Industrial Court of New South Wales CITATION: Inspector Foley v Slipstream Marine Enterprises Pty Limited & Anor [2006] NSWIRComm 290 PROSECUTION Inspector Lisa Foley PARTIES: DEFENDANTS Slipstream Marine Enterprises Pty Limited Gavin John Clark FILE NUMBER(S): IRC 5273 and 5274 of 2005 CORAM: Staff J CATCHWORDS: Occupational Health & Safety - Prosecution under s 8(1) and s 26(1) of the Occupational Health & Safety Act 2000 - Maritime industry - Slipping of vessel at marina - Vessel slipped whilst in cradle - Sentencing principles - Objective seriousness of the offence - No system in place - Foreseeability - General and specific deterrence - Subjective factors - Plea of guilty - Penalty imposed - Costs Crimes (Sentencing Procedure) Act 1999 LEGISLATION CITED: Fines Act 1996 Occupational Health & Safety Act 2000 Andrew James Ferguson v Nelmac Pty Limited (1999) 92 IR 188 Inspector Colin Price v Hunter Galvanizing Pty Limited; Inspector Colin Price v Kerry Bartholomew [2006] NSWIRComm 43 Inspector Paul Wade v Litchfield Roofing (Australia) Pty Ltd [2005] NSWIRComm 394 Manpac Industries Pty Ltd (formerly t/as Pacific Concrete & Quarries Pty Ltd) v WorkCover Authority of New South Wales (Inspector Glass) (2001) 106 IR 435 CASES CITED: U-RECT-IT Pty Ltd v WorkCover Authority of New South Wales (Inspector de Silva) [2004] NSWIRComm 266 WorkCover Authority of New South Wales (Inspector Ankucic) v McDonald's Australia Ltd (2000) 95 IR 383 at 452 WorkCover Authority of New South Wales (Inspector Barbosa) v Newstart 150 Pty Ltd and anor (2002) 113 IR 78 WorkCover Authority of NSW (Insp Egan) v Atco Controls Pty Ltd (1998) 82 IR 80 WorkCover Authority of New South Wales (Inspector Farrell) v Morrison (No 2) (2002) 112 IR 312 WorkCover Authority of New South Wales (Inspector Page) v Walco Hoist Rentals Pty Ltd & Anor (No 2) (2000) 99 IR 163 HEARING DATES: 07/08/2006 DATE OF JUDGMENT: 09/08/2006 PROSECUTOR Ms P McDonald of counsel Solicitor: Mr R Higgins Carroll & O'Dea LEGAL REPRESENTATIVES: DEFENDANTS Mr J Poulos SC Solicitor: Mr K Emanuel Boyd House & Partners JUDGMENT: - 1 - INDUSTRIAL COURT OF NEW SOUTH WALES CORAM: STAFF J 8 September 2006 Matter No IRC 5273 of 2005 INSPECTOR LISA FOLEY v SLIPSTREAM MARINE ENTERPRISES PTY LIMITED Prosecution under s 8(1) of the Occupational Health & Safety Act 2000 Matter No IRC 5274 of 2005 INSPECTOR LISA FOLEY v GAVIN JOHN CLARK Prosecution under s 8(1) of the Occupational Health & Safety Act 2000 by virtue of s 26 of the Act JUDGMENT [2006] NSWIRComm 290 1 Slipstream Enterprises Pty Ltd ("the corporate defendant") and Gavin John Clark ("the individual defendant") have pleaded guilty to charges brought by Inspector Lisa Foley, an inspector of the WorkCover Authority of NSW ("WorkCover") under s 8(1) of the Occupational Health & Safety Act 2000 ("the Act"). The individual defendant's offence arises pursuant to the provisions of s 26(1) of the Act. 2 The offences arose out of an incident which occurred on 30 March 2004 at a marina at 5 Wunulla Road, Point Piper, New South Wales. The corporate defendant was a tenant of the Marina and had leased a workshop and was allowed use of the slipway owned by Holcomm Marine Pty Ltd ("Holcomm"). 3 An employee of Holcomm, Mr L Lewis, had slipped a motor cruiser known as the "Mary Lou" on the slipway at the Marina. The boat was slipped to enable employees of Holcomm to perform work such as anti-fouling on it and to allow employees of the corporate defendant to perform work, including the replacement of a wooden docking strip on the bottom of the vessel. 4 The boat was secured by means of placing it into two cradles which consisted of a framework of horizontal and lateral beams with two sets of vertical arms that are laterally adjusted by the means of a mechanical chain and pulley system. Support for the boat was provided by the cradle arms which are moved laterally to hold the vessel upright. 5 No other support was provided to the boat. There was no stabilisation by chocking the boat to ensure that the boat could not tip or slide sideways within the cradle arms. 6 At approximately 4.30 pm on 30 March 2004, Mr Lewis was working underneath the vessel re-touching anti-foul paint. Mr E Loughrey and Mr G Clark, employees of the corporate defendant, were completing the task of replacing the docking strip under the vessel. Mr Lewis offered to assist the two employees with the replacement of the docking strip. Whilst they were working underneath the vessel, it slipped off the timber support blocks and fell to the right, impacting on Mr Lewis and Mr Loughrey. Mr Clark escaped impact as he was standing clear of the bilge, or the wider section of the vessel. 7 As a result of the incident, Mr Loughrey sustained a crush fracture to the L5 vertebrae and Mr Lewis sustained a fractured rib and soft tissue injury to the lower back. Both were incapacitated for a period of time. Mr Lewis returned to work in May 2004 and Mr Loughrey in July 2004. 