacMillan Plumbing and Smartflow Plumbing to mitigate the risk of harm. MacMillan Plumbing essentially delegated its obligations and duties under the HSWA. To Smartflow Plumbing (Mr Wright). It is likely the strong relationship between Mr MacMillan and Mr Wright clouded MacMillan Plumbing’s judgement, but that does not excuse its failures or mitigate them. There is no suggestion that MacMillan Plumbing was a risk- taker in the workplace, however if MacMillan Plumbing had for a moment stopped and made enquiries about the work its employee was about to embark upon, this fall inevitably would not have occurred.
[87] Smartflow Plumbing (Mr Wright) cannot by the same token contend that MacMillan Plumbing had a greater responsibility here for its employee, [the victim]. Mr Wright asked for and was provided an assistant. Mr Wright was obligated to comply with the requirements under the HSWA and not only look after his own safety, but those he was responsible for ([the victim]) and others in the workplace (here anyone below where the work was taking place – in the supermarket).
[88] The loose hourly rate arrangement Smartflow Plumbing had with MacMillan Plumbing does not excuse or mitigate its failures. There was an inexcusable casual approach taken to the risk of working from height simply because of the decision that the work could be undertaken from the services platform. That failure falls on both Smartflow Plumbing and MacMillan Plumbing. Mr Wright had identified working from height as a hazard but did not, among other failures, complete a formal task analysis or apply for a working at height permit. Had he done so, rather than mere “box ticking”, steps to mitigate the plain risk of a fall would have been addressed and either put in place, or if too time consuming or disruptive to work on the site, would
have resulted in Mr Wright returning to the original route for the water main. Sadly, opportunities to avoid this tragedy were missed by both Smartflow Plumbing and MacMillan Plumbing.
[89] Accordingly, there is no daylight between MacMillan Plumbing and Smartflow Plumbing’s culpability, which in my assessment is towards the top of the medium culpability band. On a totality basis, dealing with the offences both under s 34 and s 48, I adopt a start point of $550,000.
[90] The following adjustments to the start point are in my assessment available:
- (a) Co-operation with the investigation 5%.
- (b) Remorse (MacMillan Plumbing) 5%.
- (c) Previous good record 5%.
- (d) Guilty pleas 25%.
[91] There was some discussion at the hearing whether a discount for remorse was available to MacMillan Plumbing and whether the eventual guilty pleas warranted a 25% deduction.
[92] Remorse must be genuine but does not need to be extraordinary. However, it must be more than the remorse that is inherent in a guilty plea. Here I accept that MacMillan Plumbing have shown some remorse as Mr Parker explained.
[93] While there might be a gulf between what [the victim] expected and MacMillan Plumbing performed, the remorse shown needs to be acknowledged.
[94] The top up to the 80% ACC payments is the prime illustration. MacMillan Plumbing was not required to do that and while it would not have been a good look if it had not, the fact remains that it has topped up [the victim]’s shortfall in wages since the accident.
[95] WorkSafe contended that the approach MacMillan Plumbing took on the non- party disclosure application was illustrative of an absence of remorse. I do not doubt for a moment that this approach was upsetting for [the victim] and he incurred significant legal costs. However, having heard the application, and even having dismissed it, I can appreciate why it was brought.
[96] The guilty plea discount may on the face of it appear generous given the delay in entering the guilty pleas. There were a number of delays in this matter, including delay arising from the COVID-19 pandemic, however the principal delay centred around the non-party disclosure application. As Mr Parker explained, the application could not have been made if there had been a guilty plea. It was clear MacMillan Plumbing was always going to admit charges and that a trial was not required. Accordingly, while the delay here has been frustrating, it has not entirely been of MacMillan Plumbing’s making.
[97] Finally, for the reasons I explained when discussing Armitage Williams, I make no deductions for remedial steps taken. In my assessment the steps taken by MacMillan Plumbing are nothing more than MacMillan Plumbing meeting its obligations and duties required under the HSWA. That MacMillan Plumbing has applied not insignificant funds and time on health and safety since the accident was an entirely appropriate response.
[98] What a company spends on reviews of its health and safety systems and training, following an accident, is entirely a matter for the company. I am not satisfied that the steps taken here were “going the extra mile”, rather the accident exposed flaws in the company’s health and safety systems, which it appropriately addressed, which it was obliged nonetheless to do. To give a discount is to reward compliance with the Act.
