District Court New South Wales Medium Neutral Citation: SafeWork NSW v Integrated Agricultural Developments Pty Ltd [2024] NSWDC 243 Hearing dates: 17 June 2024 Date of orders: 27 June 2024 Decision date: 27 June 2024 Jurisdiction: Criminal Before: Russell SC DCJ Decision: In District Court Proceedings 2022/387576 being a charge under s 19(1) of the Work Health and Safety Act 2011 (NSW): (1) Integrated Agricultural Developments Pty Ltd is convicted. (2) The appropriate fine is $240,000 but that will be reduced by 25% to reflect the early plea of guilty. (3) Order Integrated Agricultural Developments Pty Ltd to pay a fine of $180,000. (4) Order pursuant to Section 122(2) of the Fines Act 1996 (NSW) that 50% of the fine is to be paid to the prosecutor. (5) Order Integrated Agricultural Developments Pty Ltd to pay the prosecutor's costs. In District Court Proceedings 2022/287552 being a charge under s 46 of the Work Health and Safety Act 2011 (NSW): (1) Integrated Agricultural Developments Pty Ltd is convicted. (2) The appropriate fine is $20,000 but that will be reduced by 25% to reflect the plea of guilty. (3) Order Integrated Agricultural Developments Pty Ltd to pay a fine of $15,000. (4) Order pursuant to Section 122(2) of the Fines Act 1996 (NSW) that 50% of the fine is to be paid to the prosecutor. (5) Order Integrated Agricultural Developments Pty Ltd to pay the prosecutor's costs. Catchwords: CRIMINAL LAW – prosecution – work health and safety – duty of persons undertaking business – risk of death or serious injury CRIMINAL LAW – prosecution – work health and safety – duty to consult – duty to co-operate – duty to co-ordinate SENTENCE – objective seriousness – mitigating factors – aggravating factors – plea of guilty – general deterrence – specific deterrence – capacity to pay appropriate penalty COSTS – prosecution costs OTHER – quad bike – worker rode onto irrigation dam wall – bike tipped over – worker struck and trapped – no operator protective devices on quad bike – not required to wear helmet – no quad bike exclusion zones Legislation Cited: Crimes (Sentencing Procedure) Act 1999 (NSW), ss 3A, 21A, 22 Fines Act 1996 (NSW), ss 6, 122 Work Health and Safety Act 2011 (NSW), ss 3, 19, 32, 46 Cases Cited: Baumer v R [1988] HCA 67; (1988) 166 CLR 51 Bulga Underground Operations Pty Limited v Nash [2016] NSWCCA 37; (2016) 93 NSWLR 338 BW v R [2011] NSWCCA 176 Capral Aluminium Limited v WorkCover Authority of New South Wales [2000] NSWIRComm 71; (2000) 49 NSWLR 610 Mahdi Jahandideh v The Queen [2014] NSWCCA 178 Muldrock v The Queen [2011] HCA 39; (2011) 244 CLR 120 Nash v Silver City Drilling (NSW) Pty Limited; Attorney General for NSW v Silver City Drilling (NSW) Pty Limited [2017] NSWCCA 96 R v McNaughton [2006] NSWCCA 242; (2006) 66 NSWLR 566 R v Wilkinson (No. 5) [2009] NSWSC 432 Unity Pty Limited v SafeWork NSW [2018] NSWCCA 266 Veen v The Queen (No. 2) [1988] HCA 14; (1988) 164 CLR 465 Texts Cited: Australia/New Zealand Standard AS/NZS 1698:2006 – Protective Helmets for Vehicle Users, 2006 SafeWork NSW, Code of Practice, How to Manage Work Health and Safety Risks, August 2019 SafeWork NSW, The A-Z of Farm Safety, 20 May 2019 Safe Work Australia, Labour Hire: Duties of Persons Conducting a Business or Undertaking, 3 February 2020 Category: Sentence Parties: SafeWork NSW (Prosecutor) Integrated Agricultural Developments Pty Ltd (Defendant) Representation: Counsel: N Evans (Prosecutor) P Barry (Defendant) Solicitors: Department of Customer Service (Prosecutor) Whitely Ironside & Shillington (Defendant) File Number(s): 2022/387552 2022/387576 Judgment 1. Integrated Agricultural Developments Pty Ltd (IAD) operates vineyards in the Central Tablelands region of NSW. A labour hire worker for IAD, Mr Shaun Simms, was conducting a controlled hazard reduction backburn at one of the three vineyards where IAD provided agricultural services. After the backburning had begun, Mr Simms rode his quad bike onto the wall of an irrigation dam to monitor the fire. Mr Simms felt the quad bike tip over and lost his balance. The quad bike rolled down the dam wall, striking Mr Simms and trapping him underneath the quad bike. 2. In District Court Proceeding 2022/387576 IAD has pleaded guilty to an offence that as a person who had a work health and safety duty pursuant to s 19 of the Work Health and Safety Act 2011 (NSW) (the WHS Act) it failed to comply with that duty and thereby exposed workers, including Mr Simms, to a risk of death or serious injury contrary to s 32 of the WHS Act. 3. The maximum penalty for the offence is a fine of $1,766,130. 4. In District Court Proceeding 2022/387552 IAD has pleaded guilty to an offence that as a person who had a work health and safety duty under the WHS Act, it failed to consult, co-operate and co-ordinate activities with Linda June Priest (LJ Priest) contrary to s 46 of the WHS Act. 5. The maximum penalty for the offence is a fine of $117,810. 6. Section 46 of the WHS Act provides: "If more than one person has a duty in relation to the same matter under this Act, each person with the duty must, so far as is reasonably practicable, consult, co-operate and co-ordinate activities with all other persons who have a duty in relation to the same matter." The Risk 1. In District Court Proceeding 2022/387576, the risk described in par 7 of Annexure A to the Amended Summons is as follows: "The risk was the risk to workers, including Mr Simms, of death or serious injury as a result of operating a quad bike at the Site, without wearing a suitable helmet, and where the quad bike did not have an operator protective device fitted (the risk)." 