Industrial Relations Commission New South Wales Medium Neutral Citation: Inspector Hoare v Pridham [2011] NSWIRComm 103 Hearing dates: 16 March 2011 Decision date: 10 August 2011 Before: Backman J Decision: (1) The defendant is found guilty of the offence. (2) Without proceeding to conviction, the defendant is discharged under s 10(1)(b) of the Crimes (Sentencing Procedure) Act 1999 on condition that the defendant enter into a good behaviour bond for a term of 18 months subject to the following further conditions: (a) during the term of the bond the defendant will be of good behaviour; (b) the defendant will appear before the Court if called upon to do so at any time during the term of the bond. (3) The defendant is to pay the reasonable costs of the prosecutor as agreed or in the absence of agreement as assessed. Catchwords: Occupational Health and Safety Act 2000 (the Act) - plea of guilty to an offence under s 8(1) of the Act - defendant a managing partner of a business which manufactured fibreglass tanks at a factory in Leeton - two workers suffer crush injuries at the Leeton factory when a suspended inverted fibreglass tank falls from its support trapping them inside the tank - hazardous chemicals in use in a confined space (interior of the tank) - a new and unsafe method of work devised and implemented without the defendant's knowledge - new method was a substantial departure from an established and otherwise safe work method at the factory - offence objectively serious although not at high end of culpability - defendant unlikely to re-offend - early plea - no prior convictions - ill-health of defendant taken into account - system of supervision in force at the factory at time of the offence - demonstrated remorse - post-incident measures - co-operation with WorkCover - assistance to injured workers - defendant's good citizenship - section 10(1)(b) of the Crimes (Sentencing Procedure) Act 1999 applied for and granted - orders - costs Legislation Cited: Crimes (Sentencing Procedure) Act 1999 Fines Act 1996 Occupational Health and Safety Act 2000 Cases Cited: Health and Research Employees' Association of New South Wales v Baptist Community Services NSW and ACT (No 2) [2003] NSWIRComm 7; (2003) 122 IR 199 Inspector Stephen Cooper v Kwik-Seal Pty Ltd and anor [2006] NSWIRComm 48 Kirk v Industrial Relations Commission; Kirk Group Holdings Pty Ltd v WorkCover Authority of New South Wales (Inspector Childs) [2010] HCA 1; (2010) 239 CLR 531 Category: Principal judgment Parties: Inspector Brett Hoare (Prosecutor) Gordon James Pridham (Defendant) Representation: Mr I Taylor (of counsel) (Prosecutor) Mr A Moses SC with Mr B Miles ( of counsel) (Defendant) Legal Group WorkCover Authority NSW (Prosecutor) Berry Buddle Wilkins (Defendant) File Number(s): IRC 915 of 2009 Judgment 1Gordon James Pridham, the defendant, pleaded guilty to an offence under s 8(1) of the Occupational Health and Safety Act 2000 (OHS Act 2000). At the time of the offence, Mr Pridham was the managing partner of Gebel Aquasafe (Gebel), a family partnership, which undertook the manufacture of fibreglass tanks at a factory located in Leeton. The offence arose as a result of an incident on 28 June 2007 at the Leeton factory where Scott Pickford and Darren Mickan suffered crush injuries when a suspended inverted fibreglass tank fell from its support pinning them between the fibreglass tank and the handrails of a scissor lift. 2The amended Application for Order particularised two risks. First, a risk that a suspended inverted fibreglass tank could fall, striking or crushing employees working underneath a suspended load. Secondly, a risk that employees were exposed to injury when using 332 line chemical resistant laminating resins containing styrene in a confined space. The second risk arose during the course of the incident in circumstances where Mr Pickford and Mr Mickan were inside the inverted tank, laminating its interior while using the laminating resin containing styrene. 3As managing partner of Gebel, Mr Pridham's functions included, but were not limited to, responsibility for occupational health and safety issues. He visited the Leeton site from time to time and was aware of the usual method of work at the site for the manufacture of the fibreglass tanks. At the Leeton site, Mr Pridham's son, Anthony Pridham, also a partner of Gebel, managed sales and production. At the time of the incident he had attended the site approximately three times in twelve months. Employed at the site was Stuart Attwood in the role of foreman and supervisor. In his roles, Mr Attwood attended the site at the beginning and end of each shift. His duties included allocating various tasks to other employees at the site, relaying orders from management to other staff, and generally implementing Gebel's occupational health and safety management system. Mr Attwood was acting in the role of site supervisor at the site in the absence of more senior management. At the time of the incident he had been employed by Gebel for about 15 months. 4Mr Pickford was a trainee labourer at the premises. At the time of the incident he had been employed by Gebel for five days. Mr Mickan was a supervisor at the site and at the time of the incident had been employed for some four months. 