By: Joseph Lill and Matthew Hutcheson

At a glance

• At the end of the Whakaari trial, five of the six defendants had their charges dismissed.
• The single remaining defendant, Whakaari Management Limited (WML), was convicted in respect of just one of the two charges it faced.
• In short, of the seven charges that were heard at the trial, only one was successfully proven.

Background

In December 2019, the Whakaari volcano eruption resulted in the tragic deaths of 22 tourists and tour guides. Their deaths and the life changing injuries suffered by many others prompted serious questions to be asked about the management of both health and safety and adventure tourism in New Zealand. WorkSafe, the health and safety regulator in New Zealand, launched the most complex and comprehensive investigation it had ever undertaken, ultimately charging 13 different parties with a range of offences. While many defendants resolved their charges with guilty pleas six defendants defended their charges at a seven-week trial, which ended this September. We summarise some key outcomes from the trial in advance of the sentencing hearing in February 2024.

Defendants

The defendants at the trial fell into three groups:

1. Andrew, Peter and John Buttle – all directors of WML and charged as officers.
2. ID Tours Limited (ID Tours) and Tauranga Tourism Limited (Tauranga Tourism) who were booking agents in the chain between Royal Caribbean Cruises (the ticket seller) and White Island Tours Limited (WIT) (the tour provider).
3. WML who leased Whakaari from the owner, Whakaari Trustees Limited had entered into licence agreements granting access to Whakaari to tour providers, including WIT.

Officers

As directors of WML, the three Buttle brothers are deemed by the Health and Safety at Work Act 2015 (HSWA) to be officers and were charged with breaching their due diligence obligations. The focus at trial was whether WorkSafe’s evidence was sufficient to prove this charge.

The defence case highlighted deficiencies in WorkSafe’s investigation process. In particular, the lack of evidence regarding what each of the three officers had done individually rather than collectively as a board.

Judge Thomas said that he “would need to assess each director separately” not as a board. WorkSafe had not produced evidence of what each individual had or had not done, meaning that the Judge could not “assess what a reasonable director would have done”. All three charges were dismissed because of this lack of evidence.

Duty to other persons

The booking agents and WML all faced charges alleging offences under section 36(2) of the HSWA. This subsection imposes a duty on persons conducting a business or undertaking (PCBUs), to ensure “that the health and safety of other persons is not put at risk from work carried out as part of the conduct of the business or undertaking”. 

WorkSafe argued that, as part of the supply chain facilitating tours on Whakaari, ID Tours and Tauranga Tourism held a primary duty of care to tourists. As a result, they were allegedly obliged to take steps to ensure that necessary safety information was obtained and provided to Royal Caribbean Cruises’ passengers.

As licensee to tour operators WML faced a range of more detailed allegations including allegedly failing to ensure adequate risk assessments were undertaken or consult with GNS and other PCBUs about risks and hazards on Whakaari.

Analysis

Judge Thomas disagreed with WorkSafe’s analysis of the duty imposed by section 36(2). He, highlighted that section 36 as a whole focuses on risks arising from an entity’s work activity and does not extend to the work product (the tours themselves).

In analysing the case against ID Tours and Tauranga Tourism he said that “[a]rguably and at its highest, Tauranga Tourism and ID Tours may have caused the workers of White Island Tours to be engaged in the work of taking Royal Caribbean passengers to Whakaari.” They did not influence or direct work on Whakaari and “at no point did their work take it to the level that would have engaged any duty under s 36(1).”

Judge Thomas held WML, ID Tours and Tauranga Tourism’s duties did not extend beyond the confines of the work they undertake to the eventual product, being the tours, which was conducted by other parties. On this basis Judge Thomas dismissed the charges under section 36(2) against each of these defendants.