1. In District Court Proceeding 2022/387552, the risk described in par 15 of Annexure A to the Amended Summons is as follows: "The risk was the risk to workers, including Mr Simms, suffering death or serious injury as a result of operating a quad bike at the Site, without wearing a suitable helmet, and where the quad bike did not have an operator protective device fitted (the Risk)." Reasonably Practicable Measures Failure to Comply with Duty: s 19 Offence 1. In District Court Proceeding 2022/387576, par 9 of Annexure A to the Amended Summons pleads particulars of the defendant's failure to comply with the duty under s 19(1) of the WHS Act as follows: "The Defendant failed to ensure, so far as is reasonably practicable, the health and safety of workers generally, and in particular Mr Simms, in that it failed to take one or more of the following reasonably practicable measures to eliminate, or alternatively, minimise, if it was not reasonably practicable to eliminate, the risk: a) Undertaking an adequate risk assessment for the work that identified the risk arising from the ope7ration of quad bikes at the Site in order to develop and implement a safe work procedure or safe work method statement for the use of quad bikes at the Site; b) Installing operator protective devices on all quad bikes before they are made available for use by workers; c) Requiring all workers at the Site to wear the available suitable helmets when operating quad bikes which had been fitted with operator protective devices; d) Establishing exclusion zones at the Site in locations where the terrain was unsuitable for quad bikes to be safely operated; e) Providing adequate training, instruction and information to workers in relation to the safe use of quad bikes." Failure to Comply with Duty: s 46 Offence 1. In District Court Proceeding 2022/387552, par 16 of Annexure A to the Amended Summons pleads particulars of the defendant's failure to comply with the duty under s 46 of the WHS Act as follows: "The Defendant failed to consult, co-operate and co-ordinate activities with LJ Priest who held a duty in relation to the safe use of quad bikes at the Site, in that it failed to take one or more of the following measures, each of which is alleged to have been reasonably practicable: make enquiries with LJ Priest to gain information in relation to the training and experience of its workers to be placed at the Site, in the use of quad bikes, in particular: (i) What, if any, licenses and competencies the workers had in the use of quad bikes; (ii) What, if any, experience the workers had in the safe use of quad bikes; Communicating to LJ Priest a requirement for quad bikes to be used by workers to be placed with the Defendant for work at the Site; Communicating with LJ Priest to confirm that there was a safe system of work in place for the use of quad bikes at the Site." Background 1. The parties presented an Agreed Statement of Facts and this material is summarised below. 2. IAD was the trustee for the Jarrett Agricultural Trust. IAD had acted as the trustee for the Jarrett Agricultural Trust since 7 July 1977. From 8 April 2000 the Jarrett Agricultural Trust was registered as a Discretionary Trading Trust. 3. Mr Justin John Jarrett was a director of IAD. 4. IAD operated as a vineyard and winery with 170 hectares under vines. Mr Jarrett worked within the business of IAD. 5. IAD operated its business from three properties located at: 1. 4 Nanami Lane, Cargo NSW 2800. 2. 101 Caldwell Lane, Borenore NSW 2800 (the Borenore property). 3. 2357 Cargo Road, Lidster NSW 2800. 1. All three vineyards were owned by Mr Jarrett and his wife. Thus, IAD was a service trust, controlled by Mr Jarrett, which provided agricultural services to Mr Jarrett and his wife. 2. LJ Priest was a sole trader who operated as a labour hire business, providing labour to the agricultural sector, specifically to the orchard and vineyard sectors. LJ Priest employed approximately 19 workers. 3. Mr Timothy Gary Priest was the operations manager of LJ Priest. 4. On or about 17 February 2020 Mr Simms commenced employment as a labourer/farmhand with LJ Priest. 5. In or around August 2020 Mr Simms was placed by LJ Priest as a labour hire worker with IAD. As part of this role, Mr Simms was required to carry out general manual farmhand duties. These duties included slashing, vine maintenance, weed control, and trellis repairs. IAD's Quad Bikes 1. IAD had four quad bikes which were used by its employees and labour hire workers when carrying out tasks at its properties. 2. There were no operator protective devices (OPDs) fitted to any of IAD's quad bikes. 3. IAD provided full-face motorcycle helmets for its employees and labour hire workers to wear while operating the quad bikes, but the wearing of helmets was not enforced by IAD. The Incident 1. On 1 June 2021 at approximately 7.30am, Mr Simms arrived at the Borenore property to commence work. 2. On that day, Mr Simms and Mr William Maurice Steer, a worker employed directly by IAD, were required to backburn blackberry bushes in one of the paddocks. 3. At approximately 10.00am Mr Simms and Mr Steer each rode one of IAD's quad bikes towards the location of the blackberry bushes, within an undulating paddock, to commence backburning. 4. The quad bike that Mr Simms was operating was fitted at the rear with a spray tank with a capacity of approximately 100 litres. 5. The quad bike operated by Mr Simms had about 30 litres of diesel in its rear spray tank which was used to spray the blackberries before Mr Steer set them alight with a drip torch. 