Industrial Court of New South Wales CITATION: Inspector James v Dekorform Pty Ltd & Paul [2010] NSWIRComm 150 Inspector Wayne James (Prosecutor) PARTIES: Dekorform Pty Ltd (First Defendant) Robert Mark Paul (Second Defendant) FILE NUMBER(S): IRC 1012; IRC 1013 of 2008 CORAM: Marks J CATCHWORDS: OCCUPATIONAL HEALTH AND SAFETY – breach of s 8(1) of the Occupational Health and Safety Act 2000 by the corporate defendant – personal defendant deemed guilty of the same offence by virtue of s 26(1) – guilty pleas and appropriate penalty – objective seriousness – inadequate risk assessment – prior knowledge of risk – general and specific deterrence – commitment to occupational health and safety obligations – cooperation with prosecutor – remorse and contrition – no prior convictions – relative culpability – s 10 Crimes (Sentencing Procedure) Act 1999 applied to personal defendant – orders made LEGISLATION CITED: Crimes (Sentencing Procedure) Act 1999 – s 10 Occupational Health and Safety Act 2000 - ss 8(1), s 26(1) Department of Mineral Resources (Chief Inspector McKensey) v Berrima Coal Pty Ltd & Anor [2001] NSWIRComm 130; (2001) 105 IR 348 CASES CITED: Morrison v Powercoal Pty Ltd (No 3) [2005] NSWIRComm 61 Page v Walco Hoist Rentals Pty Ltd (No 2) [2000] NSWIRComm 39 HEARING DATES: 14 October 2010 DATE OF JUDGMENT: 12 November 2010 Mr D Chin of counsel (Prosecutor) Solicitors: Legal Group WorkCover Authority of NSW LEGAL REPRESENTATIVES: Mr M Shume of counsel (First Defendant) Solicitors: Kemp Strang Mr P Coleman of counsel (Second Defendant) Solicitors: Workplace Law JUDGMENT: INDUSTRIAL COURT OF NEW SOUTH WALES CORAM: Marks J Friday 12 November 2010 Matter No's IRC 1012 & 1013 of 2008 Inspector Wayne James v Dekorform Pty Ltd and Robert Mark Paul Prosecutions under s 8(1), by way of s 26 in the proceedings against Robert Mark Paul, of the Occupational Health and Safety Act 2000. JUDGMENT ON PENALTY [2010] NSWIRComm 150 1 This judgment is concerned with the imposition of a penalty on two defendants in proceedings brought for a breach of the Occupational Health and Safety Act 2000 ("the Act") by the prosecutor, Inspector Wayne James of the WorkCover Authority of New South Wales. 2 The defendant Dekorform Pty Ltd ("Dekorform") was charged with a breach of s 8(1) of the Act. The defendant Robert Mark Paul was charged with a breach of the same section of the Act by reason of the application of s 26(1) of the Act in that he was, at all relevant times, a director of Dekorform and is therefore deemed to have committed the same offence under the Act as committed by Dekorform. Each defendant has entered a plea of guilty. 3 The proceedings are constituted by amended applications for order which were filed during the course of the hearings on penalty conducted on 14 October 2010. I shall refer, for current purposes, to the amended application for order brought against Dekorform. 4 The amended application for order charges that Dekorform [B]eing an employer, on 3 July 2006, at 5-7 Ladbroke Street, Milperra in the State of New South Wales ("premises") FAILED TO Ensure the health, safety and welfare at work of all its employees, and in particular, Wayne Hogden and Michael Hughes, contrary to section 8(1) of the Occupational Health and Safety Act 2000. 5 The particulars of the charge are: (a) At all material times, the defendant was a body corporate entitled to sue and be sued in and by its own corporate name and style. (b) At all material times, the defendant was an employer and employed persons at the premises. (c) At all material times the defendant employed Wayne Hogden as Production Manager and Michael Hughes as a machinist at the premises. (d) The defendant failed to ensure that plant, namely a Paul Maschinenfabrik GmbH & Co Multirip Circular Saw (Model K34G/1500, machine number 8944950) ("machine"), provided for use by the employees at work was safe and without risks to health when properly used, in that: (i) the defendant failed to maintain and/or replace the machine's internal rollers and sleeves to ensure that the length of the rollers had a uniform diameter; and (ii) (deleted) (iii) (deleted) (iv) the defendant failed to maintain and/or ensure the presence and operation of internal anti-kickback fingers. (e) The defendant failed to ensure that systems of work and the working environment of the employees were safe and without risk to health in that the defendant failed to ensure that, whilst operating the machine, the employees did not stand in line with the feed of the machine. (f) The defendant failed to provide such information, instruction, and training as was necessary to ensure the employees' health and safety at work, in particular in relation to the operation of the machine. (g) The defendant failed to undertake any, or any adequate, risk assessment to identify the risks associated with operating the machine, namely an assessment of the risk of "kick back" of materials being fed into the machine. As a result of the said failures, Wayne Hogden and Michael Hughes were placed at risk of injury and Mr Hogden was fatally injured. 6 There was tendered in each of the proceedings an agreed statement of facts. I reproduce hereunder, but without attachments, the agreed statement of facts in the case brought against Mr Paul, because they include, relevantly, all of the necessary factual material pertaining to the proceedings brought against Dekorform. 1. At all material times the Prosecutor was an inspector duly appointed under Division 1 of Part 5 of the Occupational Health and Safety Act 2000 ("the Act") and empowered under section 106(1) of the Act to institute these proceedings. 2. At all material times Dekorform Pty Ltd (ACN 000 639 252) ("Dekorform") was a corporation with its registered office located at Level 24, 45 Clarence Street Sydney in the State of New South Wales. The registered office as at the date of this Agreed Statement of Facts is Level 24, 207 Kent Street Sydney in the State of New South Wales. 3. Dekorform was first registered on 14 August 1968 and commenced trading in 1980. 4. Dekorform operates a business at 7 Ladbroke Street, Milperra in the State of New South Wales ("the premises"). 5. Dekorform was bought by Parbury Pty Ltd (ACN 004 568 138) ("Parbury") in two stages between 1988 and 1991, becoming a wholly owned subsidiary from 1991. 6. Parbury was acquired by Alesco Corporation Ltd (ACN 008 666 064) in 2000 ("Alesco"). Dekorform's business 7. At all material times: (a) Dekorform conducted its business at a factory located at the premises. Dekorform manufactures and supplies profile wrapped mouldings for caravan/motor homes, the funeral industry, flooring and the kitchen industry ("the Dekorform business"); and (b) Dekorform was a wholly owned subsidiary of Parbury Pty Limited (ACN 004568138 ("Parbury"). 8. From 2000 the ultimate parent company of Dekorform and Parbury was Alesco. 9. As at 3 July 2006, Dekorform employed approximately 13 persons, including: (a) Lindsay Brydson (Manager), who had been employed by the defendant for approximately 25 years; (b) Ian Owen (Administration Manager), who had been employed by the defendant for approximately 1 year; (c) Wayne Hogden (Production Manager), who was employed by the defendant for approximately 21 years; (d) Glenn Campbell (Supervisor of the machine shop), who had been employed by the defendant for approximately 20 years; and (e) Brian Hughes (Machinist), who had been employed by the defendant for approximately 4.5 years. Paul 10. The Defendant, Robert Mark Paul ("Paul"), was appointed as General Manager of the Parbury business in March 2005. 11. From on or about 1 April 2005, Paul became a director of both Dekorform and Parbury. 12. At all material times: (a) Paul was a director of Dekorform, a director of Parbury and the General Manager of the Parbury business; (b) Brydson, who was responsible for managing Dekorform on a day-to-day basis, reported directly to Paul; (c) Paul attended and participated in meetings of the Parbury Managers Committee, which was also attended by Brydson; (d) Paul attended and participated in the Parbury Executive Committee/Business Review Meetings which, from 17 May 2005 to 23 May 2006, was chaired by Justin Ryan who was, inter alia, the Deputy CEO of Alesco; (e) Paul attended and participated in the meetings of the Executive Committee of Alesco; and (f) (from on or about 31 May 2005) Paul reported directly to Ryan on matters relating to the Parbury business, including occupational health and safety matters concerning the Dekorform business. 13. As at 3 July 2006, Paul had responsibility for implementing and ensuring compliance with occupational health and safety standards and policies within the Parbury business, including with respect to Dekorform. The Machine 14. Located in the premises towards the southern rear wall was a Paul Maschinenfabrik GmbH & Co Multirip Circular Saw, with a nameplate specifying Model K34G/1500, machine number 8944950 ("the machine"). 