5The task being undertaken by Mr Pickford and Mr Mickan at the time of the incident involved laminating the interior of the tank. Gebel's normal practice for undertaking this task was to place the tank on its side in two half stages to allow for curing prior to rolling. The chemicals involved in this laminating process included acetone, the 332 line chemical resistant laminating resin, and andox lcr-s. Acetone is a hazardous substance and is classified as an irritant to the eyes. The 332 line chemical resistant laminating resin containing styrene, which was the major ingredient, is also classified as a hazardous substance, and is harmful when inhaled. It is also an irritant to both eyes and skin. A material safety data sheet (MSDS) for the resin recommends the chemical be used, "in a well ventilated area". It advises that, in the event of inhalation risk, "wear organic vapour respirator ... In confined spaces where the concentration of vapour exceeds or may exceed the TWA an air supply respirator must be used", and, "Wear overalls, chemical goggles, impervious gloves, leather boots with rubber soles". Gebel had a copy of the relevant MSDS on site which was accessible to employees. Gebel had also completed a risk assessment form in June 2005 that identified risks associated with applying resins such as the 332 line chemical resistant laminating resin. It listed risks associated with inhalation (dizziness, nausea, loss of concentration, and ultimately loss of consciousness). Controls set out in the risk assessment included limiting the amount of exposure to not less than 15 minutes, not more than four times per day. Other controls required the use of local exhaust ventilation and the use of a mask or respirator, impermeable protective gloves, protective eyewear, clean overalls, and safety boots. 6At the time of the incident, the usual method for laminating a tank was not employed. According to the prosecutor, the injuries to the two workers arose as a result of a new method of work which was unsafe and distinguishable from the usual method, which it was readily conceded was not unsafe. The usual method involved, amongst other matters, ensuring that the tank was placed in a specially constructed cradle which would have prevented any risk of the tank falling on the workers. According to the prosecutor, the new method for laminating the tank was devised by Mr Anthony Pridham the evening before the incident when he instructed the injured workers to suspend or hang the tank from a chain attached to the ceiling and to laminate the tank from the inside using a scissor lift. This method invoked the necessity to rig the tank from the roof in circumstances where no consideration was given to rigging procedures, or to necessary training. No explanation was forthcoming as to why Mr Anthony Pridham may have thought the new method was more effective than the usual established method. It should be noted, at this point, that at the time that this new method was devised and implemented the defendant was neither informed about the new method, nor was he present at the site, at the time of the incident. 7In order to illustrate the unsafe features of this new method it is necessary to resort in some detail to the circumstances which gave rise to the incident. 8At about 12.05pm on the day of the offence, Mr Pickford and Mr Mickan commenced the lamination of an internal "top" join of a partially assembled fibreglass reinforced plastic tank. During this process, the tank was suspended approximately 1.5m-1.8m off the ground in an inverted position from an overhead gantry crane. The weight of the tank was approximately 380-390 kilogrammes. Both workers were working inside the inverted tank on the platform of a scissor lift under the suspended load. By raising the scissor lift platform, they were able to access the internal top join to carry out the lamination works. 9The task of lamination included the grinding of bolts and the use of resin and fibreglass sheeting to adhere and seal the base of the tank to its walls in order to form one piece. At the time of the incident the base effectively was the top of the tank. The inverted tank was slung by the overhead gantry crane. The hook attached to the sling was attached directly to a single eye bolt, two washers, and a nut. The eye bolt was located in the centre of the inverted base of the tank. There was no shackle in use between the hook attached to the sling and the eye bolt. 10As earlier noted, Mr Anthony Pridham had instructed the workers to undertake the internal lamination of the tank employing this new process of suspending the tank via the use of the gantry crane and scissor lift. On the evening prior to the incident he had instructed the workers to take some precautions when carrying out the lamination works inside the inverted tank. These precautions consisted of not lifting the tank more than 150mm while the workers were inside, using protective PPE equipment and ensuring that a two-way radio was used. A verbal risk assessment was undertaken by Mr Anthony Pridham but no documented risk assessment was done in respect of this new method. No safe work method statement was prepared and, in particular, no specific consideration was given as to a safe method for rigging the tank, nor was there any specific consideration of the risks that might arise from carrying out the work in a confined space, nor the risks arising from working with resins including the best methods to address those risks. 11Mr Pickford and Mr Mickan could not reach the interior of the tank from within the cage of the scissor lift platform. They were therefore required to apply fibreglass to the tank interior by leaning over the cage with arms fully stretched in order to rotate the interior. They were also working without an extraction hose. They were wearing safety glasses, but not full goggles. 