6. At approximately noon, after the backburning had begun, Mr Simms rode the quad bike up onto the wall of the irrigation dam in the paddock to keep an eye on the fire and to ensure that it was burning safely. 7. Mr Simms noticed a large flame. He stopped and attempted to reverse his quad bike at low speed to better observe what was happening. 8. While Mr Simms was reversing, he felt the quad bike begin to tip over. He lost balance and the quad bike rolled sidewards down the dam wall (the incident). 9. Mr Simms became trapped beneath the quad bike. The quad bike's rear rack and spray tank came into contact with his pelvic region. 10. Mr Steer contacted emergency services. Mr Simms was treated at the scene by NSW Ambulance officers before being transferred by air to Orange Health Service. Mr Simms was treated at Orange Health Service for a fractured sacral spine and pelvis for two weeks. He did not require surgery for his injuries. 11. After the incident, at approximately 3.40pm on 1 June 2021, SafeWork NSW (SafeWork) Inspector Matthew Isaacson visited IAD's Borenore property and met with Mr Steer. Inspector Isaacson observed the following: 1. A large vineyard with a number of buildings with a signpost for "See Saw Wines" at the main gate. 2. A building identified by Mr Steer and described by him as "the main shed", situated around the middle of the property. It was a large steel shed clad in galvanised sheeting and was approximately 10 metres wide and 30 metres long. 3. Inside the shed were a number of farming implements and pieces of plant. 4. Located in the shed near the entrance was a red Honda quad bike fitted with a yellow plastic spray tank on the rear frame. 5. The site of the incident was approximately one kilometre in an easterly direction from the main shed. 6. The scene of the incident was an irrigation dam wall. The area surrounding the dam wall had an extensive area of recently burnt off shrubs consisting mainly of blackberry. 7. The gradient angle of the dam wall was approximately 22 degrees. 8. From the top of the dam wall, scrape marks and flattened scrub were visible on the ground, consistent with a quad bike overturning down the hill. Available Guidance Material 1. Prior to the incident SafeWork had published a Code of Practice titled "How to manage work health and safety risks" (August 2019) (the Code). The Code relevantly provides that: 1. A risk assessment can help a person conducting a business or undertaking (PCBU) to determine how severe a risk is, whether any existing control measures are effective, and what action should be taken to control the risk. Many hazards and their associated risks are well-known and have well-established and accepted control measures. If, after identifying a hazard, the PCBU already knows the risk and how to control it effectively, the PCBU may simply implement the controls. 2. A risk assessment should be undertaken when there is uncertainty about how a hazard may result in injury or illness. 3. Some problems can be fixed easily and this should be done immediately, while others will need more effort and planning to resolve. 4. If it is not reasonably practicable to eliminate the hazard and associated risks, the PCBU must minimise the risks in accordance with the hierarchy of controls. 5. Control measures put into operation will usually require changes to the way work is carried out. In these situations, it is necessary to support the control measures with work procedures. 1. Prior to the incident, on 20 May 2019 SafeWork published a guide titled "The A-Z of Farm Safety" (the Farm Safety Guide). This guide was available online. 2. The Farm Safety Guide relevantly provides: "H – Helmets: Protective headgear is essential when riding quad bikes … Helmets are essential for any activity where there's a possibility of falling and hitting your head, including quad bike, side-by-side vehicle, motorbike and horse riding. … Helmets should comply with … AS/NZS 1698:2006 Protective helmets for vehicle users. … Q – Quad Bikes … being aware of your vehicle's limitations and how to operate it safely is paramount. Choose wisely The right vehicle is crucial, as is making sure any attachments are suitable for your quad bike. … Protect yourself Wearing a helmet as well as appropriate footwear, clothing and personal protective equipment is essential. … 4. Operator protection Consider fitting an operator protective device to your quad bike to prevent being crushed or asphyxiated in the event of a rollover. … 7. Drive carefully Take extra care when riding in rough terrain and on steep slopes, and beware of hidden obstacles, especially if carrying cargo." 1. Prior to the incident, on 18 June 2019 SafeWork published six videos to help improve quad bike safety on farms by debunking some commonly held misconceptions about quad bike use. The videos were available online prior to and at the time of the incident and relevantly provided that: 1. Fitting OPDs to quad bikes can prevent riders from being crushed in a rollover. 2. Fitting after-market accessories, including ODPs to quad bikes should not completely void the manufacturer or consumer warranty. 3. Helmets should always be worn on quad bikes, and helmets for conditionally registered vehicles must comply with Australian/New Zealand Standard AS/NZS 1698:2006 "Protective helmets for vehicle users" (AS/NZS 1698:2006). 4. Quad bike training benefits all riders, regardless of their experience level. 1. On 3 February 2020 Safe Work Australia published the Guide entitled "Labour hire: duties of persons conducting a business or undertaking" (the Labour Hire Guide). This guide was available online before the incident. 