Industrial Court of New South Wales CITATION: Liang v Inspector David Farmer [2010] NSWIRComm 156 PARTIES: Shuo Liang (Appellant) Inspector David Farmer (Respondent) FILE NUMBER(S): IRC 118 of 2010 CORAM: Boland J President; Marks J; Staff J CATCHWORDS: OCCUPATIONAL HEALTH AND SAFETY – conviction for offence under s 26 at first instance – appeal by defendant – held that a failure by Chief Industrial Magistrate to take into account evidence of defendant concerning defence under s 26(1)(a) resulted in error of law – leave to appeal granted – decision quashed – remitted to Local Court for rehearing LEGISLATION CITED: Corporations Act 2001 (Cth) – s 201A Occupational Health and Safety Act 2000 – s 26(1), s 62, s 66 Inspector James v Ryan [2009] NSWIRComm 215 CASES CITED: Inspector Ken Kumar v Ritchie [2006] NSWIRComm 323 Inspector Wayne James v Sunny Ngai [2007] NSWIRComm 203 Mentha v Colorbus Pty Ltd (in liq) [2004] VSC 486; Re Colorbus Pty Ltd (in liq) and ors (2004) 213 ALR 789 HEARING DATES: 27 September 2010 DATE OF JUDGMENT: 17 November 2010 Mr M Moir of counsel (Appellant) Solicitors Stewart Cuddy & Mockler LEGAL REPRESENTATIVES: Mr M Cahill of counsel (Respondent) Solicitors Legal Group WorkCover Authority of New South Wales JUDGMENT: INDUSTRIAL COURT OF NEW SOUTH WALES FULL BENCH CORAM: BOLAND J, President MARKS J STAFF J Wednesday 17 November 2010 Matter No IRC 118 of 2010 SHUO LIANG v INSPECTOR DAVID FARMER Application by Shuo Liang for leave to appeal and appeal against decisions and orders of Chief Industrial Magistrate Hart given on 23 November 2009 and 28 January 2010 in matter no's CIM20103413/09, 20103390/09, 20103488/09, 20103197/09, 20103437/09, 20103787/09, 20103891/09 JUDGMENT OF THE COURT [2010] NSWIRComm 156 1 The appellant in these proceedings is Shuo Liang. He was the defendant in eight proceedings brought by the respondent, Inspector David Farmer of the WorkCover Authority of New South Wales alleging a number of breaches of the Occupational Health and Safety Act 2000 ("the Act") and of Regulations made under the Act. The proceedings were brought against him under s 26(1) of the Act arising out of the fact that he was a director of Ferro Constructions Pty Ltd ("Ferro"). That company was involved in carrying out building work at a site in Newcastle. It was alleged that the company had breached the same provisions of the Act and Regulations. 2 The proceedings were commenced by Court Attendance Notices issued in the Local Court. They were heard by the Chief Industrial Magistrate on 23 November 2009 and were defended. His Honour gave ex tempore judgment that day in which he found the defendant guilty. There then followed a sentencing hearing. In reasons for judgment delivered on 28 January 2010, his Honour imposed monetary penalties in each of the matters totalling $44,000, which he reduced to $36,000 after applying "discounts in recognition of there being some degree of duplication in relation to the offending conduct." 3 The appellant has sought leave to appeal and to appeal from his conviction in each of the eight matters. However, at the hearing of the appeal proceedings, the respondent indicated that as prosecutor it consented to the vacation of the orders made by the Chief Industrial Magistrate and to dismissal of the Court Attendance Notices with respect to six of the charges. They all related in point of time to charges arising out of the building work being undertaken by Ferro at the building site at Newcastle throughout March 2007. It was common ground between the parties that the appellant did not reside in Australia between 26 September 2006 and 6 June 2007. It was also common ground that the appellant had been appointed a director of Ferro on 31 October 2006. Accordingly, the appellant was not a resident of Australia as at the date of his appointment as a director. 4 It was submitted that by reason of s 201A(1) of the Corporations Act 2001 (Cth), the appointment of the appellant as a director was invalid because he was the sole director and, secondly, he did not ordinarily reside in Australia at the date of appointment. The respondent referred the Court to a decision of Mandie J in the Supreme Court of Victoria in Mentha v Colorbus Pty Ltd (in liq) [2004] VSC 486; Re Colorbus Pty Ltd (in liq) and ors (2004) 213 ALR 789. In those proceedings, his Honour in discussing the provisions of s 201A(1) said: [20] Presumably, in order to make sense, s 201A(1) should be read as requiring that in the case of a proprietary company, if there is more than one director, at least one director must ordinarily reside in Australia. [21] In my opinion the mandatory obligation or requirement contained in s 201A(1) operates so that the appointment of a person as a director of a proprietary company, who does not at the time of the appointment ordinarily reside in Australia, is "invalid" or irregular, if the company does not at that time have a resident director. The appointment