15. Dekorform purchased and took delivery of the machine from a German supplier (or its agent) in early 1990. 16. The machine was regularly used to cut MDF into strips of varying widths, lengths and sizes. It was also used to cut sections of radiata pine timber to smaller sizes. 17. Dekorform used the machine on a regular basis. 18. The machine as purchased was a multi-rip saw approximately 2.1 metres (width) by 1.87 metres (length) by 1.66 metres (height). The multi-rip saw was contained within an enclosed steel cabinet which housed, amongst other things, fourteen top and bottom feed rollers. The bottom feed rollers are fixed and the top feed rollers are adjustable. Each top roller is fitted with neoprene sleeves. 19. A shaft ("arbour") is located centrally in the machine. The arbour has a number of circular saw blades fixed to it with spacer rings ("spacers") in between. The arbour is hydraulically raised into cutting position. When in the cutting position the saw blades are located between the top and bottom feed rollers in the centre of the machine. Annexed and marked with the letter "A" is a diagram of the internal configuration of the fourteen rollers, arbour and saw blade. 20. Located near the in-feed on the inside of the steel cabinet is a fixed steel bar with steel fingers attached to it which is designed to prevent large objects from being ejected through the in-feed. They are known as anti-kickback fingers ("anti-kickback fingers"). 21. An external arm or handle (located on the operator side of the machine) that is used to lift and lower a row of external alloy splinter catchers ("the splinter catchers") was and is located just above and forward of the first top in-feed roller on the outside of the steel cabinet. 22. Located near the in-feed on the outside of the steel cabinet was an electronic interlock mechanism (located on the non-operator side of the machine) designed to prevent the machine being switched on unless the splinter catchers were lowered. 23. The saw is designed to be adjustable so that variable widths and thicknesses of product can be cut to a predetermined size. The cutting process is achieved by a series of circular saw blades mounted on the arbour. The spacing between the saw blades is adjusted using different sized spacers to achieve the desired width of strips. The depth of the cut is achieved through the positioning of the arbour. 24. The machine was operated in conjunction with the following ancillary components: (a) a hydraulic powered scissor lift table located on the in-feed side of the machine, at a height of 460 mm and measuring approximately 2.6 metres (length) by 1.2 metres (width); (b) a frame for a mechanical "push bar" located above the hydraulic powered scissor lift table located on the in-feed side of the machine, which measured approximately 2.11 metres (height), by 4.6 metres (length), and 1 metre wide at the front and 2.3 metres wide adjacent to the next table in line; (c) an in-feed table located between the machine and the hydraulic powered scissor lift table, approximately 3.4 metres (length) by 1 metre (width) by 1.02 metres (height). Located on the non-operator side of this in-feed table is a metal fence line which guides the material into the machine; and (d) a hydraulic powered scissor lift table located on the out-feed side of the machine, measuring approximately 1.2 metres (width) by 3.73 metres (length) and 900 mm (height). Safety Mechanisms in the Machine to deal with kickback and splinters 25. The machine was designed with two different mechanisms to prevent the ejection of material through the in-feed. The splinter catchers prevent any splinters of material created by the cutting process being ejected through the in-feed of the machine. The splinter catchers are not designed to prevent large objects from being ejected through the in-feed. Annexed and marked with the letter "B" is a copy of an email from Paul. 26. The second mechanism, the anti-kickback fingers, are designed so that as product is fed through the in-feed between the feed rollers and the anti-kickback fingers the anti-kickback fingers lift up as the material is fed into the machine. If at any point the material is the subject of ejection or kickback the anti-kickback fingers operate in one of two ways: (a) If the material has completely passed the anti-kickback fingers they prevent the exit of material through the in-feed; and (b) If the material has not completely passed the anti-kickback fingers are designed to dig into the material and prevent the exit of material through the in-feed. 27. At all material times prior to the incident, Mr Campbell, Mr Hughes and Mr Brydson were not aware of the anti-kickback fingers or their absence in the machine. Mr Campbell and Mr Brydson believed that the splinter catchers were the only anti-kickback fingers for the machine. The Incident 28. On 3 July 2006 Mr Hughes was operating the machine to cut MDF sheets that measured approximately 1.2 metres (width) by 2.4 metres (length) by 18 mm (height). Each sheet weighed approximately 39 kg. 29. Mr Hughes had set the top rollers at a height of approximately 17 mm. 30. Mr Hughes experienced some difficulty in cutting the sheets into uniform strips, in that he: (a) pushed one sheet through the machine which emerged at the end of the machine and observed the sheet moving away from the fence line on the in-feed side (that is, it emerged from the machine at a crooked angle); (b) identified that the cut strips were not rectangular; (c) found that the machine had cut the first strip closest to the fence line 42mm which tapered to 36mm; (d) the remaining strips measured 42mm wide, except for the last strip. 31. Mr Hughes then told Mr Hogden that he had a problem with the operation of the machine. 32. Mr Hogden inspected the sheet that had been cut; adjusted the gauge of the top rollers from a height of 17mm to a height of approximately 20mm; and proceeded to feed another sheet (of the same dimensions as the previous sheet) through the machine. Mr Hogden was located on the operator side of the machine, that is, adjacent to the side of the in-feed table. 33. While Mr Hogden was manually feeding the sheet into the machine, the sheet was ejected from the machine on an angle and struck Mr Hogden in the stomach region, causing Mr Hogden to fall to the ground. No one witnessed the ejection of the sheet or Mr Hogden being struck but an unusual noise was heard which drew Mr Hughes' attention towards Mr Hogden. 34. Immediately upon the identification of Mr Hogden's injuries an emergency phone call was made to emergency services. Another two phone calls were made to the emergency service prior to two ambulances arriving approximately 30 minutes after the first call. 35. The ambulance officers' record general pain to the abdomen area, numbness to feet and Mr Hogden having difficulty breathing. Mr Hogden presented at the hospital in cardiac arrest and died soon after admission. The subsequent autopsy identified blunt force abdominal injuries as the cause of death. "Kickback" 36. "Kickback" occurs when material being cut by the machine binds onto the saw blades and/or becomes caught in the teeth of the saw, which causes the material to suddenly and forcefully move in the direction of the rotation of the blades - against the direction in which the material is being fed into the machine. Kickback occurs more frequently when ripping then cross-cutting. Rough cutting of timber in the direction of the grain is known as "ripping". Cutting timber across the grain is known as "cross-cutting". MDF sheets do not have a directional grain structure due to the nature of its manufacture and the machine was used for cutting strips. 37. Mr Roger Roberts, a machine safety specialist engaged as part of Dekorform's investigation into the incident which was conducted by SafetyWorks Group Pty Ltd ("the SafetyWorks Report"), formed the opinion that Mr Hogden had manually withdrawn the sheet from the machine through the in-feed side. As he withdrew it the sheet came out at an angle and the sheet became caught in the teeth of the saw blades which caused it to eject rapidly. Mr Roberts also concluded that other contributing factors to the incident were: the missing anti-kickback fingers, and the inability of the severely damaged rollers (being the top roller immediately before and the top roller immediately after the arbour) within the machine to hold down the sheet. In Mr Roberts' view, the damaged rollers contributed to the kickback of the sheet because the two rollers in particular did not exert sufficient downward pressure on the sheet such that the teeth of the saw gripped the underside of the sheet and thus propelling the sheet out of the machine. 