2. The Labour Hire Guide relevantly provides: 1. All labour hire PCBUs and host PCBUs have a primary duty of care to ensure, so far as is reasonably practicable, the health and safety of labour hire workers engaged by, or caused to be engaged by, or whose activities are influenced or directed by, the PCBU. 2. All duty holders in a labour hire arrangement must consult, co-operate, and co-ordinate with each other so far as is reasonably practicable. 3. Before engaging labour hire workers to carry out work, a host PCBU should: 1. Verify, in consultation with the labour hire PCBU, that the selected workers have the necessary qualifications, licences, skills and training to carry out the work safely. 2. Consult with the labour hire PCBU on WHS matters including in relation to who will provide any necessary equipment such as personal protective equipment (PPE). 1. Before placing labour hire workers, a labour hire PCBU should: 1. Gather information about the work and the workplace, including the work environment, organisational arrangements, health and safety risks associated with the work, and any skills and knowledge the worker will require to safely undertake the work. 2. Verify and work with the host PCBU to ensure site-specific and task-specific induction, training and PPE is provided to labour hire workers in a way that is suitable, adequate and readily understandable to them. 3. Ensure that workers have the necessary qualifications, licences, skills and training to safely carry out the work. IAD 1. IAD did not have any safe work procedures for operating quad bikes. 2. At the time of the incident, there were no OPDs, or other rollover protection systems installed on IAD's quad bikes. 3. An OPD is an engineering control that guards against the risk of a quad bike rider being crushed by the quad bike in the event of a rollover. 4. IAD did not ensure that employees and labour hire workers were aware of the availability of helmets. The use of suitable helmets while operating quad bikes was not enforced. 5. IAD did not establish exclusion zones or communicate information to workers about where the terrain was unsuitable for quad bikes. 6. IAD did not provide adequate training, instruction and assessment to workers in the safe use of quad bikes. 7. IAD did not consult with LJ Priest about risks to the health and safety of workers placed with IAD, in relation to the safe use of quad bikes or at all. Evidence for the Defendant 1. Mr Jarrett swore affidavits on 29 May 2024(DX 1) (first affidavit) and 14 June 2024 (DX 2) (second affidavit). Mr Jarrett is the general manager and founder of IAD. First Affidavit (DX 1) 1. Mr Jarrett's first affidavit outlined IAD's background, operations, and its capacity to pay. 2. IAD was founded in 1997 as an agricultural management business. IAD is the trustee of the Jarrett Agricultural Trust, which is a discretionary trading trust. 3. Mr Jarrett and his wife, Philippa Jane Jarrett, are the owners in a partnership of properties known as Springvale Coole Park, Annangrove Park, and Balmoral wineries (the sites). 4. IAD provides vineyard workers, plant and mobile equipment to the sites. The tasks performed by IAD include picking, pruning, disease control and vine maintenance. 5. IAD provides these services pursuant to Vine Management Agreements (VMAs) in respect of each site. Payment under the VMAs is by way of a fixed annual fee. This means that at the beginning of each financial year, IAD must calculate what that fee should be. When the VMA is executed IAD is bound by the stipulated fee. 6. Mr Jarrett annexed copies of the VMAs for each site between IAD and himself and Ms Jarrett (Annexure A). 7. Mr Jarrett explained that where unforeseen events occur resulting in excess expenses for IAD, that excess cannot be recovered under the VMA. Rather, the excess becomes a direct expense to IAD which may cause a profit or loss for IAD. 8. Each of the sites where IAD operates are vineyards at different elevations. The sites operate within a 30km radius of each other. 9. The grapes from all the sites are sold to Top Drop Pty Ltd (Top Drop). Top Drop then makes and sells wine known as See Saw Wines. 10. IAD is responsible for its expenses in performing the VMAs, such as: 1. Wages. 2. Materials and equipment to maintain and/or repair the sites. 3. Equipment finance repayments. 1. Occasionally IAD performs grape growing services for other wineries. When IAD undertakes other services such as this, IAD invoices those other wineries directly. However, Mr Jarrett said that IAD rarely performs works for other wineries and that this only accounts for approximately 2%-3% of IAD's total work. 2. At the time of Mr Jarrett's first affidavit, IAD: 1. Employed five workers, being a vineyard manager, vineyard operators, and a bookkeeper. 2. Had plant and mobile plant assets, being: 1. Three tractors and one grape harvester and excavator. These are all subject to asset finance by various equipment finance providers. These items of plant are not owned by IAD. Mr Jarrett annexed copies of the equipment finance agreements for these assets (Annexure B). 2. Four spray units, three slashers, a barrel pruner, and grape bins. These assets are owned by IAD and are essential equipment for IAD to continue its operations. IAD's Financial Position from Financial Year 2021 Onwards 1. Mr Jarrett annexed the following IAD profit and loss statements and tax returns: 1. Financial year 2021 (Annexure C). 2. Financial year 2022 (Annexure D). 3. Financial year 2023 (Annexure E). 4. Current financial year 2023/2024 (Annexure F). 1. Mr Jarrett stated that IAD recorded a nett loss of $674,001 in the 2021 financial year. Mr Jarrett explained why IAD made this loss, listing the following: 1. 