Officer awarded $238,000 in costs against WHS Regulator as a result of a failed due diligence case

A company director was awarded $238,000 in costs (click here) following the WHS Regulator’s failed attempt to prosecute him for due diligence offences that followed after a male customer died and his wife was severely injured in a zip line accident in Queensland.

The Magistrate found that the WHS regulator had not properly investigated the accident from a due diligence perspective and questioned their decisions to:

• commence the case in the first place; and

• not abandon it during proceedings,

when it should have been apparent that the relevant standard had been met.

Our Take

This case should not be seen as ‘gloating’ over the WHS Regulator suffering a loss in the Magistrates Court. On the contrary, it is a recognition that due diligence cases of their very nature have a peculiar level of difficulty and complexity. The case is an endorsement that the management and implementation of safety systems is not solely held with business owners and directors. Such management and implementation is likely, in most cases, to be appropriately delegated to others within the organisation to manage safety risks. To put it another way – it is often more risky (and practically impossible) for a single person to hold complete responsibility for the implementation of safe systems of work.

Action items

• undertake due diligence training with all organisational leaders (not just directors and executives) so that a genuine understanding of safety duties is achieved;

• regularly assess due diligence efforts much like a scorecard/KPI so you can identify gaps;

• address gaps in a measured and structured manner.

Edge Legal

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