8 In an application for order, it was alleged that the corporate defendant, being an employer: DID FAIL, contrary to Section 8(1) of the 2000 Act to ensure the health, safety and welfare at work of all of the employees of the Defendant employer, and in particular, Mr Eoin Loughrey. The particulars of the charge are as follows:- 1. The Defendant failed to provide and maintain a system of work that was safe and without risks to health in relation to the undertaking of cleaning, anti-fouling and repair work of vessels placed on the slip way. The system of work failed to require that vessels on the slip way be adequately jacked, shored or chocked so as to ensure the lateral stability of the vessel whilst in the slip way. 2. The Defendant failed to adequately assess the risks of a vessel in the slip way tipping over, such a risk assessment had it been undertaken or had it been adequate would have required a vessel to be supported by the use of akro props, wedges, or other means to stabilise a vessel in the slip way. 9 The individual defendant was charged pursuant to the provisions of s 26(1) of the Act in relation to the offence committed by the corporate defendant on the basis of his directorship of that defendant. The failures particularised in the charge were the same as those for the corporate defendant. 10 Each defendant pleaded guilty to the charge. Statement of Facts 11 Two similar statements of facts were tendered by the prosecutor. One in respect of the corporate defendant and the other in respect of the individual defendant. 12 The individual defendant's statement of facts provided (formal parts omitted): 2. At all material times Mr Gavin John Clark ("the Defendant") was a Director of Slipstream Marine Enterprises Pty Ltd (ACN 090 840 412) ("the Company"), a company duly incorporated with a registered office located at Unit 3, 2A Mona Road, Darling Point in the State of New South Wales. 3. At all material times the Company was an employer at a site located at 5 Wunulla Road, Point Piper in the State of NSW ("the site"). 4. At all material times the site was the Defendant was directly involved in the management of the Company's operations at the site and was in a position to influence the Company's conduct. 5. At all material times, and in particular on 30 March 2004 ("the incident date"), Eoin Loughrey ("Loughrey") was an employee of the Company. 6. At all material times the Company was permitted to use the slipway and a workshop at the site as a result of undocumented agreement between the Company and Holcomm Marine Pty Ltd ("Holcomm") (ACN 062 320 780). 7. The slipway at the site is an inclined track with rails set in concrete that slopes down into the water. Two cradles sit on the top of these rails, which allows a vessel to be floated into the cradles and then pulled up the track out of the water – vessels are moved up & down the inclined track by means of winches and cables so that the vessels can be worked on in an elevated upright position, with the weight of the vessel resting on its keel. The cradle is a framework of horizontal and lateral beams with two (2) sets of vertical arms that are laterally adjusted by means of a mechanical chain and pulley system. The manual controls for the cradle arms are located on work platforms, which are attached to the side of each cradle and are approximately four (4) metres above ground level. The cradle arms are moved laterally to hold the vessel upright, and the cradle arms are locked into position with a removable pin. 8. At sometime prior to the incident date, the Company agreed to perform work on a timber motor cruiser, the "Mary Lou" (Halvorsen style of approximately 20 to 25 tonnes, and approximately 46 feet in length and 13 feet wide), that was owned by Mr Anthony Fisher ("Fisher"). The work that the Company was to perform was replacement of the wooden docking strip, which was located at the bottom of the vessel. In order to replace the docking strip, the vessel had to be jacked up in sections so that the existing docking strip could be removed and then replaced. 9. At some time prior to the incident date, Holcomm also agreed to perform associated work on the "Mary Lou" for Fisher. This work included slipping the vessel on the slipway. 10. Prior to the date of the incident date, Holcomm slipped the "Mary Lou" onto the slipway and positioned the vessel within the cradle arms of the inclined slipway. However, the Mary Lou was not stabilised or chocked, other than reliance on the cradle arms, so as to ensure that the vessel could not tip or slip sideways within the cradle arms off the slipway. 