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January 2020

Property management business falls foul of SafeWork NSW

Property management business falls foul of SafeWork NSW

SafeWork NSW v Investa Asset Management Pty Ltd (2019)

Facts

Earlier this year, Building Maintenance Unit Service Pty Ltd (BMUS), a company responsible for servicing and maintaining building maintenance units (BMUs), was found to be in breach of its work health and safety (WHS) duties after a BMU fell down the side of a building with two workers inside, causing them to suffer serious injuries (SafeWork NSW v Building Maintenance Unit Service Pty Ltd [2019]).

SafeWork NSW also prosecuted Investa Asset Management (Investa), which managed the building that was serviced by the faulty BMU. As the BMU formed part of the plant used in the building, SafeWork NSW submitted that Investa breached its duty as a body with management or control of a workplace. Investa pleaded not guilty to these charges.

Judgment

The Court found Investa to be in breach of its WHS duty by exposing the BMU workers to a risk of death and serious injury for the following reasons:

  • the emails tendered in evidence indicated that Investa had actual knowledge or ought to have known that there was a need to undertake a major inspection as per the relevant Australian Standards;
  • Investa knew the purpose of this major inspection was to identify defects that may pose a risk to the BMU;
  • Investa’s internal reporting processes were insufficient as it did not act on recommendations to undertake an inspection;
  • there were alternative methods available to Investa to determine when the BMU needed to be inspected (e.g. Investa could have contacted the BMU manufacturer to find out the age of the BMU and its service history); and
  • the likelihood of risk for critical components of the BMU failing was low to moderate. However the risk of the BMU failing increased the longer the BMU went without servicing. Also, the degree of harm that could be suffered by the BMU failing was significant.

The Court rejected Investa’s submission that it could discharge its duties under WHS legislation by relying solely on BMUS’ expertise. The Court also rejected Investa’s submission that, even if an inspection had been performed by the Company, there was no guarantee that the inspector would have discovered the fatigued equipment. The Court accepted the Prosecution’s expert evidence that had a major inspection been carried out, the fatigue and cracking would have been visible and that the studs would have been replaced.

The Court announced a sentencing hearing would be set at a later date.

Lessons

Businesses involved in property management will need to ensure they comply with their health and safety duties even though they are not directly involved with hands-on worksite operations. Health and safety duties cannot always be delegated or discharged by relying on the expertise of engaged contractors when there is actual knowledge of the requirements to take steps (such as plant servicing). A duty remains to ensure that steps are being taken by the contractor.

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