Health and Safety at Work Act 2015 – Whakaari White Island – person conducting a business or undertaking – workplace – reasonably practicable – other persons

WorkSafe New Zealand v Whakaari Management Limited [2023] NZDC 23224.

Located in the eastern Bay of Plenty, Whakaari White Island is often described as New Zealand’s most active volcano. On 9 December 2019, another mark was notched in the island’s eruptive history. Ashore that day were 47 people: 42 paying tourists and five tour guides employed by commercial tour operators. All were on the crater floor when Whakaari erupted.

The eruption was driven by steam that’s generated when water beneath the ground or on the surface is heated by volcanic activity. The explosion created what’s known as a “base surge” – the erupting column collapsed in on itself, resulting in a flow of ash, steam, volcanic gases and rocks that surged across the crater floor. Twenty-two people were killed; the remaining 25 were injured, most seriously. Many survivors still suffer.

After the eruption, workplace health and safety regulator WorkSafe started an investigation, ultimately charging 13 defendants under the Health and Safety at Work Act 2015. Six have pleaded guilty; six have had their charges dismissed. Whakaari Management Limited (WML) remained.

Whakaari Trustees Limited owned and leased the island to WML, which was responsible for managing Whakaari. In return for money, WML granted various tour operators access to the island to run commercial walking tours. Licensing the island was WML’s only activity; WML ran no other business on the island, including tours, and had no staff or permanent presence on Whakaari or nearby Whakatāne.

Being a “person conducting a business or undertaking” (PCBU), WML was charged under ss 37(1) and 36(2) of the Act. The thrust of WorkSafe’s case was that WML’s failures to comply with its duties exposed individuals to a risk of death or serious injury arising from volcanic activity.

Admissibility of evidence

A preliminary issue was whether WorkSafe improperly obtained evidence in the form of an interview that WML had to give as part of the regulator’s investigation, and whether it should still be admitted.

WML accepted that s 168(1)(f) empowered WorkSafe to compel an interview, but challenged the regulator’s power to compel attendance at a certain place or time. Judge Evangelos Thomas agreed with WML – the provision didn’t expressly permit it, nor was it necessary to infer the power when s 176 obligated PCBUs to give all reasonable assistance to inspectors.

Having found impropriety, Judge Thomas balanced it against the need for an effective and credible system of justice, concluding that the interview was nonetheless admissible. WorkSafe hinted at being flexible with the interview location and dates, and after further discussions ultimately agreed to interview WML in Auckland (a location easier on all three of the company’s directors as they lived there). Moreover, the public interest in ensuring a fair prosecution went ahead was high and WML faced “significant jeopardy” in respect of the charges it faced, with the maximum fines being significant.

Section 37

PCBUs who manage or control a workplace must ensure, so far as reasonably practicable, that the workplace, its entry and exit, and anything arising from it are without risks to the health and safety of any person.

WML claimed WorkSafe insufficiently pleaded that Whakaari was a workplace as the charge needed to specifically identify the workplace for the court to determine how much control or management WML had over it – if any. A workplace is a place where work is being or is customarily carried out for a business or undertaking and includes any place where workers go or are likely to be while at work. Conducting walking tours on Whakaari was the work of the tour operators, the judge said, and where they then carried out those tours constituted the relevant workplace.

WML argued it didn’t manage or control the workplace enough to be caught by the charge. The words of the provision – “manages or controls” – were broad and far-reaching, the judge said. Parliament’s intention in passing the Act showed lawmakers were more concerned with PCBUs that managed or controlled workplaces in a “practical sense”, instead of those that “merely have an ability to”.

“To be caught by s 37, a PCBU must in fact be exercising active control or management of the workplace in a practical sense. Owning it is not enough. Making money from it is not enough. Merely being able to manage or control a workplace, but not doing so, is not enough,” the judge said.

WML was no passive landowner. It generated income by enabling commercial walking tours on Whakaari; entered into licence agreements, under which it had termination rights upon breaches; maintained a “direct and continuous” relationship with tour operators; engaged with them and other stakeholders interested in increasing tourist numbers to Whakaari; and had occasional direct engagement with WorkSafe and GNS.

WML argued its involvement was limited to dealing with access and that no workplaces existed until the tour operators determined their location and started taking tourists there. WML claimed it had no influence or control over deciding where tour operators’ workplaces would be, other than in setting the geographic boundaries. Evidence showed that workplaces on Whakaari were under the management and control of those who used them.

“Every landowner can control access to their land. Did Parliament intend every landowner to be caught by the section? Some landowners might do very little to control access to their land, others may do more. Was what WML did enough to amount to control and management of the workplace?” Judge Thomas asked.

WML’s argument – that the tour operators were responsible, not the landowner – was “too simplistic”. While zipline or ski operators, for example, would provide “the thrill” of riding a zipline or skiing, Judge Thomas said the active volcano of Whakaari was the product. “Exposure to it is the recreational activity. It is both the hazard and the thrill. WML’s business was to provide that.” The court found WML had active control or management of the workplace.