of Mr Kintsch as a director, although invalid in that sense, was not in my view a nullity. (Cf the discussion of s.124 of the Companies Act 1936 (NSW) in Grant v John Grant & Sons Pty Ltd [1950] HCA 54; (1950) 82 CLR 1.) The invalidity might have been cured by Mr Kintsch commencing to ordinarily reside in Australia. It might also have been cured by the appointment as an additional director of a person who ordinarily resided in Australia. These events of course did not occur and Mr Kintsch's appointment was invalid and remained so. 5 The parties made no submissions concerning the possible validation of the appointment of the appellant as a director when he later became a resident of Australia. Presumably, in any event, the validation would only occur upon the appellant commencing to reside in Australia. The Court accepted the reasoning of Mandie J, acceded to the respondent's application, which was not opposed, and the orders below made with respect to the six charges were vacated. Costs were reserved. 6 That left for consideration two charges only, which became the subject of these appeal proceedings. As previously stated, they arose out of contraventions of the Act committed by the company. The culpability of the appellant arises because of the provisions of s 26(1) of the Act, which is in the following terms: 26 Offences by corporations—liability of directors and managers (1) If a corporation contravenes, whether by act or omission, any provision of this Act or the regulations, each director of the corporation, and each person concerned in the management of the corporation, is taken to have contravened the same provision unless the director or person satisfies the court that: (a) he or she was not in a position to influence the conduct of the corporation in relation to its contravention of the provision, or (b) he or she, being in such a position, used all due diligence to prevent the contravention by the corporation. 7 Both charges alleged a contravention of s 66(a) of the Act in that Ferro, without reasonable excuse, failed to answer questions of an inspector asked in accordance with a Notice issued under s 62 of the Act and Ferro failed to produce documents asked to be produced in the same Notice. Particulars of the charge assert that on 22 November 2007 a Notice under s 62 of the Act was issued by the respondent prosecutor. It was said to have been served on Ferro "by faxing it to the corporation's construction manager Andrew Rowland, and by serving it personally on Jackson Cai, the site manager at 335 Wharf Road Newcastle." The failure to comply was said to have occurred on 1 December 2007. Obviously, at that date, the appellant was a director of Ferro. 8 For the purpose of the appeal proceedings, the appellant did not challenge the quantum of the penalties imposed by the Chief Industrial Magistrate. Accordingly, the only matter that was the subject of the appeal was whether the appellant was entitled to rely on his defence under s 26(1)(a) of the Act. 9 The prosecution case was conducted on the basis of an agreed statement of facts and the tender of certain documentary material. It was agreed that the appellant was appointed a director of Ferro and company secretary on 31 October 2006 and remained in those positions until 20 December 2007. 10 There is no reference in the agreed statement of facts to the appellant, by name or in any other way, other than to the fact that he was at the relevant dates an officer of the company. There is a reference to other persons who were involved in the building works, but the appellant was not so named. 11 None of the documents tendered in the proceedings (except for ASIC records) refer to the appellant. There is correspondence on behalf of Ferro with the WorkCover Authority of New South Wales under the hand of Andrew Rowland, Construction Manager, who appears to have been associated with a company named High Trade Company Pty Ltd. An ASIC search of that company reveals that the appellant was also a director of that company. However, he was appointed on 19 December 1990 and ceased to be a director on the same day. 12 The defendant gave oral evidence in the proceedings. His evidence was to the effect that he was born in China and lived in China until 1995. Between 1995 and 2006, he visited Australia once a year for about three to four weeks a year. On those visits, he came with his wife and the one child that he then had for about three to four weeks a year. Some time in 2006, and he thought about the end of August 2006, he spent a month in Sydney. He then returned to China where he resided. This was about September 2006. 13 He became a director of Ferro, he said, about the end of October 2006. He said that while he was in China a friend called him to say "If I like to take a job, work for an Australian company, to raising money for them from China and I agreed, I said yes." He identified that company as being Ferro. He said he agreed to become a director because "I thought that if I was the director, it's better for me to raising money from China and people, I think more like to prefer to trust me if I'm a director of the company." 