Safework NSW v Dongwha Timbers Pty Limited

[2020] NSWDC 9

District Court

New South Wales

Medium Neutral Citation:

Safework NSW v Dongwha Timbers Pty Limited [2020] NSWDC 9

Hearing dates:

7 February 2020

Date of orders:

07 February 2020

Decision date:

13 February 2020

Jurisdiction:

Criminal

Before:

Russell SC DCJ

Decision:

(1)   The offender Dongwha Timbers Pty Limited is convicted.
(2)   The appropriate fine is $120,000 but that will be reduced by 25% to reflect the plea of guilty.
(3)   Order the offender Dongwha Timbers Pty Limited to pay a fine of $90,000.
(4) Order pursuant to Section 122(2) of the Fines Act 1996 that 50% of the fine is to be paid to the prosecutor.
(5)   Order the offender Dongwha Timbers Pty Limited to pay the prosecutor’s costs.

Catchwords:

CRIMINAL LAW – prosecution – work health and safety – duty of persons undertaking business – risk of death or serious injury

 

SENTENCE – objective seriousness – mitigating factors – aggravating factors – plea of guilty – general deterrence – specific deterrence – appropriate penalty

 

COSTS – prosecution costs

  OTHER – timber mill – worker tried to dislodge fillet stick which was jamming machinery – heavy arm of machine fell on worker – no written safety procedure in place

Legislation Cited:

Crimes (Sentencing Procedure) Act 1999 (NSW)
Fines Act 1996 (NSW)
Work Health and Safety Act 2011 (NSW)

Cases Cited:

Baumer v R [1988] HCA 67; (1988) 166 CLR 51
Bulga Underground Operations Pty Limited v Nash [2016] NSWCCA 37; (2016) 93 NSWLR 338
BW v R [2011] NSWCCA 176
Capral Aluminium Limited v WorkCover Authority of New South Wales [2000] NSWIRComm 71; (2000) 49 NSWLR 610
Mahdi Jahandideh v The Queen [2014] NSWCCA 178
Muldrock v The Queen [2011] HCA 39; (2011) 244 CLR 120
Nash v Silver City Drilling (NSW) Pty Limited; Attorney General for NSW v Silver City Drilling (NSW) Pty Limited [2017] NSWCCA 96
R v McNaughton [2006] NSWCCA 242; (2006) 66 NSWLR 566
R v Wilkinson (No. 5) [2009] NSWSC 432
Safework NSW v Freyssinet Australia Pty Ltd [2018] NSWDC 66
Unity Pty Limited v SafeWork NSW [2018] NSWCCA 266
Veen v The Queen (No. 2) [1988] HCA 14; (1988) 164 CLR 465

Texts Cited:

SafeWork NSW Code of Practice: Managing Risks of Plant in the Workplace (July 2014)
SafeWork Australia Code of Practice: Managing Risks of Plant in the Workplace (March 2016)

Category:

Sentence

Parties:

SafeWork NSW (Prosecutor)
Dongwha Timbers Pty Limited (Defendant)

Representation:

Counsel:
M Scott (Prosecutor)
S McIntosh (Defendant)

  Solicitors:
SafeWork NSW (Prosecutor)
HWL Ebsworth Lawyers (Defendant)

File Number(s):

2018/81296

Judgment

1. Dongwha Timbers Pty Limited (Dongwha) has pleaded guilty to an offence that as a person who had a work health and safety duty pursuant to s 19 of the Work Health and Safety Act 2011 (NSW) (the Act) it failed to comply with that duty and thereby exposed Mr Timothy Ross James Olsen to a risk of death or serious injury contrary to s 32 of the Act.

2. The maximum penalty for the offence is a fine of $1,500,000.

Background

3. The parties presented an Agreed Statement of Facts and this material is summarised below.

4. Dongwha conducted a business or undertaking in the lumber industry, including the operation of a timber sawmill and timber re-manufacturing facility at its registered address of 1 Sandy Lane, Bombala, New South Wales.

5. Dongwha was incorporated on 6 May 2003. Hong Yeol Lee, Jung Ah Kim and Chae Kwang Byeong were the directors of Dongwha.

6. Dongwha operated plant and equipment in the course of conducting its business, including a tilt hoist on the satellite line infeed unit. This satellite line infeed unit formed part of the satellite line plant which also comprised a grading conveyor chain, a stacker and an outfeed chain.

The Satellite Line Plant

7. Timber packs were loaded by forklift onto the satellite line infeed unit, after being dried in a kiln. When loaded onto the satellite line infeed unit each layer of the timber pack was separated by smaller pieces of wood called fillet sticks. The purpose of the fillet sticks is to allow timber boards to dry properly in the kiln.