38. Mr Prasad de Silva, a machine safety specialist and WorkCover NSW mechanical engineer, observed that the diameter of the top rollers had been unevenly reduced along the length of the rollers through wear on the neoprene sleeves fitted on those rollers; and that most of the wear was on the right side of the top rollers (when facing the entry or in-feed section). He concluded that the uneven diameter of some of the top rollers resulted in the left side of the sheet (which was in contact with the side of the rollers with a greater diameter) travelling at a faster rate than the right side (not in contact with the side of the rollers with a lesser diameter), thus skewing the direction of the board, and causing the board to catch against the teeth of the rotating blades of the machine resulting in kickback.. Mr de Silva also concluded that "[i]ncreasing the height of the top rollers to process the board ... reduced the force imposed by the rollers and therefore their capacity to counter the kickback"; and that the absence of the anti-kickback fingers allowed the sheet to fly backwards and hit Mr Hogden. Condition of Machine 39. The condition of the machine at the time of the incident: (a) the gauge for the top rollers was set at 20mm; (b) the neoprene sleeves on the top rollers exhibited wear and tear which reduced the diameter of the sleeves predominantly on the right side relative to the left side (as viewed from the entry point of the machine); (c) the splinter catchers were in a raised position as a result of the arm or handle being jammed into the open position by a wooden block; (d) the interlock mechanism for the splinter catchers had been disabled; and (e) there was a gap between the first and second rollers within the steel cabinet of the machine where there should have been a row of internal anti-kickback fingers. 40. The manufacturer's manuals: (a) strictly forbade removing, disabling or circumventing any safety device on the machine; (b) required that all safety devices, including anti-kickback devices, are always fully functional; (c) prohibited any attempt to raise the anti-kickback fingers when the saw shaft is turning, noting that the interlock mechanism prevented the anti-kickback fingers from moving before the saw shaft is at a standstill; (d) prohibited any operator from standing in line with the in-feed of the machine, and required operators to always stand to one side of it, particularly when working with material that tends to kick-back such as solid wood; and (e) prohibited feeding material into the machine until the top rollers have been set to the correct height. ("the manufacturer's prohibitions"). The system of maintenance 41. For a period of fourteen months prior to the incident Dekorform conducted monthly safety audits. 42. Prior to early 2006, repairs to the machine were performed on an as needs basis in addition to an annual maintenance program for the machine whereby a maintenance crew from Parbury would perform maintenance of the machine during each Christmas period. The premises were closed over the Christmas period for approximately four weeks which allowed the Parbury maintenance crew uninterrupted access to the machines. 43. Dekorform relied upon the experience and knowledge of its supervisors, operators, the Parbury maintenance crew and external contractors for maintaining the condition and safety of the machine. 44. On 6 March 2006 Mr Brydson and Mr Hogden inspected each of the machines in the premises, including the machine. A document titled "Safety Audit" was prepared. In the course of this inspection the condition of the rollers within the machine was not assessed. 45. On 21 June 2006, Mr Owen conducted a safety inspection of the premises. In respect of this inspection, Mr Owen did not check the interlock mechanism for the splinter catchers of the machine because he did not know its function. 46. Some weeks before 3 July 2006: (a) Mr Campbell states that they had trouble with the machine making the sheets "thin one end and thick at the other end", and had observed (together with Messrs Brydson, Hogden and Hughes) that two of the top rollers were chewed and worn down in the areas of the saw blades. (b) Mr Brydson states that the MDF sheets were running off the fence line of the machine, the two top rollers closest to the saw blade were worn and that it was decided that those two top rollers could be replaced at the annual Christmas close-down. (c) Mr Campbell tightened a number of shims which were identified as being loose during the inspection. After the shims were tightened the "trouble with the machine" ceased. 47. Prior to the incident, Dekorform did not regularly check the operation or condition of the splinter catchers and/or interlock mechanisms on the machine. Usual operation of the machine 48. The usual operation of the machine commenced with loading MDF sheets on the front scissor lift. The sheets were automatically fed from the front scissor lift to the front table feed rollers, which in turn fed the sheets into the machine. The machine cut the sheets in accordance with the way it had been set up and fed the cut sections onto the back scissor lift rollers where they were picked up on a forklift once all the cutting was complete. 49. At the commencement of a new operation one sheet would be fed through the process (this could be done either manually or automatically). Once the cutting was complete for the first sheet, this sheet was measured to confirm the desired result. If the desired result was achieved, the machine was put into automatic. 50. Operators generally stood to the side of the machine near the operating controls. It was not possible to stand "in front" of the machine as identified in the machine's manual due to the front scissor lift and roller table. 51. There were three persons who operated the machine. They were Messrs Hogden, Campbell and Hughes. Mr Campbell was the main operator, with Mr Hughes operating the machine when Mr Campbell was unavailable. 52. Mr Hughes was unaware of the splinter catchers and operated the machine with them in a raised position. Mr Campbell was aware of the splinter catchers and operated the machine with them in the lowered position other than on a few occasions where he did not realise that they were not lowered. Failure to maintain and/or replace the machine's rollers and sleeves 53. Several weeks prior to the incident Messrs Brydson, Campbell, Hogden and Hughes identified that two sets of the top rollers that sat on either side of the arbour had been damaged by the saw blades. 54. It was not identified until after the incident that there was a reduced diameter on all of the top roller sleeves on the right hand side of the machine when looking at the in-feed. 55. Dekorform failed to maintain and/or replace the machine's internal rollers and sleeves to ensure that the length of the rollers had a uniform diameter. 56. On 5 July 2006 Inspector Wayne James made observations of the internal workings of the machine. He identified that two of the top rollers were severely damaged (being the same two top rollers identified in paragraph 37 above) and the other top rollers were worn. Failure to ensure the presence of the anti-kickback fingers 57. Dekorform failed to ensure that the anti-kickback fingers were present and operational within the machine, in that, at the time of the incident, the machine was missing its set of internal anti-kickback fingers. 58. A few days after the incident, Mr Campbell found the machine's anti-kickback fingers under another machine within the premises which was located about 20 to 21 metres from the machine. 59. If the anti-kickback fingers were in place within the machine, those fingers would have functioned as an anti-kickback device with respect to the board that struck Mr Hogden. 