11. At approximately 4.30pm on the incident date Loughrey and Clark were working underneath the vessel with an employee of Holcomm, Laurie Lewis ("Lewis"). Lewis was retouching the antifoul paint and he offered to assist Loughrey and Clark with the last section of docking strip, as it had previously slipped out of place. Whilst working underneath the vessel, the keel of the vessel slipped off the timber support blocks and fell to the right (starboard) side impacting on Lewis and Loughrey. Clark, however, escaped impact as he was standing clear of the bilge (the widest section of the vessel). 12. As a result of the incident, Loughrey sustained a crush fracture to the L5 vertebrae and Lewis sustained a fractured rib and soft tissue injury to the lower back. Immediately prior to impact Loughrey was crouched forward and on one knee and Lewis was in a crouched position learning forward. 13. Both Loughrey and Lewis required a substantial period of time off work – Loughrey was incapacitated for work up until July 2004 and Lewis was incapacitated for work up until May 2004. 14. Prior to the incident date, the Company had not undertaken a document risk assessment in relation to work being performed underneath vessels on the slipway, and specifically failed to assess the risk of the vessel tipping due to inadequate chocking. 15. The day after the incident Holcomm sold the slipway. The sale is unrelated to these proceedings, but Holcomm later made an ex gratia payment of $25,000.00 to the purchaser with respect to loss of business due to a necessity for the slipway to be repaired because of its poor condition. 16. It is alleged, that on the said date the said site, the Defendant being a Director of the Company, breached s.8(1) of the 2000 Act, by virtue of section 26 of the 2000 Act, in that the Company, being an employer at the site on the said date, did fail to ensure the health, safety and welfare at work of all of the employees of the Company, and in particular Eoin Loughrey, in that the Company: (1) failed to provide and maintain a system of work that was safe and without risks to health in relation to the undertaking of cleaning, anti-fouling and repair work of vessels placed on the slipway. The system of work failed to require that vessels on the slipway be adequately jacked, shored or chocked so as to ensure the lateral stability of the vessel whilst in the slipway; (2) failed to adequately assess the risks of a vessel in the slipway tipping over, such a risk assessment had it been undertaken or had it been adequate would have required a vessel to be supported by the use of akro props, wedges, or other means to stabilise a vessel in the slipway. 13 The corporate defendant's statement of facts included additional paragraphs that were in the following terms: 4 At all material times the site was the Defendant's place of work. 5. At all material times the Defendant was an employer in the State of NSW. Evidence 14 In addition, the prosecutor relied on the following evidence in the sentencing proceedings: 1. 26 colour photographs of the incident scene taken by Inspector Elizabeth Benbow of WorkCover on 30 and 31 March 2004. 2. 27 colour photographs taken by the Police of the scene of the accident on 30 March 2004. 3. 15 colour photographs of the Marina taken by Inspector Lisa Foley of WorkCover on 22 June 2004. 4. A factual report by Senior Inspector Elizabeth Benbow dated 15 April 2004. 5. Statements regarding prior convictions of the defendants. Neither defendant has a prior conviction. 6. A slipway cradle inspection report prepared by D F Dickson & Associates Pty Limited, Consulting Civil & Geotechnical Engineers dated 15 April 2004. 15 Mr J Poulos SC, who appeared for the defendants, tendered: 1. An affidavit of the individual defendant dated 21 July 2006, who was required for cross-examination. 2. An affidavit of Mark Cotter, Vice-President of the North Bondi Surf Life Saving Club, dated 28 July 2006. Mr Cotter was not required for cross-examination. 16 Mr Clark deposed that he was the sole director and shareholder of the corporate defendant, which he established in either 1994 or 1995. After leaving school at the age of 16, Mr Clark became an apprentice boat builder, completing his apprenticeship with D & R Shipwrights at Rushcutters Bay. The corporate defendant undertakes boatbuilding, boat repairs, fit outs and marine surveying. It commenced to work permanently at the Marina at 5 Wunulla Road, Point Piper from approximately February or March 2002. The business operated from a workshop at the Marina. 17 Mr Clark stated that from time to time, it was necessary to have vessels on which work was to be carried out slipped at the premises. The slipping of vessels on the slipway was undertaken by Holcomm, who was also responsible for the maintenance of the slipway. 18 In April 2003, the corporate defendant employed Mr Loughrey as an apprentice shipwright. He and Mr Clark were the only employees of the corporate defendant at the date of the incident. The slipway manager at the Marina was Mr L Lewis, who was employed by Holcomm. He was never an employee of the corporate defendant, although from time to time he would also assist Mr Clark in carrying out work on vessels at the Marina. 