12After some 20 minutes, fumes from the resins appeared at the top of the inverted tank. The workers exited the tank by descending the scissor lift and shortly after returned to the tank wearing breathing apparatus. At this time, they attempted to remove the fumes from the interior of the tank with an extraction hose. Mr Attwood apparently suggested to them that they should place empty 44-gallon drums underneath the outside edge of the base of the inverted tank. Shortly after, while still in the process of completing the lamination, Mr Pickford and Mr Mickan were spinning the load and applying the resin when the suspended tank fell pinning both of them between the tank and the handrails of the scissor lift. Attempts by co-workers to lift the base of the tank by hand were not successful. One attempt to lift the tank by the co-workers allowed Mr Mickan to slip out from between the tank and the scissor lift before the co-workers had to drop the tank. Mr Pickford was also able to free himself from being pinned between the tank and the scissor lift at that time. When the tank was dropped, the side caught Mr Mickan's right arm which became pinned between the interior of the tank and the railing of the scissor lift platform. Mr Mickan was able to reach out to the controls of the scissor lift with his left arm. The controls, however, had been damaged by the falling tank and they came apart in Mr Mickan's left hand as he attempted to descend the scissor lift. Mr Pickford had also attempted to reach the controls of the scissor lift but found that he was unable to descend the lift. Mr Attwood managed to get underneath the tank and access the controls for the scissor lift so that it started to descend. At that point, the tank came to rest on the ground by which time Mr Pickford and Mr Mickan were on the floor of the scissor lift platform. The co-workers abandoned any further attempts to lift the tank and began to cut their way into the barrel of the tank which enabled both Mr Pickford and Mr Mickan to exit through one of the holes. 13Shortly after, both workers were conveyed to Leeton District Hospital. Mr Mickan suffered multiple bruises and abrasions, right arm nerve injury with neuropraxia and right-hand weakness. Mr Pickford suffered facial contusions, multiple abrasions, lacerations to lip, lower back injuries and concussion. Both workers were off work for several weeks. Systems of work in place prior to offence 14It was fairly conceded by the prosecutor that the established method for laminating the tanks was not unsafe. A risk assessment form existed for this task. The new method devised by Mr Anthony Pridham of laminating internal joins of a partially assembled tank had never been attempted prior to the incident. The decision to undertake the internal lamination of the suspended tank using the gantry crane and scissor lift was also made by Mr Anthony Pridham. The defendant was unaware that this new method was devised and implemented. According to the evidence, at that time the defendant was ill and not present at the site. 15The new method had a number of patently unsafe features. There were no documented safe systems of work at the site regarding the slinging of loads to the overhead gantry crane. This is perhaps not surprising given that there were features of the new system which involved a substantial departure from the established method. Neither Mr Pickford nor Mr Mickan had worked under an inverted fibreglass tank suspended by the crane at any time prior to the incident. The fibreglass tank was not suspended in accordance with standard safe work practices by reference to the WorkCover rigging guide of 1995. The hook attached to the sling was connected directly to a single eye bolt. According to the rigging guide, hooks should not be inserted into eye bolts, a shackle must always be used. The rigging guide also cautions that loads can spin when lifted with a single eye bolt causing the eye bolt to unscrew from the load. The safe procedure suggested by the guide is to "mouse" (secure) the eye bolt to the load to stop unscrewing. It will be recalled from an earlier recitation of the facts that the new method involved the hook being connected directly to the eye bolt. 16Cutting discs were also used as washers, though they were not designed for that use. A single eye bolt was also used without any means to prevent its rotation relative to the nut with the result that the eye bolt could unscrew and release the load. 17Mr Michael Lai Cheung Cheng, mechanical engineer, prepared an expert report for the prosecutor which was tendered during the sentence proceedings. According to Mr Cheng, when the fibreglass tank was being rotated during the laminating process by Mr Pickford and Mr Mickan they were exposed to the following risks: (i) the single nut attached to the eye bolt had become unscrewed due to the torsional load build-up in the chain. The freed eye bolt pulled through the pre-drilled holes at the top of the fibreglass tank, causing it to drop and crush the workers against the railings of the scissor lift; (ii) when the scissor lift was lowered to release the two injured workers the inverted fibreglass tank rested on the ground forming a confined space enclosing the two injured workers and the scissor lift. 18The correct method by which the load should have been suspended, according to Mr Cheng, was: (i) the nut should have been secured, for example, by using a second block nut or by using a locking pin. A longer eye bolt would have been required to accommodate the second nut or locking pin; (ii) an alternative method would have been to use two longer eye bolts with double nuts and steel washers to be installed symmetrically about the centre of the tank top and a set of two-leg slings to be lifted by the swivel hook of the overhead gantry crane. This would have prevented the eye bolt from rotating; (iii) a shackle should have been used to connect the eye bolt to the hook. 19The inverted tank in which the injured workers were operating at the time of the incident was partially enclosed. It had a restricted means of exit and entry and was a confined space. When working in the inverted tank the workers were exposed to laminating resins containing styrene that had the potential to cause them injury. There was no evidence of any confined spaces training being given to employees at the site. 20At the time of the incident, Mr Attwood and Mr Anthony Pridham were at the site, but were undertaking tasks of their own. Mr Pickford and Mr Mickan did not have the benefit of any direct supervision, although apparently Mr Mickan, who was employed in the capacity of supervisor, was supervising Mr Pickford at the time of the incident. It will be recalled that this was the first time that either worker had undertaken the lamination process in the manner described. No risk assessment was undertaken with respect to the task of suspending and laminating inverted fibreglass tanks. No risk assessment had been undertaken in relation to work in confined spaces at the site and no consultation was undertaken with employees entering confined spaces. Mr Pickford, who was instructed to sling the tank to the overhead gantry crane, was not given sufficient information on how to conduct that task. In particular, he was not instructed: (i) how to secure the threaded eye bolt to prevent it becoming unscrewed from the load; (ii) how to use a shackle to connect the threaded eye bolt; (iii) not to use a single threaded eye bolt so as to prevent the load from spinning; (iv) to use a purpose-designed washer. 