Industrial Relations Commission New South Wales Medium Neutral Citation: Inspector Lancaster v M L Colturi Sawmills Pty Ltd [2011] NSWIRComm 47 Hearing dates: 6 April 2011 Decision date: 15 April 2011 Jurisdiction: Industrial Court of NSW Before: Boland P Decision: Matter No IRC 639 of 2010 (1) The defendant is found guilty of the offence charged under s 8(1) of the Occupational Health and Safety Act 2000 and is convicted of the offence. (2) The defendant is fined an amount of $220,000 with a moiety to the prosecutor. Matter No IRC 640 of 2010 (1) The defendant is found guilty of the offence charged under s 8(1) of the Occupational Health and Safety Act 2000 by operation of s 26(1) of that Act and is convicted of the offence. (2) The defendant is fined an amount of $22,000 with a moiety to the prosecutor. The defendants shall jointly and severally pay the costs of the prosecutor as agreed or assessed. Catchwords: OCCUPATIONAL HEALTH AND SAFETY - Forestry industry - Fatality - Employee crushed by logging machine - Prosecution under s 8(1) of Occupational Health and Safety Act 2000 of corporate defendant and prosecution of sole director under s 8(1) by virtue of s 26 of Occupational Health and Safety Act - Guilty pleas - Sentencing - Consideration of objective and subjective factors - High range of seriousness - Small employer - Capacity to pay - Victim impact statement - Penalties imposed Legislation Cited: Crimes (Sentencing Procedure) Act1999 Evidence Act 1995 Fines Act 1996 Occupational Health and Safety Act 2000 Cases Cited: Bollen v R (1998) 99 A Crim R 510 Cahill v State of New South Wales (Department of Community Services) (No 3) [2008] NSWIRComm 123; (2008) 182 IR 124 Cahill v State of New South Wales (Department of Community Services) (No 4) [2008] NSWIRComm 201; (2008) 182 IR 231 Capral Aluminium Ltd v WorkCover Authority of New South Wales [2000] NSWIRComm 71; (2000) 49 NSWLR 610 Department of Mineral Resources of NSW (McKensey) v Kembla Coal & Coke Pty Ltd (1999) 92 IR 8 at 27 Environment Protection Authority (EPA) v Barnes [2006] NSWCCA 246 Inspector Elizabeth Benbow v Planada Holdings Pty Ltd [2001] NSWIRComm 275 Inspector Franke v Vin Heffernan Pty Ltd [2005] NSWIRComm 16 Inspector Lancaster v Eurobodalla Shire Council [2009] NSWIRComm 192 Inspector Schultz v Leonard J Williams (Timber) Pty Ltd [2001] NSWIRComm 286 Inspector Wolf v Colebrook & Sons Pty Ltd [2008] NSWIRComm 231 Inspector Wolf v The Forestry Commission of NSW t-as Forests NSW [2008] NSWIRComm 230 Inspector Yeung v Wilson trading as Wilson's Tree Service [2004] NSWIRComm 346 McColl v John Watson Building Services Pty Ltd [2004] NSWIRComm 353; (2004) 137 IR 310 Morrison v Centennial Coal Co Ltd [2010] NSWIRComm 4 R v Dang [1999] NSWCCA 42 R v Mansour [1999] NSWCCA 180 R v Previtera (1997) 94 A Crim R 76 R v Thomas [2007] NSWCCA 269 Riley v Australian Grader Hire Pty Ltd [2001] NSWIRComm 31; (2001) 103 IR 143 SBF v R [2009] NSWCCA 231; (2009) 198 A Crim R 219 Wilmot v R [2007] NSWCCA 30; (2007) 169 A Crim R 280 WorkCover Authority of NSW v ACI Operations Pty Ltd [1994] NSWIRComm 167 WorkCover Authority of New South Wales (Inspector Ankucic) v Lyndhurst Trading Co Pty Ltd (2000) 95 IR 462 Workcover Authority of New South Wales (Inspector Farrell) v Schrader [2002] NSWIRComm 25; (2002) 112 IR 284 WorkCover Authority (NSW) (Inspector Maddaford) v Coleman [2004] NSWIRComm 317; (2004) 138 IR 21 WorkCover Authority of New South Wales (Inspector Mansell) v Chen [2004] NSWIRComm 247; (2004) 137 IR 33 WorkCover Authority of New South Wales (Inspector Webster) v Power Rise Pty Limited [2008] NSWIRComm 26 WorkCover Authority (Inspector Yeung) v Wilson (t/as Wilson's Tree Service) [2005] NSWIRComm 158; (2005) 143 IR 187 Category: Principal judgment Parties: Inspector Ian Lancaster (Prosecutor) M L Colturi Sawmills Pty Ltd (Defendant in Matter IRC 639 of 2010) Maurice Louis Colturi (Defendant in Matter IRC 640 of 2010) Representation: D B O'Neil of counsel (Prosecutor) J P Phillips SC (Defendants) WorkCover Authority of NSW (Prosecutor) Gleeson & Co., Solicitors (Defendants) File Number(s): IRC 639 of 2010 IRC 640 of 2010 Judgment 1These matters concern the prosecution of two defendants, namely, M L Colturi Sawmills Pty Ltd ("corporate defendant") and Maurice Louis Colturi ("personal defendant") by Inspector Ian Lancaster, an inspector with the WorkCover Authority of New South Wales. 2The corporate defendant operates a small business that consists of a sawmill plant at Mathoura in the south of the State, together with various plant and equipment for the removal and transportation of timber for forest compartments. The personal defendant is the sole director and guiding mind of the corporate defendant. 3The corporate defendant was prosecuted for contravention of s 8(1) of the Occupational Health and Safety Act 2000 ("the Act"). The personal defendant was prosecuted for contravention of the same provision by virtue of s 26(1) of the Act. Sections 8(1) and 26(1) provide: 8 Duties of employers (1) Employees An employer must ensure the health, safety and welfare at work of all the employees of the employer. That duty extends (without limitation) to the following: (a) ensuring that any premises controlled by the employer where the employees work (and the means of access to or exit from the premises) are safe and without risks to health, (b) ensuring that any plant or substance provided for use by the employees at work is safe and without risks to health when properly used, (c) ensuring that systems of work and the working environment of the employees are safe and without risks to health, (d) providing such information, instruction, training and supervision as may be necessary to ensure the employees' health and safety at work, (e) providing adequate facilities for the welfare of the employees at work. ... 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. 4The prosecutions arose from an incident that occurred on Saturday, 26 July 2008 when Dennis Russell Rowbottom, an employee of the corporate defendant, was killed when a "Bell logger" knocked Mr Rowbottom to the ground and rolled over him. 5In an amended application for order in respect of the corporate defendant it was alleged the corporate defendant "failed by its acts or omissions as particularised below to ensure the health, safety and welfare at work of all of its employees and in particular Dennis Rowbottom and Peter Crane contrary to Section 8(1) of the Act." The particularised acts or omissions were as follows: The employees of the corporation, and in particular, Mr Rowbottom and Mr Crane, were at risk of being hit, struck or run over by the Bell logger. The particulars of the corporation's acts and omissions are: 1. The corporation failed to ensure that plant, namely the Bell logger, provided for use by employees at work, was safe and without risks to health or safety when properly used in that: (a) The corporation failed to ensure the bell logger had a neutral start switch which was in place and in proper working order so as to prevent the Bell logger moving when the ignition was turned on. 2. The corporation failed to instruct employees in and ensure employees undertook, pre-start checks of the bell logger prior to working upon, using or starting the Bell logger so as to ensure safety devices including the neutral start switch were in place and in working order. 