WorkSafe New Zealand v Safe Business Solutions Limited [2024] NZDC 19761 (16 August 2024)

Last Updated: 29 August 2024

EDITORIAL NOTE: CHANGES MADE TO THIS JUDGMENT APPEAR IN [SQUARE BRACKETS].

ORDER PROHIBITING PUBLICATION OF EVIDENCE AND SUBMISSIONS CONTAINED IN THIS JUDGMENT PURSUANT TO S 205 CRIMINAL PROCEDURE ACT 2011. SEE http://www.legislation.govt.nz/act/public/2011/0081/latest/DLM3360354.html

ORDER PROHIBITING PUBLICATION OF NAME OF [PERSON A] PURSUANT TO S 202 CRIMINAL PROCEDURE ACT 2011. SEE http://www.legislation.govt.nz/act/public/2011/0081/latest/DLM3360349.html

IN THE DISTRICT COURT AT NEW PLYMOUTH I TE KŌTI-Ā-ROHE KI NGĀMOTU

CRI-2021-043-001236

[2024] NZDC 19761

WORKSAFE NEW ZEALAND

Prosecutor v

SAFE BUSINESS SOLUTIONS LIMITED Defendant

Hearing:	16 August 2024
Appearances:	T Braden for the Prosecutor F Pilditdch and A Smith for the Defendant
Judgment:	16 August 2024

NOTES OF JUDGE A S GREIG ON SENTENCING

[1] Safe Business Solutions Limited, who I will refer to as “SBS”, are for sentence having pleaded guilty to one charge laid under ss 36 and 48 of the Health and Safety at Work Act 2015. The maximum penalty is a fine not exceeding $1.5 million.

[2] I will expand on the summary of facts shortly, but in a nutshell SBS were contracted by another company who I shall refer to as “Westown” to devise a traffic

WORKSAFE NEW ZEALAND v SAFE BUSINESS SOLUTIONS LIMITED [2024] NZDC 19761 [16 August 2024]

management plan. SBS did not provide an effective traffic management plan and as a result one of Westown’s workers was hit by a moving vehicle and suffered serious injury. Westown have already pleaded guilty for their part in what happened, as a result of which I placed their level of culpability, I set the starting point for their fine, at $450,000. SBS pleaded not guilty and defended the matter for a long time. More recently they have pleaded guilty which is why they are being sentenced separately.

[3] Dealing in more detail with the summary of facts. Westown Agriculture Limited and Westown Haulage Limited are family operated companies with the same two directors and shareholders. They shared premises which is why I am referring to them under the global name of Westown.

[4] Mr Grant Bowling was a worker employed by Westown. In July 2019 Westown began operating from new premises and by August 2020 those premises were still being developed. On a number of occasions through from 2019 to 2020 the need for traffic management was identified as being required for the site to ensure clear traffic flow and the separation of pedestrians and mobile plant.

[5] The responsibility for forming a traffic management plan was assigned to Westown’s external health and safety consultants, the defendant SBS. One of SBS’s directors was allocated to Westown and subsequently undertook all of the consultant visits to them. I shall refer to him as “[person A]”. [Person A] was visiting Westown’s premises at the same time as a WorkSafe inspector visited in July 2019. It was at that time that the site had just started being used. The WorkSafe inspector made it clear that an improved traffic management plan was required, amongst other safety considerations.

[6] In September 2019 [person A] determined that the traffic flow plan would be implemented after the completion of the office building. In February 2020 [person A] visited the site and recorded that there was: “A desperate need for a traffic flow plan but is hard to put in place until new offices are built in front of the building.” SBS provided a package of support to Westown and the traffic management plan would have been in addition to the package already provided.

[7] Despite noting the desperate need for a traffic flow plan no interim traffic management measures were put in place. At a subsequent meeting SBS and Westown agreed on a trial of the flow direction around the main building, but nothing was formally documented, implemented or enforced. The offices were finally completed in about August 2020. The office staff had moved in and the site was fully operational.

[8] By 24 August 2020, however, no traffic management plan had been put in place although [person A] was in the process of drafting such a plan. The only physical traffic safety measure put in place at the site prior to this date was a multi hazard board which included a small sign stating that the speed limit was 20 kilometres per hour.