19 Mr Clark deposed that no maintenance work, or general upkeep work had been carried out on the slipway for some time prior to 30 March 2004. Following the incident and the sale of the premises on 31 March 2004, the purchasers closed the slipway for approximately four weeks, during which time substantial repairs and maintenance work were carried out to the slipway. 20 Mr Clark stated that he was interviewed by Inspector Foley after the incident. He annexed a copy of his statement dated 27 January 2005. Mr Clark accepted that no written risk assessment was prepared prior to 30 March 2004. However, after the employment of Mr Loughrey, his practice was to outline to him the relevant procedures to be undertaken in respect of any job being performed, including the risks involved in such a job. The work that was being carried out on 30 March 2004 included the jacking of the vessel whilst on the slipway which Mr Clark had learnt in his apprenticeship and had been taught by very experienced shipwrights. Mr Clark stated that during his time in business he had never encountered a situation that when a vessel which was slipped, slid out when it was being jacked up. 21 Mr Clark stated that he was, and still is, extremely upset that Mr Loughrey and Mr Lewis suffered injuries in the incident on 30 March 2004. He stated that he did everything he could to ensure that Mr Loughrey, as an employee of the corporate defendant, had every assistance required whilst off work and prior to his return to working with the corporate defendant. 22 During further oral evidence given during the sentencing hearing, Mr Clark stated that his wife was expecting their first child in November and that they had their unit at North Bondi up for sale. Mr Clark has already entered into a contract for the purchase of another property for $575,000. The unit is on the market for $409,000, however he is having difficulty selling it. 23 Mr Clark has been an active member of the North Bondi Surf Club for the majority of his life. He had been an active patrol member for the last 15 years, receiving 100 per cent co-efficiency each year. It is particularly rare these days for patrol members to receive this award because of work pressures and the like. He performs voluntary work for the Surf Club, including carrying out repairs to boats and life saving equipment. 24 Mr Clark stated that he received a call from the owner of the boat after it had been slipped as it was found that the docking strip was rotten and needed replacing. This work is carried out by a shipwright. It involves placing a new piece of timber approximately five inches by one inch and 40 feet long on the bottom of the boat. It is fastened in sections and in order to insert the docking strip, it is necessary to jack the boat up to enable room to slide the docking strip between the boat and the cradle. The jacks are hydraulic and work on the same principle as a motor vehicle jack. Mr Clark's evidence was that the boat would be jacked approximately two inches. 25 Mr Clark conceded that with the benefit of hindsight, the risk of the boat falling could have been avoided by putting in what he called "builders' blocks". Mr Clark stated that he had made extensive enquiries in respect of the weight of the "Mary Lou". The general consensus was that it would weigh approximately 17 tonnes. There are no qualifications required for the slipping of boats. It is the responsibility of the slipway manager to carry out this task. 26 The corporate defendant currently has 4 employees including Mr Clark. Mr Clark acknowledged that the corporate defendant did not have a written plan for safety management. After the incident, Mr Clark obtained advice from WorkCover regarding safe methods of work and put in place a system of work to ensure that a vessel was slipped correctly. 27 It was acknowledged that the fall of the boat had the capacity to seriously injure or kill Mr Lewis and Mr Loughrey. 28 Mr Clark stated that he was very remorseful for what happened; that he couldn't sleep for a couple of months and that the accident still goes through his mind 100 times a day. When Mr Loughrey returned to work, an opportunity came up for him to work in the Mediterranean which Mr Clark assisted him with by keeping his job open until he returned some four months later. Mr Clark went to see both Mr Lewis and Mr Loughrey initially each day they were in hospital and then every second day. In respect of Mr Loughrey, he also made visits to his home once he was discharged. 29 Mr Poulos also tendered Mr Clark's tax return for the financial years 2003/04 and 2004/05 and the financial report for the year ended 30 June 2005 for the corporate defendant. Mr Clark stated that at the present time he has a $240,000 mortgage which requires a repayment of $1,200 per month. The mortgage would increase to $475,000 if the unit is not sold with repayments of $3,000 per month. 