21No written procedures were consulted, such as the rigging guide, for the rigging and slinging of the tank to the overhead gantry or any system of work for the task undertaken by the workers. Mr Pickford did not receive sufficient training in rigging activities. Both workers were not instructed to wear personal protective equipment at all times when carrying out lamination works within a confined space (that is, the interior of the suspended inverted fibreglass tank) in order to prevent their exposure to, and inhalation of, the 332 line chemical resistant laminating resin which was present within the tank's interior. 22At the time of the incident, Gebel had a documented occupational health and safety management system in place which consisted of an organisation policy, procedures, and safe work method statements. The defendant was responsible for endorsing the policy and procedures and for reviewing existing policy and procedures, as well as monitoring the effectiveness of the system. The Gebel safety system plan consisted of documentation concerning ten key focus areas which included OHS policy, consultation, risk assessment, hazard identification, OHS inspections, incident reporting, emergency response and first aid, injury and claims management, audit and performance indicators, registers, information and training, and OHS signage. Gebel used a consultant, "Business Savvy", to develop its health and safety system, which was endorsed by the defendant. The health and safety system also included a hazardous substances register, and a risk assessment form containing information about hazardous substances existing at the site, which were applied to the moulding, laminating, and curing processes of fibreglass tank fabrication. 23The particulars of the defendant's omissions in the amended charge focus on the system which was in place at the time of the offence. As earlier noted, this system was devised by Mr Anthony Pridham and was a substantial departure from the established and otherwise safe method for laminating tanks. Moreover, the defendant was not aware, either at the time this new system was devised or implemented, and indeed did not become aware, until some time after the incident. These matters, according to the prosecutor, should be taken into account in assessing the objective seriousness of the offence. The prosecutor sought to emphasise, however, that the breach was undoubtedly serious and the defendant was the person responsible for the breach on two levels. First, he was the employer of the two workers and therefore bore the statutory responsibility to ensure their safety. Secondly, he was the manager responsible for occupational health and safety. According to the prosecutor, the breaches that arose on the day of the incident at the site flowed from steps that should have been taken prior to the incident in relation to which the defendant, as the managing partner, bore ultimate responsibility. Those steps included an absence of training in respect of rigging, an absence of adequate instruction in respect of PPE when working with chemicals, an absence of adequate instruction and training in respect of the necessity to ensure proper risk assessments are made, and ensuring that work method statements are developed prior to the undertaking of new tasks. Other objective factors 24The prosecutor submitted in relation to the two risks identified in the amended charge that they were reasonably foreseeable risks. The first risk, that the suspended tank could fall and strike or crush the workers working underneath the suspended load, was said to be obvious and foreseeable in circumstances where the load was not properly rigged. I agree and would add that the facts, which disclose that Mr Pickford, who rigged the load, had inadequate training and instruction to enable him to safely perform the task, facilitate the conclusion that the risk was reasonably foreseeable. With regard to the second risk, involving the exposure to 332 line chemical resistant laminating resins containing styrene in a confined space, the prosecutor referred to evidence which demonstrated that the partnership was aware of that risk. Some of that evidence included the relevant MSDS which was at the site, as well as Gebel's risk assessment which identified risks associated with applying resins such as the 332 line chemical resistant laminating resin. The defendant conceded that it was open to the Court to conclude that the risks to safety were foreseeable as a result of his failures particularised in the amended charge. 25The defendant also conceded, quite properly, that the contravention was serious and that the injuries sustained by Mr Pickford and Mr Mickan manifested the degree of seriousness of the risks to safety. 26Another feature of the objective seriousness of the offence was that available, straightforward steps were not taken to ensure the safety of the two workers. These included, according to the prosecutor, the failure to ensure that PPE was worn by the workers at all times while working with a hazardous chemical in a confined space, as well as the failure to ensure the suspended load was properly rigged, a matter readily ascertainable by reference to the Rigging Guide. 