8. The task of the satellite line infeed unit is to mechanically separate each timber board, and to remove the fillet sticks entirely, so that the timber boards can be re-palleted and distributed.

9. After loading by forklift onto the satellite line infeed unit, the timber pack is moved towards and onto the tilt hoist by the satellite infeed chains.

10. The tilt hoist is then used to lift the timber packs off the satellite infeed chains, to separate the fillet sticks, and to feed the timber boards onto the grading conveyor chain.

11. The hoist component of the tilt hoist consists of six individual steel lift arms measuring 2.0m x 0.12m x 0.15m. The lift arms lift the timber packs. The lift arms are held together by a single steel bar and are spaced along the bar at regular intervals of 1.3m. The lift arms have a lifting and lowering motion and move through a 90 degree trajectory. The lift arms are controlled by an electrically driven drive chain mechanism that raises the arms of the tilt hoist against the steel plate. The drive chain is located behind and beneath the steel plate.

12. When the timber packs are lifted and fed onto the grading conveyor chain, the fillet sticks automatically separate from the timber boards due to their much smaller size. The fillet sticks drop onto a fillet stick unscrambler.

13. The satellite line plant is located in the satellite shed. Within the satellite shed and surrounding the satellite line plant is a satellite line infeed unit which was enclosed by a 0.9m high mesh fence and the shed walls. A gate measuring 0.75m in height x 1.0m in width provides access to the restricted access area near the tilt hoist. The gate is fitted with an interlocking switch that is designed to isolate the supply of electricity and disable the operation of the satellite line plant once opened.

14. The component parts of the satellite line plant are controlled by three separate control panels that independently control the infeed chain, the tilt hoist and the grading conveyor chain.

Mr Olsen

15. Mr Olsen commenced employment with Dongwha on 18 February 2016 as a leading factory hand. Mr Olsen’s main duties included undertaking tasks in relation to the timber re-remanufacturing process, including operating machinery throughout the premises (such as the Satellite Production Line), grading, stacking, wrapping, and strapping timber and placing fillet sticks in the magazines.

16. As at 27 July 2016, Mr Olsen had been working in the satellite shed for approximately two months. Mr Aaron Simpson was responsible for providing supervision to some of the workers, including Mr Olsen.

The Incident

17. On 27 July 2016, Mr Olsen commenced work in the satellite shed around 2.30pm.

18. At approximately 4.30pm, Mr Olsen was operating the satellite line infeed unit when a fillet stick became jammed under the lift arms of the tilt hoist, preventing the lift arms from lowering to their resting position. Mr Olsen became aware of the jammed fillet stick when he lowered the lift arms of the tilt hoist to receive a new pack of timber.

19. Mr Olsen attempted to dislodge the jammed fillet stick by manually raising and lowering the lift arms at the control panel. This did not work so Mr Olsen turned off the tilt hoist and satellite line infeed unit. Mr Olsen did not attempt to isolate the satellite line infeed unit nor did he ensure that it was locked out using a safety padlock prior to entering the restricted access area. To enter the restricted access area, Mr Olsen stepped over the closed and electrically interlocked gate to gain access to the tilt hoist. The tilt hoist was therefore not isolated.

20. At the time Mr Olsen entered the restricted access area the drive chains of the lift arms of the tilt hoist were slack. This meant that once the fillet stick jammed under the lift arms was dislodged, the arms could fall as the drive chains were not holding them in place.

21. Using a long-handled shovel and with his back to the tilt hoist, Mr Olsen attempted to dislodge the fillet stick. On the third or fourth attempt, Mr Olsen successfully dislodged it. The lift arms dropped suddenly due to the slack in the drive chains. The lift arms struck Mr Olsen on the lumbar region of the back, pushing him to the ground.

22. Mr Simpson heard Mr Olsen scream and ran to his aid by jumping over the closed gate.

23. Emergency services attended the scene and transported Mr Olsen to hospital.

Injuries

24. As a result of the incident Mr Olsen sustained serious injury including a dislocation of the left hip joint. Mr Olsen remained physically unfit for pre-injury duties for a period of 16 to 20 weeks following the incident.

Systems of Work before the Incident

25. At the time of the incident Dongwha had a work health and safety system in place. The system included conducting a formal induction program for workers, undertaking site specific risk assessments, site safety rules and regulations, documented safe operating procedures, weekly toolbox meetings and safety patrols of the premises.