2021 was the beginning of the La Nina year which meant that IAD incurred considerable expenses due to flood remedial works. These costs were well in excess of the normal costs for running a vineyard. 2. In November 2021 the region had snow, which required abnormally large amounts of contract labour to remove the shoots to allow the vines to re-burst. 3. These events resulted in considerably higher expenses for IAD which it could not recover under the VMA. 1. In the 2022 financial year IAD recorded a nett loss of $578,236. Mr Jarrett explained that this loss was due to: 1. All sites being affected by excess rain and flood events, including a flood event at the Annangrove winery which destroyed the town of Eugowra. The flood caused a large amount of damage to that site, requiring significant labour expenses for its repair work. 2. Crop loss due to poor flowering and disease, leading to IAD having to "shoot in" and use increased amounts of chemical, fuel and labour costs. 3. Tariffs placed on Australian grapes by the Chinese government. The tariffs resulted in a significant reduction in the value of the sale of grapes to China. Consequently, this reduced production on the sites, causing crop removal which is labour intensive and thus IAD incurred additional labour costs. 1. In the 2023 financial year, IAD recorded a nett profit of $266,588. Mr Jarrett said that the profit was recorded because in 2023 the seasons returned to more average levels, meaning that IAD did not incur additional expenses for repairs and maintenance. 2. However, Mr Jarrett stated that because of IAD's accumulated losses in the preceding financial years, the profit was immediately absorbed into the losses; this was not a nett profit that was used to reduce IAD's nett losses on its balance sheet. 3. The IAD management noted that IAD has a current profit of $113,762 but a predicted nett loss of $36,253 this financial year. Mr Jarrett explained that this is because pruning must be conducted at the sites in June 2024, and labour rates are higher than anticipated when the VMA was executed at the start of the financial year. Consequently, IAD will incur significantly higher labour expenses as a direct cost over and above any labour expense it can invoice under the VMA. Capacity to Pay 1. In his first affidavit, Mr Jarrett conceded that it is not the case that IAD has no capacity to pay a penalty but rather, IAD "respectfully submits" that on the basis of Mr Jarrett's affidavit, annexures and sentencing submissions, it has a reduced capacity to pay any penalty imposed. 2. At the time Mr Jarrett swore his first affidavit, IAD had access to $8,951.28 in liquid funds. 3. IAD's access to liquid funds is through IAD's $300,000 overdraft with Rabobank. However, Mr Jarrett said that over the approximately 20 years that IAD has had an overdraft with Rabobank, its lowest recorded balance was approximately $274,943 at the end of the 2021 financial year. Mr Jarrett annexed IAD's overdraft statement summaries for the financial years ending in 2021, 2022 and 2023 (Annexure G). 4. Mr Jarrett stated that if the court imposed a large penalty, IAD: 1. Does not have access to any liquid funds to enable it to pay a penalty. 2. Cannot sell or otherwise dispose of its few assets because those assets are essential for IAD to continue performing its work. 1. Mr Jarrett said that if a large penalty were to be imposed, IAD would have to consider whether it could enter into a payment plan with State Revenue. 2. Mr Jarrett also made enquiries about whether Rabobank can loan any additional funds to IAD. 3. Consequently, Mr Jarrett finished his first affidavit by "respectfully" asking the court to exercise its discretion in favour of finding that IAD has a reduced capacity to pay any fine when determining the appropriate penalty. Second Affidavit (DX 2) 1. Mr Jarrett swore his second affidavit on 14 June 2024 and annexed Exhibit JJJ-1. Background 1. Mr Jarrett stated that he is a director of IAD and is "actively involved in its running and day to day operations". 2. IAD is a family run business who currently employs five workers, as described above in Mr Jarrett's first affidavit. Approach to Safety Prior to the Incident 1. Mr Jarrett asserted that IAD "has always taken safety seriously". 2. As part of IAD's "broad approach to safety", IAD had an Occupational Health and Safety (OHS) Policy and an OHS Handbook which applied to IAD's operations. These included IAD's requirements regarding risks on site, PPE, vehicle and mobile plant safety and the safe operation of tractors. The OHS Policy and OHS Handbook's tables of contents were annexed to Mr Jarrett's affidavit at pages 1 and 2 of Exhibit JJJ-1. 3. New workers were taken through IAD's OHS Handbook and were provided with information about other site safety requirements. In particular, as part of their induction, workers were told that "a helmet must be worn when riding the motor bikes". 4. A signed copy of IAD's "Form A Induction" sign-off for Mr Simms, including the direction to wear helmets, dated 3 August 2020 was annexed at p 3 of Exhibit JJJ-1. 5. Mr Jarrett said that a worker's competency in operating quad bikes was verified on site before workers could use the bikes on the farm. Mr Jarrett explained that this competency verification involved IAD observing the new worker operating a quad bike in a confined area to ensure that it was satisfied that the worker could operate the quad bike around the farm. The "confined observation" lasted approximately 20 minutes. After completing the "confined observation", IAD documented it as part of the worker's training records. A copy of the "IAD Training Record Register" for quad bike observation was at p 4 of Exhibit JJJ-1. 