27General deterrence is a feature to be taken into account in the circumstances of this case in order to stress the importance of first, ensuring that employers are made aware of the risks associated with the types of activities which were engaged in by the two workers and secondly, that a defendant's failure to ensure these activities are conducted safely may result in prosecutions under the Act. 28Specific deterrence as a factor to be taken into account in the sentencing process has a less prominent role in the present circumstances. The defendant's evidence, which was uncontested, was that the Leeton site was closed some five or six months after the incident because of safety concerns which arose from the incident. It was submitted that closure of the site was effected in order that the partnership have closer supervision of factory operations. As a result, the partnership expanded its Penrith site at which it conducts numerous operations involving the production of water and filtration equipment for domestic, urban, rural, industrial/municipal and commercial purposes. At the time of the incident the defendant suffered ill-health which included heart disease and multiple sclerosis (MS). According to the defendant, the incident exacerbated his MS, and the death of his grandson approximately two days after the incident, as well as the incident itself, resulted in a diagnosis of depression from which he continues to suffer. Continuing health problems, both physical and psychological, resulted in the defendant having a reduced role at the Leeton site prior to its closure. Since August 2009, the defendant said he had retired from an active role in the partnership because of ill-health. The defendant, however, remains the CEO of the partnership. He has no prior convictions. 29These matters in combination make it unlikely, in my view, that the defendant will re-offend. Nevertheless, his continuing role as CEO of the partnership necessitates that specific deterrence must play a role, albeit a limited one, in the sentencing process. 30The maximum penalty faced by the defendant is $55,000. Subjective factors 31The defendant pleaded guilty to an amended charge some two months after it was filed. It was somewhat faintly contended by the prosecutor that the original charge contained sufficient particulars of the alleged omissions such that the defendant could have entered a plea of guilty at an earlier stage and accordingly it was open to the Court to find that the plea to the amended charge was not entered at the first available opportunity. According to the defendant, the utilitarian saving achieved from the entry of the early plea (to the amended charge) warrants a discount, "up to 25 per cent". 32The charge was amended at the instigation of the prosecutor. Perhaps this was done for abundant caution following the High Court judgment in Kirk v Industrial Relations Commission; Kirk Group Holdings Pty Ltd v WorkCover Authority of New South Wales (Inspector Childs) [2010] HCA 1; (2010) 239 CLR 531. It may be inferred from the fact that the prosecutor instigated the amendments, that a view was taken that the original charge did not sufficiently particularise the alleged omissions of the defendant. This Court was not invited to examine the original charge in order to ascertain for itself whether the particulars as originally drafted sufficiently identified the alleged omissions. The Court file indicates that leave was granted to the prosecutor to file the amended charge on 14 December 2010 and immediately thereafter the defendant entered his plea of guilty. The filing of the charge followed the filing of a Notice of Motion by the prosecutor to amend the original charge two months before. Negotiations apparently took place within the two-month period which resulted in agreement between the parties to the form of the amended charge. In view of these matters the Court finds that the plea of guilty was entered at the first available opportunity and accordingly the defendant will receive a discount of 25 per cent, reflecting the utilitarian value of the plea. Exercise of discretion under s 10 33The defendant made an application that the Court exercise its discretion and make an order under s 10 of the Crimes (Sentencing Procedure) Act 1999 (CSPA). In doing so, the defendant conceded that the Court in dealing with matters will only in "rare and exceptional" circumstances make such an order. The defendant relied, however, on a number of factors which, it was said, justified the proper exercise of the Court's discretion to discharge him without conviction or penalty under s 10(1)(b) of the CSPA on condition that he enter into a bond for a period of 18 months. 34The precise terms of the Orders sought were helpfully set out by the defendant: 1. The defendant is discharged without conviction and penalty in accordance with s 10 of the Crimes (Sentencing Procedure) Act 1999 in relation to the charge under s 8(1) of the Occupational Health and Safety Act 2000 in IRC 915 of 2009. 2. The condition of the discharge referred to in Order 1 above is that the defendant is to enter into a bond for a period of 18 months. The condition of that bond is that the defendant is to be of good behaviour and commit no offences during that time. Should he do so, he is to be formally called before this Court for consideration as to conviction and penalty in relation to the offence from which he has been discharged in Order 1 above. 