14 He said that he did not know any other directors of that company nor did he ever attend any meetings of the company. He signed a document as a director some time between August and September 2006, or possibly about 31 October 2006. 15 The appellant said that he was not aware of any specific project that he was to raise money for, only that he was asked to raise money generally by introducing potential investors to Ferro. He said that his understanding was that he would be paid commission if he successfully introduced an investor from China into the company. 16 The appellant said that he resided in China between August or September 2006 and returned to Australia in June 2007. This was about the time his wife was due to give birth to their second child. 17 The appellant said that the first occasion on which he understood that there had been an incident in Newcastle was when he was served with the court papers. This would appear to have been some time after 6 March 2009 when the proceedings were first filed in the Court. 18 The appellant said that he resigned as a director in December 2007 because he was unable to raise any money from investors. The only time that he visited the construction site in Newcastle was after he found out about the incident which, it may be assumed, was some time in or after March 2009. 19 The appellant was cross-examined on his evidence. He said that he was introduced to Ferro through a friend, Zhang Li, and that he did not know who was the "boss of Ferro". He said that he had heard the name High Trade. He agreed that he had been a director of High Trade. 20 The appellant was cross-examined about the address at which he lived in Sydney in October 2006 and was unable to explain the address shown for him in the ASIC records of Ferro Constructions. 21 The appellant was also cross-examined about his knowledge of certain other named directors of Ferro. He conceded that he knew one such person, but in re-examination it appeared that he had been confused by counsel for the respondent as to the name of that person. 22 Later the appellant was cross-examined about his directorship of other companies namely Bidot, Good Brothers International Pty Ltd, Sanwei International Pty Ltd, Wansun International Pty Ltd and Australia China Impex Pty Ltd, all being companies of which, he conceded, he had been a director at various times over a period of 20 years when he had been involved in "international trade between Australia and China." 23 It was the appellant's case before his Honour that he was not in a position to influence the conduct of the corporation in relation to its contravention of the provision because: a) at all relevant times he resided in China and was not physically present in Australia; b) his only involvement with the company was to endeavour to find investors for it in China; c) he had no involvement whatsoever in the control or management of the corporation. 24 In the course of his ex tempore judgment, his Honour correctly referred to the necessity for the appellant to prove that the provisions of s 26(1)(a) applied, to the requisite civil standard. 25 In dealing with the appellant's submissions, his Honour said: The defendant's case did not include any challenge to the prosecution's case going to the contraventions committed by the corporation. The defendant's case relies on the statutory defence afforded by s 26(1)(a) of the Occupational Health and Safety Act . Namely, that the defendant was not able to exercise control of the conduct of the company. Mr Mockler appearing for the defendant also made reference to s 26(1)(b), but it became clear during submissions that the defendant did not claim that he exercised due diligence. But rather that he was simply not in a position to exercise due diligence or exercise any control or influence over the operations of the company, including its operation of excavation and demolition work at a building site in Newcastle, the workplace relevant to the eight offences of the corporation. Whilst the prosecution has the onus to establish its case beyond reasonable doubt, the defendant, should he invoke s 26(1)(a) or (b), need only establish his defence to the civil standard. The defendant's case in this regard relies solely on his oral evidence. The defendant chose not to supplement his oral evidence with any supporting documentation. The evidence of the defendant is that for many years he has visited Australia for approximately three or four weeks per year and that he enjoys the status of permanent residency here, but that he resides mostly in China, his place of birth and that he remains a Chinese citizen. The defendant claims that he had no knowledge of the company Ferro Construction Pty Limited, but that whilst in China, he