60. The SafetyWorks Report concluded that an immediate cause of the incident was, inter alia, the missing anti-kickback fingers. Failure to ensure that the employees did not stand in line with the feed of the machine 61. Dekorform failed to ensure that, whilst operating the machine, the employees did not stand in line with the feed of the machine, in that: (a) As noted above, the width of the in-feed table adjacent to the feed section of the machine was 1 metre, whilst the width of the in-feed entry of the machine was 1.3 metres. There was a space between the left hand side of the in-feed entry (the operator's side) and the edge of the in-feed table of approximately 0.3 metres in width, which was directly in line with the feed of the machine. (b) Hughes adopted the practice of manually pushing the first board into the in-feed section of the machine whilst standing at the in-feed or insertion end of the machine (after which the feeding in of boards would be automated), in a manner similar to that adopted by Hogden during the incident on 3 July 2006. (c) Hughes and Campbell were not aware of the manufacturer's prohibition against standing in line with the feed of the machine, as they had not seen a copy of the machine's manual from the manufacturer in English. Failure to provide necessary information, instruction and training 62. Dekorform failed to provide such information, instruction and training as was necessary to ensure employees' health and safety at work in relation to the operation of the machine, in that: (a) Dekorform had no formal documented training processes or competency assessments for employees with respect to the safe operation of the machine. (b) The training of employees in the operation of the machine consisted largely of "on-the-job" training, with no provision of any training relating to the machine's manual. (c) A 6-step 'Safety Procedure for Paul Saw' had been developed by Dekorform and placed on the side of the machine. It was not in place on the day of the incident. (d) Messrs Campbell, Hughes and Brydson were not aware of the manufacturer's prohibitions (referred to above) as they had not seen a copy of the machine's manual from the manufacturer in English. (e) Mr Owen's role within Dekorform was to assist Mr Brydson with administrative duties and attend and represent Dekorform at the Parbury OH&S committee meetings, performing monthly safety inspections of the premises and performing 'safety walks' around the premises. Mr Owen completed a four-day OH&S course in 1992 and an injury management course in 2004. Mr Owen had been a machine operator, production co-ordinator and union safety representative at Parbury's Wetherill Park premises. Mr Owen never enquired as to the training or competency of staff at Dekorform. (f) The SafetyWorks Report concluded, inter alia, that the lack of a sufficiently detailed safe work procedure for the machine and the lack of formalised training and competency assessment processes were contributing factors. Failure to undertake any risk assessment 63. Dekorform failed to undertake an adequate risk assessment to identify the risks associated with operating the machine, including an assessment of the risk of "kick back" of materials being fed into the machine, in that: (a) There was a 'safety audit' of the premises conducted by Mr Brydson and Mr Hogden on 6 March 2006, but with only one reference to the machine noting the need to "replace lid on control box – Scissor lift". Mr Brydson does not recall whether they opened the lid of the machine to inspect the rollers at that time. The condition of the rollers was not considered during the 'safety audit' on 6 March 2006. (b) Parbury had an occupational health and safety manual dated 31 July 2003 ("the Parbury manual") which contained a safety inspection "check sheet" for Parbury's Wetherill Park site ("the Wetherill Park site check sheet"), but was not developed specifically for the premises. The Wetherill Park site check sheet included a "machinery hazard checklist" that asked whether it is "possible for material (including chips and dust) to be ejected from the point of operation and injure the operator or someone nearby?". (c) From 1 April 2006 Dekorform had its own occupational health and safety manual ("the Dekorform manual") that did not have a "machinery hazard checklist" equivalent to that found in the Parbury manual and, in particular, had no provision for the assessment of the risk of material being ejected from the point of operation of the machine. The safety inspection check sheet for the premises contained in the Dekorform manual ("the MiIperra site check sheet") had only a series of four questions relating to the inspection of machines generally, with no specific inspection system for the machine in particular. (d) Mr Owen - who was responsible for site safety inspections at the premises used the Wetherill Park site check sheet to perform monthly inspections at the premises. (e) Mr Owen did not check the electrical interlock systems on the machine during the safety inspection on 21 June 2006 as he did not know they existed. Mr Owen never at any stage lifted the cover of the machine and inspected the internal workings of the machine. Mr Owen did not have a maintenance background and stated that he did not have the experience to perform that check. (f) The SafetyWorks Report concluded, inter alia, that the lack of a formalised risk assessment in which the risk of "kick-back" is formally documented along with the associated required controls, was a contributing factor. The risk 64. As a result of the aforesaid failures, Mr Hogden and Mr Hughes were at risk of injury from the ejection or "kick-back" of materials being fed into the machine. Improvements Post Incident 65. After the incident , Dekorform has carried out improvements to the machine including the following: (a) reinstalled the anti-kickback fingers in the machine; (b) enabled the electronic interlock device by fitting an air operated locking device to the splinter catchers to prevent the lever being moved (thereby lifting the splinter catchers) whilst the machine was being operated; (c) installed an interlock on the rear cover of the saw (non-operator side); (d) installed a laser beam safety cut-out device that prevents persons from accessing the feeder table (scissor lift) while the machine is operating; (e) installed new neoprene sleeves on the top rollers; (f) installed a fence and interlock gate on the exit end on the non-operator side of the machine; (g) installed a fence on the rear and side (non-operator) of the in-feed scissor lift with a sliding gate that is bolted and a safety switch mechanism to prevent unintentional access; (h) installed "c-section" guarding on the operator side of the in-feed roller table with a lanyard interlock and bar; (i) installed two sets of kickback (finger) flaps on the in-feed roller table and one continuous flap on the in-feed end of the scissor lift table; (j) repositioned the stop/start switch and installed three emergency stops; (k) installed an interlock switch on the lid of the machine; and (l) engaged two external consultants to perform a risk assessment of the machine. 7 In addition, there was tendered into evidence on behalf of the prosecutor factual inspection reports prepared by WorkCover New South Wales and photographic evidence. 8 For Dekorform, there was tendered into evidence an affidavit of Lindsay William Brydson and of Donald Ian Page. Both these affidavits became evidence also in the proceedings against Mr Paul. 9 For the defendant Mr Paul, there was tendered into evidence an affidavit, which he had sworn, and affidavits of William Lindsay Brydson, Peter White and Kelly Lovely. 10 The proceedings against both defendants arise out of an incident that occurred at the premises of Dekorform involving a multirip circular saw on 3 July 2006. The agreed statement of facts contains detailed evidence about the saw and the circumstances leading up to and following the incident. Tragically, an employee of Dekorform was killed. 11 The additional affidavit evidence adduced by the defendants supplements the material contained in the agreed statement of facts. 12 Donald Ian Page described himself as "the former owner" of Dekorform with a great deal of experience in the industry in which it operated. He managed the Dekorform business from 1980 to 1989. He sold a substantial portion of his shares in Dekorform to Parbury Building Products Pty Ltd ("Parbury") in 1988 and sold the remainder of his shareholding to Parbury in 1991. It was Mr Page who acquired the multirip circular saw and oversaw its installation. At the time of that installation, he was "very confident" that the internal anti-kickback fingers were installed in it. 13 Mr Page appointed Mr Brydson manager of Dekorform in 1981. 14 Mr Brydson said that he was appointed as sales manager of Dekorform in 1981. Although he was principally involved in the sales administration of the business, he did perform work from time to time in operating machines to assist operators where necessary. Mr Brydson has a qualification in accounting but does not appear to have any other formal qualifications associated with the operation of machinery. 15 Parbury had previously been involved in the manufacture of some products similar to those being manufactured by Dekorform but this ceased in 2004. It operated its business at premises away from and separate to the premises occupied by Dekorform. Alesco Corporation Limited ("Alesco") acquired Parbury in March 2000 and it remains a wholly owned subsidiary. 16 There is a description of the multirip circular saw commencing at [14] of the agreed statement of facts and, commencing at [25], a description of the safety mechanisms designed to deal with kickback and splinters. 