3. The corporation failed to put in place a safe work procedure for the Bell logger. 4. The corporation failed to ensure that there was a sufficiently trained, qualified and experienced supervisor undertaking supervision of its employees on 26 July 2008. As a result of the acts and omissions of the corporation its employees, and in particular Dennis Rowbottom and Peter Crane, were placed at risk of injury. As a result of the acts and omissions of the corporation its employee, Dennis Rowbottom, suffered fatal injuries. 6In relation to the personal defendant the amended application for order alleged that Mr Colturi: being a director of a corporation, M L Colturi Sawmills Pty Ltd [ACN 072 557 941] in the State of New South Wales ("corporation"), by virtue of section 26(1) of the Act, is taken to have contravened section 8(1) of the Act, in that the corporation, being an employer, on 26 July 2008 at Compartment 17 of Millewa State Forest in the State of New South Wales ("premises") 7It was further alleged there was a failure to: Ensure, by its acts or omissions as particularised below, the health, safety and welfare at work of all its employees, and in particular Dennis Rowbottom and Peter Crane, contrary to section 8(1) of the Occupational Health and Safety Act 2000. The particulars of the charge are: The employees of the corporation, and in particular, Mr Rowbottom and Mr Crane, were at risk of being hit, struck or run over by the Bell logger. At all material times the defendant was a director of the corporation. The particulars of the corporation's acts and omissions are: 1. The corporation failed to ensure that plant, namely the Bell logger, provided for use by employees at work, was safe and without risks to health or safety when properly used in that: (a) The corporation failed to ensure the bell logger had a neutral start switch which was in place and in proper working order so as to prevent the Bell logger moving when the ignition was turned on. 2. The corporation failed to instruct employees in and ensure employees undertook, pre-start checks of the bell logger prior to working upon, using or starting the Bell logger so as to ensure safety devices including the neutral start switch were in place and in working order. 3. The corporation failed to put in place a safe work procedure for the Bell logger. 4. The corporation failed to ensure that there was a sufficiently trained, qualified and experienced supervisor undertaking supervision of its employees on 26 July 2008. As a result of the acts and omissions of the corporation its employees, and in particular Dennis Rowbottom and Peter Crane, were placed at risk of injury. As a result of the acts and omissions of the corporation its employee, Dennis Rowbottom, suffered fatal injuries. Both defendants entered pleas of guilty to the charges. Agreed facts 8Agreed statements of fact were filed in both matters in substantially similar terms. The statements revealed that the corporate defendant held a licence to remove timber from compartment 17 of the Millewa State Forest. At the relevant time the corporate defendant had four to five permanent employees and as the need arose would engage four to five contractors. 9At the time of the incident Mr Rowbottom was 58 years of age and had been employed by the corporate defendant for a few months. He had been granted a Forests NSW Forest Operator's Licence for the categories of truck driver, machine operator - track/wheeled loader, machine operator - skidder. 10On 26 July 2008 Mr Rowbottom and Mr Crane, a fellow employee, were processing timber residue. The primary work task involved cutting up of the timber that was then loaded onto trucks and taken away. There was no supervisor present. 11At some time during the course of the morning, Mr Rowbottom advised Mr Crane that the Bell logger would not start. Mr Rowbottom borrowed some tools from Mr Crane and informed Mr Crane that he, Mr Rowbottom, was going to clean the battery terminals. 12A short time after Mr Rowbottom got the tools from Mr Crane, Mr Crane looked up and the Bell logger was "coming up beside" him. It was an agreed fact that: Whilst no one was watching Mr Rowbottom at the relevant time, it appears that he was outside the cabin when he pressed the ignition button, whereupon the Bell logger began to move backwards. The Bell logger knocked Mr Rowbottom to the ground and then rolled over him. It is not known at what speed the Bell logger moved. After running over Mr Rowbottom, the Bell logger continued its travel under its own power until it collided with a stack of timber adjacent to the sawmill docking machine being operated by Mr Peter Crane. As a result of being run over by the Bell logger Mr Rowbottom died. 13The Bell logger was described as follows: A triangular shaped vehicle when viewed from the side and from above. It has two tractor type front wheels, a rear jockey wheel, a forward operator's cabin, a rear mounted diesel engine, and an overhead boom fitted with a hydraulic log grab attachment above the operator's cabin. The top of the chassis frame (back of the machine) slopes front to rear. Overall the Bell measured 6.1 metres long x 2.7 wide x 2.6 metres high. 14The Bell logger is a load-shifting machine with a fully enclosed operator's cabin. It operates hydraulically and is directionally controlled by two pedals. The agreed statements of fact described a safety feature on the Bell logger that had been bypassed: A safety feature of the T-bar and the neutral position system is the neutral start switch which must be engaged by the T-bar before power is available to the ignition circuit. The T-bar must be engaging both pedals to depress the neutral start switch. This means that the ignition system is ready and the pedals are in neutral, meaning the machine will not move until the T-bar is removed and the pedals operated. At the time of the incident the neutral start switch had been bypassed. This was done using a crimp lug connector to join the two wires, removing the switch from the circuit. Mr Colturi indicated during interview that when the Bell logger was purchased, second hand, the T-bar safety device had been bypassed. 15In relation to maintenance, there were no maintenance records for the Bell logger. The corporate defendant's designated supervisor, Daniel "Bill" Roberts, said maintenance matters were dealt with by the operators bringing matters to the attention of the supervisor when they, the employees, were unable to fix the problem themselves. Mr Roberts indicated that nothing was ever written down properly regarding plant maintenance despite it being a requirement of the corporate defendant's licence. Furthermore, Mr Roberts accepted that there was no occupational health and safety maintenance system in place. 