35Section 10(1)(b) provides: (1) Without proceeding to conviction, a court that finds a person guilty of an offence may make any one of the following orders: (a) ... (b) an order discharging the person on condition that the person enter into a good behaviour bond for a term not exceeding 2 years, 36Section 10(3) lists those factors which the Court must take into account in deciding whether to make the order: (3) In deciding whether to make an order referred to in subsection (1), the court is to have regard to the following factors: (a) the person's character, antecedents, age, health and mental condition, (b) the trivial nature of the offence, (c) the extenuating circumstances in which the offence was committed, (d) any other matter that the court thinks proper to consider. 37The defendant sought to emphasise, in support of its application, that Gebel had in force at the Leeton site prior to the offence a safe system for laminating the interior of the tanks and that the new method employed by the two workers represented a departure from the usual safe method. Moreover, the new method was devised by Mr Anthony Pridham without informing the defendant and without his knowledge. No explanation was forthcoming in these proceedings as to why the alternative method was devised. The prosecutor agreed that these matters should be taken into account by the Court in its assessment of the objective seriousness of the offence, although it was pointed out that the defendant's omissions, pleaded in the charge, flowed from defects (earlier referred to) in the established system. The defects were identified by the prosecutor as the absence of training in respect of rigging; the absence of instruction in respect of PPE; and, the absence of instruction and training in respect of ensuring that risk assessments and safe work methods are developed before new work is undertaken. It should be noted, however, that not all of the defects identified by the prosecutor could be said to flow from the established system. There is nothing in the evidence to suggest, for example, that rigging formed part of the established method for laminating the tanks. In addition, a risk assessment had been developed for the established method. 38It was accepted by the defendant to his credit that the offence was serious. Nevertheless, the unexplained departure from the established safe system for laminating the tanks by reliance on the new method, which was patently unsafe, was done without informing the defendant, and in his absence apparently due to ill-health. These matters, in my view, mitigate to a not insubstantial degree the seriousness of the defendant's conduct. It has not been submitted that the defendant was responsible for the direct supervision of the two injured workers at the time of the incident. Nor would such a submission, if made, be accepted. The partnership had put in place supervisors at the site, notably Mr Attwood. These matters, which are relevant to the circumstances which gave rise to the offence, indicate in my view that the defendant's breach, although serious, does not occupy the high range of culpability. 39A finding that an offence is not trivial under s 10(1) of the CSPA does not of itself preclude the making of an order under the section. There are numerous authorities for this proposition which include R v Paris [2001] NSWCCA 83 and R v Piccin (No 2) [2001] NSWCCA 323. 40In the latter authority Hulme J made the following observations on s 10(1): [25] Although the matter has not been argued, I wish to record my view that it is not a pre-condition of the exercise of power under s10 of the Crimes (Sentencing Procedure) Act, 1999 that the offence involved be trivial. That conclusion was more obvious in the case of s556A of the Crimes Act, 1900 (as amended) which s10 replaced, the relevant terms of both sections being as follows:- "556A (1) Where any person is charged before any court with an offence punishable by such court, and the court thinks that the charge is proved, but is of the opinion that, having regard to the character, antecedents, age, health or mental condition of the person charged or to the trivial nature of the offence, or to the extenuating circumstances under which the offence was committed, or to any other matter which the court thinks it proper to consider, it is inexpedient to inflict any punishment, or any other than nominal punishment, or that it is expedient to release the offender on probation, the court may, without proceeding to a conviction, make an order either:- (a) dismissing the charge; or (b) discharging the offender conditionally on his entering into a recognisance..." [26] However, there is nothing in the explanatory memorandum to the later Act or in the Minister's Second Reading speech or in the Law Reform Commission Discussion Paper 33 or Report 79 which preceded the legislative changes reflected in the Crimes (Sentencing Procedure) Act to suggest that any change of significance so far as s556A is concerned was intended. And clearly, a limitation such that the section could be invoked in only trivial cases would be a change of significance. [27] That some power should exist to ameliorate the rigours of the criminal law in cases calling out for such an approach has been recognised in a number of cases. It is sufficient for present purposes to refer to one. In R v Ingrassia (1997) 41 NSWLR 447 at 449, Gleeson CJ with the concurrence of the other members of this Court said:- "The essence of s556A is that it empowers a court which considers that a charge has been proved, in certain circumstances, to take steps 'without proceeding to a conviction'. The legal and social consequences of being convicted of an offence often extend beyond any penalty imposed by a court. As Windeyer J said in Cobiac v Liddy (1969) 119 CLR 257 at 269, 'a capacity in special circumstances to avoid the rigidity of inexorable law is of the very essence of justice'." [28] I am unaware of any other statutory provision or other power applying to offences or offenders generally which enables a court to avoid recording a conviction when the facts prove establish the commission of an offence. Against this judicially recognised purpose and function of s556A, one cannot conclude from what is obviously a "plain English" rewriting of the section that a change to limit it to only trivial offences was intended. Indeed were one to regard the reference to "the trivial nature of the offence" as limiting the section's application to only such offences, one would have to take the same approach to the terms of paragraph (c) and conclude that the section was not merely limited to trivial offences but trivial offences where there were also "extenuating circumstances". [29] Such an emasculation of an important provision, designed to mitigate "the rigidity of inexorable law", is not to be inferred in the absence of legislative intent far more clearly demonstrated than in the change in terminology from s556A to S10. 