17 In amplification of material in [26], Mr Brydson said in his affidavit that prior to the incident I was unaware of the difference between splinter catchers and anti-kickback fingers that operated in the machine … I had assumed that the splinter catchers that were observable at the in-feed on the machine were anti-kickback fingers and only became aware of the difference post incident after discussion with Inspector Wayne James. I never had a reason to question this over the period that the machine was operated at Dekorform as there had been no experience of kickback prior to Mr Wayne Hogden's incident. 18 In his affidavit, Mr Brydson described in some detail problems associated with the operation of the machine. He said: [44] Some weeks before the Incident: (a) I had been involved with Wayne, Glenn and Mick in identifying a problem with the Machine. The sheets of MDF were running off the fence line, producing the exact same result as occurred on the day of the Incident. A photograph of the fence line of the PAUL Machine is exhibited at "LB2-4". (b) During the inspections we identified that a number of locking nuts which located shims into position on an arm which controlled the movement and pressure of the top rollers were loose. Glenn relocated the shims and tightened the locking nuts. After the locking nuts were tightened and the shims relocated the problem we had been experiencing with the Machine ceased. Photographs of the shims, locking nuts and controlling arm are exhibited at "LB2-17". (c) During the inspection I observed that two of the top rollers located either side of the saw blades were damaged. The rest of the top rollers appeared to be in good condition. I discussed with Wayne, Glenn and Mick whether the damaged top rollers needed to be replaced. We jointly concluded that they were not adversely affecting the operation of the Machine and decided that they could be replaced during the annual closedown. I was under no budgetary constraint in relation to the repair and/or maintenance of the Machine (or any other machine in the business) and the only reason this decision was made was on a belief that it was not affecting the safe operation of the Machine. (d) I have seen a photograph of one of the damaged top rollers after it was removed from the Machine. Photographs of the damaged top rollers are exhibited at "LB2-18 and 19". The photograph behind LB2-19 does not depict how the damaged top rollers looked while they were still in the Machine, LB2-18 being more accurate. If I had known, or it had been suggested by Wayne, Glenn or Mick that the damaged top rollers were affecting the safe operation of the Machine, I would have taken the Machine out of service and arranged for the top rollers to be replaced. 19 In explaining what he knew about the circumstances of the removal of the internal anti-kickback fingers, Mr Brydson said: [50] I do not have any direct knowledge as to when the anti-kickback fingers were removed. I know that to be able to remove them it is necessary for at least the top half of the Machine to be pulled down. We, that is the people who work at the Premises with me, have never pulled the Machine down prior to the Incident. On this basis I can exclude the anti-kickback fingers being removed by anyone employed at the Premises. [51] Prior to the Incident a Parbury maintenance crew ("PMC") performed all major repairs and maintenance on the PAUL Machine and the other machines at the Premises. The PMC normally varied in size between 2 to 4 persons. [52] Although the PMC attended the Premises during the annual closedown at the end of each year to perform maintenance on the machines they were contacted throughout the year to assist with maintenance where required. Prior to the annual closedown Dekorform provided the PMC with information in relation to known maintenance issues so that they could obtain parts and schedule the maintenance. [53] The PMC attended the Premises for maintenance purposes until the closure of the manufacturing business at the Parbury Wetherill Park factory on or about 2004. After this time, a former employee of Parbury, Mr Graham Lund (a member of the PMC), then provided mechanical maintenance services as a contractor engaged by Dekorform. Other external contractors (for example, electricians) have also been engaged since this time to perform maintenance. [54] Some time prior to the Incident the PMC had done work which involved pulling down the top half of the Machine and replacing the neoprene sleeves fitted to the top rollers of the Machine. This required the top rollers to be removed. To remove the top rollers it is necessary to remove the anti-kickback fingers. This work was performed during the annual closedown. I have not been able to identify on which annual closedown that this occurred, but believe it was approximately 18 months prior to the Incident. [55] I believe this is the time that the anti-kickback fingers were removed and not replaced, although I accept that I have no direct knowledge of this. 20 There was tendered into evidence on behalf of Dekorform a letter addressed to the Court under the hand of Rob Guttentag, the group General Manager of the Functional and Decorative Products Division of Alesco. Mr Guttentag is also currently the sole director of Dekorform. The letter said in part: On 3 July 2006 an employee of Dekorform, Mr Wayne Hogden, was fatally injured whilst working on one of the machines at the premises of Dekorform, namely 7 Ladbroke Street Milperra, NSW. The company deeply regrets the accident and loss of life of Wayne who was a long serving and valuable employee. I acknowledge and accept that Dekorform has breached section 8(1) of the Occupational Health and Safety Act 2000 (NSW) and on behalf of Dekorform would like to apologise for this breach to both the Court and members of Mr Hogden's family. The accident has been a serious wake up call for the company. Prior to the accident the view was held that Dekorform was a safe business and employer to work for. However, it is now recognised and acknowledged that there was a gap in our operational knowledge of the machine Mr Hogden was working on at the time of his death. Since the accident Dekorform has worked hard to obtain the required knowledge and training for the operation of that machine whilst investing time and money ensuring that all available safety modifications to the machine have been put in place. Dekorform has also gone further by implementing a comprehensive safety management system at the factory covering not only the machine the cause of the accident but all other machines at the premises. Dekorform will continue to review and improve its safety systems and is committed to providing a safe work site and safe work practices for its employees, visitors and contractors. Safety is not a one-off matter, it requires constant attention and improvement and is an evolving and continuous process. I fully support and will continue to support Dekorform's employees and management to achieve our goal of zero harm. 21 I turn now to deal with the evidence adduced by the defendant Mr Paul. In an affidavit Mr Paul said that he is currently aged 52, married with two children. Prior to joining Parbury in May 2003, he had worked predominantly in the pharmaceutical industry in senior managerial roles including sales and marketing. In May 2003, he had been employed as the National Sales Manager for Parbury. In May 2005, he was appointed as the General Manager for Parbury and Dekorform. 22 Mr Paul described his role as General Manager in the following terms: [7] My role as General Manager was to lead and develop a diverse range of stakeholders within Parbury and Dekorform, including sales, marketing, finance, risk management, IT operations, manufacture, compliance and occupational health and safety (OHS). I was responsible for developing professional relationships with international suppliers and critical industry partners. I was also responsible for developing supplier and distributor networks in the United States, Asia Pacific and Europe. [8] I spent about 5% of my time on the Dekorform business and the remaining 95% on the Parbury business. [9] When I began my employment with Parbury I introduced myself to the Dekorform Manager, Mr Lindsay Brydson. Lindsay Brydson had over 20 years experience working for Dekorform. It appeared to me that Dekorform was a well run business and I was satisfied that Lindsay could continue to manage the business. [10] During my visits to the Dekorform Factory I would spend time with Lindsay Brydson, to review the business, walk through the Factory to 'meet and greet' the employees and discuss with them any needs and concerns they may have. 23 Upon becoming General Manager, Mr Paul appointed a Mr Ian Owen to work in the Dekorform business in "a clerical/OHS capacity." He said that Mr Owen "was able to support and develop an increased awareness of OHS within the Dekorform organisation." He described Mr Owen's primary task as involving liaison with Mr Peter White, the National Warehouse and Distribution Manager of Parbury to update and integrate the Parbury and Dekorform OHS manuals into one OHS manual. 