Industrial Court of New South Wales CITATION: Inspector Clothier v Malcolm McIntyre trading as Corambie Pastoral Company and another [2007] NSWIRComm 40 Prosecutor: Inspector Helen Clothier PARTIES: First defendant: Malcolm McIntyre trading as Corambie Pastoral Company Second defendant: Tracy McIntyre trading as Corambie Pastoral Company FILE NUMBER(S): IRC 5630 and 5631 of 2005 CORAM: Backman J CATCHWORDS: Occupational health and safety - sentencing under s 10(2) of the Occupational Health and Safety Act 2000 - pleas of guilty entered - contract carrier injured when his hand and arm were pulled into the rotating shaft of an auger which was used to transfer grain from a grain bin - injured contract carrier operated the auger without authorisation - defendants, husband and wife, in partnership operated a farm - auger's moving parts at time of the accident were unguarded - no risk assessment had been done prior to the offences - risk of entanglement obvious, foreseeable and likely to have serious consequences - safety system in place prior to offences seriously deficient - deterrence considered and applied - personal factors considered - application of s 10 Crimes (Sentencing Procedure) Act 1999 considered and rejected - application of s 6 Fines Act 1996 considered - application for order under s 116 of the Act considered and rejected - totality principle applied - penalties - orders Crimes (Sentencing Procedure) Act 1999 LEGISLATION CITED: Fines Act 1996 Justice of the Peace Act 2002 Occupational Health and Safety Act 2000 Capral Aluminium Ltd v WorkCover Authority of New South Wales (2000) 49 NSWLR 610 Department of Mineral Resources of NSW (Chief Inspector Terrey) v A M Hoipo & Sons Pty Ltd (2000) 99 IR 137 Ferguson v Nelmac Pty Limited (1999) 92 IR 188 Genner Constructions Pty Limited v WorkCover Authority of New South Wales (Inspector Guillarte) (2001) 110 IR 57 Graincorp Operations Ltd v Inspector Mason (2006) 157 IR 103 Haynes v CI & D Manufacturing Pty Limited & Anor (1995) 60 IR 455 Inspector Cherie McGrath v Anglican Retirement Villages Diocese of Sydney 20363079/04/2 CASES CITED: Inspector Chris Chadwick v B H MacLachlan (NSW) Pty Ltd [2004] NSWIRComm 331 Inspector Green v Camilleri Properties Pty Ltd (2006) 152 IR 156 Maddaford v CSR and Mulgoa Quarries Pty Ltd [2004] NSWIRComm 337 Manpac Industries Pty Ltd (formerly t/a Pacific Concrete & Quarries Pty Ltd) v WorkCover Authority of NSW (Inspector Glass) (2001) 106 IR 435 Morrison v Powercoal Pty Ltd (2003) 130 IR 346 R v Thompson; R v Houlton (2000) 49 NSWLR 383; 115 A Crim R 104 WorkCover Authority of New South Wales (Inspector Ankucic) v Mc Donald's Australia Limited and Anor (2000) 95 IR 383 WorkCover Authority of New South Wales (Inspector Downie) v Menzies Property Services Pty Ltd (2004) 136 IR 449 WorkCover Authority of New South Wales (Inspector Robert Mayell) v D J Gleeson Pty Ltd [2006] NSWIRComm 363 HEARING DATES: 29/09/2006 DATE OF JUDGMENT: 28 February 2007 Prosecutor: Mr M Cahill, of counsel Solicitors: DLA Phillips Fox LEGAL REPRESENTATIVES: First and second defendants: Mr J Stanton, of counsel Solicitors: Booth Brown Samuels & Olney JUDGMENT: - 19 - INDUSTRIAL COURT OF NEW SOUTH WALES CORAM: BACKMAN J Wednesday, 28 February 2007 Matter No IRC 5630 of 2005 INSPECTOR HELEN CLOTHIER v MALCOLM MCINTYRE TRADING AS CORAMBIE PASTORAL COMPANY Prosecution pursuant to s 10(2) of the Occupational Health and Safety Act 2000 Matter No IRC 5631 of 2005 INSPECTOR HELEN CLOTHIER v TRACY MCINTYRE TRADING AS CORAMBIE PASTORAL COMPANY Prosecution pursuant to s 10(2) of the Occupational Health and Safety Act 2000 JUDGMENT [2007] NSWIRComm 40 1 The defendants Malcolm McIntyre and Tracy McIntyre have each pleaded guilty to one offence under s 10(2) of the Occupational Health and Safety Act 2000. The defendants are husband and wife and operate a farming property in partnership under the registered trading name of Corambie Pastoral Company. The property is located at Narromine in New South Wales. 2 Each defendant has been charged with identical breaches of s 10(2) of the Act, which have been set out in applications for order as follows: [T]he defendant, being a controller of plant, namely an orange coloured 16 hp petrol-powered jet stream auger ( auger ) used by people other than employees of the defendant, including Larry Luther ( injured worker ), at work at the premises of the defendant being premises not occupied only as a private dwelling, failed to ensure that the auger, which was controlled in the course of a trade, business or other undertaking (whether for profit or not) of the defendant, was safe and without risks to health when properly used in that as the injured worker was withdrawing his right hand from the auger after having tightened the throttle control of the auger the injured worker's shirt sleeve of his right arm became entangled around the unguarded drive shaft of the auger dragging his arm around the drive shaft causing serious injuries including fractures to bones in his right hand, and tendons to be ripped out of his right arm which injuries prevented the injured worker from returning to his pre injury duties for approximately 12 months by reason that: 1 The drive shaft of the auger was not guarded so as to prevent the risk of entanglement 2 The motor and drive pulley of the auger were not guarded so as to prevent the risk of entanglement. 