[9] The victim Mr Bowling was at work on 24 August 2020. He was by the wash bay area, having just finished a conversation with another worker who was operating a telehandler. Mr Bowling was wearing a high-vis vest. The telehandler has a boom attached to the front with a bucket attached to the boom. The bucket restricts visibility to the front of the telehandler. The telehandler driver became distracted and turned to look back over his shoulder. He did this as he started to drive forwards. Mr Bowling was standing with his back to the telehandler and was using an app on his mobile phone to clock off work for the day. This was a breach of Westown’s work instructions to workers which was not to use mobile phones in the area in question. The telehandler struck Mr Bowling on the leg from behind. He was knocked into the bucket, hitting his head. He was rendered unconscious and subsequently found to have suffered a bifrontal intracerebral and subdural haemorrhage. He was hospitalised for three days and has suffered long-term consequences which I shall cover shortly.

[10] The identifiable and relevant hazard in this incident was mobile plant coming into contact with a pedestrian. This possibility is an obvious and well-known risk and had been identified by both Westown and SBS. The risk of serious injury or death was high and foreseeable. Given the lack of a traffic management plan there was a real risk of the hazard causing harm.

[11] The agreed summary of facts records a number of failings. They were the lack of an effective risk assessment and risk register, the lack of a traffic management plan, a failure by SBS to provide a traffic management plan and a failure by SBS to oversee

[person A]’s work. It was reasonably practicable for SBS to have developed an effective management plan and to ensure that it was operating properly.

[12] I also note the following, the defendant has no compliance history, no previous convictions and has co-operated with WorkSafe over the course of its investigation. In other words, SBS has done all that it could and should since this accident occurred.

[13] I also note the following, the defendant has been obliged to plead guilty to this charge and has been reluctant to do so. I can understand that reluctance. This prosecution as I understand it is the first time that an entity engaged as a consultant in health and safety at work practices has been prosecuted. Secondly, [person A] was not by this time acting, it appears from the submissions at least and I accept them, was not acting in SBS’s interests. He was in the process of setting up his own company to do the same work and the submissions indicate that SBS subsequently initiated proceedings against [person A] citing trade issues. Those proceedings were settled and consequently the full details are not available to me.

[14] The defendant company, SBS, has been very much left holding the baby by a director who was not doing his job properly. [Person A] was a director and therefore was an operating heart and mind of the defendant, hence their liability at law and they are the people who are going to bear the cost of this, the current directors and shareholders, and they are not those who are responsible for the various failures that led to Mr Bowling’s injuries. They are justified in feeling aggrieved.

Assessing the starting point

[15] The purposes and principles of sentencing under the Health and Safety at Work Act are as set out in the Sentencing Act 2002 and I have regard to those. In particular, I have regard to the decision of the High Court in Stumpmaster v WorkSafe New Zealand as well as all of the other cases that have been referred to me by both the defendants and the prosecution.1

1 Stumpmaster v WorkSafe New Zealand [2018] NZHC 2020, [2018] 3 NZLR 881.

[16] The High Court in Stumpmaster v WorkSafe New Zealand sets out a four-stage process to be followed. The first is to assess the amount of reparation that should be paid to Mr Bowling. Secondly, to affix the amount of the fine. Thirdly, to determine any ancillary orders including costs and finally, to have regard to the overall proportionality and appropriateness of the sentence. In particular, and this is relevant in this matter, I must have regard to the defendant’s ability to pay.

[17] I turn first to the issue of reparation. Having already sentenced Westown I do not understand that Mr Bowling’s situation in terms of his health and the long-term consequences has changed since November 2022. On that occasion I recorded that I had the benefit of three victim impact statements. The first from Mr Bowling himself, secondly from his wife and thirdly, from one of his daughters.

[18] For Mr Bowling himself the physical injuries were significant. He has lost his sense of smell and taste permanently. The incident aggravated an already damaged left knee with the result that he required a knee replacement operation. He is very prone to headaches. He struggles with his speech at times. He lost his peripheral vision for six months and his short-term memory is poor. He has what he described as: “A short fuse,” and is easily overwhelmed. I think it is fair to say that he, his wife and his children say that this has affected him very deeply and he is a different person.

[19] There were shorter term consequences, the eight months off work, the overwhelming tiredness and he has changed jobs. He can no longer do long haul driving and there has been a significant financial impact on him. His family life has suffered because he is less able to tolerate events, he is less able to play with his grandchildren, he suffers from PTSD, he has nightmares and sleeping problems. He is sensitive to noise which has diminished his ability to enjoy concerts, something that had been a family tradition. His 25-year-old daughter moved home to help for him, something that Mr Bowling describes as: “Humbling,” but which I suspect he actually might find humiliating, although he should not. Naturally all of this has affected his wife as well as his daughter who has had to move.