24 On the day of the incident, Mr Paul attended Liverpool Hospital and met with Mr Hogden's family members. He also dealt directly with Dekorform's staff and arranged counselling for them. He closed the Dekorform factory after the incident for approximately three days. He also arranged for tangible support to be given to the late Mr Hogden's wife and mother-in-law. 25 After the incident, Mr Paul took active steps to arrange for a complete review of the occupational health and safety procedures and protocols of Dekorform and Parbury and changed the structure of the businesses to accommodate this. 26 After he had resigned from Parbury Mr Paul decided to "move away from manufacturing and back into sales and marketing. I am now extremely critical of a company's focus on OHS." 27 Much of Mr Paul's evidence was corroborated by Mr White. Mr White said that upon his appointment as General Manager, Mr Paul elevated consideration of occupational health and safety matters and that they had become "more important". 28 George Alexander Bejatovic was the National Sales and Marketing Manager of Parbury between January 2006 and December 2007. He reported directly to Mr Paul. He said that occupational health and safety matters were a "priority" for Mr Paul and his management team. 29 Mr Bejatovic described the impact of Mr Hogden's death on Mr Paul personally and on his commitment to occupational health and safety matters. He said that, in effect, Mr Paul demonstrated a renewed commitment to occupational health and safety matters and to this purpose he appointed Ms Kelly Lovely as Health Safety and Environment Manager. New protocols and procedures were introduced, a new manual was produced and Mr Paul conducted regular senior management meetings that specifically focussed on safety. 30 Mr Bejatovic observed that: After the accident to Wayne Hogden I witnessed a transformation in Robert Paul – from grief to an uncompromising, relentless and total commitment to even higher levels of occupational health and safety awareness, hazard identification, incident reporting and measurement. Mr Bejatovic also referred to Mr Paul's "heightened commitment to Wayne Hogden's family." 31 In her affidavit, Ms Kelly Lovely described her background as an occupational health and safety manager and the work that she performed within the Parbury Division including Dekorform after her appointment in January 2007 and until she departed for other employment in January 2008. 32 I am satisfied on the basis of the evidence adduced in the proceedings on behalf of Mr Paul, and which is replicated in the agreed statement of facts, that there did exist prior to the incident a commitment on the part of Dekorform and Mr Paul to occupational health and safety matters, and that commitment increased after the incident. The objective seriousness of the offences 33 Dekorform and, in effect, Mr Paul are each charged with the same breach of s 8(1) of the Act. The starting point for a consideration of the assessment of penalty is a determination of the objective seriousness of the offence. It is clear, as is conceded by all parties, that the multirip circular saw, at the time of the incident, was defective and manifestly unsafe. The internal anti-kickback fingers had been removed, the rollers and sleeves were damaged, employees were not precluded from standing in line with the in-feed of the machine, such steps as were taken to identify any risks involved in the condition of the machine were inadequate, and nobody appears to have been furnished with sufficient or appropriate information, instruction and training concerning the identification of any risk associated with the state of the machine and in some respects its operation, especially prohibiting employees from standing in line. Furthermore, there was a failure to undertake an adequate risk assessment in all the circumstances. 34 This seemingly parlous state of affairs was, however, ameliorated by the fact that Dekorform, through its controlling personnel at Parbury, had had the machine serviced at regular intervals. Indeed, it may be inferred from the evidence, and especially that given by Mr Brydson in his principal affidavit, that the internal anti-kickback fingers had been removed by a person or persons forming part of the Parbury maintenance crew. This throws up for consideration what Dekorform ought properly to have done in circumstances where, on the evidence, the machine was regularly serviced to deal with any problems that arose and undertook a major service during the annual close down. 35 However, the situation is more complex because some weeks before the incident trouble had been encountered with the machine as is outlined in the agreed statement of facts, and there was a failure to have the machine examined by a person who was fully trained and competent to do so. An examination carried out after lifting the top of the machine would have revealed that a bar which was the housing for the internal anti-kickback fingers was missing. Furthermore, it appears that none of Mr Brydson, Mr Hogden or Mr Owen was trained, equipped or competent to carry out an inspection of the equipment. Accordingly, the no doubt well-intentioned regular inspections and safety audits were insufficient and ineffective to reveal the underlying condition of the machine, one that was manifestly unsafe predominantly because of the absence of the internal anti-kickback fingers. 36 This discussion of the evidence leads me to conclude that this is a most serious breach of the Act and should be so characterised for the purpose of the assessment of an appropriate penalty. 37 In assessing penalty, I shall also take into account the need to accommodate the deterrent effect that any penalty will provide both generally within the industrial and manufacturing community and specifically with respect to these defendants. However, I acknowledge that the commitment to the discharge of occupational health and safety obligations demonstrated by each of the defendants after the incident, which is manifested in the steps taken to enhance compliance with occupational health and safety obligations, will ameliorate to some extent the need to accommodate specific deterrence in the fixing of any penalty. Subjective factors 38 There are a number of subjective factors that the Court is entitled to take into account in favour of each of the defendants and that are common to both of them. As was conceded by the prosecutor, both defendants co-operated fully with the WorkCover Authority in and about its investigation of the incident and have made tangible expressions of contrition and remorse for what occurred. Both defendants sought an available discount on the basis that they had entered a plea of guilty at the earliest appropriate opportunity. These submissions were rejected by the prosecutor. 39 The applications for order were filed in the Court on 30 June 2008. Not guilty pleas were initially entered in February 2009. The proceedings were then set down for hearing over several days in June 2009. Just before that hearing, Mr Paul indicated the entry of a guilty plea on 4 June 2009 and Dekorform seven days later. I should add for completeness that the sentencing hearings were deferred pending the determination by the Court of proceedings brought by the prosecutor against another defendant, Justin Ryan. Those proceedings were protracted, occupied many days of court time and, furthermore, involved the hearing of an appeal. Mr Ryan was acquitted. It was only at that stage that the Court was asked to determine the penalties to be imposed on both defendants. 40 In the case of Dekorform, it is clear that the indication of a plea of guilty was not entered at an appropriately early time. Nevertheless, there has been a saving of court time that would, in my opinion, justify the application of some discount. In the case of the defendant Dekorform, I propose applying a discount of 5 per cent. 41 It was Mr Paul's submission that he was faced with a difficulty in terms of a decision to enter a plea of guilty because his culpability relied in turn on the culpability of Dekorform by reason of the operation of s 26 of the Act. Accordingly, it was said that it would have been inappropriate for Mr Paul to given consideration to the entry of a plea of guilty unless and until he was aware of the course that Dekorform was likely to take. I accept this submission in part and I would propose, in the circumstances of Mr Paul, to apply a discount of 10 per cent for this matter. 42 In each case the prosecutor sought a moiety of the penalty imposed and an order for costs. Neither defendant opposed this course of action. 