3 The partnership entered into an arrangement with AWB GrainFlow (AWB) whereby AWB collected grain including wheat grain from the property between 13 November 2003 to 13 December 2003. Larry Luther was engaged by AWB as a truck driver contract carrier for farm pick-ups on 13 November 2003. The engagement involved Mr Luther travelling to properties to collect grain for AWB and then delivering it to AWB's site for storage. Mr Luther arrived at the defendants' property on 15 November 2003 in order to collect grain. Mr McIntyre at that time assisted him and operated the auger to load Mr Luther's truck with the grain. On occasions the auger had to be moved. On other occasions Mr Luther turned off the auger. Mr Luther attended the defendants' property over the next two days to collect grain. Each time Mr McIntyre and one other unidentified person operated the auger and Mr Luther occasionally turned it off. 4 On 18 November 2003 Mr Luther returned to the property with Ken Schneider (also engaged by AWB as a truck driver) in order to collect wheat grain. Both men drove semi-trailers. Mr Luther decided to collect the grain from a bin which had the number "3" painted on its side. The auger's input end was directly under the bin. Mr Luther positioned his truck so that his trailer was underneath the auger's outlet which was raised into the air about 5.8 metres above the trailer. The length of the auger between the outlet and inlet was about 12.3 metres. Mr Schneider meanwhile drove his truck to another bin in which grain was stored. This bin was some 150 metres from the No. 3 bin. 5 Mr Luther started the auger but as soon as it was "under load" the engine dropped back to an idle. He "revved" the engine but again the auger dropped back to an idle. It was common ground between the parties in these proceedings that Mr McIntyre had issued explicit instructions, of which Mr Luther was aware, that no one except Mr McIntyre was to operate the auger. Mr Luther, ignoring those instructions, decided that there was a problem with the throttle and after obtaining a screwdriver from his truck he proceeded to tighten a screw on the throttle. When he attempted to pull up his right hand his shirtsleeve became entangled on a bolt on the shaft collar on the side of the auger. His arm was dragged around the shaft of the auger and his head was pressed against the barrel of the auger. Eventually he was able to turn off the machine by operating a cut-off switch on the motor with his free hand. He also managed to attract Mr Schneider's attention who by chance saw Mr Luther while he was in the cabin of his truck completing paper work. Mr Schneider was able to free Mr Luther by using scissors to cut off Mr Luther's shirt. 6 Mr Luther suffered serious injuries including fractured bones in his right hand and ripped tendons. He has since undergone some four or five operations including skin grafts and tendon replacements, and at the time of these proceedings may be required to undergo further operations. He has also lost the use of two of his fingers and was unable to return to his normal duties for 12 months. 7 The risk to safety is described in the charges as the risk of entanglement in the unguarded drive shaft, motor and drive pulley of the auger. The evidence tendered during the sentence proceedings which includes the factual background set out in a statement of facts and accompanying photographs taken a few hours after the accident, reveals that Mr Luther's shirt, right hand and arm were pulled into the rotating shaft of the auger attached to a roller from which protruded bolt heads and other metal pieces. None of this area was guarded. Although Mr Luther was apparently aware of Mr McIntyre's instruction not to operate the auger, the reality was that workers were granted access to the property for the purpose of loading grain using the auger, the moving parts of which were unguarded. The risk of entanglement in these circumstances was both obvious and reasonably foreseeable. This places the offence in a serious category: Capral Aluminium Ltd v WorkCover Authority of New South Wales (2000) 49 NSWLR 610 at [81] - [82] 8 The risk of entanglement was also likely to have serious consequences as evidenced by the very serious injuries sustained by Mr Luther. This factor exacerbates the objective seriousness of the offence: Maddaford v CSR and Mulgoa Quarries Pty Ltd [2004] NSWIRComm 337 at [17] [18] [23];.WorkCover Authority of New South Wales (Inspector Ankucic) v McDonald's Australia Limited and Anor (2000) 95 IR 383 at 428; Morrison v Powercoal Pty Ltd (2003) 130 IR 346 at [32]. 9 General deterrence has particular significance in the circumstances of these offences. Not infrequently, prosecutions under the occupational health and safety legislation involve farming machinery and equipment used in remote farming locations, by inexperienced, uninstructed and unsupervised workers often with tragic results. I endorse the comments of his Honour Justice Haylen on the necessity for the rural community to meet its safety obligations. In Inspector Chris Chadwick v B H MacLachlan (NSW) Pty Ltd [2004] NSWIRComm 331 at [39]: In this case, there is a proper role for considerations of general and specific deterrence. The evidence demonstrates the slow awakening of the rural community to its obligations under the Act and the need to rethink its everyday work practices. Performing work on the same basis that it has been traditionally done over many years will no longer meet those obligations. The defendant continues to be an employer operating two very large properties. I accept that the defendant had in operation a number of safety practices but they were deficient. It is in those circumstances that specific deterrence has a role to play. 10 Specific deterrence also falls for application here. The partnership is an ongoing concern utilising contract labour and involving the operation of the property's machinery and equipment, by farming management: see Capral Aluminium at [77]. 