CEO found guilty and fined $130,000 for breach of officer duty

Tuesday 22 April, 2025

On 30 August 2020 Pala’amo Kalati was killed by a falling shipping container. Pala’amo was working the night shift at Ports of Auckland Limited (POAL) as a lasher. Lashers are responsible for securing stacked shipping containers to container ships using metal lashing bars.  

POAL pleads guilty and CEO charged 

Maritime New Zealand charged POAL with failing to ensure the health and safety of workers, exposing them to risk of death or serious injury.  POAL pleaded guilty. Maritime New Zealand also charged POAL Chief Executive Mr Gibson with two offences under the Health and Safety at Work Act 2015 (HSWA).  

The first charge was under s 48(1) HSWA. Maritime NZ alleged that by failing to comply with his duty to exercise duty diligence to ensure POAL complied with its duties or obligations under the HSWA (‘duty to exercise due diligence’) Mr Gibson exposed POAL’s stevedores to a risk of death or serious injury. That risk was being struck by objects falling from operating cranes.  

The second charge was the same as the first charge, but it did not allege that any failure exposed workers to risk of death or serious injury (s 49(1) HSWA).  

Mr Gibson pleaded not guilty to all charges.

District Court’s findings

The Court was satisfied that Mr Gibson failed to comply with his duty to exercise due diligence. It was undisputed that Mr Gibson was an officer under the HSWA.  He had significant influence and responsibility over the health and safety matters at POAL. 

The Judge explained that POAL pleading guilty did not mean that Mr Gibson failed in his duty. Mr Gibson may have acted reasonably in the circumstances despite the incident occurring. To determine whether this was so, the Court had to determine the circumstances in which Mr Gibson was acting, the risks involved, POAL’s and Mr Gibson’s awareness of the risks, and whether he met the reasonable standards in managing them. 

Ultimately, the Court concluded that Mr Gibson did have the capacity and the ability to influence the conduct of POAL in respect of its failures. He had breached his duty to exercise due diligence. In confirming this the Court had regard to a number of factors including:

• Mr Gibson was aware of the risks involved with stevedoring and crane operations.
• Mr Gibson was responsible for health and safety at POAL. He had key health and safety responsibilities and was responsible for monitoring and reviewing the performance of his subordinates and POAL’s systems.
• POAL received a KPMG audit with recommendations. Mr Gibson did not respond to these recommendations in a timely manner.
• Mr Gibson was aware of POAL’s previous convictions for health and safety breaches, but he did not ensure appropriate systems and processes were put in place. 
• Mr Gibson knew of the risks associated with handling suspended loads, but did not ensure that additional hard controls, such as barriers or signage were put in place. They were implemented quickly after the fatality, indicating that they were entirely feasible. 

The judge was satisfied that Mr Gibson’s failures materially exposed stevedores to risk of death or serious harm. Mr Gibson was found guilty of two particulars of the charges brought under s 48(1) of the HSWA. The judge was not satisfied beyond reasonable doubt of Mr Gibson’s guilt in respect a third particular of the charge.  This related to POAL’s duty to having clearly documented, effectively implemented, and appropriate processes for ensuring coordination between lashers and crane operators. As Gibson was found guilty under s 48(1) the judge did not need to consider s 49(1) HSWA.

Sentenced 

At sentencing Mr Gibson faced a fine of up to $300,000. He was fined $130,000 and ordered to pay Maritime New Zealand’s costs of $60,000. $60,000 was a far cry from what Maritime New Zealand initially sought at $395,000, before reducing this to $180,000. 

It is sobering to consider that Mr Gibson was not the only officer at POAL. The judge found that the Board was responsible for setting and approving policies for the business and monitoring overall safety compliance.  However, the judge was not required to determine whether Board members had breached their duties as officers as none had been charged. 

At sentencing the judge referred to the fact that a duty is shared does not diminish the duty. As CEO, Gibson had the power, capability and responsibility to do all he could to reduce the risk.