Risk Assessment

26. On 9 October 2014, Dongwha undertook a risk assessment of the satellite line plant.

27. The risk assessment did not specifically identify the risk of the arms of the tilt hoist falling and striking a worker, while clearing or unblocking jammed timber from underneath the arm of the hoist, due to the chains being slack.

28. There was no separate specific risk assessment undertaken in respect of the operation of the tilt hoist itself, nor was there a specific risk assessment undertaken in respect of an untrained worker removing or unblocking jammed timber pieces if they became lodged underneath the arms of the hoist.

Training, Procedures & Supervision

29. Dongwha provided an induction program to workers prior to commencing work at the premises. This program including training on Dongwha’s Standard Operating Procedures (SOPs).

30. Records signed and dated by Mr Olsen on 18 February 2016 indicate he received safety training, including the Satellite Line SOP and the Satellite Line Infeed Lockout Procedure on his first day at work.

31. The Satellite Line SOP stated that the satellite infeed unit was to be isolated and locked out with a safety padlock before entering the area for cleaning, unblocking jams or maintenance. It did not state that a maintenance employee was to be called by a worker to attend the area to clear or unblock the jams.

32. The Satellite Line SOP did not state that the chains of the arms of the tilt hoist could become slack which could result in the arms falling to their resting position in the process of clearing or unblocking jams.

33. The Satellite Line SOP stated that under no circumstances was a worker to access the infeed chain area before isolation and lockout of this area was completed and to refer to the Satellite Infeed Isolation Procedure.

34. The Satellite Line SOP also stated that a worker was not to operate the satellite infeed unit if they had not received safety training, and not to operate the satellite infeed unit if it was beyond the worker’s ability or training level of authority.

35. The SOP entitled “Satellite Line Infeed/Grading Conveyor Chain Area Individual Lockout Procedure” set out the guidelines to be followed for an individual lockout or isolation by all workers whenever the satellite line infeed/grading conveyor chain area was required to be locked out or isolated for maintenance, jams or cleaning. However, neither this SOP nor the Lockout Procedure stated that a maintenance employee was to be called by a worker to attend the area to clear or unblock the jams.

36. The SOP also did not specifically mention the risk of being struck by an arm of the tilt hoist while accessing parts of the production line for cleaning, unblocking jams or maintenance purposes.

37. Dongwha did have an undocumented informal procedure in place for clearing jammed timber from beneath the tilt hoist. Only maintenance personnel were to remove or clear jammed timber from beneath the tilt host (Clearance Procedure). The Clearance Procedure required operators to contact the maintenance crew. This would involve a satellite line plant operator walking over to the forklift operator to use the radio to call the maintenance crew. An electrician would then come to the satellite line infeed unit and rewind the chains of the tilt hoist electronically with a laptop ensuring that there would be no more slack in the drive chains.

38. In practice the Clearance Procedure was not always followed and, on occasion, workers cleared jammed timber themselves without calling maintenance personnel.

39. While Dongwha did not expect production line operators to remove jammed timber from the hoist, some operators understood that if, after assessing the situation, the operators could safely rectify any issues themselves, they should do so instead of calling maintenance personnel.

40. It was not unusual for workers to enter the satellite infeed area without isolating the machinery to fix any issues or clean the area. However, even if the satellite line plant was isolated and locked before a worker entered the restricted access area, there would still be a risk of the arms of the tilt hoist falling on workers who were clearing jammed timber due to slack in the drive chains.

41. Dongwha’s organisational structure required that production team members reported to leading hands. Mr Korrie Elton (Mr Elton) was the team leader who had overall supervision of the satellite shed. Mr Simpson was the leading hand and Mr Olsen’s direct supervisor. At the time of the incident Mr Simpson was working in the strapping and wrapping area in the satellite line which was approximately 50 metres away from where Mr Olsen was working. Mr Elton had finished work for the day and was not at work at the time of incident.

Guidance Materials

42. The Code of Practice entitled “Managing Risks of Plant in the Workplace”, dated July 2014 (the NSW Code), was freely available on the SafeWork NSW website at the time of the incident. It provides guidance on specific control measures for guarding plant.

43. At p 28 the NSW Code provides guidance for the “isolation of energy sources”, and stated:

“The lock-out process is the most effective isolation procedure. The process is as follows:

●   shut down the machinery and equipment;

●   identify all energy sources and other hazards;

●   identify all isolation points;

●   isolate all energy sources;

●   control or de-energise all stored energy;

●   lock out all isolation points;

●   tag machinery controls, energy sources and other hazards; and

●   test by ‘trying’ to reactivate the plant without exposing the tester or others to risk. Failure to reactive the plant means that the isolation procedure is effective and that all stored energies have dissipated. This may require further measures to safely release these energies, for example hydraulic or pneumatic pressure, suspended weight or compressed springs.”