11 Prior to the offences the defendants had in place a system intended to implement safe work practices for the protection of the farm workers and other personnel visiting the property in either a work-related or non work-related capacity. The defendants have frankly conceded in relation to this system that it suffered from a number of deficiencies. Mr Luther for example had not been inducted by the defendants in relation to the prevailing work practices on the property before his accident. He lacked both familiarity and experience in relation to the operation of the auger. The defendants also failed to provide any information, instruction or direction to Mr Luther concerning the use or operation of the auger. I note in relation to this last concern that the evidence appears to be that Mr Luther although not the direct recipient of Mr McIntyre's instruction not to operate the auger, was nevertheless aware of the instruction before his accident. 12 The most obvious deficiency in the system was the total absence of any guarding on the auger. This is despite the evidence which suggests that the auger was frequently and routinely operated whenever grain was collected from the grain bin. This deficiency is, of course, at the crux of the offences to which the defendants have pleaded guilty. I emphasise it to highlight the system in place, such as it was, prior to the offences. 13 The prosecutor also contends that the occupational health and safety policy, which the defendants advance as an important component of the safety system in place prior to the offence, was only a draft policy and apparently drawn from a model policy used by Mrs McIntyre in her presentation of occupational health and safety training courses. Furthermore, the prosecutor asserts that no explanation has been offered to the Court by the defendants as to why the policy was not fully promulgated prior to the accident. Nor has any explanation been forthcoming from the defendants for the failure to undertake a risk assessment of the auger and its operation in accordance with the terms of the draft policy. 14 The affidavit of Mrs McIntyre confirms that the occupational health and safety policy was in draft form prior to, and at the time of the offences. Mrs McIntyre has also deposed that she was responsible for the implementation of safety matters which included the guarding of the auger, which was not done. Mrs McIntyre frankly acknowledges that, "the failure to have the auger guarded was the cause of the accident." 15 The draft policy is exhibited to the affidavits of both defendants. It is not entirely clear from the affidavits, or from the terms of the policy itself the extent, if any, of the policy's implementation at the property prior to the offences. A paper system, without more has no practical impact on ensuring safety. Both defendants assert in their respective affidavits that the procedures set out in the occupational health and safety policy, "...were in place prior to the accident." A reading of the policy suggests that monthly occupational health and safety meetings were instituted. An exhibit to the defendants' affidavits contains three one-page records of occupational health and safety meetings that apparently took place at the property on 1 September 2003, 8 October 2003 and 5 November 2003. I am prepared to find based on the defendants' assertions and the minutes of the OH&S meetings exhibited to the affidavits that the defendants had in place prior to the offences a safety system but it was deficient as demonstrated by the matters outlined above. To the extent however that some safety policies were implemented at the property prior to the offence this will operate in the defendants' favour. 16 Another feature of the evidence which heightens the objective seriousness of the offences to which I should refer at this point concerns the simple straight-forward measures available to the defendants prior to the offences which would have eliminated the risk of entanglement. I refer of course to the guarding of the auger's moving parts, a measure which was attended to shortly after the accident and which could have been taken at any time before the offences. 17 I turn now to consider a number of personal factors which operate in favour of the defendants. First, it is conceded by the prosecutor that both defendants entered pleas of guilty at an early stage of the proceedings. They are therefore entitled to a discount of their sentences in accordance with the principles in R v Thompson; R v Houlton (2000) 49 NSWLR 383; 115 A Crim R 104. I consider the appropriate discount for the utilitarian value of the pleas is 25 per cent. 18 The defendants also cooperated with WorkCover during that authority's investigation into the accident of 18 November 2003. In addition, by reason of the pleas of guilty, and, as a separate consideration from utilitarian principles, the defendants have also exhibited contrition and remorse. All these matters will be taken into account in both defendants favour in the assessment of penalties. 