was telephoned by a friend in Australia, who invited him to become involved in promotion of the company in china for the purpose of raising capital. No documentation was before the court dealing with his contractual arrangements with the company. There was no contract or correspondence, no email communications. There was only the defendant's description of the arrangement. He gave evidence that if he had succeeded in attracting Chinese investors for the company, he would have negotiated a commission with whoever was running the company, but he was unable to say who that was. The defendant deposes that he was listed as a director of the company, but that was only for the purpose of enhancing his credibility with potential investors, who would be more likely to trust him if he was a director. In cross-examination, the defendant claimed that he had not even known the nature of the corporation's business, even though he was ostensibly seeking to attract investors by promoting the company as a good investment. In cross-examination, the defendant was confronted with ASIC database extracts, showing that he had not only been a director between October 2006 and December 2007, but that he had been the company secretary during that time as well. The defendant denied any knowledge of having been issued one million fully paid up shares in the corporation as recorded in the ASIC documents. In cross-examination, the defendant conceded that he had from dates as early as 1990, held office as a director or company secretary or both in a number of Australian registered companies. In relation to a number of others, he replied that he did not recall. He did however concede that for a period of about twenty years, he had been engaged in business activities relating to international trade between Australia and China and had participated in a number of registered companies. I did not find the defendant to be a reliable witness. In my view, he found it convenient to say "I don't recall" on a number of occasions without first endeavouring to search his memory. I would have been a relatively simple task for the defendant to present evidence from the Department of Immigration, charting his arrivals and departures from this country. I am not prepared to make a finding of fact that he was physically out of the country at the time the offences were committed. I simply do not accept the uncorroborated oral evidence of the defendant. However, even if I was satisfied on the evidence that he was in China at relevant times, that would be insufficient to satisfy the court the he is entitled to the s 26(1)(a) defence. In WorkCover Authority v Ritchie , his Honour Haylen J of the Industrial Court of New South Wales, provides an exhaustive analysis of the legislative purpose behind as 26(1), as well as the effect of the words selected by the legislature. It is clear on that and other authorities binding on this Court that a director of a corporation has obligations as a director, notwithstanding the physical impossibility of an individual director being able to personally supervise all of the operational worksites of a company. Further, where a director declines to take an interest in some aspect of the company's business, leaving that to others, the director cannot later rely upon the lack of concern or interest to base a defence under s 26(1)(a). The purpose of 26(1) is clearly to ensure that occupational health and safety is an area of concern for every director and every person involved in the management of the corporation. I FIND THAT THE DEFENDANT HAS FAILED TO ESTABLISH THE DEFENCE DESCRIBED IN S 26(1)(a) OF THE OCCUPATIONAL HEALTH AND SAFETY ACT . TO THE EXTENT THAT IT IS RELIED ON, I ALSO FIND THAT S 26(1)(b) IS NOT AVAILABLE TO THE DEFENDANT. I FIND THE DEFENDANT GUILTY OF EACH OF THE EIGHT CHARGES BEFORE THE COURT. 26 His Honour has clearly rejected the appellant as a reliable witness. His Honour has given a number of reasons for so concluding: 1) The appellant did not provide any corroborative documentary evidence for his assertions that he was residing in China between September 2006 and June 2007. He did not provide any corroborative evidence about the basis upon which he was involved with the corporation and did not provide any corroborative evidence concerning his arrivals into and departures from Australia. 2) The appellant denied that he had been appointed company secretary, as revealed in the ASIC documents and denied any knowledge of having been issued with one million fully paid up shares. 3) The appellant conceded in cross-examination that from 1990 he had been an officer of a number of Australian registered companies, but did not recall others. He said that the appellant "found it convenient to say 'I don't recall' on a number of occasions without first endeavouring to search his memory." 