16It was also a condition of the corporate defendant's licence that the licensee develop and implement a documented safety management system as modelled by the State Forests Contractor's Safety Pack. Mr Roberts accepted that there was no proper occupational health and safety management system in place. Mr Colturi did not have any understanding of what an occupational health and safety management system was. 17The corporate defendant's risk management plan did not mention at all of any plant or machinery, nor specifically the Bell logger. 18There was a label (but barely legible) on the Bell logging machine indicating the start up checks. That label displayed the following words: Start up and shut down 1. Never start machine without feet firmly on the pedals 2. Engage park brake and neutral start lock mechanism 3. Set engine throttle position to idle (forward) 4. Check operating arm is clear of personnel 5. Start engine, check instruments and warm up gradually Shut down 1. Run engine at idle before use 2. Minute to balance temperature 3. Engage park brake and neutral start lock mechanism 4. Lower gravel to the ground 5. Pull engine stop and shut down electrics 19There were no safe work procedures in place for any of the larger items of plant, including the Bell logger, notwithstanding that there should have been safe working procedures for each item of plant. Whilst oil would be checked and the machines would be greased, there was no daily check sheet for an operator to complete in relation to the machines in general and the Bell logger in particular. 20The "Contractor's Safety Pack", which the corporate defendant was required to observe under the terms of its licence, spelt out a range of requirements regarding supervision including provision of effective workplace supervision and " [e]nsure that all work is conducted in a safe manner and without risks to health and safety of employees and other persons at the workplace". 21Under the Site Safety Plan (which included the various safety documents), Mr Roberts was the designated safety officer and workplace supervisor. He was accredited and competent in cross cut, occupational health and safety, first aid and machinery operation. There was no indication of any competence or accreditation in supervision. Mr Roberts, at the relevant time, did not work on Saturdays. Consequently, Mr Rowbottom and Mr Crane were working without any supervision at all on 26 July 2008. Mr Roberts had had no supervisor training and no qualifications. Instruction to Mr Roberts was limited to "keep and update the site safety plan and keep the harvesting plan in order". Other evidence 22The prosecutor tendered a bundle of documents that included the following: (1)timber licences issued to the corporate defendant by the Forestry Commission together with the conditions for the licences; (2)Forests NSW Harvesting Plan for compartments 15, 16 and 17 of the Millewa State Forest; (3)State Forests Contractor's Management of Workplace Safety: Safety Pack 2002; (4)the corporate defendant's Site Safety Plan; (5)the corporate defendant's contractor safety documents; (6)documents provided by Jason Vickers of Blitz Auto Electrics as evidence of compliance with a Prohibition Notice (7)Forests NSW Forest Operators Licence and training records for Mr Rowbottom; (8)ASIC current and Historical extract for the corporate defendant; (9)photographs of the incident scene including photographs from various aspects of the Bell Logger including the controls of the Bell logger; (10)prior convictions certificates for the defendants showing no prior convictions. 23Also in evidence was an affidavit of the personal defendant with some seven attachments. Mr Colturi also gave oral evidence and was subject to cross-examination. Consideration 24The objective seriousness of the offences is at the high end of the scale. The corporate defendant conducted a logging operation in almost complete disregard of its obligations in respect of occupational health and safety both under the Act and under the conditions imposed on the company by its licence to remove timber from State forests. 25The corporate defendant was required to model its documented safety management system upon the State Forests Contractor's Safety Pack, which required "All plant and equipment should be maintained and serviced in accordance with the manufacturer's recommendations" and noted that "Contractor's plant and equipment should be regularly inspected and maintained. Inspections are to be documented". The corporate defendant did not even have a copy of the operator's manual for the Bell logger. 26The only documentation relevant to maintenance that the corporate defendant had in place was within the Site Safety Plan ("SSP"). Item 5 of the SSP referred to plant maintenance. Relevantly, it stated: Check all oil and fluid levels everyday before commencing work. Grease machine everyday to keep in good working order. Do monthly inspection reports so as to minimise the risk of malfunction and keep machine in good order. ... 27Nothing was ever written down properly regarding plant maintenance and there was no occupational health and safety maintenance system in place. 28There was no proper safety management system in place despite a condition that the licensee develop and implement a documented safety management system as modelled by the State Forests Contractor's Safety Pack. The SSP that the corporate defendant had in place at the relevant time was comprised only of a series of forms taken from the forms annexed to the State Forests Contractor's Safety Pack. The SSP did not refer specifically to any item of plant other than chainsaws and specifically did not refer at all to the Bell logger. 29The Contractor's Safety Pack identified a risk management process that was to be implemented. The process involved the following steps: 1. Identify the hazard 2. Assess the risk 3. Eliminate or control the risk 4. Develop/document/review safe work procedure There was detailed guidance as to how to go about steps 1, 2 and 3. 30The corporate defendant's completed risk assessment section in the SSP dealt only with: 1. Dead standing trees 2. Other people in work zone 3. Overhead hazards, broken limbs may fall out of dry trees, green trees after mill falling areas There was no mention at all of any plant or machinery, nor specifically the Bell logger. 31There were no safe work procedures in place for any of the larger items of plant despite the fact there should have been such procedures for each machine including the Bell logger. 32Although a label on the Bell logger set out the start up and shut down procedure, it was not followed. The corporate defendant did not have any safe work procedure nor did it have a safe operating procedure in place for the Bell logger as at 26 July 2008. 