19 The defendants shortly after the accident implemented a number of impressive measures which are set out in the various documents exhibited to their respective affidavits. This documentation reveals, for example, that the defendants purchased a fertiliser shed in the sum of $17,168 which apparently dispenses with the need to operate the auger. Another item purchased was a "Motherbin". According to Mr McIntyre's affidavit this item came equipped with a covered auger with no exposed parts thereby eliminating the risk of any further injuries to safety. The prosecutor has submitted in relation to the purchase of the item that if the defendants expended a substantial sum of money in order to improve occupational health and safety on the property following the accident, it does not assist them because the cost of complying with the legislation after the commission of an offence cannot be said to be moneys spent in mitigation of the penalty imposed. 20 I understood this submission to be directed more towards pre-empting any submission which might be made by the defendants that the moneys expended in the purchase of the Motherbin can be offset or traded-off against the penalties imposed. I agree that the moneys used to purchase an item directed towards ensuring safety may not be offset against the quantum of any penalty imposed. Nevertheless, the conventional approach, which I take, is that the purchase of an item for the purpose of obviating or eliminating risks to safety following a breach of safety legislation is a subjective factor that operates to mitigate any penalty that may be imposed. 21 The prosecutor conceded that it is open to the Court to have regard to the defendants' antecedents as providing evidence of good industrial citizenship. The defendants submit that, but for the commission of the offences, they are persons of good character. A number of references tendered during the sentence proceedings give testament to the excellent reputation both defendants hold locally, particularly as to their involvement in promoting safety issues, as well as their involvement in community and charitable organisations in the Narromine community. 22 In the recent Full Bench decision of Graincorp Operations Ltd v Inspector Mason (2006) 157 IR 103, the issue of good corporate citizenship (or good industrial citizenship) was explored in the context of prior convictions. At [37]-[40], the Full Bench said: [37] The appellant also contended under this second ground of appeal that his Honour erred in holding that it was not a good corporate citizen which disentitled it to any mitigation of the sentence. [38] His Honour's finding that the appellant has not shown good corporate citizenship and was therefore not entitled to a discount on sentence was based upon the evidence that the appellant had eight prior convictions. We perceive no error in this approach. The absence or presence of prior convictions can appropriately be taken into account on sentence either in mitigation or as a basis for withholding leniency: see, in relation to the absence of the prior convictions, Genner Constructions Limited v WorkCover Authority of New South Wales (Inspector Guillarte) (2001) 110 IR 57 at [74]. The question of good corporate citizenship may be considered by reference to an appropriate assessment of prior convictions: see, for example, Boland J's comment on the issue in Inspector Hannah v Graincorp Operations Limited [2005] NSWIRComm 427 at [41] where his Honour said: [41] The defendant now has nine convictions against its name in a space of six years. The guilty pleas in relation to the charges before me will mean eleven convictions. It is not a simple matter, however, of pointing to the number of prior convictions and arriving at the conclusion the defendant is not a good corporate citizen. Of course, if the Court, after making a proper assessment of the prior convictions and other relevant factors, comes to the view that the defendant has a propensity to re-offend or is deserving of "condign punishment" to deter it from committing further offences, it would be inconsistent with such a finding to conclude that the defendant was a good corporate citizen in the context of its responsibilities for occupational health and safety." [39] Later, in Boland J's judgment (at [47]), his Honour expressed agreement with Staff J's approach to the issue in the present case. Clearly, that approach which involved a detailed examination of the appellant's prior convictions was not founded upon a consideration that a propensity to re-offend may result in an increase in sentence, which is impermissible in the absence of statutory authority, but rather as a basis for his Honour's finding that the appellant was not entitled to a discount. Such an approach is in accordance with prevailing authority. In Baumer v The Queen (1988) 166 CLR 51 at 58, for example, the High Court, in commenting upon a sentencing judge's observation that the applicant's "... literally appalling offence" had increased the seriousness of the offence said (at 57, 58): If this means no more than that such a record would make it difficult to view the circumstances of the offence or of the offender with any degree of leniency then, of course, such a remark would be understandable and unobjectionable. It would clearly be wrong if, because of the record, his Honour was intending to increase the sentence beyond what he considered to be an appropriate sentence for the instant offence. Similarly, his Honour's observation that people with the propensity of the applicant to continue to commit driving offences must be "kept away" for the protection of the public is open to misunderstanding. Propensity may inhibit mitigation but in the absence of statutory authority it cannot do more. [40] We would add for completeness, that we do not consider that there was any compounding of this factor by his Honour considering both 'corporate citizenship' and prior convictions. In this matter they are related issues and both went to the question of leniency. 