6. IAD "closely supervised" new workers for their first 12 months of employment at the farm. IAD had an informal buddy system so that new workers were always working with more experienced workers. For example, when Mr Steer joined IAD, for the first year he was almost always working with Mr Jarrett's son, Brendan, or other workers if he was not at the site. 7. Before the incident, IAD purchased full face motorcycle helmets for its workers to use when operating the quad bikes. However, Mr Jarrett said that IAD accepts that it should have made the existence of these helmets better known to its workers and that it should have better enforced the requirement for workers to always wear them on the quad bikes. 8. IAD conducted informal toolbox talks regularly on site. These included: 1. Daily start meetings with IAD workers about the day's tasks and safety matters relevant to those tasks. 2. Annual refreshers for workers, covering PPE requirements and the use of equipment. 1. Additionally, IAD undertook informal site wide risk assessments. From these risk assessments, IAD: 1. Implemented the use of electric chainsaws that cut out when placed on the ground and introduced a minimum requirement of 10 years of experience handling chainsaws before workers could use them on IAD's sites. 2. Only uses hydraulically driven slashers, providing significantly greater safety for workers. 3. Abolished the use of "unacceptably dangerous chemicals" in the vine industry, such as spray seed. Approach to the Risk Following the Incident 1. Mr Jarrett said that IAD made a number of changes to address the risk following the incident. In particular, IAD: 1. Installed roll-over protection on all its quad bikes. 2. Attached fit-for-purpose helmets to each quad bike. 3. Designated and enforced "no-go zones" on the farm. 4. Trained all IAD workers on those no-go zones. 1. IAD also "enhanced" its induction process, including for labour hire workers. The enhanced induction process now contains more information about all aspects of IAD's approach to safety, including the use of quad bikes. A copy of IAD's enhanced worker induction record is annexed at p 5 of Exhibit JJJ-1. 2. After the incident, IAD implemented a quad bike Safe Work Procedure (SWP). All IAD workers are trained in the SWP, and it is the only authorised way that IAD permits the use of quad bikes. A copy of the SWP is annexed at pp 6 and 7 of Exhibit JJJ-1. 3. Upon IAD purchasing fit for purpose helmets for its quad bikes, IAD convened a toolbox talk to take the workers through the use of the helmets and to reinforce the requirement that such helmets were to be worn at all times when operating the quad bikes. A copy of this toolbox talk is annexed at p 8 of Exhibit JJJ-1. 4. After explaining the new helmets to the workers, IAD re-trained its workers on the quad bikes and required each worker to undergo an enclosed space operating test to satisfy IAD of their competency. 5. With respect to the no-go zones established by IAD, to enable workers to continue checking these areas, IAD purchased drones. IAD's workers were trained on drone operation, meaning that they can check the no-go zones without needing to physically enter the area. Corporate Citizenship 1. Mr Jarrett stated that IAD has been a long-term supporter of the community and has made donations to various groups and charities. A spreadsheet setting out some of IAD's donations for the years 2021-2024 is annexed at pp 10-13 of Exhibit JJJ-1. 2. Mr Jarrett also described the non-financial contributions that IAD makes to the community, such as hosting researchers and students. It also makes its facilities available for community organisations and industry conferences. Support for Mr Simms 1. Mr Jarrett said that his family, workers and himself "were all very concerned for Mr Simms". 2. After the incident IAD: 1. Visited Mr Simms in hospital and at his home. 2. Regularly called Mr Simms to see how he was and whether he needed anything. 3. Liaised with Mr Simms's labour hire employer about whether IAD could find suitable alternative employment. However, Mr Jarrett said that "unfortunately" IAD could not find another suitable role for Mr Simms given the nature of IAD's work. 1. Mr Jarrett explained that IAD is in "a close and small community" and that consequently he occasionally sees Mr Simms in town. Mr Jarrett considers himself to have a "very good relationship" with Mr Simms, saying that they stop to chat whenever they see each other around. Remorse and Contrition 1. Mr Jarrett described IAD as "like a family". Mr Jarrett's children work for IAD and Mr Jarrett and Ms Jarrett see their workers as part of their "extended family". Consequently, Mr Jarrett said that this makes it "especially painful and difficult for IAD" when one of their workers is hurt. 2. As IAD's general manager, Mr Jarrett is "truly sorry for the pain and hurt caused to Mr Simms and his family" and he "deeply regret[s] that the incident occurred". Consideration 1. I have had regard to the objects in s 3 of the WHS Act and the purposes of sentencing set out in s 3A of the Crimes (Sentencing Procedure) Act 1999 (NSW) (CSP Act). Objective Seriousness of the Offence 1. The proportionality principle requires that a sentence should neither exceed nor be less than the gravity of the crime having regard to the objective circumstances: Veen v The Queen (No. 2) [1988] HCA 14; (1988) 164 CLR 465 at 472, 485-6, 490-1 and 496. At common law, the term "objective circumstances" was used to describe the circumstances of the crime. The gravity of the offence was assessed by reference to its objective seriousness: R v McNaughton [2006] NSWCCA 242; (2006) 66 NSWLR 566 at [15]. 