33The Contractor's Safety Pack dealt with supervision. Under the sub-heading "Workplace Supervisor" it was noted: The workplace supervisor has the role of implementing the detail of the contractor's OHS&R Policy and Procedures. The workplace supervisor has the specific role of providing workplace supervision. There listed were the following dot points: Implement the contractor's OHS&R procedures Provision of effective workplace supervision Ensure that all work is conducted in a safe manner and without risks to health and safety of employees and other persons at the workplace Where appropriate, conduct risk management to identify, assess and control risks in the workplace Plan to do all work safely in accordance with relevant Safe Work Procedures Provide advice and assistance on OHS&R to all employees Ensure current OHS&R and other relevant legislative requirements are met in the workplace Action safety reports and carry out workplace inspections Prepare and participate in safety meetings and programs Participate in incident investigation Lead by example and promote workplace safety at every opportunity Assist in the rehabilitation of injured employees Facilitate Tool Box Safety Talks on a regular basis 34The Contractor's Safety Pack set out a model document. It was noted in relation to supervision: We will ensure that employees, and other persons at the work place, are provided with supervision by a competent person to ensure their health and safety. The nature and extent of supervision will have regard to the competence, experience and age of each employee. Supervision will be monitored each month and recorded on Form 17: Safety Pack Checklist ". 35A "Safety Pack Checklist" included provision for supervision to be monitored, for example, by assessment of the workplace safety management systems and confirmation of the company safety management system documentation together with the need for the supervisor to agree to any comments arising in relation to specific issues and to sign off on them. 36The SSP nominated Mr Roberts as the designated safety officer and workplace supervisor. The SSP called for written indication of "competency and accreditation in relation to various individuals". Mr Roberts was noted as accredited and competent in cross cut, OH&S, first aid and machinery operation. There was no indication of any competence or accreditation in supervision. 37In his role as workplace supervisor, Mr Roberts, at the relevant time, did not work on Saturdays. Consequently, Mr Rowbottom and Mr Crane were working without any supervision at all on 26 July 2008. 38Mr Roberts had had no supervisor training and no qualifications. Instructions to Mr Roberts were limited to "keep and update the site safety plan and keep the harvesting plan in order", instructions that were completely inadequate as a measure to ensure the safety of workers. 39It is evident that the corporate defendant: 1. failed to put in place a safe work procedure for the Bell logger. 2. failed to ensure that there was a sufficiently trained, qualified and experienced supervisor undertaking supervision of its employees on 26 July 2008. 40The corporate defendant allowed the Bell logger to be operated in circumstances where the neutral start switch had been bypassed. Apparently the machine was purchased, second hand, in this state. It was Mr Colturi's evidence that upon taking possession of the machine he subjected it to a maintenance overhaul and instructed the auto electrician to fix the neutral start switch so that it was in working order. This was done. However, at some time between when the switch was fixed and the day of the incident the wires to the switch were cut making it inoperative. 41The neutral start switch was a critical safety feature. With the neutral switch having been made inoperative, the machine could move immediately upon being started. This is what appears to have occurred; Mr Rowbottom was outside the cabin when he pressed the ignition button, whereupon the Bell logger began to move backwards. The Bell logger knocked Mr Rowbottom to the ground and then rolled over him. It continued its travel under its own power until it collided with a stack of timber adjacent to the sawmill docking machine being operated by Mr Crane. 42The first particular of the charge is also clearly made out, namely, that the corporate defendant: failed to ensure that plant, namely the Bell logger, provided for use by employees at work, was safe and without risks to health or safety when properly used in that: (a) The corporation failed to ensure the bell logger had a neutral start switch which was in place and in proper working order so as to prevent the Bell logger moving when the ignition was turned on. 43The conclusion is unavoidable that the corporate defendant had no system in place whatsoever to ensure the safety of employees in so far as the Bell logger was concerned. Safety generally was given only the barest acknowledgement in the corporate defendant's systems. The personal defendant, who was the sole director and guiding mind of the corporate defendant, did not even have any understanding of what an occupational health and safety management system was. 44It cannot be doubted that the complete absence of a safe work procedure for the Bell logger, the absence of a sufficiently trained, qualified and experienced supervisor and the absence of a neutral start switch on a large machine like the Bell logger, in the context of a forestry logging operation notorious for its danger, created a high risk to the safety of Mr Rowbottom and Mr Crane. The risk of death or serious injury was reasonably foreseeable in such circumstances, thereby exacerbating the objective seriousness of the offences. 45In Cahill v State of New South Wales (Department of Community Services) (No 3) [2008] NSWIRComm 123; (2008) 182 IR 124 at [369] the Court said: [369] In determining whether a defendant should have reasonably foreseen a risk of injury, it is not necessary to show that a reasonable person placed in the defendant's position would have foreseen as a possibility the particular chain of cause and effect involved in the happening of the defendant's accident or, in other words, the precise risk of injury or how it occurred. It is sufficient that the risk is one of a class of risk that in a general way the defendant should have foreseen or it was reasonable to foresee in a general way the kind of thing that occurred. 46In the present case, however, the personal defendant knew that the neutral start switch could be bypassed, and in that knowledge had the switch fixed after he purchased the machine. Thus, it may reasonably be inferred he understood the risk to safety posed by a switch that did not work. What is more, it was reasonably foreseeable in the absence of specific directions not to interfere with the switch and in the absence of regular checks, the switch might become disconnected or that an employee might seek to again bypass the switch in order to speed up the start up process. 47Mr Rowbottom's death is a manifestation of the seriousness of the risk to his safety, which was the risk of being hit, struck or run over by the Bell logger. Section 21A(2)(g) of the Crimes (Sentencing Procedure) Act 1999 applies as an aggravating factor to be taken into account in determining penalty. 