30 Mr Clark stated that the current liabilities of the corporate defendant had increased from $50,000 in 2004 to $68,000 in 2005 and that he had lent the additional money to the corporate defendant. He stated that this had occurred on a number of occasions; that he has had to put his own money into the corporate defendant in 2004 and that he loaned the corporate defendant $39,958 in 2005 because the corporate defendant had made an operating loss before income of $7,332. The total property, plant and equipment was valued at $29,229 in 2005. Consideration 31 The sentencing principles to be applied in matters such as this were recently restated by the Full Bench in U-RECT-IT Pty Ltd v WorkCover Authority of New South Wales (Inspector de Silva) [2004] NSWIRComm 266, where the Full Bench stated at [11]: The sentencing principles to be applied in the assessment of appropriate penalties under the Act have been considered on many occasions by this Court, including Full Bench level, and are well known. We refer by way of example to Lawrenson Diecasting Pty Ltd v WorkCover Authority of New South Wales (1999) 90 IR 464 at 474-475 and Fletcher Construction Australia Limited v WorkCover Authority of New South Wales (1999) 91 IR 66 at 77. The starting point is the objective seriousness of the offence and the need to accommodate both general and specific deterrence. The maximum penalty that may be imposed is to be reserved for the most serious offence, that is, the worst possible case. Only after an appropriate penalty has then been formulated are subjective matters to be taken into account, which include factors such as cooperation with the investigation and inquiries of the WorkCover Authority, expressions of remorse and contrition, steps taken to remedy the matters giving rise to the breach and the general approach to occupational health and safety matters and attention to safe working practices by a defendant. This list is not intended to be exhaustive but is indicative of the matters which should be taken into account. Furthermore, a defendant will be entitled to a discount of up to 25 per cent for entering a plea of guilty at the earliest possible opportunity. These subjective factors are then aggregated so that a discount is applied to the penalty assessed by reference to the objective factors, resulting in the penalty to be properly imposed. 32 In this matter, in my view, the risk to the health and safety of employees was the risk of the vessel tipping or slipping when employees were working underneath it. The vessel weighs between 17 to 25 tonnes and the employees were required to work underneath the vessel. In these circumstances, the risk was reasonable foreseeable. The occupational health and safety system put in place by the corporate defendant was rather rudimentary or minimal at best. There was no real conscious assessment on whether the vessel, in the particular circumstances, posed a risk. Although employees were required to work underneath the boat, there was no additional layer of safety as required by the Act to ensure that serious or fatal injuries are avoided. 33 After the accident, Mr Clark's evidence was that a system, or method of work was put in place to ensure that the boat was slipped correctly and that the employees followed proper procedures. Clearly, there was not any systematic approach to the identification of risks. The obligations imposed on an employer by the Act requires the employer to be proactive. As Hill J said in WorkCover Authority of NSW (Insp Egan) v Atco Controls Pty Ltd (1998) 82 IR 80 at 85: This case is yet another illustration of the need for employers to exercise abundant caution, maintain constant vigilance and take all practicable precautions to ensure safety in the workplace. It is essential that the approach should be a pro-active and not a re-active one; employers should be on the offensive to search for, detect and eliminate, so far as is reasonably practicable, any possible areas of risk to safety, health and welfare which may exist or occur from time to time in the workplace. 34 Mr Clark's evidence was that the procedure now in place is that the vessel is shored and preventative bilge blocks are put in place to minimise the risk of slipping. In addition, he also makes sure that the arms of the cradle are tied together. This is another way of ensuring that the cradle is operating properly. 35 The gravity of the injury actually resulting from the breach does not of itself dictate the amount of penalty. Nevertheless, the occurrence of death or serious injury manifests a degree of seriousness of the relevant detriment to safety. Wright J, President in Andrew James Ferguson v Nelmac Pty Limited (1999) 92 IR 188 at 204 stated: … where a fatal injury had occurred, that is a factor to be taken into account and is often, of itself, reflective of an offence the nature and quality of which is serious. 