2. The task requires the court to consider where in the range of conduct covered by the offence the conduct of the offender falls: Baumer v R [1988] HCA 67; (1988) 166 CLR 51 at 57. This assessment will generally indicate the appropriate range of sentences available which will reflect the objective seriousness of the offence committed, and set the limits within which a sentence proportional to the criminality of the offender will lie: BW v R [2011] NSWCCA 176 at [70]. 3. In Muldrock v The Queen [2011] HCA 39; (2011) 244 CLR 120 at [27] the High Court said: "The objective seriousness of an offence is to be assessed without reference to matters personal to a particular offender or class of offenders. It is to be determined wholly by reference to the nature of the offending." 1. The sentencing judge should take into account not only the conduct which actually constitutes the crime, but also such of the surrounding circumstances as are directly related to that crime and are properly regarded as circumstances of aggravation or mitigation: R v Wilkinson (No. 5) [2009] NSWSC 432 at [61]. 2. The existence of a reasonably foreseeable risk to safety that is likely to result in serious injury or death is a factor relative to the gravity of the offence: Capral Aluminium Limited v WorkCover Authority of New South Wales [2000] NSWIRComm 71; (2000) 49 NSWLR 610 at [82]. The question of foreseeability of the risk is to be determined objectively. 3. The court must identify all the factors that are relevant to the sentence, discuss their significance and then make a value judgment as to what is the appropriate sentence given all the factors of the case: Muldrock. This approach to sentencing, known as the "instinctive synthesis" approach, involves the making of a global judgment without any attempt to state precisely how any given factor has influenced the judgment. 4. The Court of Criminal Appeal has examined the sentencing process with regard to the WHS Act in the matter of Nash v Silver City Drilling (NSW) Pty Limited; Attorney General for NSW v Silver City Drilling (NSW) Pty Limited [2017] NSWCCA 96. Justice Basten at [34], under the heading "Assessment of Risk" said: "The sentencing judge commenced his consideration with the proposition that 'greater culpability attaches to the failure to guard against an event the occurrence of which is probable rather than an event the occurrence of which is extremely unlikely'. However the truth of that proposition depends upon other considerations including (a) the potential consequences of the risk, which may be mild or catastrophic, (b) the availability of steps to lessen, minimise or remove the risk, and (c) whether such steps are complex and burdensome or only mildly inconvenient. Relative culpability depends on assessment of all those factors." 1. Further at [42] his Honour continued: "The culpability of the Respondent is not necessarily to be determined by the remoteness of the risk occurring, nor by a step‑by‑step assessment of the various elements. Culpability will turn upon an overall evaluation of various factors, which may pull in different directions. Culpability in this case is reasonably high because, even if the [event] which occurred might not be expected to occur often, the seriousness of the foreseeable resultant harm is extreme and the steps to be taken to avoid it, which were not even assessed, were straightforward and involved only minor inconvenience and little, if any, costs." 1. At [53] his Honour dealt with the proper approach to considering the objective seriousness of offences under the WHS Act, saying: "It is important to note that the risk to be assessed is not the risk of the consequence, to the extent that a worker is in fact injured, but is the risk arising from the failure to take reasonably practicable steps to avoid the injury occurring. To discount the seriousness of the risk by reference to the unlikelihood of injury resulting is apt to lead to error. The conduct in question is the failure to respond to a risk of injury, conduct which will be more serious, the more serious the potential injuries, whether or not they are likely to materialize. The objective seriousness of the conduct will also be affected by the ease with which mitigating steps could have been taken." 1. My findings about the defendant's level of culpability are based upon the following: 1. The risk of a worker being injured on a quad bike was foreseen by IAD, although not enough was done to minimise the risk. Further, the risk was foreseeable, by reason of the guidance material. 2. The likelihood of the risk occurring was significant, particularly where a quad bike had to be manoeuvred quickly in the area of a backburn. 3. The potential consequences of the risk were death or serious injury. 4. Steps were available to minimise the risk, and appropriate steps were taken shortly after the incident by IAD. 5. There was no particular burden or inconvenience of implementing the steps. 6. A serious injury was caused to Mr Simms. He can no longer do the agricultural work required by IAD. 7. The maximum penalty for the s 19(1) offence is a fine of $1,766,130, and the maximum penalty for the s 46 offence is a fine of $117,810. These penalties reflect the legislature's view of the seriousness of the offences. 8. Quad bikes operate on uneven terrain, so it is important for appropriate measures to be taken to minimise their inherent risks. 