48The existence of simple and straightforward remedial steps that could have been taken by the corporate defendant to avoid the risk to safety are relevant in assessing the seriousness of the offence: Department of Mineral Resources of NSW (McKensey) v Kembla Coal & Coke Pty Ltd (1999) 92 IR 8 at 27; WorkCover Authority of NSW v ACI Operations Pty Ltd [1994] NSWIRComm 167; Inspector Elizabeth Benbow v Planada Holdings Pty Ltd [2001] NSWIRComm 275. The straightforward steps in this case included the proper observance of the licence conditions regarding occupational health and safety, ensuring the neutral start switch was in proper working order and the provision of a sufficiently trained, qualified and experienced supervisor undertaking supervision of the corporate defendant's employees on 26 July 2008. 49The defendants did submit that in relation to the supervision aspect of the charges its seriousness was of a lesser magnitude than the failure in respect of the start switch. In this respect the defendants contended that Mr Rowbottom was a very experienced employee in the logging industry and that should be taken into account in sentencing as a mitigating factor. 50The evidence does suggest that Mr Rowbottom was very experienced, including in connection with the operation of machinery. In Riley v Australian Grader Hire Pty Ltd [2001] NSWIRComm 31; (2001) 103 IR 143 at [15] the Full Bench stated: [15] The magistrate appears to have reached her conclusion as to the objective seriousness of the offence, having regard to the lack of common sense of the injured worker. It is reasonably clear from her decision that it was concluded that the conduct of the injured worker effectively removed or minimised the liability of the respondent in relation to the lack of training or instruction afforded the employee. This was wrong in principle. Section 15 of the Occupational Health and Safety Act requires employers to be diligent and proactive to ensure the safety of employees. Those obligations are not diminished because of the error or negligence of an employee, although such matters may reflect on the degree of culpability of the employer for the purposes of sentencing. We note the following observations of Bauer J in WorkCover Authority of New South Wales (Inspector Twynam-Perkins) v Maine Lighting Pty Limited (1995) 100 IR 248 at 257: Much of what was urged by Mr King was directed to showing that the worker who was killed knew of, and therefore ought to have avoided the exposed electrical connections. In one sense such a submission militated against the position of the defendant; the very purpose of the Act was to introduce safe working practices so that accidents are prevented. The Act was designed to protect against human errors including inadvertence, inattention, haste and even foolish disregard of personal safety as well as the foreseeable technical risks in industry. 51The corporate defendant's obligations to ensure the safety of its employees was not diminished by the fact that Mr Rowbottom (and Mr Crane) were experienced workers, nor by the fact that the defendants would not have expected Mr Rowbottom to start the Bell logger whilst outside the cabin in circumstances where there was every possibility the machine would commence to move. I do, however, take into account that Mr Colturi recognised the danger of the neutral start switch being bypassed and took steps to fix it. There was no evidence that Mr Colturi knew about the switch later being bypassed and that fact lessens his culpability because if he had known and done nothing about it, the offence would be approaching the worst case category. 52General and specific deterrence are matters to be taken into account in sentencing under the Act: Capral Aluminium Ltd v WorkCover Authority of New South Wales [2000] NSWIRComm 71; (2000) 49 NSWLR 610 at [71]-[80]; Cahill v State of New South Wales (Department of Community Services) (No 4) [2008] NSWIRComm 201; (2008) 182 IR 231. The logging or tree felling industry is inherently dangerous: see, for example , Inspector Schultz v Leonard J Williams (Timber) Pty Ltd [2001] NSWIRComm 286; Inspector Franke v Vin Heffernan Pty Ltd [2005] NSWIRComm 16; Inspector Wolf v Colebrook & Sons Pty Ltd [2008] NSWIRComm 231; Inspector Wolf v The Forestry Commission of NSW t-as Forests NSW [2008] NSWIRComm 230; Inspector Lancaster v Eurobodalla Shire Council [2009] NSWIRComm 192. It involves the use of large machinery operating often in rough terrain in isolated and sometimes confined forest areas. It is appropriate to bring the risk and the need to have proper systems in place to guard against the risk, to the attention of other employers operating in the forestry industry. I therefore propose to adopt a significant element of general deterrence in the penalty imposed. 53In respect of specific deterrence, the evidence was that the corporate defendant is to be wound up. The purpose of imposing a penalty for specific deterrence is to deter the offender from re-offending. Given the corporate defendant is to be wound up there is no utility in making a provision in the penalty for specific deterrence. In relation to the personal defendant, he intends to continue in the logging industry as a sole trader. Mr Colturi was the guiding mind of the corporate defendant, which has committed a gross breach of the Act. Despite being engaged in a dangerous industry and acknowledging he understood the conditions of the harvesting plan, including its requirements regarding occupational health and safety, the fact is he did not have any understanding of what an occupational health and safety management system was. Any penalty should reflect a significant element for specific deterrence. Subjective factors 54The corporate defendant was a small business with the personal defendant its only shareholder. The personal defendant's wife assisted in running the business, but she had fallen quite ill in recent times. Mr Colturi left school at 14 and commenced work in the logging industry when he was 18. When he was aged 9, Mr Colturi suffered severe injuries to his hands when they were caught in the gears of a hay baler. The injuries limited his choice of vocation and, of course, the type of work he is now able to undertake. 55The corporate defendant is to be wound up. A contributing factor to this is that the New South Wales Government shut down logging of red gum forests and revoked the licences to fell and process red gum trees. This occurred in the corporate defendant's case from 1 July 2010. As compensation for the revocation of the licence the corporate defendant was paid $1,282,180 of which the corporate defendant still has about "$600,000 or $700,000". 56Given the corporate defendant is to be wound up, Mr Colturi intends to sell off plant and equipment, for which he expects to receive about $40,000-$60,000. He intends to keep the rest of the plant and equipment to allow him to continue in the logging industry as a sole trader. 57The corporate defendant's income for each of the years 2007-2010 was between about $955,000 and $1.4m, although expenses meant the business incurred a loss in each of the years. There was no real analysis of the financial information, but I do note that Mr Colturi's taxable income for the financial year ended 30 June 2010 was $12,387. I also note that there are two properties in Mr Colturi's name valued at $275,000. 