43 Before proceeding to fix an appropriate penalty in the case of each defendant, I also acknowledge that the Court received, during the course of the proceedings, a victim impact statement of Michele Hogden, the sister of the late Mr Hogden. During the course of the proceedings and whilst Ms Hogden was present, the Court formally acknowledged receipt of the statement and indicated the Court's expression of regret for the loss suffered by her and her family as a result of this tragic incident. Dekorform Pty Ltd 44 I have already described the serious nature of the offence committed by Dekorform assessed objectively by reference to all of the relevant circumstances. Dekorform has no previous relevant convictions and the maximum penalty is $550,000. After taking into account the level of seriousness, which I have identified, and having regard also to the mitigating factors, which I have described, I am of the opinion that an appropriate penalty in the case of Dekorform is the sum of $125,000. Robert Mark Paul 45 Obviously, the culpability of Mr Paul is linked with that of Dekorform in terms of the serious nature of the offence. 46 However, there is Full Bench authority in this Court to the effect that notwithstanding that a personal defendant is taken to have committed the same offence as a corporation by reason of the application of s 26 of the Act, it is nevertheless appropriate to take into account when sentencing the relative culpability of the individual. 47 The starting point for this discussion is the judgment of Wright J, President in Page v Walco Hoist Rentals Pty Ltd (No 2) [2000] NSWIRComm 39; (2000) 99 IR 163. In those proceedings, his Honour was considering the application of s 50 of the predecessor Occupational Health and Safety Act 1983, which is in relevantly comparable terms to s 26 of the Act. At [38] and [39], his Honour said: [38] Having reached those conclusions in relation to the culpability of the first defendant it is necessary to consider that of the second defendant. The construction and implications of s 50 are relevantly these. First, the level of culpability of a personal defendant who is deemed to have committed the offence by virtue of s 50(1) cannot be greater than that of the corporation who has been convicted or otherwise assumed to be guilty for the purposes of the operation of the section. However, most pertinently for the present proceedings, it must be recognised that the culpability of the personal or individual defendant may be less than that of the corporate defendant. It is not, in my view, a question of considering their relative contribution but assuming that the purpose of the provision is to make an individual who is responsible to an extent for the management of the corporation similarly responsible and culpable for the acts or omissions of the corporation. Although the relevant consideration is not whether, or to what extent, there is a level of contribution as between the corporate and individual defendants for the particular breach of safety which arose under the Act, it is nevertheless necessary when dealing with the precise gravity of the offence committed, or deemed to have been committed by the personal defendant, to accept the possibility or, in many cases where the individual is not simply the alter ego of the corporation, the likelihood that the level of gravity of the offence attributable to the personal defendant may be less than that which has been found to have been committed by the corporate defendant – that is, in these proceedings the first defendant. [39] In assessing the culpability of the second defendant it is, in my view, important to place particular weight upon the role of the defendant in the management of the corporation and the nature of the gravity of the offence as identified in relation to the first defendant, and to make an assessment in that context of the situation of the second defendant. Any matters of doubt should, generally speaking, be resolved in favour of the defendant: R v Olbrich (1999) 73 ALJR 1550 at 24 – 28; Camilleri's Stock Feeds Pty Ltd v Environment Protection Authority (1993) 32 NSWLR 683 at 698 - 699. Although the second defendant was an important and crucial part of the management of the first defendant, nevertheless he was a manager in the context of a small company which was a family company which was itself managed and run by a highly experienced manager who had many years of experience in the industry, as did those members of the family who preceded him. He was not the alter ego of the company. It would be appropriate therefore to proceed on the basis that although the second defendant would have had a significant role in decision making as to employment and the like and otherwise in the running the first defendant, it could not be assumed that he could make all crucial decisions, or changes to practices, relating to a change in employment policy as to, for example, the qualifications that would necessarily be required of all employees. Therefore, it may be appropriately assumed, and thus found for the purpose of these proceedings, that the system now in place as exemplified by paragraph 21 of the defendants' submissions was not a matter within the authority of the second defendant. Accordingly, I consider that there is a significant qualitative difference between the culpability attaching to the first and second defendants, although I find that the gravity of all of the offences is serious. 48 In Department of Mineral Resources (Chief Inspector McKensey) v Berrima Coal Pty Ltd & Anor [2001] NSWIRComm 130; (2001) 105 IR 348, Walton J, Vice President, approved of the observations of Wright J set out above. (See [178] and [179]). A Full Bench of the Commission in Court Session (Walton J, Vice President, Boland J and Staff J) set out inter alia [178] and [179] of the judgment of Walton J in Berrima Coal and proceeded to apply them to the circumstances of the proceedings before them in Morrison v Powercoal Pty Ltd (no 3) [2005] NSWIRComm 61. 49 It may be assumed that in applying these observations, the Full Bench intended fully to approve them. 50 In undertaking the sentencing process, the Court is to have regard to the culpability of Mr Paul in the context of his involvement in the management of Dekorform and the part played by him in the particular breach of safety with which the Court is concerned in these proceedings. 51 The effect of the evidence given in the proceedings to which I have previously referred is that Mr Paul had ultimate responsibility for occupational health and safety matters in the Dekorform business. However, he was not involved in the day-to-day management of that business which appears to have been vested in Mr Brydson who was the manager of Dekorform. Assessed objectively, and given the evidence about the obligations, responsibilities and duties both overall and specifically with respect to occupational health and safety matters, I would assess Mr Brydson as being much more culpable than Mr Paul in terms of the matters surrounding the incident that is at the heart of these proceedings. I am unaware whether the prosecutor has instituted proceedings against Mr Brydson under s 26 of the Act, but certainly they are not proceedings with which I have had to deal. 52 The maximum penalty applicable to the charge against Mr Paul is $55,000. Assuming that his culpability is less than that of Dekorform, on the basis of the matters to which I have just referred, an appropriate monetary penalty would be something less than $5,000. 53 It was submitted on behalf of Mr Paul that the Court should apply the provisions of s 10 of the Crimes (Sentencing Procedure) Act 1999. Relevantly, s 10(1) to (3) of that Act is in the following terms: 10 Dismissal of charges and conditional discharge of offender (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. (2) An order referred to in subsection (1) (b) may be made if the court is satisfied: (a) that it is inexpedient to inflict any punishment (other than nominal punishment) on the person, or (b) that it is expedient to release the person on a good behaviour bond. (2A) An order referred to in subsection (1) (c) may be made if the court is satisfied that it would reduce the likelihood of the person committing further offences by promoting the treatment or rehabilitation of the person. (2B) Subsection (1) (c) is subject to Part 8C. (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. 54 In support of this submission, Mr Paul's counsel stressed Mr Paul's good character, his lack of antecedents, and his age. Appropriately, there was no submission that the offence was of a trivial nature. However, emphasis was placed on his more remote involvement in the management of Dekorform and his lack of involvement in day-to-day matters including the state of the machinery and in particular the fact that it was malfunctioning just prior to the incident occurring. 