[20] In summary, this moment of carelessness has had very serious consequences for both Mr Bowling and his family.

[21] In my earlier sentencing I assessed the appropriate amount of emotional harm reparation to be paid to Mr Bowling as $50,000. That was ordered against Westown because, of course, at that stage there was no certainty that SBS would in fact face sentencing.

[22] The defendant submits that whilst it sees $50,000 as being an appropriate sum to pay by way of reparation, and whilst it is willing to pay Westown 50 per cent of the reparation figure, that I cannot order the defendant to pay Westown 50 per cent of the reparation figure that Westown has already paid. The defendant submits that s 32 of the Sentencing Act prohibits a payment from SBS to Westown by way of reparation. I quote directly from the defendant’s submissions where the defendant said:

The prosecutor has suggested that it would be appropriate for SBS to reimburse Westown for 50 per cent of the emotional harm reparation that it paid to Mr Bowling. Whilst SBS would not quibble with that proposal, there is no order that the court can make to that effect.

[23] I had been going to order reparation and take the view that Westown were a victim of SBS as defined by s 32 of the Sentencing Act. I am going to hold back from that because I think as Mr Pilditch has in a very proper and polite way made clear, that at some stage such a direction might be called in aid by another judge at another sentencing and then that would have to be appealed and what I order today, whilst being effectively unnecessary, might then become controversial. So I will pull back from that. Because what Mr Pilditch has said, and I accept his undertaking on this point, is that he has unequivocal instructions from his instructing solicitor that SBS’s insurers will reimburse Westown one-half of the reparation figure. If that is not done, then SBS are to be resentenced because this is very much a factor in my overall sentencing. But I am confident that this will be done because Mr Pilditch has said so.

[24] The total figure for both emotional harm and consequential loss is $56,806 and therefore I anticipate that SBS will pay Westown, or the insurers will pay Westown, the sum of $28,403.

Setting the Fine, Assessing Culpability

[25] The prosecution submit that the defendant’s culpability is at the same level as I assessed Westown’s culpability and that the starting point for the fine should be around $450,000. The defendant submits that their culpability is significantly less when considering the factors relevant to determining culpability as set out in the decision in the Department of Labour v Hanham & Philip Contractors Ltd.2 Having done so, the defendant also submits that the role played by the defendant should also be assessed and cites the Court of Appeal decision in Zhang v R.3 I agree.

[26] Having applied all of those tests, viewing the relevant factors and the role played by SBS, I find that if anything, the role played by SBS rendered them marginally more culpable than Westown. Westown were relying on SBS to come up with a plan to prevent Mr Bowling and other employees from suffering injuries. SBS, as a result of [person A]’s failure, failed to do so. I say “marginally more culpable”. There are so many variables when assessing this test that in the end I am simply going to conclude that they are not less culpable, and I set the same starting point as I did for Westown. The starting point for this penalty is a fine of $450,000.

[27] From that adjusted starting point I give the defendant a credit of five per cent for co-operating with the investigation and a further five per cent credit for previous good character. SBS submit that their ultimate guilty plea entered two and a half years after the charge was first filed merits the full discount of 25 per cent awarded to those who plead guilty at an early opportunity. SBS submit that they were entitled to test the law as to their liability. They pursued an unsuccessful application under s 147 of the Criminal Procedure Act 2011 and this did undoubtedly cause a significant delay, but they only pleaded guilty a very short while before a five-day hearing had been arranged. There is no question that they merit a 25 per cent discount. I will give them a five per cent discount for a very late guilty plea. That is a discount of $67,500, making a total fine of $382,500.

2 Department of Labour v Hanham & Philip Contractors Ltd [2008] NZHC 2076; (2008) 6 NZELR 79 (HC).

3 Zhang v R [2019] NZCA 507, [2019] 3 NZLR 648.

[28] [Details deleted].4 For reasons that are suppressed the amount that SBS are to actually pay is $70,000.

Ancillary orders

[29] Dealing with the issue of ancillary orders, WorkSafe has recorded costs of

$30,944.21. The defendant takes no issue with this figure and accordingly are ordered to pay a contribution towards WorkSafe’s legal costs of $15,460.11. [Details deleted] I regard the overall package of financial penalties and orders to be proportionate and to not require any readjustment.

Judge AS Greig

District Court Judge | Kaiwhakawā o te Kōti ā-Rohe

Date of authentication | Rā motuhēhēnga: 23/08/2024

4 Wimpex Ltd v WorkSafe New Zealand [2019] NZHC 1978 at [25].