58The thrust of the submissions of Mr Phillips SC for the defendants regarding the defendant's capacity to pay was not so much there was an incapacity, but rather, pursuant to s 6 of the Fines Act 1996, in considering penalty the Court should have regard to the small nature of the business, to the fact that Mr Colturi is the sole shareholder and the burden of any fine on the corporate defendant will fall on him, that Mr Colturi's future employment and business prospects were bleak, that any fine should not be "crushing or oppressive" and that the fixing of any penalty should be done in the light of any costs ordered against the defendants: see Inspector Yeung v Wilson trading as Wilson's Tree Service [2004] NSWIRComm 346; WorkCover Authority (Inspector Yeung) v Wilson (t/as Wilson's Tree Service) [2005] NSWIRComm 158; (2005) 143 IR 187. It was also submitted that the Court should be conscious of the fact that the amount paid to the corporate defendant under the NSW River Red Gum Structural Adjustment Package was compensation for the loss of the licence to undertake logging in the relevant areas and consequently the loss of future income over the period of the licence and that the money and assets the personal defendant has is needed to protect his family's future. 59In addition to the foregoing subjective considerations, the defendants submitted there should be a discount for early pleas of guilty. The prosecutor did not oppose this. It was also unchallenged that the defendants cooperated with the prosecuting authority in the investigation of the breaches. I propose to give a discount of 25 per cent. 60It was further submitted the defendants showed contrition and remorse manifested by: * the erection of a commemorative stone and plaque at the scene of Mr Rowbottom's death; * early pleas to the charges; * changes made to the operations immediately after the incident; and * an expression of regret and remorse by Mr Colturi on behalf of the defendants. 61The Court is able to accept that the expression of contrition and remorse was genuine. Mr Rowbottom had been a "mate" of Mr Colturi. At one point Mr Colturi had worked for Mr Rowbottom and at a time when Mr Rowbottom was unemployed, Mr Colturi had given him a job. 62In considering the respective culpabilities of the two defendants my view is that they are equal. Section 26(1) of the Act relevantly provides that if a corporation contravenes, whether by act or omission, any provision of this Act, each director of the corporation is taken to have contravened the same provision unless the director otherwise satisfies the court as provided for in the section. The corporate defendant was essentially the alter ego of Mr Colturi. The charges and the agreed facts are essentially in the same terms. 63The culpability of the two defendants is high. There was almost a complete absence of any system or process for ensuring workers were not exposed to the obvious risk of being hit, struck or run over by the Bell logger. The failure by the defendants to ensure the critical safety device of the neutral start switch remained in place and in working order was a devastating failure with tragic results. It is feasible that if Mr Crane had not been in another machine and had been in the path of the Bell logger, there could have been a double fatality. 64I accept that the burden of any penalty on the corporate defendant will fall on the personal defendant. However, the fact that a corporation may represent the alter ego of a person and that any penalty imposed on the corporation will consequently have a financial impact on that person does not, of itself, warrant a reduction in penalty: WorkCover Authority of New South Wales (Inspector Mansell) v Chen [2004] NSWIRComm 247; (2004) 137 IR 33; WorkCover Authority (NSW) (Inspector Maddaford) v Coleman [2004] NSWIRComm 317; (2004) 138 IR 21; McColl v John Watson Building Services Pty Ltd [2004] NSWIRComm 353; (2004) 137 IR 310. 65Having in mind that the corporate defendant is the alter ego of Mr Colturi and that he will bear the burden of any fine, and having regard to the fact that senior counsel for both defendants has raised the issue of means in respect of both defendants, I think the relevant principle to be applied is that stated by the Court in WorkCover Authority of New South Wales (Inspector Ankucic) v Lyndhurst Trading Co Pty Ltd (2000) 95 IR 462 at 476: Where the means of the defendant to pay any fine is raised, the proper course will be to assess the appropriate amount of the fine having regard to the gravity of the offence charged and then reduce the fine to take into account the defendant's means and impecuniosity: see Rahme (1989) 43 A Crim R 81 at 86. See also Workcover Authority of New South Wales (Inspector Farrell) v Schrader [2002] NSWIRComm 25; (2002) 112 IR 284 at [85]. 66As to the defendants' submissions that I should have regard to costs in determining penalty, I have taken this into account as best as I am able: WorkCover Authority (Inspector Yeung) v Wilson (t/as Wilson's Tree Service). It would have been preferable to know the amount involved insofar as the prosecutor's costs are concerned, but I am able to accept the sum would not be insignificant. There was some debate about the appropriateness of taking costs into account when determining penalty and it was contended by the prosecutor that to do so would be a disincentive to prosecutions. But it is settled that costs may be taken into account: Wilson and see for, example, WorkCover Authority of New South Wales (Inspector Webster) v Power Rise Pty Limited [2008] NSWIRComm 26; Morrison v Centennial Coal Co Ltd [2010] NSWIRComm 4 where reference is made to Environment Protection Authority (EPA) v Barnes [2006] NSWCCA 246 at [78] where it was stated costs are to be regarded as part of the defendant's punishment. 67Although I have taken costs into account it needs to be understood that the Court considers the offences in these matters to be at the high end of the scale of seriousness and the penalties must be fixed accordingly. 68The maximum penalties are $550,000 for the corporate defendant and $55,000 for the personal defendant. 69I am conscious I am dealing with a small company whose sole director left school early, has severe hand injuries involving the amputation of fingers and no doubt worked hard throughout his life. But these are not reasons to excuse the defendants' conduct. A man lost his life because of serious failures on the part of the defendants to ensure safety. 70Having regard, in particular, to the objective considerations, but also to the subjective factors that are addressed in this judgment and the need to avoid a penalty that is crushing or oppressive, I consider that an appropriate penalty for the offence committed by the corporate defendant is $220,000 and for the personal defendant $22,000. Victim impact statement 71In these proceedings the daughter of Mr Rowbottom sought to read out a victim impact statement. I have not named the daughter because I think, in the interests of her privacy, there is no need to. 72By reason of s 27(2A) of the Crimes (Sentencing Procedure) Act , Division 2 of Part 3 of that Act dealing with victim impact statements only applies to an offence being dealt with by the Industrial Relations Commission if: (a) the offence is an offence against Division 1 of Part 2 of the Occupational Health and Safety Act 2000 or Division 1 of Part 2 of the Rail Safety Act 2008,and (b) the offence results in the death of, or actual physical bodily harm to, any person. That provision is satisfied in relation to the present proceedings. 