27 A perusal of the transcript of the evidence reveals that although the appellant did say under cross-examination that he did not recall a number of matters on a number of occasions, there are many occasions on which he agreed with certain propositions. The questions related to a period of about 20 years. There is nothing untoward in a failure to recollect accurately matters over such a period. 28 Furthermore, the appellant's evidence concerning the relevant period of absence from Australia was not challenged in cross-examination. Indeed, counsel for the respondent, who was counsel for the prosecutor below, informed the Full Bench that he deliberately refrained from cross-examining the appellant about any of his evidence concerning his absence from Australia at the relevant time. This was because the prosecutor and his counsel were in possession of a Movement Record produced by the Department of Immigration and Citizenship which set out a record of all of the movements into and out of Australia of the appellant from 22 July 1990 until 9 October 2008. This document was clearly corroborative of the appellant's evidence. 29 The appellant's counsel asserted during the course of the hearing that the respondent should have made this document available at the hearing below because it would have dissuaded the Chief Industrial Magistrate from making adverse criticism of the appellant's evidence because of the lack of corroboration about this matter and may have assisted the Chief Industrial Magistrate in accepting, or at least becoming more accepting, of the appellant's evidence. Counsel for the respondent said that he had refrained from making the document available either to the appellant's solicitor or to the Court because he did not think that in all the circumstances it was relevant. It is not necessary to explore this matter further because of the ultimate decision as to the disposal of the appeal. 30 The offences which are now the subject of these appeal proceedings are those that relate to the issue of Notices and the failure to comply with them. The Notices are directed to a failure to answer questions and to furnish documentation. These are the contraventions about which the Court below needed to determine whether the appellant was in a position to influence the conduct of Ferro. The Notices were directed to and served upon two named persons. The appellant said he had no involvement in the affairs of Ferro other than to raise money on its behalf from investors in China. 31 In effect, the appellant bore the onus of negativing a state of affairs. The appellant needed to adduce such evidence which was available to him to prove that he was not in a position to influence Ferro with respect to these contraventions. Unfortunately, it appears that these two contraventions did not receive much attention from anyone in the proceedings. The focus of attention appears to have been the state of the construction site in Newcastle during March 2007. This was at a time when the appellant was clearly residing outside Australia. 32 The Chief Industrial Magistrate clearly considered that the appellant's case was implausible. Indeed, there must be some sympathy for such a consideration judged by the way in which such arrangements are entered into in Australia. Arrangements of this kind are usually documented. The person charged with the responsibility of raising capital usually has sufficient information to inform prospective investors about the nature of the investment. The Chief Industrial Magistrate seized upon the lack of detail and, in particular, the lack of documentation. In particular, there was no documentation dealing with the contractual arrangements with Ferro. 33 However, no evidence was adduced in the proceedings either by way of examination in chief or cross-examination that was indicative that any such documentation existed. It is only when the existence of such documentation is demonstrated that a failure to produce it by way of corroborative evidence can be the subject of adverse criticism. Furthermore, the Chief Industrial Magistrate focussed his attention, in particular, on the failure of the appellant to present evidence from the Department of Immigration charting his arrivals into and departures from Australia. On this basis his Honour was not prepared to accept that the appellant had demonstrated that he was physically out of the country at the time that the offences were committed in March 2007. This caused his Honour to reject, generally, the evidence of the appellant. However, as has previously been pointed out, the evidence of the appellant concerning the dates of his absence from Australia was not made the subject of attack of any kind by the prosecutor. Accordingly, these matters had to be considered as uncontroversial in the context of the evidence given before his Honour. The matter of the absence of the appellant from Australia, which became significant in the rejection of the appellant's evidence by his Honour, did not require further corroboration. It follows that his Honour was in error in rejecting the appellant's evidence about his absence from Australia. This error has affected his Honour's reasoning and a basis upon which his Honour rejected the establishment of the defence under s 26(1)(a). To this extent, his Honour was in error and such error must result in the conviction of the appellant being quashed. 