1. I find that the level of culpability of IAD is in the mid range. Deterrence 1. The penalty imposed in relation to this offence must provide for general deterrence. Employers must take the obligations imposed by the WHS Act very seriously. The community is entitled to expect that both small and large employers will comply with safety requirements. General deterrence is a significant factor when safety obligations are breached: Bulga Underground Operations Pty Limited v Nash [2016] NSWCCA 37; (2016) 93 NSWLR 338 at [180]. 2. The penalty must reflect the need for specific deterrence. IAD is still conducting a business. Its operations involve agricultural services and the continuing engagement of workers. Aggravating Factors 1. The injury, emotional harm, loss or damage caused by the offence was substantial: s 21A(2)(g) CSP Act. Mitigating Factors 1. IAD has no record of previous convictions: s 21A(3)(e) CSP Act. 2. IAD is otherwise of good character: s 21A(3)(f) CSP Act. The steps which it took after the incident demonstrate this. IAD has been in business since 1997. 3. IAD is unlikely to re-offend: s 21A(3)(g) CSP Act. 4. IAD has good prospects of rehabilitation: s 21A(3)(h) CSP Act. It has taken positive steps to guard against the risk of an incident such as this ever happening again. It has brought its equipment, documentation and procedures into line with those which, on all the evidence, should have been in place before this incident occurred. 5. IAD has shown remorse for the offence: s 21A(3)(i) CSP. It has provided evidence that it has accepted responsibility for its actions and has acknowledged that the injury to Mr Simms was caused by its actions. 6. IAD entered a plea of guilty: s 21A(3)(k) CSP Act. The court must take into account the fact that the offender has pleaded guilty, when the offender pleaded guilty, and the circumstances in which the offender indicated an intention to plead guilty: s 22(1) CSP Act. It is appropriate to give IAD a 25% discount for an early plea. 7. IAD gave assistance to law enforcement authorities: s 21A(3)(m) CSP Act. It cooperated at all times with the prosecutor and provided all documents requested in a prompt fashion. Capacity to Pay a Fine 1. I am required to have regard to s 6 of the Fines Act 1996 (NSW) before imposing a fine. Where an offender seeks to have a fine reduced on the basis of a limited capacity to pay, it bears the evidentiary onus of convincing the court that it should exercise its discretion to limit the amount of the fine. The offender's capacity to pay is relevant but not decisive: Mahdi Jahandideh v The Queen [2014] NSWCCA 178 at [16]. A substantial fine may still be warranted as a result of the seriousness of the offence and the need for general deterrence. 2. In Unity Pty Limited v SafeWork NSW [2018] NSWCCA 266 at [79] the Court of Criminal Appeal said: "First, and more generally, questions of specific deterrence should take into account the size and scope of the operations of the defendant; a fine which may be crippling to a small business may have virtually no impact on the financial operations of a large corporation. The maximum penalty for the offence is undoubtedly set having regard to such a factor. Secondly, the Court is required to have regard to 'the means' of the defendant, pursuant to s 6 of the Fines Act 1996." 1. The business of IAD is intimately concerned and integrated with the ownership of the sites by Mr and Mrs Jarrett. The selection of a figure to be charged by IAD each year therefore does not necessarily represent an appropriate commercial approach to costs. It is artificial to say that IAD has been running at losses when any arms-length business would have been charging more to take account of seasonal difficulties. 2. The balance sheet for the year ended 30 June 2023 (DX 1, p 94) shows that IAD has undistributed tax losses of $1,139,041. As counsel for the prosecutor pointed out, the business is still trading in spite of poor results over the years and the high overall losses. No evidence was placed before the court of the ability of IAD to fund a fine from sources other than its own meagre cash reserves. The continuing operation of IAD, and the significant accumulated losses, suggest that there is funding available from a related entity (probably Mr and Mrs Jarrett who are substantial landholders) to which IAD could have recourse to pay a fine. There will be no reduction in the fine because of the capacity to pay issue. Costs 1. The parties have agreed to an order that the defendant is to pay the prosecutor's costs. Penalty 1. The orders in District Court Proceeding 2022/387576 are: 1. Integrated Agricultural Developments Pty Ltd is convicted. 2. The appropriate fine is $240,000 but that will be reduced by 25% to reflect the early plea of guilty. 3. Order Integrated Agricultural Developments Pty Ltd to pay a fine of $180,000. 4. Order pursuant to Section 122(2) of the Fines Act 1996 (NSW) that 50% of the fine is to be paid to the prosecutor. 5. Order Integrated Agricultural Developments Pty Ltd to pay the prosecutor's costs. 1. The orders in District Court Proceedings 2022/387552 are: 1. Integrated Agricultural Developments Pty Ltd is convicted. 2. The appropriate fine is $20,000 but that will be reduced by 25% to reflect the plea of guilty. 3. Order Integrated Agricultural Developments Pty Ltd to pay a fine of $15,000. 4. Order pursuant to Section 122(2) of the Fines Act 1996 (NSW) that 50% of the fine is to be paid to the prosecutor. 5. Order Integrated Agricultural Developments Pty Ltd to pay the prosecutor's costs. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 27 June 2024