73If it considers it appropriate to do so, a court may receive and consider a victim impact statement at any time after it convicts, but before it sentences, an offender: s 28(1) of the Crimes (Sentencing Procedure) Act . Section 28(3) provides that if the primary victim has died as a direct result of the offence, a court must receive a victim impact statement given by a family victim and acknowledge its receipt, and may make any comment on it that the court considers appropriate. Section 28(4)(b) provides that the court must not consider a victim impact statement given by a family victim in connection with the determination of the punishment for the offence unless it considers that it is appropriate to do so. 74Section 30A(1) and (2) of the Crimes (Sentencing Procedure) Act provides: 30A Reading out victim impact statements in court (1) If a victim impact statement has been duly received by a court, a victim to whom it relates, or a person having parental responsibility for the victim, or a member of the immediate family, or other representative, of the victim, is entitled to read out the whole or any part of the statement to the court. (2) The statement may be read out at such time as the court determines after it has convicted, but before it sentences, the offender. ... 75Following the conviction of the two defendants and before sentence, the Court invited the daughter to read out the two-page statement. 76Reading the statement was obviously difficult and stressful and took some courage on the daughter's part. The statement described the devastating effect of Mr Rowbottom's death on his daughter. The pain and the suffering and the feeling that a piece of her had died with her father; the permanent change it wrought in her life; the dreadful effect on her of viewing the crushed body. 77Shortly after her father was killed, her mother passed away. She felt she had been left with nothing, "no parent, no help, no support, no love, no nothing". She sought to ease the pain by drinking, she gained weight and if it had not been for not wishing to hurt her husband she would have taken her own life. She said she was only alive today because of her husband. She was angry, bitter and frustrated. She lost her father whilst her mother was dying of cancer and at a time when she said she needed him most. 78The daughter said her health has suffered, she has low esteem issues and that she "struggles some days to get out of bed and live just for the sake of living." She believes she has been cheated of all those special moments she might have shared with her father had he lived. She is no longer socially active and is reserved and withdrawn. She has decided against starting her own family. She feels gutted and believes she will "never love the same again and never get my life back". 79There was no objection to the victim impact statement and no call to cross-examine Mr Rowbottom's daughter. 80Section 21A(2)(g) of the Crimes (Sentencing Procedure) Act provides that an aggravating factor to be taken into account in determining the appropriate sentence for an offence includes "the injury, emotional harm, loss or damage caused by the offence was substantial ..." 81In R v Thomas [2007] NSWCCA 269, Basten JA, with whom Latham J agreed, stated at [36]: [36] Section 29(3) of the Crimes (Sentencing Procedure) Act notes that the 'absence of a victim impact statement does not give rise to an inference that an offence had little or no impact on a victim'. Although the Act does not provide how an impact statement is to be taken into account, it should be inferred that it is material upon which the sentencing judge can rely in determining the appropriate sentence. The relevance of that factor is expressly identified in s 21A(2) which identifies one aggravating factor as arising where 'the injury, emotional harm, loss or damage caused by the offence was substantial': s 21A(2)(g) Indeed, as stated by Spigelman CJ in R v Henry at [94]: There is no doubt that impact on victims is an aspect of the seriousness of an individual offence. 82Basten JA also observed at [37]: [37] In R v Slack [2004] NSWCCA 128 at [60] Sperling J noted there is further implicit recognition of the entitlement of a sentencing judge to rely upon a victim impact statement in s 28(4), dealing with the use of a victim impact statement given by a family victim 'in connection with the determination of the punishment of the offender'. It is unfortunate that the Act gives no greater guidance as to the appropriate use of such a statement, especially where untested, for the purposes of determining sentence. However, it will often be appropriate to give weight to a victim impact statement where the conduct of the offender is otherwise established beyond reasonable doubt and the statement is restricted to subsequent effects on the victim. There is some doubt in the present case as to what weight the sentencing judge gave either to the physical effects of the assault or its psychological sequelae. 83The court observed in SBF v R [2009] NSWCCA 231; (2009) 198 A Crim R 219 at [88] that there is no statutory or other restriction on the extent to which a sentencing judge may set out the contents of victim impact statements. 84In Wilmot v R [2007] NSWCCA 30; (2007) 169 A Crim R 280 at [34], a finding of substantial emotional harm for the purposes of s 21A(2)(g) based on the contents of a victim impact statement, was also open to the sentencing judge. The judge's finding had been challenged on the basis that the statement was unsworn, untested and included material inadmissible under the rules of evidence. The statement had, however, been tendered without objection, and with no application that the law of evidence apply to the sentencing hearing under s 4(2) of the Evidence Act 1995. 85The foregoing observations and findings were concerned with victim impact statements by the victim. It would appear that where the crime involves the death of the victim, a victim impact statement by a member of the family of the deceased, which deals only with the effect of the death on the family, is not relevant to the quantum of the sentence: Bollen v R (1998) 99 A Crim R 510 at 529 per Hunt CJ at CL referring to his earlier judgment in R v Previtera (1997) 94 A Crim R 76 . 