The successful health and safety prosecution of Tony Gibson, former Chief Executive Officer of Ports of Auckland (POAL), by Maritime New Zealand has been upheld.
Background
This prosecution relates to the tragic death of a lasher at POAL in 2020, after being struck by a container being loaded onto a ship.
Both POAL and Mr Gibson were subsequently charged for this incident under the Health and Safety at Work Act 2015 (HSWA). In relation to Mr Gibson, it was alleged that he had breached his officer duties under s 44 of HSWA.
This duty requires an officer of a person conducting a business or undertaking (PCBU) to exercise due diligence to ensure that the PCBU complies with its separate health and safety duties or obligations. Among other things, it specifically includes ensuring that the PCBU has available for use, and uses, appropriate resources and processes to eliminate or minimise risks to health and safety from work, and to verify the provision and use of those resources and processes.
The duty does not make an officer responsible for an accident or for the failures of a PCBU. It only applies in circumstances where an officer has failed to “exercise the care, diligence, and skill that a reasonable officer would exercise”. This is referred to as the ‘reasonable officer test’.
In November 2024, the District Court found Mr Gibson guilty of failing to exercise due diligence giving rise to a risk of serious injury or death. We wrote about the District Court decision here.
Mr Gibson was sentenced to a fine of $130,000 and ordered to pay $60,000 towards the costs of the prosecution. Mr Gibson subsequently appealed his conviction and sentence, which is the focus of the latest decision released by the High Court.
The High Court Decision
Conviction appeal
The starting point in relation to an appeal against conviction is whether (in the case of a judge-alone trial) the Judge erred in his or her assessment of the evidence to such an extent that a miscarriage of justice has occurred, or if a miscarriage of justice has occurred for any other reason. If neither of these can be established, the appeal must be dismissed.
There were numerous points Mr Gibson made to support his claim that he had been wrongfully convicted as a result of a miscarriage of justice. These points and the High Court’s response to those by way of high-level summary are:
- First, it was argued that there had been a focus on the proved failures of POAL and these were wrongly attributed to Mr Gibson. The High Court noted that the proved failures of POAL had been the starting point for the District Court’s analysis, but this did not mean that the discrete reasonable officer test had not been applied;
- Second, it was submitted that the District Court wrongly attributed ultimate responsibility for health and safety at POAL to Mr Gibson, ignoring that he was only one officer part of a wider governance group, and acted at the direction of the board. The High Court rejected this submission. The District Court had found that Mr Gibson exercised “overall responsibility at the Executive level for health and safety matters at POAL”, and the High Court agreed;
- Third, the issue of whether due diligence duties have been breached or not requires an assessment of the circumstances at the time, and what a “reasonable officer” would have done. The High Court agreed with this, and found that the District Court had taken that approach;
- The fourth and fifth issues, which the High Court dealt with together, relate to the significance placed on comparative case law. Mr Gibson argued that an incorrect lens had been taken in respect Australian decisions where the relevant legislation in those cases differed from the relevant section of HSWA, and that a different Australian decision which was both recent and relevant, had been disregarded. The High Court was unconvinced;
- Sixth, Mr Gibson argued that the reasonable officer standard was set too high and requires only the taking of reasonable seps to ensure, rather than actually ensuring, the PCBU’s compliance. The High Court disagreed with this, considering that the correct test and analysis had been applied, and POAL’s failings had not been attributed to Mr Gibson; and
- Finally, it was submitted that the District Court wrongly ignored evidence as to what other equivalent officers were doing to manage analogous critical risks in New Zealand. There had not been any evidence before the District Court on this point, and it therefore could not give rise to miscarriage of justice. In any case, it is not a defence.
Sentence appeal
Mr Gibson also argued that his sentence was manifestly excessive.
The first point Mr Gibson raised was that the District Court had applied relevant factors for sentencing PCBUs, rather than for officers. The High Court disagreed. It considered that the factors were relevant and had been appropriately modified to reflect that Mr Gibson was an officer, not a PCBU.
The second point related to the culpability banding. Mr Gibson was liable on conviction for a fine not exceeding $300,000 given he was an officer of POAL. In the sentencing decision, the District Court adopted a starting point of $140,000, which is the bottom half of the high culpability band. It was then reduced to $130,000 due to Mr Gibson’s previous good character.
The High Court considered that the starting point had been slightly overstated, and the offending equated to the top of the medium culpability band – being $120,000. However, the High Court considered that while it may have been stern, the original sentencing had not been outside the appropriate range.
The third point put forward was that while Mr Gibson’s sentencing had been reduced slightly, it should have been further reduced because of his personal mitigating features and conduct at trial. The High Court commented that the reduction had not been generous, but again that it had not been outside the normal range.
Finally, Mr Gibson challenged the order to pay $60,000 towards the regulator’s costs in bringing the prosecution. This challenge was rejected on the basis that in making this order, the District Court had appropriately considered the relevant circumstances, and, among other reasons, the order was appropriate and within range.
For the above reasons, Mr Gibson’s appeal was dismissed.
Comments
The key learnings from the original decision still stand. Fundamentally, officers of PCBUs have a duty to exercise due diligence to ensure that the PCBU complies with its health and safety duties and obligations. This means exercising the care, diligence, and skill that a reasonable officer would exercise in the same circumstances. The High Court acknowledged that “reasonable” does not mean perfect, but nor does it mean the average of what others would do.
While what is “reasonable” will always be fact and circumstance dependent, it is clear that:
- Due diligence requires more than governance or directorial oversight, policies or procedures;
- Officers must proactively and personally acquire and maintain sufficient knowledge, including of “work as done” i.e. how work happens in practice, and what people are actually doing on the ground rather than methods of work designed, understood or expected by management and other staff who do not actually undertake the work;
- Officers should implement and monitor (and improve where necessary) the PCBU’s health and safety processes;
- Timely action is required;
- Effective reporting lines and systems are essential;
- The duty applies irrespective of the size of the PCBU;
- The duty cannot be reassigned; and
- There are potentially significant consequences for breaching the duty.
These highlight that directors and other officers must, in their circumstances, put in place means that provide sufficient access and knowledge of the business in practice to ensure they comply with their duty.
If you have any questions about the officer due diligence obligations, please get in touch with our Health and Safety Team or your usual contact at Hesketh Henry.
Disclaimer: The information contained in this article is current at the date of publishing and is of a general nature. It should be used as a guide only and not as a substitute for obtaining legal advice. Specific legal advice should be sought where required.