Failure to comply

The mere failure to take reasonably practicable steps didn’t necessarily mean WML had failed in its duty, the judge said. The company was obligated to ensure the health and safety of persons weren’t put at risk. If it met that duty without taking some or all these steps, it would have still complied with the law.

WorkSafe didn’t argue WML had to eliminate the risk of an eruption as far as was reasonably practicable. Rather, the company failed to minimise the risk as far as was reasonably practicable. WML submitted it didn’t “permit” people to be on Whakaari; it granted licences only to tour operators, who decided who came onto the island. Judge Thomas disagreed, saying, “The broad permission WML gave to permit tours is still the act of permitting. Without WML’s permission, no tourist or guide would have been able to visit Whakaari.”

GNS had always maintained it could never predict an eruption of Whakaari, of which WML was aware. Therefore, taking tourists to the island exposed them to this risk. Engaging in the necessary expertise to assess the risk was fundamental to WML complying with its duty and ensuring safe tours. Because of the variable and unpredictable conditions and characteristics of the island, which affected the nature and predictability of an eruption, WML had to continually assess risk, the judge said – a reasonably practicable step for the company to take. “WML did not do that.”

WML did understand the risk but argued it wasn’t reasonable for the company to take steps that had already been done by others. Health and safety duties always remained with a PCBU though; they weren’t transferable, the judge said. But what steps were necessary could be affected by those already taken by others. In respect of GNS, WML’s engagement wasn’t enough to relieve it of the need to ensure the necessary risk assessments were done. Among other things, each entity was assessing a fundamentally different risk and when a deeper assessment was needed, the information that GNS passed onto WML was “ad hoc, infrequent, unstructured, informal, and incomplete”. Nor was it sufficient for WML to rely on the tour operators’ risk assessments.

Whakaari erupted on the night of 27 April 2016. Thankfully no people were on the island at the time. If WML had taken comfort in knowing others had assumed risk assessment responsibilities, the judge said the defendant’s comfort should have all ended with that eruption.

“What should then have been obvious to every Whakaari stakeholder was that any risk assessment and risk management processes in place had failed. They would not have prevented serious injury or loss of life had tours been operating on the island at the time. In WML’s case, it should have appreciated it could no longer rely on risk assessment work being done by others to relieve it of its own obligation in relation to risk. Whatever it thought was in place prior, it needed to stop and re-evaluate.”

At a bare minimum, engaging with experts to understand its obligations and to ensure it complied with them – including by assessing risk – was WML’s duty. While there was no evidence it was deliberately ignorant, WML’s interview showed a lack of appreciation, which further illustrated the need to have taken expert advice from the outset, the judge said. “Its failure to do so then, and at any time since, was always within its control. It was a reasonably practicable step it should have taken to ensure it met its duty. This was a major failure and amounts to a breach of its duty under s 37.”

In obiter comments, Judge Thomas held much of his risk assessment analysis would’ve applied to the other reasonably practicable steps WML failed to take, including monitoring and reviewing volcanic hazards and risks and ensuring an adequate means of evacuation. “It could not properly take any of these steps without knowing clearly what the risk was.”

Exposure to risk

WML would have had two options had it complied with its duty: stop the tours entirely or implement effective controls to minimise or, if possible, eliminate the risk. A causal link must exist between the failure and the risk to which individuals are exposed, the judge said. Without the company’s work activity of granting access to Whakaari, there would have been no tours to the island.

“WML’s breach, its failure to undertake the necessary risk assessments, was a significant and substantial cause of an individual being exposed to risk of death or injury. Its breach was not, and does not need to be, the sole cause of the exposure to the risk of death or serious injury,” Judge Thomas found. “Other causes contributed. However, it is enough to amount to ‘substantial’. It was more than a minimal causal factor, making it also ‘significant’.”

Section 36

On the s 36(2) charge, Judge Thomas concluded WML didn’t owe a duty to tourists and workers, whom WorkSafe argued fell within the meaning of “other persons”.

In a related, earlier judgment WorkSafe v National Emergency Management Agency [2022] NZDC 8020, Judge Thomas held s 36(2) must be read with reference to subsection 1, in which a PCBU’s duty of care arises from its work activity as opposed to its work output. This conclusion was supported by the overall provision (which focused almost exclusively on worker or workplace safety), the statute’s structure and purpose, and legislative history.

In WML’s case, it never had workers on Whakaari. While WorkSafe argued that other contextual clues favoured a wider interpretation of s 36(2), the judge said his finding of a duty under s 37 nevertheless satisfied the regulator’s argument.

Applicable principles: Health and Safety at Work Act 2015 – whether WML owed duties under ss 36(2) and 37(1) – whether Whakaari was a workplace – whether WML managed or controlled Whakaari – whether WML failed to comply with its duties – whether the compliance failures exposed any individual to a risk of death or serious injury

Held: WML is convicted and found guilty of the s 37(1) charge. The charge under s 36(2) is dismissed.

Read the case here.