Duty as manager or controller of place of work

WML was also charged with breaching the duty under section 37(1) of the HSWA. This duty obliges a PCBU that manages and controls a workplace to ensure that the workplace and anything arising from the workplace is without risks to the health and safety of any person. WorkSafe alleged WML was required to take specific steps including ensuring adequate risk assessments were undertaken and that it had consulted with GNS and other PCBUs about risks and hazards on Whakaari.

WML argued that Whakaari was not its workplace, and it did not have control or management over it. The Judge found that section 37 of the HSWA requires active, rather than passive, control and merely owning or receiving income from a workplace is insufficient to trigger the section 37 duty. The Judge then considered WML’s role in managing access to Whakaari and the features of Whakaari that meant it was a tourist destination. Considering the facts in this case, the Judge found WML had sufficient control over the workplace to give rise to a duty under section 37.

The Judge then turned to the type of risk assessment that was required of WML. Judge Thomas considered what WML had said it understood from work done by other entities, such as GNS, or required its licence holders to undertake. Judge Thomas distinguished those risk assessments from what WML was required to do. This is because “WML’s risk was fundamentally different from that of an individual tour operator”. WML should have assessed the risk from all tour activities to ensure tourism on Whakaari overall was as safe as reasonably practicable.

Having found the duty existed and that there were steps available to WML that it failed to take, Judge Thomas convicted WML. Sentencing will occur in February 2024 along with the other defendants who had already entered guilty pleas.

Criticism of WorkSafe’s investigation

Another feature of the trial decisions is a number of criticisms of WorkSafe’s investigation process which Judge Thomas made when dismissing the charges.

Lack of evidence

WorkSafe’s investigation into the Buttles did not obtain the evidence required to enable the Judge to consider each of their roles individually. In his decision Judge Thomas highlighted that:

“WorkSafe decided very late to prosecute the Buttles as directors. It did not appear to have enough time to further investigate before its self-imposed charging deadline.”

While section 146 imposes a 12-month limitation on filing charges, section 147 enables WorkSafe to seek an extension. Given the scale and complexity of this event, it’s likely the application would have been granted by the Court. Striving to meet a self-imposed deadline appears to have resulted in an incomplete investigation being used for the unsuccessful prosecution.

Improperly obtained evidence

WML argued that the interview which its representatives were required to provide to WorkSafe during the investigation was improperly obtained. WorkSafe had written to WML exercising its power under section 168 of HSWA to require a statement, dictating that the interviews had to take place on either 11 and 12 August or 18 and 19 August at WorkSafe’s Whakatāne office.

WML argued this request was improper because, while WorkSafe can require a PCBU to make a statement, it cannot dictate where and when that statement takes place. Judge Thomas accepted WML’s argument and found that the statement had been improperly obtained.

Judge Thomas then weighed up the impropriety against the need for an effective and credible system of justice. He identified there was a lack of prejudice or unfairness to WML and concluded that the interview should remain in evidence.

Takeaways

Finding the limits of HSWA duties

Each officer must take their own steps to discharge their personal due diligence duty. Equally, a board or company failure does not mean each officer has breached their duty.

PCBUs (such as WML) who are managing multiple subsidiaries or activities cannot rely on each entity to undertake their own risk assessment. They need to understand the risk as a whole to properly manage safety and discharge their own duty.

Judge Thomas’ finding regarding the primary duty of care not extending to work product may lead some PCBUs to try and limit their exposure by narrowing the scope of their undertaking or business. WorkSafe clearly considers that the duty under section 36 extends broadly and while, in this instance, the Court was willing to limit the duty, each scenario will turn on its own facts and further cases testing this issue are expected.

WorkSafe investigations will improve

The HSWA provides a mechanism for WorkSafe to extend time for filing charges which arguably should have been used in this case. More care with both the decision to prosecute and ensuring a comprehensive evidence gathering process is complete prior to filing charges is expected.

WorkSafe and defence lawyers will be carefully reviewing current prosecutions to ensure that interviews have not been improperly obtained. A change in practice regarding how interviews are requested by WorkSafe investigators has already been seen and whether those changes go far enough may be tested in future.