23 In Genner Constructions Pty Limited v WorkCover Authority of New South Wales (Inspector Guillarte) (2001) 110 IR 57 at [74], the Full Bench, in considering the relationship between the absence of prior convictions and good corporate reputation, said (at [74]): [74] Certain subjective factors in favour of the appellant arise for consideration in the assessment of sentence. As has been mentioned, the appellant has no prior convictions under the Act and we particularly note that it has been operating for a period of over 20 years in an industry which presents inherent dangers and is notorious for occasioning injuries to workers. The appellant's record, combined with other evidence, demonstrates a generally conscientious and serious approach to achieve the safety of its employees and other persons on its worksites. We also observe that the appellant has further refined its safety procedures since the accident, producing a set of guidelines for supervisors and sub-contractors, implementing additional structured training for its workers and defining the line of command at its worksites. Those actions are commendable and in accordance with the appellant's obligations under the Act; they should receive due recognition in mitigation of penalty. 24 In the present proceedings the defendants have no prior convictions. They also have good safety records and are held in high esteem by their local community in relation to their work and involvement in safety issues pertaining to rural properties and wider community issues. Adopting the principle in Genner it follows from these matters that the defendants have displayed good industrial citizenship which will be duly acknowledged in mitigation of their penalties. 25 The defendant, Mrs McIntyre asked the Court to consider the application of s 10 of the Crimes (Sentencing Procedure) Act 1999 (CSP Act). The basis of the application is that Mrs McIntyre is a Justice of the Peace and she is concerned that if she incurs a conviction for the offence to which she has pleaded guilty that she "may" lose her "commission" as Justice of the Peace. 26 The prosecutor opposed the application emphasising the serious nature of the offence and the relevant principles in relation to the application of s 10 in the context of occupational health and safety legislation. One notable authority in this regard is the Full Bench in WorkCover Authority of New South Wales (Inspector Downie) v Menzies Property Services Pty Ltd (2004) 136 IR 449 at [57] of that judgment the Full Bench said: [57] We acknowledge that the demands of the Local Court often preclude lengthy deliberation prior to the making of a decision. Nevertheless, it is critical when determining a sentence to clearly distinguish those factors which are special considerations in sentencing, and in particular those which warrant the application of s 10 of the Crimes (Sentencing Procedure) Act . In our view, the utterance of the above words alone is insufficient, in our view, to justify the making of an order under s 10 of the Crimes (Sentencing Procedure) Act . Given the existence of a clear line of authority establishing that such orders are available only in limited circumstances, any decision to make such an order must necessarily include an examination of the relevant circumstances and an explanation as to why those circumstances fall within the limited class of circumstances contemplated by the established authorities. The Full Bench in Profab Industries expressly stated (at [26]) that "...when a defendant seeks [the exercise of the discretion under s 10] cogent reasons must, in our view, be provided by the defendant for such exercise and also by the judge acceding to that submission." 27 It may be convenient to extract below the relevant portion of s 10 of the CSP Act: (1) Without proceeding to conviction, a court that finds a person guilty of an offence may make any one of the following orders: (a) an order directing that the relevant charge be dismissed, (b) an order discharging the person on condition that the person enter into a good behaviour bond for a term not exceeding 2 years, (c) an order discharging the person on condition that the person enter into an agreement to participate in an intervention program and to comply with any intervention plan arising out of the program. ..... (3) In deciding whether to make an order referred to in subsection (1), the court is to have regard to the following factors: (a) the person's character, antecedents, age, health and mental condition, (b) the trivial nature of the offence, (c) the extenuating circumstances in which the offence was committed, (d) any other matter that the court thinks proper to consider. 