41In Inspector Stephen Cooper v Kwik-Seal Pty Ltd and anor [2006] NSWIRComm 48, Haylen J referred to two authorities in this jurisdiction in which s 10(1) orders have been granted. They are WorkCover Authority of New South Wales (Inspector Dall) v R & D Enterprises (Newcastle) Pty Ltd [2001] NSWIRComm 329; (2001) 110 IR 469, per Hungerford J and Health and Research Employees' Association of New South Wales v Baptist Community Services NSW and ACT (No 2) [2003] NSWIRComm 7; (2003) 122 IR 199. 42In Kwik-Seal , Haylen J granted an application for an order under s 10(1)(a) of the CSPA notwithstanding a finding by his Honour that the offence constituted a serious breach of the Act: at [34]. His Honour also took into account in granting the application a number of factors, also present (to a greater or lesser degree) in the present circumstances. The factors are set out at [58] of his Honour's judgment. They may be summarised as consisting, relevantly, of the following: (i) the defendant had in place a safe system for the task being performed which gave rise to the offence; (ii) that safe system was not followed at the time of the offence; (iii) the departure from the safe system was the result of a conscious decision taken by a sub-contractor, notwithstanding instructions to him by the defendant to the effect that the safe system should be followed; (iv) the defendant had in place at the time of the incident a site supervisor of operations. 43His Honour concluded in relation to those factors that: Adherence to a safe system of work would not require Mr Seal [the individual defendant] to be personally present at each site to ensure that the safety rules were adhered to. In my view, what occurred in this day was uncharacteristic of the operation of Mr Seal's business and something of an aberration. There were, nevertheless, formal and important provisions that were not complied with and they are matters that add to the difficulty of this delicate balancing exercise. 44His Honour in granting the application also took into account that the individual defendant did not hesitate to take full responsibility for the offence (at [59]). In addition, his Honour found a number of subjective factors influential in granting the application. These included the fact that the individual defendant suffered a debilitating illness following the incident which caused his once prosperous company to crumble financially: at [59]. The fact that the defects in Kwik-Seal's system, which manifested at the time of the incident, were addressed following the incident, were also taken into account by his Honour, as were the subjective factors of remorse, an early plea, and assistance provided to WorkCover. His Honour also found persuasive that the individual defendant was unlikely to re-offend: [60], [62]-[63]. 45By way of analogy with Kwik-Seal , this Court has already found that the offence, although serious, is not at the high end of culpability because it arose without the knowledge of the defendant and in his absence from the factory, and, was the direct result of the unexplained departure from a safe system which had been established by Gebel for laminating the interior of the tanks at the Leeton site. The defendant had also in place at the site at the time of the offence a supervisor in the form of Mr Attwood. 46The defendant's uncontested evidence, which the Court accepts, was that Gebel's decision to close the Leeton factory was based, at least in part, on the view taken by the partners that they did not have adequate supervisory control of the operations at the Leeton site, and, by implication, sought to minimise the risk of a recurrence of an incident. The closure of the site and the transfer of operations to the Penrith site also incurred substantial expenditure, in the vicinity of $600,000. 47The defendant did not make a formal application under s 6 of the Fines Act 1996 that he lacked the capacity to pay any fine that might be imposed. It was submitted on his behalf, however, that any fine imposed upon the defendant would have a significant impact on his financial borrowings for the partnership, linked to loans on the family home. Moreover, his financial position at the time of these proceedings disclosed that his liabilities exceeded his assets by some $360,000. These matters were confirmed in the defendant's unchallenged affidavit evidence. According to the defendant, his financial position was such that he would have difficulty in sourcing money to satisfy any significant penalty that may be imposed by the Court. 48A further factor of relevance to the present application under consideration is the defendant's deteriorating ill-health. I accept his evidence that following the incident his physical and psychological ill-health further deteriorated as a direct result of the incident. 49Other subjective factors which in my view may be taken into account on the application include the defendant's early plea of guilty and the unlikely prospect of him re-offending under the Act given his ill-health and his reduced role, at least in an operations capacity, within the partnership. 