36 Clearly, there was the potential for serious, even fatal injuries to occur to the employees working underneath the vessel. 37 Section 21A(2) of the Crimes (Sentencing Procedure) Act 1999 provides that an aggravating factor that may be taken into account in determining the appropriate sentence for an offence is: (g) the injury, emotional harm, loss or damage caused by the offence was substantial, 38 Mr Loughrey sustained a crush fracture of the L5 vertebrae and was incapacitated for work until July 2004. 39 The seriousness of the offence may also be reflected in the simple remedial and straightforward steps the defendant would have been able to implement to meet its obligations under the Act. I have already referred to some of the steps taken by the corporate defendant after the accident. In addition, chocking and shoring of the vessel and the use of akro props, wedges or blocks could have been utilised, together with safe work statements being issued to employees to minimise the risk to the employees. Such steps were adopted after the accident. 40 Section 21A(2)(1) of the Crimes (Sentencing Procedure) Act provides that an aggravating factor that may be taken into account in determining the appropriate sentence for an offence is the fact that the victim was vulnerable, for example, the victim was very young. In respect of the offence under s 8(1) of the Act, the victim was, in the overall circumstances, vulnerable. Mr Loughrey was an apprentice and was aged 17 years at the time of the incident. The presence of young and inexperienced persons in the workforce gives rise to increased responsibilities of an employer and reflects the seriousness of the offence: WorkCover Authority of New South Wales (Inspector Barbosa) v Newstart 150 Pty Ltd and anor (2002) 113 IR 78 at 100 and Inspector Paul Wade v Litchfield Roofing (Australia) Pty Ltd [2005] NSWIRComm 394. 41 The youth and inexperience of the injured worker is relevant to the weight to be given to general deterrence. It is relevant, in light of the objects of the Act, that general deterrence should normally be given weight in the sentencing process to compel the attention of other employers operating in similar industries to the importance of ensuring the safety of young and inexperienced workers: WorkCover Authority of New South Wales (Inspector Ankucic) v McDonald's Australia Ltd (2000) 95 IR 383 at 452; Inspector Colin Price v Hunter Galvanizing Pty Limited; Inspector Colin Price v Kerry Bartholomew [2006] NSWIRComm 43 at [13] - [14]. I have, therefore, included an element in each of the penalties for general deterrence. 42 The corporate defendant remains in business in the maritime industry, an industry that presents risks to workplace safety. I propose to include an element in the penalty for specific deterrence, although it will only be small given that I consider the incident was a salutary lesson for each of the defendants and it is unlikely they will re-offend. 43 There are a number of relevant subjective considerations. Each defendant entered a plea of guilty at an early stage and a discount of 25 per cent is warranted. It is clear from the evidence of Mr Clark that he felt great remorse and contrition concerning the incident and that it had affected him. Both the corporate defendant and the individual defendant have provided significant support to Mr Loughrey to enable him to recover from his injuries and also to progress his career. Steps have also been undertaken by both defendants to endeavour to ensure that such an incident does not occur again. 44 I also accept that both defendants co-operated with the investigating authority. I note that neither defendant has any prior convictions. 45 In respect of the defendant's capacity to pay a fine, there is evidence before me that the corporate defendant operated at a loss in the last financial year, despite the injection of funds by the individual defendant. The main asset of the individual defendant is a unit which is up for sale with other premises to be purchased. The corporate defendant does not appear to own any real property. The total value of its property, plant and equipment in 2005 was $29,229. It was conceded by the prosecutor that the defendant's financial position is not strong. 46 I am entitled to take into account these matters pursuant to s 6 of the Fines Act 1996. However, in doing so, I am mindful of the comments of Wright J, President in Ferguson v Nelmac Pty Limited which were endorsed by the Full Bench in Manpac Industries Pty Ltd (formerly t/as Pacific Concrete & Quarries Pty Ltd) v WorkCover Authority of New South Wales (Inspector Glass) (2001) 106 IR 435. His Honour observed: "... Whilst I accept that the imposition of heavy fines would be a burden on the defendant and its financial resources and that consideration should be given appropriate weight on the question of penalty, it does not necessarily result in the Court not imposing a heavy penalty. ... ... When viewed in the context of the statutory mandate in s 15 the offences were very serious and provided proper weight is given to the subjective considerations and insofar as deterrence is concerned some tempering thereof, the penalty should reflect the objective seriousness of the offence. ..." 