Conclusion on fines
[99] From a start point of $550,000 MacMillan Plumbing is entitled to a total deduction of 40% ($220,000) resulting in an end fine of $330,000.
[100] Smartflow Plumbing is entitled to a total deduction of 35% ($192,500) resulting in an end fine of $357,500.
[101] The issue for both defendants is the ability to pay a fine which I will return to under step 4.
Step 3 other orders under the HSWA
[102] The only costs sought under this Step is $2,225.40 described as a reasonable contribution to the costs of the prosecution. No issue is taken by the defendants to the payment of these costs. The costs sought are extremely modest and will not reflect the true costs of a prosecution like this which I direct to be paid equally as between the defendants.
Step 4 proportionality assessment
[103] The fourth Stumpmaster step in the sentencing process is to make an overall assessment of the proportionality and appropriateness of the combined package of sanctions imposed by the earlier three steps. The impecuniosity of a defendant is a relevant consideration and the Court can decide not to impose an otherwise appropriate fine that an offender cannot pay; and must have regard to the circumstances of an offender which might mean an otherwise appropriate sentence might be disproportionally severe, or where a fine is to be imposed, the offender’s financial capacity.23
[104] Armitage Williams does not seek any adjustment to the end fine, or the reparation and costs order. However, as I observed earlier, both MacMillan Plumbing
23 Sentencing Act – ss 8(h); 14(1) and 40(1).
and Smartflow Plumbing submit that they cannot meet fines anywhere near the range of what is ordinarily imposed for offending like this.
[105] In relation to reparation, WorkSafe submits that the reparation order should be apportioned 60:40 between MacMillan Plumbing and Smartflow Plumbing. While Smartflow Plumbing does not disagree with that, MacMillan Plumbing submits that it is Smartflow Plumbing which ought to pay a greater share, having had more control over the factors resulting in the fall then MacMillan Plumbing had.
[106] As discussed earlier, in my assessment Smartflow Plumbing and MacMillan Plumbing have for the reasons I explained, equal culpability. Accordingly, the reparation is to be paid equally.
[107] It is the issue of ability to pay the fines was a significant focus of sentencing. I received supplementary submissions and affidavits from accountants for the defendant companies and for WorkSafe, and a significant portion of the lengthy oral submissions at the sentencing hearing related to Smartflow Plumbing and MacMillan Plumbing’s capacity to pay fines. The affidavits from the accountants are dense in detail, and for MacMillan Plumbing in particular, there is little agreement between the respective experts.
Smartflow Plumbing
[108] [Financial details deleted].
[109] [Financial details deleted].
[110] [Financial details deleted].
[111] [Financial details deleted].
[112] [Financial details deleted].
[113] [Financial details deleted].
[114] [Financial details deleted].
[115] [Financial details deleted].
[116] [Financial details deleted].
[117] [Financial details deleted].
[118] [Financial details deleted].
MacMillan Plumbing
[119] [Financial details deleted].
[120] [Financial details deleted].
[121] [Financial details deleted].
[122] [Financial details deleted].
[123] [Financial details deleted].
[124] [Financial details deleted].
[125] [Financial details deleted].
[126] [Financial details deleted]
.
[127] [Financial details deleted].
[128] [Financial details deleted].
[129] [Financial details deleted].
[130] [Financial details deleted].
[131] [Financial details deleted].
[132] [Financial details deleted].
[133] [Financial details deleted].
Result
[134] Armitage Williams is to pay a fine of $10,500.
[135] Smartflow Plumbing is to pay reparation of $25,000 and a fine of $60,000 payable on a monthly basis for up to five years.
[136] MacMillan Plumbing is to pay reparation of $25,000 and a fine of $330,000 payable on a monthly basis for up to five years.
[137] The defendants to pay and equal share of the prosecution costs of $2,225.40.
[138] Suppression orders by consent:
- (a) The name of the victim.
- (b) The discussion regarding the financial capacity of Smartflow Plumbing and MacMillan Plumbing to meet the payment of fines.
Judge GM Lynch
District Court Judge
Date of authentication: 17/08/2021
In an electronic form, authenticated pursuant to Rule 2.2(2)(b) Criminal Procedure Rules 2012.
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