34 There is one other basis upon which the appellant submitted that the decision of his Honour should be quashed. This referred to his Honour's approach to the construction of s 26(1)(a). His Honour's approach to construction is contained within the penultimate paragraph of his Honour's reasons for judgment, extracted in [25] above. Having referred to the judgment of Haylen J, his Honour concluded that a director's obligations under the Act existed "notwithstanding the physical impossibility of an individual director being able to personally supervise all of the operational worksites of a company." The judgment of Haylen J to which his Honour referred is reported in Inspector Ken Kumar v Ritchie [2006] NSWIRComm 323 in support of this approach to construction of s 26(1)(a). With respect, this is not what Haylen J determined in approaching the construction of s 26(1)(a). At [178] Haylen J said: [178] I accept the general thrust of the prosecutor's submissions in relation to both defences and the analysis of the evidence that results in those defences failing. It may be accepted that s 26(1)(a) allows consideration to be given to the particular position of the director and to do so in the context of the particular breach committed by the corporation. It might also be accepted that the word "position" in sub-section (1)(a) looks either to the status or standing of the director or to the particular circumstances of the director, but that status or the circumstances must result in the director not being capable of influencing the conduct of the corporation in relation to its contravention and that must be established objectively. In light of the duties imposed by the Act, it would be unusual for this defence to be made out simply by a director saying that he or she was too busy with other aspects of the business, or indeed with other businesses, to take steps to ensure the safety of persons at the corporation's place of work. The evidence relied upon by the defendant does not establish that he was unable to influence the conduct of the corporation in relation to its contravention – quite to the contrary, that evidence points to both capacity and ability to influence the conduct of the corporation in relation to the contravention of the Act. The evidence shows no more than that Mr Ritchie was very busy. It is difficult to understand why a hands-on director, running his own company and being very busy, for example, with the financial aspects of that company, might nevertheless be in a position to influence the conduct of the company in relation to the contravention of the Act but that a head office based director, remote from the workplace in a larger organisation, would be able to establish a defence. It seems rather that there needs to be demonstrated something that is particular about either the status or circumstances of the director that leads such a director to be unable to influence the conduct of the corporation in relation to a particular breach. In the present case, Mr Ritchie had the status and there had been circumstances in which he had influenced the conduct of the corporation in relation to safety matters so that it might not come into contravention of the Act. In relation to this particular contravention there was nothing about his status or his circumstances that stopped him from being able to influence the conduct of the corporation in relation to the contravention but rather, he chose a course of involvement in safety that primarily left safety issues in the hands of others: in making that choice, in my view, he is not able to make out a defence under s 26(1)(a). 35 The approach contended for by his Honour is also contrary to the approach to construction taken by Staff J in Inspector Wayne James v Sunny Ngai and Ors [2007] NSWIRComm 203 at [125] to [128]. [125] A person holding the office of "director" of the corporation which contravenes the Act is, as I have already observed, deemed to be liable for a breach of the Act unless he or she satisfies the burden of proving otherwise by reference to the matters in s 26(1)(a) or s 26(1)(b). In deeming directors liable, and thus imposing on them the burden of exculpation by satisfying the requirements of s 26(1)(a) or s 26(1)(b), the section expressly recognises that not every director will be held to have contravened the same provisions as the corporation. The section distinguishes between those directors who are in a position to influence the conduct of the corporation in relation to its contravention and those who are not and in respect of those who are in a position to influence the conduct