50In addition, the defendant demonstrated remorse for his role in the circumstances of the offence. In his affidavit evidence, which I accept, the defendant said he was extremely saddened and distressed by the events and the injuries suffered by the two workers. He added: In my professional and personal life I have always attempted to act with a social conscience and responsibility for the health, safety and welfare of all our employees, which was at the time and remains of paramount importance. The partners of Gebel Aquasafe and I particularly feel responsible for and, as such, have taken every step to prevent a reoccurrence. I have never wanted to injure anyone in my entire life and it has made me feel terrible. The thought that I have contributed to injuries to someone has left a marked impact on me from a psychological perspective that will stay with me for the rest of my life. 51The issue of remorse is satisfied for the purposes of s 21A(3)(i) of the CSPA by the action taken by the defendant following the incident to address outstanding safety matters. These matters were summarised in submissions made on the defendant's behalf, which are extracted below: (a) taking measures to review, evaluate and improving their systems of work in regards to occupational health and safety; (b) Gebel engaged an OH&S Manager who has responsibility for all OH&S duties for Gebel; (c) engaged Business Savvy to assist the OH&S manager to upgrade the OH&S manual to deal with a number of issues including, but not limited to, reinforcing the use of risk assessments prior to commencing work, training and instruction and ensuring that the correct and up to date documentation exists with respect to hazardous chemicals; (d) utilised Business Savvy to conduct a complete OH&S reviews and prepare a report for management in relation to the Penrith site; (e) spent approximately $650,000 on the introduction of new handling, fall arrest mechanisms including harnesses, scissor lifts, mono rails for cranes, entry ramp, production conveyor system and ventilation/extraction equipment (which cost $295,885.00 alone) to eliminate the risk of injury; (f) conducted a review to ensure all staff were provided with their own equipment boxes with PPE; (g) improved the procedures with respect to confined space work; (h) in or about 2008 Gebel instituted tool box talks on a weekly basis. It also instituted tool box/safety talk in the boardroom on a monthly basis. All staff are required to attend the tool box talks. This provides an avenue for staff to raise any safety concerns; (i) ensured that all staff received the appropriate training and certifications. 52The defendant also co-operated with WorkCover in its investigation of the offence. The defendant also contacted Mr Pickford and Mr Mickan to ascertain their current condition arising from their injuries. He and his family also attended the hospital on two occasions in order to visit the injured workers. Both workers made workers compensation claims for which liability was admitted. 53The evidence also demonstrated that the defendant has exhibited good citizenship by reason of his community service and involvement, as well as character references tendered on his behalf from business associates and personal friends all of whom attested to his genuine character. 54The defendant, in his role as managing partner of Gebel, also demonstrated a strong commitment to occupational health and safety matters prior to the incident by reason of Gebel's safety systems and procedures in force at the Leeton site. These systems and procedures have been earlier referred to and need no repetition. 55When all these objective and subjective factors are weighed in the balance the conclusion is available that it would be appropriate for the Court, make the order sought under s 10(1)(b) on the basis that it is inexpedient to inflict any punishment on the defendant other than a nominal punishment: s 10(2)(a) of the CSPA. In so doing, the Court has found most persuasive its finding that the offence arose as a direct result of the new and unsafe method devised and implemented by Mr Anthony Pridham in the absence of the defendant and without informing him of his intention to depart from what was otherwise a safe system established for the specific task undertaken by the two workers at the time of the incident. In this sense, to adopt the words of Haylen J in Kwik-Seal , the offence properly understood was, "uncharacteristic and represent(ed) something of an aberrant departure from the usual standards of the defendant": Kwik-Seal at [63]. Other factors that the Court has also found particularly persuasive include the defendant's deteriorating ill-health as a result of the impact of the incident, the fact that a system of supervision was in place at the Leeton site at the time of the incident and the defendant's reduced role in safety matters in particular which make it unlikely that he will re-offend. 56An outstanding matter concerns the issue of costs. The defendant submitted that the prosecutor should not be entitled to any of his costs in relation to the application to amend the charge. I do not agree. As the prosecutor pointed out in submissions, the application to amend was consented to by the defendant following negotiations between the parties over a two-month period. Orders 57The Court makes the following orders: (1) The defendant is found guilty of the offence. (2) Without proceeding to conviction, the defendant is discharged under s 10(1)(b) of the Crimes (Sentencing Procedure) Act 1999 on condition that the defendant enter into a good behaviour bond for a term of 18 months subject to the following further conditions: (a) during the term of the bond the defendant will be of good behaviour; (b) the defendant will appear before the Court if called upon to do so at any time during the term of the bond. (3) The defendant is to pay the reasonable costs of the prosecutor as agreed or in the absence of agreement as assessed. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 10 August 2011