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10 Apr 12
The winds of change - 'reasonably practicable' defence succeeds

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By Jeremy Kennedy (Partner) and Gillian Holmes (Lawyer)

A recent decision of the Supreme Court of Western Australia has added to the pool of case law surrounding the definition of ‘reasonably practicable’ and the role of duty holders as the harmonisation of work health and safety regimes continues.

The Supreme Court of Western Australia has found that Fortescue Metals Group (Fortescue) complied with its duty to ensure ‘so far as is practicable’ the safety of workers at a Pilbara construction camp hit by Cyclone George.

So what should organisations in New South Wales and Queensland take away from this decision?

  • ensure that appropriate experts are engaged where tasks are out of the duty holders areas of expertise
  • contractual arrangements should clearly define the area of expertise for which the expert is engaged, and
  • warranties and disclaimers should be implemented to place an onus on the expert to undertake their own assessment, enquiries and analysis, irrespective of briefing or information that the principal duty holder provides.

Whilst this decision is undoubtedly a win for duty holders engaging the expertise of others, it is relevant to note that contracting work to another entity will not relieve a duty holder of their obligation to ensure safety, rather it may assist in discharging the duty.

Facts

In March 2007 Cyclone George ravaged much of Australia’s top end before sweeping the Kimberly’s and reaching peak intensity on the Pilbara coast, just east of Port Headland.

Significant damage was caused to a number of remote mining camps in the area, including a temporary rail construction camp run by Fortescue and its wholly owned subsidiary The Pilbara Infrastructure (TPI). Cyclone George claimed two lives at the TPI camp and several people sustained serious injuries when the dongas (huts designed for cyclonic refuge) lifted and pulled away from their footings as a result of the high winds.

The subsequent investigation by Western Australia’s WorkSafe identified that the camp design did not comply with wind-load standards for the Pilbara region and the tie-downs attached to the dongas were inadequate.

Whilst Western Australia is amongst those states not yet operating under harmonised legislation, the primary duty of care under the existing Occupational Safety and Health Act 1984 (WA) (OSHA) closely follows the harmonised model.

Specifically, section 19 of the OSHA requires an employer to ‘so far as is practicable’ provide and maintain a work environment which does not expose employees to hazards. ‘Practicable’ is then defined as ‘reasonably practicable’ having regard to a number of factors including: severity of injury, degree of risk, state of knowledge and the availability, suitability and cost of mitigating measures.

As such, this case was argued on substantially the same terms as those that now apply to the Commonwealth, New South Wales, Queensland and the territories.

The Proceedings

WorkSafe commenced proceedings against Fortescue and TPI in the Magistrates Court, alleging the companies (as principals engaging contractors to build the camp), did not do all that was practicable to ensure that the workers had safe refuge and that the premises supplied were able to withstand cyclones. All charges stemmed from the same alleged failure, that the accommodation facilities had not been constructed in accordance with the appropriate wind-load specified in the relevant Australian Standard.

The Magistrate dismissed the charges, finding Fortescue and TPI had no expertise in the designing and building of camps, and as such had discharged their duties in relying on the design expertise of ‘NT Link’, the specialist builder they had engaged for that purpose.

The Appeal

WorkSafe appealed the decision, arguing the magistrate had erred in finding that Fortescue and TPI had done all that was reasonably practicable. In particular, arguments were raised that the request for tender (RFT) sent out by the defendants included the wrong wind-load specification for the region, and that the Shire of East Pilbara Council had approved NT Link design plans irrespective of their inadequacy.

WorkSafe’s position was that it was reasonably practicable for Fortescue and TPI, having control of the construction, to have re-checked these aspects. In doing so, Worksafe argued that TPI and Fortescue would have identified the inaccurate information and prevented the inadequate design from proceeding. The Supreme Court dismissed the appeal, finding in favour of Fortescue and TPI and marking a milestone success for the reasonably practicable defence.

The Findings

In finding that TPI and Fortescue were entitled to rely upon the work of NT Link, having the design and installation expertise to complete the tasks, the Supreme Court considered the RFT and installation contract (Contract) noting:

  • the RFT contained a disclaimer that there was no express or implied warranty that the information was accurate
  • those tendering were required to confirm in writing that they had not relied on the information in the RFT but had undertaken their own investigation and inquiries of the site, including the local conditions
  • the Contract contained a clause that NT Link would ensure work was carried out in compliance with all relevant legislation, Australian Standards and the Building Code of Australia
  • the RFT included a risk allocation matrix which indicated that the successful tenderer was to be fully responsible for all pre-contract design work, whether or not it was carried out by them, and
  • the Contract made clear that the obligation for ensuring the camps were designed and built in accordance with relevant standards was on the successful tenderer.

The Supreme Court also considered that TPI and Fortescue were entitled to rely on the representations made by NT Link, as an expert and specialist in the area. Furthermore, there was nothing to suggest that TPI and Fortescue had the expertise to evaluate whether the designs of NT Link were wind-load compliant, without engaging further experts or a second opinion.

In that regard, the Supreme Court drew a distinction between what was ‘technically possible’ and ‘reasonably practicable’ finding that although TPI and Fortescue may have been capable of having the designs ‘double checked’ it was not reasonably practicable to expect them to engage further experts to review the work done by experts first engaged.

Although decided in Western Australia, this decision could potentially be cited as a relevant authority for proceedings of the Work Health and Safety Act 2011 in both New South Wales and Queensland. Whilst there is no formal obligation to follow the decision of the Western Australian Supreme Court, the similarity between provisions in the OSHA and harmonised legislation means that New South Wales and Queensland could apply these principles, providing a greater pool of case law that the harmonised states can rely on.

 

For updates on developments in relation to workplace relations and safety law link in with Jeremy Kennedy LinkedIn, subscribe to Workplace Health & Safety Lawyer discussion group on LinkedIn or follow Jeremy on Twitter @WHSLawyer.

Focus covers legal and technical issues in a general way. It is not designed to express opinions on specific cases. Focus is intended for information purposes only and should not be regarded as legal advice. Further advice should be obtained before taking action on any issue dealt with in this publication.

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