28 In my view the application of the section is inappropriate to the present circumstances. First the offences are very serious. The risk of entanglement was obvious, foreseeable and could have been eliminated by the simple, inexpensive remedy of placing guards over the auger, a remedy which the defendants promptly implemented following the accident. The deterrent factor must also play a prominent role by reason of the need to direct attention to the wider farming community concerning the dangers associated with farm equipment and machinery used by inexperienced and unsupervised personnel often in remote locations. 29 Secondly in relation to Mrs McIntyre, the evidence has revealed that she was instrumental in drafting the occupational health and safety policy which was to apply to the property. The evidence was not clear as to the extent of implementation of the policy at the time of the offences but the circumstances suggest that it had not been fully implemented at the time of the accident, and that the prevailing system of safety was seriously deficient in many respects. These conclusions follow from a number of factors which include the absence of induction, instruction, supervision and direction to Mr Luther in relation to the operation of the auger. In addition the defendants did not perform a risk assessment of the hazards associated with the operation of the auger, and, the auger's moving parts were unguarded. 30 Thirdly the defendants have not relied upon any evidence in support of the assertion that in the event of a conviction Mrs McIntyre "may" lose her "...commission as a Justice of the Peace". In any event, a brief excursus into the relevant provisions of the Justice of the Peace Act 2002 (JP Act) does not tend to confirm the assertion. Section 9 of that Act which deals with the circumstances in which a person comes to hold office provides, where relevant: 9 Vacation of office (1) A person ceases to hold the office of a justice of the peace if the person: ..... (c) is removed from office by the Governor under subsection (2). (2) The Governor may at any time, on the recommendation of the Minister, remove a justice of the peace from office. (3) Without limiting subsection (2), the Governor may at any time, on the recommendation of the Minister, remove a justice of the peace from office: ..... (c) if the person is convicted in New South Wales of an offence that is punishable by imprisonment for 12 months or more or is convicted elsewhere than in New South Wales of an offence that, if committed in New South Wales, would be an offence so punishable , or (d) in any other circumstances prescribed by the regulations. 31 Regulation 6 of the Justices of the Peace Regulation 2003 provides where relevant: 6 Additional circumstances for removal from office For the purposes of section 9 (3) (d) of the Act, a person may be removed from office as a justice of the peace in the following circumstances: ..... (b) if the Minister is of the opinion that the person does not satisfy or no longer satisfies the criteria for appointment as a justice of the peace, (c) if the Minister is of the opinion that the person has failed to carry out properly the person's functions as a justice of the peace. 32 It seems reasonably clear that these provisions have no application to Mrs McIntyre since the offence to which Mrs McIntyre has pleaded guilty is not subject to a period of imprisonment. The maximum penalty that may be imposed is a fine in the amount of $55,000. Nor does Regulation 6 appear on its face and in combination with s 9 of the JP Act to have any application to the circumstances where a holder of the office is convicted of an offence. In any event the Court's attention was not directed to any of this legislation. 33 The application for an order under s 10(1) of the CSP Act is therefore refused. 34 The defendants have also tendered into evidence some financial records and other records to support a submission that they have limited capacity to pay a fine. The Court is required under s 6 of the Fines Act 1996 to consider the means of a defendant in the exercise of a discretion to impose a fine. In this regard the defendants contend that because of prevailing economic conditions brought on by an entrenched drought and a consequential failure of the property to yield a return on crops planted their capacity to pay a fine is "extremely, if not severely, constrained..." 35 While documents relied on by the defendants support low rainfall figures and low crop yield, other documents purporting to reveal the defendants' financial position are not as clear. One document appears to be a summary of actual and projected income and expenditure on the property for the period January 2006 until December 2006. The document shows a "Total Inflow" of $607,563 and a "Total Outflow" of $977,002. The same document also shows as at January 2006 a cash flow balance of -$462,732 and a net worth of -$441,334 for December 2006. A second document purporting to predict similar details for the period January 2007 to December 2007 predicts for December 2007 a "Total Inflow" of $799,561 and a "Total Outflow" for the same period of $212,675. In addition a monthly surplus as at December 2007 is predicted as $586,886 followed by a cash flow balance for the same period as -$301,228 and a net worth figure of -$358,878. No explanation is forthcoming as to where the surplus for