Legal Appointments and Liability
By Colin Rice
The Mine Health and Safety Act is very cleverly structured and focusses very strongly on the delegation of responsibilities for health and safety. The Act places full responsibility for health and safety on the “employer” of the mine but it also recognises that one person cannot be responsible for everything that takes place on a mine on a day to day basis. The Act therefore makes provision for the appointment of people to assist in carrying out the responsibilities of the employer.
In the first of our Legal Focus articles, we discussed that all exploration drilling operations are regulated by the MHSA, we also saw that the word “drilling” appears once in the Act (in a definition!!) and so our challenge is to extract from the Act the sections that apply to exploration drilling operations and then interpret what the Act requires - in a number of the following articles in this Legal Series we will do this.
We have also previously explored the origins and structure of The Mine Health and Safety Act 29 of 1996 (MHSA). In this article, I would like to examine an important feature of the Act – the placement of responsibility through the provisions for legal appointments: Who is liable if something goes wrong?
Before we begin to discuss this issue, it is important that we briefly look at two definitions contained in Section 102 of the Act.
Important definitions
OWNER
i. The holder of a prospecting permit or mining authorisation issued under the Mineral and Petroleum Resources Development Act;
ii. if a prospecting permit or mining authorisation does not exist, the person for whom the activities contemplated in paragraph (b) of the definition of 'mine' are undertaken, but excluding an independent contractor;
iii. or, if neither (i) or (ii) is applicable, the last person who worked the mine or that person's successor in title.
This is an extremely important definition because it addresses a serious loophole in previous versions of legislation. Effectively it covers all eventualities – if a prospecting permit or a mining authorisation has been legally issued then the owner is the person in whose name the permit or authorisation has been issued.
Secondly, if a permit or authorisation has not been issued – in other words, the exploration activities are being conducted “illegally”, then the owner is the person for whom the activities are being conducted. It is important to recognise that the “independent contractor” who is doing the work is not considered the owner.
The third part of this definition covers what happens when the holder of the permit or authorisation abandons the mine or passes away – in this case the last person to work the mine or the person who inherits the permit or authorisation becomes the new owner. This means that the liability cannot be delegated or evaded. The owner cannot escape his obligation to comply with the provisions of the Act.
EMPLOYER:
The Owner of the mine.
This definition effectively says that the terms “owner” and “employer” are synonymous and so wherever we see the word “owner” we can substitute the word “employer” and vice versa.
Chief executive officer responsibil for safety
The Act very clearly places the responsibility for health and safety on the owner / employer – this is contained in Section 2.
2. (1) The employer of every mine that is being worked must -
(a) ensure, as far as reasonably practicable, that the mine is designed, constructed and equipped
(i) to provide conditions for safe operation and a healthy working environment; and
(ii) with a communication system and with electrical, mechanical and other equipment as necessary to achieve those conditions;
(b) ensure, as far as reasonably practicable, that the mine is commissioned, operated, maintained and decommissioned in such a way that employees can perform their work without endangering the health and safety, of themselves or of any other person;
(2) The employer of a mine that is not being worked, but in respect of which a closure certificate in terms of the Minerals Act has not been issued, must take reasonable steps to continuously prevent injuries, ill-health, loss of life or damage of any kind from occurring at or because of the mine.
2A (1) Every chief executive officer must take reasonable steps to ensure that the functions of the employer as contemplated in this Act, are properly performed.
(2) Without derogating from any responsibility or liability of the chief executive officer in terms of subsection (1), the chief executive officer may entrust any function contemplated in the said subsection to any person under the control of the chief executive officer, which person must act subject to the control and directions of the chief executive officer.
(3) If the employer is a body corporate, the functions of the chief executive officer contemplated in subsections (1) and (2) may be performed by a member of the board of the body corporate designated by the board.
(4) Subsections (1), (2) and (3) do not relieve an employer of any duty imposed on employers by this Act.
(5) Every person appointed in terms of section 3 or 4(1) must perform their functions subject to the control and direction of the chief executive officer or the person contemplated in subsection (3).
Section 2 (1) clearly places full responsibility for health and safety on the employer / owner from the design phase to decommissioning, i.e. for the lifecycle of the mine. This responsibility is incredibly onerous and leaves no room for the employer to escape liability.
Section 2 (2) is very important in the current climate because it says that even after the mining activity has ceased, the employer (owner) must still ensure that no one suffers injury or harm at or because of the mine.
The MPRDA requires that once a mine has been fully worked and all mining activities have been stopped, the employer / owner must obtain a “closure certificate” from the DMR which effectively ends the employer's / owner’s responsibility for health and safety at the mine. Closure certificates are seldom issued and so this sub-section extends the responsibility for health and safety long after the mine has stopped working.
The problems associated with illegal miners working dis-used mines are therefore the responsibility of the employer / owner and raises the question – to what extent must an owner protect old workings, is a fence and signage enough or should armed guards be placed at the old entrances to the workings? The fact that so many illegal miners have been able to access old workings seems to indicate that the owner has not complied with Sub-section 2. (2).
Section 2A (1) recognises that the mine may be owned by a company of a group of people – a group of shareholders for example, and so makes the Chief Executive Officer (CEO) responsible for ensuring that the responsibilities of the “owner” are performed – this section effectively makes the CEO the “owner’s representative” and so we can substitute the CEO in place of employer in the section 2 (1) and 2 (2). The effect of these sections is to place the full burden for health and safety on the shoulders of one person – the CEO.
