Still questions about Whittall’s $3.41m Pike deal

John Farrow
John Farrow
The tragedy at the Pike River mine in November 2010 triggered the enactment of the Health and Safety at Work Act 2015.

One of the primary roles of WorkSafe under that Act is to monitor and enforce compliance with relevant health and safety legislation.

Therefore it is somewhat ironic that the Supreme Court last month found the decision of WorkSafe to offer no evidence in the prosecution of Pike River Coal director and chief executive Peter Whittall was unlawful and contrary to the public interest.

Twelve charges were originally laid against Mr Whittall.

They were based on Mr Whittall having ‘‘directed, authorised, assented to, acquiesced in, or participated in the safety failures of the company’’. 

The failures were mainly in relation to management of the risk of a methane gas explosion and inadequacies in ventilation.

At the time, WorkSafe described what happened as "the employment-related disaster of a generation".

At the sentencing of Pike River Coal Ltd, WorkSafe’s lawyer described the safety failures  as "breathtaking". 

This view was substantiated by the 2012 Report of the Royal Commission into the explosion.

By the time Judge Jane Farish passed sentence, Pike River Coal was in receivership.  

It was fined $760,000 and ordered to pay $3.41million in reparation to the survivors and to the families of the 29 men who died. 

WorkSafe ultimately decided to offer no evidence on all charges against Mr Whittall after he agreed to make a payment into the court of $3.41million.  

The source of the money was director insurance.

At the Supreme Court, the counsel for Anna Osborne and Sonya Rockhouse, the mothers of two of the miners killed, argued  WorkSafe failed to comply with the Solicitor-general’s prosecution guidelines and the purposes of the Health and Safety in Employment Act 1992. 

The role of the Solicitor-general is to have general oversight of public prosecutions, including the maintenance of guidelines and general advice and guidance.

WorkSafe, in its decision to offer no evidence, explicitly invoked the Solicitor-general’s prosecution guidelines. 

The decision to discontinue the prosecution was based solely on its assessment of public interest and not due to a lack of evidence. 

WorkSafe decided that as Pike River Coal was in receivership, the reparation order was unlikely to be paid. 

Mr Whittall proposed he would make a voluntary payment of $3.41million if the prosecution against him was discontinued. 

WorkSafe believed that, in those circumstances, a prosecution was not in the public’s interest.

The Supreme Court ruled receiving a payment in return for a promise to abandon criminal proceedings amounted to an abuse of the obligations of public prosecution. 

Suppression of prosecutions should not be the matter of a private bargain — the interests of the public are paramount.

The Supreme Court noted  the initial discussions on  resolving the charges were originated by WorkSafe’s lawyer. 

Mr Whittall’s lawyer, however, replied on the basis a voluntary payment would only be made if the charges against Mr Whittall were not proceeded with.

The court found there was nothing in the Solicitor-general’s prosecution guidelines that suggested such an arrangement was permissible.

The major consideration in any prosecution is the seriousness of the offence and the risk of harm it created.

At sentencing, Judge Farish acknowledged some might think Mr Whittall was "buying his way out" of a prosecution. 

However, her view was the voluntary payment was really a side issue. 

The Supreme Court, however, noted that Judge Farish did not have all of the information before her at that time. 

She did not know the payment of $3.41million was on the condition that WorkSafe offer no evidence.

It has been seven years since the Pike River mine disaster.  

It looks increasingly likely the new Government will try to re-enter the mine.  If this occurs we may well learn about the causes of the disaster and be better able to prevent them from occurring again. 

To be fair, WorkSafe faced a difficult decision.

By not offering evidence against Mr Whittall, it managed to secure $3.41million reparation for the affected families.  

It must have done so with the best of intentions. 

However, in doing so it entered into a bargain to stifle the prosecution.

   Let’s hope that in the future, for the sake of all workers, WorkSafe puts its obligation to enforce compliance with Health and Safety legislation first.

- John Farrow is the partner leading Anderson Lloyd’s Dunedin employment team. The opinions expressed in this article are those of the writer and do not purport to be specific legal or professional advice.

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