47 In respect of the question of culpabilities, Wright J, President (in referring to the predecessor of s 26(1)) observed in WorkCover Authority of New South Wales (Inspector Page) v Walco Hoist Rentals Pty Ltd and Anor (No 2) (2000) 99 IR 163 at [38]: [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. 48 The individual defendant is the sole director and shareholder of the corporate defendant. The culpabilities of both defendants are, in my view, the same. The focus of the prosecutions in both these matters and those brought against Holcomm and Mr Holmes, its director (who were charged with offences pursuant to s 8(1) and s 8(2) of the Act), was on the instability of the boat in the slipway. The fundamental responsibility for this, to my mind, and I find, fell on Holcomm and Mr Holmes, the owner and director of the Marina. They had the primary responsibility to slip the boat and to ensure it was stable. Although there was no evidence before me as to the cause of the incident, it would appear that the work being performed by the individual defendant (the jacking of the boat) though small, may have contributed to the instability of the boat. The evidence was that the vessel had been on the slipway for some days. If a proper risk assessment had been conducted and the remedial steps which were taken after the incident been put into place by Holcomm, the risk to safety would have been avoided. In my view, the primary responsibility for the slipway falls upon the slipway proprietor. It had the responsibility of slipping the vessel and for having in place a system that ensured that anyone who worked on the vessel was not exposed to a risk to their health and safety. For the reasons outlined, I find, Holcomm and Mr Holmes were more culpable than these defendants. 49 I have applied the principle of parity in this matter in assessing the sentences applicable for these defendants and the slipway proprietor. I respectfully adopt the principles set out by Walton J, Vice-President in WorkCover Authority of New South Wales (Inspector Farrell) v Morrison (No 2) (2002) 112 IR 312 at [70] - [71] in this regard. 50 In the present circumstances, the defendants have been charged under the same section of the Act as the defendants in another proceedings for a risk which arose from the same factual scenario: see Inspector Foley v Campbell Barrett Holmes & Anor [2006] NSWIRComm 289, delivered concurrently with the judgment in these proceedings. 51 I have earlier found the culpabilities of the defendants in these sets of proceedings less than that of the defendants in Holmes. The application of the Fines Act in this matter is also a distinguishing feature. 52 In the result, and applying the principles of parity, I consider that the abovementioned factors require a different penalty for these defendants and the defendants in Holmes. 53 In determining penalty, I take into account all of the matters set out earlier in my reasons. I note that the maximum penalty for the corporate defendant is $550,000 and the maximum penalty for the individual defendant is $55,000. I should observe that it is not entirely clear to me why direct prosecutions were brought against Mr Clark as there does not seem, on the evidence, any particular aspect warranting this approach. However, having said that, I proceed to sentence the individual defendant and the corporate defendant. I consider the appropriate penalties to be: 1. In matter No IRC 5273 of 2005 - $30,000. 2. In matter No IRC 5274 of 2005 - $2,500. ORDERS 54 The Court makes the following orders: In matter No IRC 5273 of 2005: 1. The offence is proven and a verdict of guilty is entered. 2. The defendant is convicted of the offence as charged. 3. The defendant is fined an amount of $30,000 with a moiety to the prosecutor. 4. The defendant shall pay the prosecutor's costs of the proceedings in an amount as agreed, or, if agreement cannot be reached, as assessed in accordance with the Rules of the Court. In matter No IRC 5274 of 2005: 1. The offence is proven and a verdict of guilty is entered. 2. The defendant is convicted of the offence as charged. 3. The defendant is fined an amount of $2,500 with a moiety to the prosecutor. 4. The defendant shall pay the prosecutor's costs of the proceedings in an amount as agreed, or, if agreement cannot be reached, as assessed in accordance with the Rules of the Court. 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