86In R v Mansour [1999] NSWCCA 180 at [7], it was held by Spigelman CJ (with whom Studdert and Adams JJ agreed) that it was entirely appropriate for trial judges to acknowledge the impact of crime on victims and their families in a public way, giving public recognition of the grief imposed. At [3]-[7] of the judgment the Chief Justice said: [3] The first ground of appeal was an allegation that the sentencing judge took into account irrelevant material. This is based on the following comments by his Honour during the course of his remarks on sentence. His Honour said: "I think it is fair to say that the result of this collision and the loss of that young lady's life has caused what can only be described as immeasurable grief to her family. The material in the form of Victim impact statements supports that situation". [4] This passage in his Honour's reasons occurs immediately after his summary of the facts and immediately before his reference to the case in Jurisic (1998) 45 NSWLR 209 and to the sentencing guidelines therein contained, to which I will further refer. It was submitted that his Honour's reference to "immeasurable grief" indicated that his Honour had taken into account an irrelevant consideration in arriving at the sentence. This submission should be rejected. [5] In Bollen (1998) 99 A Crim R 510, Hunt CJ at CL referred to his earlier decision in Previtera (1997) 94 ACrim R 76 to the effect that the Victim Impact Statement is not relevant to sentence. When applying the principle to the facts before him in the case of Bollen , however, his Honour said: "When referring to the Victim Impact Statements, the judge said that the consequence of the crime committed by the Appellant was that the community had lost one of its number and the Groves family had lost a loving member - one who was a husband, father, son and brother. I see nothing wrong with that statement. It does no more than recognise the value which the community places upon human life. However, the judge then said that he had 'borne in mind' the seven statements filed, the material which they contained about the deceased and the reaction of the respective authors of those statements to his death. He went on to describe the statements as useful because of the involvement which they permitted of the family 'in a criminal justice process' and also because 'they helped remind the sentencing judges that the loss of any individual has real effect upon others'. He referred to the counselling and medical attention they had received, and continued: 'Naturally, the seven statements were written at a time when the authors anticipated the verdict would be murder. They will, of course, understand that the prisoner must be dealt with consistently with the jury's verdict, and also that I must proceed dispassionately no matter how strongly they feel.' I am satisfied that, by bearing this material in mind and by having regard to the particular effects of the death of the deceased upon the members of his family, the judge had taken irrelevant material into account and thus fallen into error." [6] In the present case, there is no language in the judgment which would suggest that Viney DCJ had taken into account the contents of the victim statements in the manner referred to above. Rather, the reference to "immeasurable grief" is equivalent to the "recognition of impact", referred to by Hunt CJ at CL in the first three sentences of the above extract from Bollen . [7] It is entirely appropriate that trial judges acknowledge the impact of crime on victims and their families in this public way. The purposes of the criminal justice system are well served by such public recognition of the grief imposed on families of victims. Unlike Bollen , there is nothing in the judgment to suggest that his Honour gave this consideration weight in determining the sentence eventually imposed. To infer that he did so would be to draw an inference from what is submitted to be a manifestly excessive sentence, but if it is a manifestly excessive sentence then it falls for that reason, rather than by reason of some inference about his Honour's reasoning process that can be derived from its manifestly excessive character. 87In R v Dang [1999] NSWCCA 42 Adams J said at [25]-[26]: [25] The reason why a victim's impact statement cannot be taken into account where a person dies may easily be demonstrated. Assume the deceased was friendless; assume the deceased had no family. It would be monstrous to suggest that that meant for some reason killing her should attract a lesser sentence than would be the case if, as is the situation here, she had a loving family and grieving relatives. Essentially, then, the reason that victim impact statements in cases involving death are not taken into account in imposing sentence is that law holds, as it must, that in death we are all equal and the idea that it is more serious or more culpable to kill someone who has or is surrounded by a loving and grieving family than someone who is alone is offensive to our notions of equality before the law. [26] I do not want those who may be here to think that the court is unmindful of the grief and anguish which they suffer. It is that we must obey the fundamental stricture of the law as to the equality of all citizens who come before us; and in death also the equality which that dreadful consequence brings about. 88The "fundamental stricture of the law" to which Adams J referred means that I am unable to take into account the effect of Mr Rowbottom's death on his daughter in determining penalty. In any event, an unsworn statement in respect of which the author is not subject to cross-examination, is no basis upon which the Court could conclude that the harm done to a family victim was an aggravating factor despite s 28(3) of the Crimes (Sentencing Procedure) Act providing that the court may make any comment on a victim impact statement given by a family victim that the court considers appropriate. 89I am effectively limited to acknowledging in this judgment the impact on her of that death. The impact, as it is evident from the daughter's statement, has been profound. Her grief and anguish over the loss of her father has had a ruinous effect on her life. 90The impact of Mr Rowbottom's death on his daughter may also serve to drive home to employers, especially those engaged in the forestry industry, the tragic consequences of their failure to ensure safety. Too often, deaths and serious injury in the workplace are regarded as mere statistics or are overlooked entirely in debates about the efficacy of occupational health and safety laws. The statement of Mr Rowbottom's daughter is a distressing but sobering reminder of the damage wrought on peoples' lives by workplace deaths and why these laws exist. orders 91The Court makes the following orders: Matter No IRC 639 of 2010 (1) The defendant is found guilty of the offence charged under s 8(1) of the Occupational Health and Safety Act 2000 and is convicted of the offence. (2) The defendant is fined an amount of $220,000 with a moiety to the prosecutor. Matter No IRC 640 of 2010 (1) The defendant is found guilty of the offence charged under s 8(1) of the Occupational Health and Safety Act 2000 by operation of s 26(1) of that Act and is convicted of the offence. (2) The defendant is fined an amount of $22,000 with a moiety to the prosecutor. 92The defendants shall jointly and severally pay the costs of the prosecutor as agreed or assessed. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 15 April 2011