The Act is cleverly structured because it recognises that the nature of the activities of the mine may make it impossible for the CEO to personally ensure that the owners responsibilities are performed and so Section 2A (2) makes provision for the CEO to appoint a person to act on his behalf. The wording of this section makes it very clear that if the person appointed by the CEO is negligent, the CEO still carries full responsibility and therefore full liability. This responsibility is repeated later in Sub-section 4.
Other legal appointments
A number of other sections of the Act provide for persons to be appointed to assist the owner / employer (CEO) and together these sections create a “legal appointment” structure through which the day to day functions of the mine can be safely carried out. In the first article in this series we saw that although the Minerals Act 50 of 1991 has been repealed, the regulations of the Minerals Act are still in force. Some appointments are therefore made in terms of the Minerals Act Regulations while others are made in terms of the Mine Health and Safety Act - this can be confusing.
In some cases, the decision to appoint a person lies with the employer or owner in which case the Act uses the word “may” but in some cases the employer or owner have no choice in which case the Act uses the word “must or shall”.
We are not concerned with the entire legal appointment structure – we are only interested in the appointments that have a direct effect on exploration drilling operations – I will therefore limit our examination to these appointments. Table 1 summarises the main legal appointments that an exploration drilling contractor will be affected by.
Section 3 makes it obligatory (the employer must) for the employer / CEO to appoint one or more Managers to run the day to day operations of the mine.
Section 3: Employer must appoint manager
(1) The employer of every mine that is being worked must -
(a) appoint one or more managers with the qualifications as may be prescribed, and if more than one manager is appointed, ensure that the managers' functions do not overlap;
(b) supply the managers with the means to perform their functions; and
(c) take reasonable steps to ensure that the managers perform their functions.
(2) The appointment of a manager does not relieve the employer of any duty imposed on owners by this Act or any other law.
(3) If no manager is appointed in terms of subsection (1), the employer must perform the functions of a manager in terms of this Act.
This section leads to the definition of a Manager as found in Section 102 of the Act:
MANAGER: Any competent person appointed in terms of Section 3. 1 (a).
Section 3 cleverly requires that if more than one manager is appointed that their functions and responsibilities do not overlap – this is very important. The section then goes further by requiring that the employer / CEO must provide the Managers with whatever they need to carry out their duties and the employer / CEO must check up to make sure that the Managers are indeed carrying out their duties.
As we saw in the previous Section, the mere fact that the employer / CEO has appointed Managers does not relieve him of his responsibilities and liability – if the Manager fails to act correctly and something goes wrong, the CEO is still ultimately responsible.
Depending upon the complexity and the structure of the mining or exploration company, contractor personnel may be required to accept either a 2.6.1, “sub-ordinate manager” or a 2.9.2, “person to assist” appointment.
Both of these sections can be found in the Minerals Act Regulations (the third part of the MHSA as describe in the first article in this section). The wording of these sections is included below.
Section 2.6.1 (Minerals Act Regulations): The manager may appoint one or more competent persons as sub-ordinate managers to assist him in the control, management and direction of the mine or of the works and every such person shall, to an extent to be clearly defined in his letter of appointment, have the same responsibilities under the regulations as the manager: Provide that the appointment of such persons shall not be taken to relieve the manager of any personal responsibility under the regulations.
Section 2.9.2 (Minerals Act Regulations): The manager shall appoint such persons as may be necessary to assist him in enforcing such observations of the regulations.
Typically, the Manager (3.1(a)) will require that a senior operational person from the contractor acts as a sub-ordinate manager (2.6.1) – this could be the contract manager or the area manager for the drilling project.
It is clear that the Manager who appoints this person must satisfy himself that the person is “competent” – this is extremely important because the wording or the section makes it very clear that even though the manager has appointed a person as sub-ordinate manager, he is still liable for anything that may go wrong. Managers will therefore be very demanding in terms of the way that the 2.6.1 appointee goes about his day to day duties.
It is also important for the appointee to recognise that his responsibilities are the same as those of the Manager but limited to the what is specified in the letter of appointment. It is important therefore that the appointee has a very good understanding of what the responsibilities and liabilities of the Manager are.
Whether the Manager appoints a sub-ordinate manager or not, he must appoint one or more “persons to assist", 2.9.2 appointees. In an exploration operation, this would typically be the supervisor or site foreman responsible for one or more drill rigs.
Although the wording of this regulation is not as onerous as that of regulation 2.6.1, the appointee must be aware of what his responsibilities are.
Table 1: Legal Appointments required by the MHSA applicable to an exploration drilling operation
A legal appointment is not a paper exercise, it is a formal acceptance of legal responsibility. It is essentially a contract and requires that the appointed person understands the objectives of the legislation, and the requirements imposed by the Act. It is extremely important that the appointee has a clear understanding of the duties imposed on him by the letter of appointment.
All legal appointments must be made on official company letterheads, dated and signed both by the appointee and the person making the appointment. Appointment letters are typically worded in a very general way - this is to protect the employer should a regulation be repealed, altered or added to. This however places an extremely heavy burden on the appointee to ensure that he not only carries out his day-to-day duties but also keeps himself fully updated on all changes to the Mine Health and Safety Act.
Legislation is complex and not always easily accessible, so, we have developed a course to provide people involved in the exploration industry with a working knowledge of the legislation that is applicable to exploration activities.