December 2007 is intended to be utilised in the document which might shed some light on the projected negative cash flow and net worth figures. The partnership tax return for 2006 shows a total business income of $298,432 and total expenses of $639,730. The tax return also discloses dividends earned from shares ($3,229) and rental income for two properties owned by the partnership at Dubbo and Cronulla in Sydney. Current assets of the partnership are in the amount of $1,170,524 and current liabilities in the amount of $324,199. No source documents such as banking records and accounting records have been included in the tender. Insofar as the defendants' financial position can be ascertained from the documents before the Court, it seems that it is not beyond the respective capacities of the defendants to pay a fine, should one be imposed. I also bear in mind my finding that the offences are serious and the observations in that regard of Wright J, President in Ferguson v Nelmac Pty Limited (1999) 92 IR 188 at 209 - 210: The financial position and more particularly the means of the defendant should be taken into account in relation to the question of penalty. Otherwise it is inappropriate to consider the fact or amount of legal costs, consulting and other fees. In any event, it was not submitted that I should. I should, as submitted by counsel for the informant, consider not only the financial information included in the correspondence from the accountants, but also the defendant's asset position. Whilst I accept that the imposition of heavy fines would be a burden on the defendant and its financial resources and that consideration should be given appropriate weight on the question of penalty, it does not necessarily result in the Court not imposing a heavy penalty. The penalty imposed will reflect the consideration given to this aspect as discussed above. I have also had regard to the submissions filed by the informant in respect of the additional affidavit and issues arising from it. Further, I have considered and applied the authorities referred to therein, particularly Haynes v C I & D Manufacturing (at 457-458); R v Sgroi (1989) 40 A Crim R 197 and Rahme v The Queen (1989) 43 A Crim R 81. Finally on this aspect, I indicate that I do not consider that the penalties imposed are beyond the means of the defendant. ..... When viewed in the context of the statutory mandate in s 15 the offences were very serious and provided proper weight is given to the subjective considerations and insofar as deterrence is concerned some tempering thereof, the penalty should reflect the objective seriousness of the offence. In that context I do not consider the matters referred to in paras 22 to 24 of the Agreed Facts would, to the extent they applied at the time, have any significant additional effect on the penalty. I have therefore not taken them into account. 36 As these observations emphasise the objective seriousness of an offence must be acknowledged when imposing a penalty even in circumstances where the imposition of a heavy fine would be a financial burden: see also Department of Mineral Resources of NSW (Chief Inspector Terrey) v A M Hoipo & Sons Pty Ltd (2000) 99 IR 137 at [48] - [51]; Manpac Industries Pty Ltd (formerly t/a Pacific Concrete & Quarries Pty Ltd) v WorkCover Authority of NSW (Inspector Glass) (2001) 106 IR 435 at [56] - [57], [67], [81] - [83]; Inspector Green v Camilleri Properties Pty Ltd (2006) 152 IR 156 at [21]; WorkCover Authority of New South Wales (Inspector Robert Mayell) v D J Gleeson Pty Ltd [2006] NSWIRComm 363 at [33]. 37 The defendants have also applied to the Court for an order under s 116 of the Act. Section 116 is as follows: 116 (1) The court may order the offender to carry out a specified project for the general improvement of occupational health, safety and welfare. (2) The court may, in an order under this section, fix a period for compliance and impose any other requirements the court considers necessary or expedient for enforcement of the order. (3) A Local Court may not make an order under this section unless it is satisfied that the cost of complying with the order does not exceed the jurisdictional limit of a Local Court when sitting in its General Division within the meaning of the Local Courts Act 1982. 38 The defendants in written submissions sought an order under s 116 "in lieu of a fine". In oral submissions the defendants explained that they were asking the Court to impose a penalty consisting of two components namely a fine in the low range as well as an order that they undertake a specified project in accordance with the terms of s 116. 39 Section 116 of the Act is found in Division 2 of Part 7. According to s 111, Division 2 applies where a Court finds an offence against the Act or regulation proved. A "proved offence" is an offence in relation to which a Court convicts the offender or where the Court makes an order under s 10 of the CSP Act. Under s 112 a Court may make more than one order under Division 2 against an offender and the order or orders may be made in addition to any penalty that may be imposed or any other action that may be taken in relation to the offence. Section 117 also in Division 2 makes it an offence for a person the subject of an order under the Division to fail to comply with an order. 