of the corporation, those who used all due diligence to prevent the contravention by the corporation and those who did not. In my view, there is no basis for assuming that every director of a corporation is in the same position to influence the relevant conduct of the corporation. [126] Section 26 must be considered and interpreted in the context of the existing state of the law: CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384 at 408. The legislature in passing the Act must have been aware that Corporations had the ability to allocate and/or limit the duties and responsibilities of directors by providing for a governing director to have all relevant powers of other directors: see Whitehouse & Anor v Carlton Hotel and the cases referred to earlier in these reasons on this issue. If the legislature wished to make each director directly or absolutely responsible, whether complicit or not, this could have been simply achieved by the use of words similar to that found in s 8. [127] In my view, the defence available in s 26 is designed to avoid a situation of persons being punished simply by reason of holding the office of director. In order for a director to be liable, it is necessary to establish that the director was complicit in the contravention. The evidence establishes that in respect of the practical position, the defendants, because of the limited powers, duties, responsibilities and defined roles provided to them by the Governing Director, were not in a position to influence the Corporation's contravention and were not complicit in the Corporation's contravention. Similarly, from a theoretical perspective, in light of the Articles of Association, these defendants were not in a position to influence the contravention by the Corporation. [128] The section provides for punishment for an offence to which the person is deemed to be a party because the person is not able to establish the matters of exculpation in s 26(1)(a) or s 26(1)(b). Whether a person was not able to influence (to the requisite degree), the relevant conduct of the corporation will depend on a range of matters, both legal and factual. 36 There are also observations concerning the construction of s 26(1)(a) in the judgment of Marks J in Inspector James v Ryan [2009] NSWIRComm 215. 37 We appreciate that his Honour's judgment was given ex tempore immediately after the conclusion of the hearing. Accordingly, it is appropriate to make some allowance for the cryptic manner in which his Honour expressed his reasons for judgment. However, his Honour appears to have proceeded on a basis that would equate the offence under s 26(1) as being almost of an absolute nature and by postulating examples which would render the available defence under s 26(1)(a) as being almost of no effect. As has been demonstrated by reference to the extracts of the judgments of Haylen J and Staff J, this is simply not the case. 38 We observe also that the focus of attention in determining whether or not a defence has been made out under s 26(1)(a) is an enquiry as to whether or not a defendant is in a position to influence the conduct of the corporation "in relation to its contravention of the provision". This in turn directs attention to the position of the appellant to influence the conduct of Ferro on 1 December 2007 when there was a failure to comply with the Notices. This was a matter to which his Honour's reasons for judgment should have been specifically directed. They were not. 39 It must be concluded in all the circumstances that his Honour was in error in the manner in which and the reason for which he determined to reject the appellant's evidence and in error in the formulation of the approach which his Honour took in rejecting the availability of the s 26(1)(a) defence that the appellant sought to raise. His Honour's decision should be quashed. 40 In all the circumstances, given the conclusions that have been reached, it is appropriate that the matters be remitted to the Local Court for rehearing. 41 As is obvious from the conclusions reached, it is appropriate that leave to appeal be granted and the appeal upheld. 42 The question of costs was not argued. Costs should be reserved in the event that the parties are unable to reach sensible agreement about them. Orders 43 The following orders are made: 1) The judgment of the Chief Industrial Magistrate as it refers to Court Attendance Notices alleging a contravention of s 66(a) of the Occupational Health and Safety Act on 1 December 2007 at Kogarah and the Court Attendance Notice as it alleges a second contravention of the same provision of the Act on 1 December 2007 at Sydney is quashed. 2) The proceedings are remitted to the Local Court to be dealt with by a magistrate other than the Chief Industrial Magistrate. 3) Costs are reserved with liberty to apply. _____________________________________________________________________ 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.