55 Furthermore, it was said that there were a number of mitigating factors that applied including the fact that Mr Paul had no previous record of any conviction for an offence under the Act, he was unlikely to re-offend, he had expressed personal contrition and remorse and the incident has undoubtedly affected him personally. 56 There is Full Bench authority that is binding upon me concerning the exercise of the discretion created by s 10 of the Crimes (Sentencing Procedure) Act in the circumstances of proceedings brought under the Act. 57 In Morrison v Powercoal (No 3), previously referred to, the Full Bench said: [131] The application of s 10 was recently considered at length by a Full Bench in Inspector Christopher Downie v Menzies Property Services Pty Limited [2004] NSWIRComm 259. The Full Bench stated at [57]: [I]t 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 s10 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 s10] cogent reasons must, in our view, be provided by the defendant for such exercise and also by the judge acceding to that submission." [58] We agree with the decision of Wright J, President in WorkCover Authority (NSW) v Ecolab Pty Limited at 430 that there is little value in considering the particular approach taken in other decisions or judgments to the exercise of discretion under s10 of the Crimes (Sentencing Procedure) Act , as each matter turns on its own facts. However, we note that in Department of Mineral Resources v Berrima Coal , the Court gave explicit details of the "extraordinary and highly exceptional circumstances" which existed in that case which warranted the exercise of the Court's discretion under s10 of the Crimes (Sentencing Procedure) Act . Whilst we would not wish to suggest that there are particular or defined criteria which will inevitably lead to the exercise of that discretion (as it is a wide discretion), it is pertinent to highlight the decision in Department of Mineral Resources v Berrima Coal as being one in which extensive reasoning was given to support the proper exercise of discretion under s10 of the Crimes (Sentencing Procedure) Act , in stark contrast to the matter presently before us where there is a total absence of such reasoning. [132] It is abundantly clear, therefore, that it will only be in rare situations in which s 10 will be available to a defendant under the Act and that if it is to be applied "cogent reasons must … be provided by the defendant for such exercise and also by the judge acceding to that submission." [133] In Department of Mineral Resources (Chief Inspector McKensey) v Berrima Coal and Coke Pty Ltd and Anor (2001) 105 IR 348, in which Walton J, Vice President determined to apply s 10, his Honour referred to the judgment of Wright J, President in WorkCover Authority of New South Wales (Inspector Page) v Walco Hoist Rentals Pty Ltd (No. 2) (2000) 99 IR 163 at [38] and [39] where the President considered the construction of s 50 of the Occupational Health and Safety Act : 178 In assessing the culpability of the second defendant, it is also necessary to consider the application of s50 of the Act. Wright J, President, discussed the construction and implications of s50 of the Act in WorkCover Authority of New South Wales (Inspector Page) v Walco Hoist Rentals Pty Ltd (No. 2) (2000) 99 IR 163 at [38]. His Honour's construction of the section, with which I agree, was as follows at [38]: Having reached those conclusions in relation to the culpability of the first defendant it is necessary to consider that of the second defendant. The construction and implications of s50 are relevantly these. First, the level of culpability of a personal defendant who is deemed to have committed the offence by virtue of s50(1) cannot be greater than that of the corporation who has been convicted or otherwise assumed to be guilty for the purposes of the operation of the section. However, most pertinently for the present proceedings, it must be recognised that the culpability of the personal or individual defendant may be less than that of the corporate defendant. It is not, in my view, a question of considering their relative contribution but assuming that the purpose of the provision is to make an individual who is responsible to an extent for the management of the corporation similarly responsible and culpable for the acts or omissions of the corporation. Although the relevant consideration is not whether, or to what extent, there is a level of contribution as between the corporate and individual defendants for the particular breach of safety which arose under the Act, it is nevertheless necessary when dealing with the precise gravity of the offence committed, or deemed to have been committed by the personal defendant, to accept the possibility or, in many cases where the individual is not simply the alter ego of the corporation, the likelihood that the level of gravity of the offence attributable to the personal defendant may be less than that which has been found to have been committed by the corporate defendant - that is, in these proceedings the first defendant. 179 His Honour also made some observations relevant to the assessment of culpability in the light of a prosecution arising in consequence of the operation of s50 of the Act as follows (at [39]): In assessing the culpability of the second defendant it is, in my view, important to place particular weight upon the role of the defendant in the management of the corporation and the nature of the gravity of the offence as identified in relation to the first defendant, and to make an assessment in that context of the situation of the second defendant. … 58 The prosecutor submitted that there did not exist the "extraordinary and highly exceptional circumstances" that would justify the grant of discretion under s 10. 59 Whilst I recognise that this Court must be concerned to ensure that s 10 is only applied appropriately, there are in my opinion circumstances that would justify the exercise of discretion in favour of Mr Paul. As I have said, his position was remote from that of the actual business operations of Dekorform. Although he was admittedly a director of that company, he was not an executive employee of it. He was predominantly an employee of Parbury with overall management responsibilities for Dekorform. Mr Paul did take active steps designed to satisfy the obligations of Dekorform under the Act and to enhance its commitment to occupational health and safety matters. Persons were appointed by him to facilitate the involvement of Dekorform in occupational health and safety protocols and procedures, audits were undertaken and there were regular reports made to management, including Mr Paul. Of course, as I have observed, the persons who carried out these activities were not adequately or appropriately qualified to do so and were not given the requisite training or instruction. However, these failures should have been more apparent to the immediate management of Dekorform, albeit that they were themselves unequipped to recognise this. 60 In particular, the failure to ensure that the internal anti-kickback fingers were installed and operational was something that was remote from Mr Paul's day-to-day activities and in particular remote from his involvement in Dekorform. The same comment may be made with respect to the failure to maintain or replace the rollers, the failure to provide information, instruction and training and the failure to undertake an adequate and appropriate risk assessment. All these matters were the responsibility of the more immediate management. There is no explanation for the apparent failure of the prosecutor to institute proceedings against Mr Brydson who is clearly involved in the management of Dekorform and who would have been amenable to prosecution under the provisions of s 26 of the Act. 61 Having regard to these matters, Mr Paul's age, background, previous good record and the personal impact that the incident had upon him, I am persuaded that it is appropriate in all the circumstances to apply the provisions of s 10 of the Crimes (Sentencing Procedure) Act and direct that the charge against him be dismissed. Nevertheless, he should be directed to pay the costs of the prosecutor, because having entered a plea of guilty it is appropriate that he be found guilty of the offence. Orders 62 I make the following orders: 1) Each of the defendants is found guilty of the offence with which it or he has been charged. 2) The defendant Dekorform Pty Ltd is convicted accordingly. The charge against the defendant Robert Mark Paul is dismissed. 3) Dekorform Pty Ltd is fined the sum of $125,000 with a moiety to the prosecutor. 4) The defendants are to pay the costs of the prosecutor assessed in default of agreement as to Dekorform Pty Ltd ninety per cent and as to Robert Mark Paul ten per cent. 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.