40 No authorities were relied upon by the defendants in support of the application although several days after the sentence proceedings had concluded the defendants provided to the Court a copy of the second reading of the Occupational Health and Safety Bill which contains the following response to the then proposed s 116: The bill contains various enforcement initiatives that are designed to benefit occupational health and safety in the community generally. Non-monetary penalties in the form of publicity and occupational health and safety project orders will be available in the sentencing of offenders. That brief reference does little to advance the Court's understanding of what is involved in an application under s 116. The Court is aware of one decision in the Local Court by Mr Miller , Chief Industrial Magistrate where an application under s 116 was made and granted: Inspector Cherie McGrath v Anglican Retirement Villages Diocese of Sydney 20363079/04/2, 19 April 2005. According to that decision both parties put forward to the Court a joint proposal for an order. In granting the application the Court was persuaded by particular objective and subjective features of the case, for example, the defendant was a non-profit organisation undertaking charitable works. His Honour was apparently of the view that an order under s 116 in lieu of a fine would be a preferable course since a fine would impact on the defendant's charitable works. His Honour convicted the defendant and ordered it to carry out the specified project under s 116. 41 A reading of the provisions of Division 2, which include s 116, indicates that the decision to grant an application under s 116 is first, discretionary; secondly, may be applied for following a conviction for an offence; and, thirdly, may be ordered in addition to any other penalty that may be imposed for the offence. 42 No proposal was advanced to the Court by the defendants as to the content of any specified project under the section. Instead the Court was informed that if it were prepared to entertain the making of an order following a consideration of all the evidence then the parties would be invited to participate in discussions between themselves in relation to the nature and extent of the project with a view to providing further submissions on the issue to the Court. The prosecutor informed the Court that it was open to it to consider s 116 as part of its approach to sentencing both defendants. 43 In my opinion the decision to grant an application under s 116 is governed here by similar considerations to those identified by the Court in relation to Mrs McIntyre's application for an order under s 10 of the CSP Act. For the same reasons as previously indicated in relation to the application under s 10 the Court declines to entertain an application under s 116. The offences to which the defendants have pleaded guilty are serious offences. In addition, the evidence placed before the Court in relation to s 6 of the Fines Act as I have earlier found does not support the defendants' contention that they have little or no capacity to pay a fine. 44 The Court was also asked in the event fines were imposed on both defendants to apply the principle of totality. The prosecutor suggested that the defendants in partnership operate as one economic unit, even though they are different legal entities. A similar situation arose in Haynes v CI & D Manufacturing Pty Limited & Anor (1995) 60 IR 455 where the Full Bench imposed one penalty on two corporate defendants on the basis that one was wholly owned by the other and, "...the connection between the two companies (was) so intimate that it is permissible to view the offence in a global way," (at 458). I propose to adopt the same course. The defendants presently before the Court are husband and wife and are joint owners of a property which they run together as a partnership. The offences for which each defendant has been charged are identical and involve the same factual background. Totality 45 In relation to Mr McIntyre I consider that a fine in the sum of $12,000 should be imposed for the offence under s 10(2) of the Act. In relation to Mrs McIntyre I consider that a fine in the sum of $12,000 should be imposed for the offence under s 10(2) of the Act. In order to properly reflect the criminality of both defendants, taking into account the principle of totality, I consider the total fine for both offences for which the defendants have been charged should be $12,000. Penalties 46 In determining the penalties against both defendants I have taken into account the objective seriousness of the offences, the personal factors described above and the absence of prior convictions. All of these factors have been considered by reference to the CSP Act in particular s 21A. I have also taken into account the respective capacities of both defendants to pay a fine and the principle of totality. Orders 47 I make the following orders: 1. In Matter No IRC 5630 of 2005 the defendant Malcolm McIntyre trading as Corambie Pastoral Company is convicted of the offence and fined $6,000 with a moiety to the prosecutor. 2. In Matter No IRC 5631 of 2005 the defendant Tracy McIntyre trading as Corambie Pastoral Company is convicted of the offence and fined $6,000 with a moiety to the prosecutor. 3. In Matter Nos IRC 5630 and 5631 of 2005 the defendants are to jointly pay the costs of the prosecutor as agreed or in the absence of agreement as assessed. ___________________ 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.