44. Similarly, the SafeWork Australia Code of Practice dated March 2016 with the same title, “Managing Risks of Plant in the Workplace”, was freely available at the time of the incident on the SafeWork Australia website and provided guidance in the same terms as the NSW Code.

Systems of Work Following the Incident

45. On 2 August 2016 in response to the incident SafeWork NSW issued three improvement notices requiring Dongwha to develop and implement a system for ensuring the safety of workers operating the tilt hoist and to ensure adequate information, training and instruction was provided to workers for the safe operation of the tilt hoist.

46. In compliance with the SafeWork improvement notices, Dongwha conducted a risk assessment for the operation of the satellite line plant between 9 August 2016 and 25 August 2016.

47. The risk assessment identified various additional control measures which Dongwha subsequently implemented as follows:

1. Erected new safety fencing around the restricted access area, particularly near the satellite line infeed unit and raised the height of the gate.

2. Installed new position sensors on the drive chain mechanism to detect slack in the lifting chains of the tilt hoist.

3. Installed new anchor points in the floor for attaching a hand winch to lift the tilt hoist during maintenance or while releasing jammed timber. The floor anchor plate was positioned to allow a 1500kg comealong (a hand-operated winch) to be connected to hold the tilt hoist backrest in a fixed position. This meant that if the tilt hoist is jammed in a set position the comealong would hold it in that position until the maintenance work was completed.

4. Implemented a system for steel pins to be inserted in the side of the tilt hoist to secure it during maintenance, stopping the arm from moving.

5. Clearly marked designated exclusion zones and installed prominent signage around the satellite line infeed unit area.

48. The risk assessment also required the existing unwritten practice of calling maintenance to remove jams in a controlled manner to be incorporated into the operational manual.

49. Dongwha prepared an incident investigation report dated 12 September 2016 which reached the following conclusions:

1. The training system currently in place was not being implemented.

2. The training package was outdated and referred to a different satellite line.

3. Common practices were not formalised and not effectively communicated to new workers.

4. Safety protocols were not being uniformly followed and leading hands were not enforcing compliance with them.

5. Safety culture in the satellite line was ineffective.

50. The investigation report made a number of recommendations which included:

1. updating Dongwha’s SOPs;

2. updating training manuals;

3. considering disciplinary action for non-compliance with safety protocols;

4. risk assessment of satellite infeed;

5. implementing recommendations of risk assessment; and

6. developing individual training plans for all satellite line employees.

The Evidence for Dongwha

51. Mr Dongjin Lee swore affidavits dated 16 December 2019 and 4 February 2020. Mr Lee is the Human Resources and General Affairs Manager, and Manager for Safety and Environment, of Dongwha.

52. In his first affidavit Mr Lee, on behalf of Dongwha, expressed deep remorse for the harm caused to Mr Olsen and offered an unqualified apology. Mr Lee further acknowledged on behalf of Dongwha, himself and the directors, that had steps been taken prior to the incident, the risk to which Mr Olsen was exposed would have been reduced.

53. Mr Lee said that Dongwha has employed qualified health and safety personnel since commencing operations.

Purchase and installation of the Satellite Line Infeed Unit

54. The satellite line infeed unit was a brand new machine when it was purchased by Dongwha in May 2014.

Safety and Supervision

55. Dongwha acknowledges that the unwritten requirement to call maintenance to remove a jammed fillet stick was not always enforced, and that supervisors had not been required to monitor and enforce compliance with the procedure, particularly in respect of new workers.

56. Mr Lee also stated that Dongwha apologises for the fact that it had not put the Clearance Procedure in writing, and that its supervisors did not always monitor and enforce compliance by the workers with the Clearance Procedure.

57. Dongwha fully acknowledges that it had not adequately required Mr Simpson, as a supervisor, to monitor and enforce compliance with the Clearance Procedure, and to particularly focus on new production workers in doing so.

Risk Assessment of Satellite Line Plant

58. Mr Lee acknowledged that Dongwha did not undertake a specific risk assessment which identified: the risk of the arms of the tilt hoist falling if the chains of the lift arms were slack; and the control measures to eliminate or minimise this risk.

Actions taken after the incident

59. Dongwha notified the regulator as soon as possible after the incident occurred. It assisted the regulator with its inquiries into the incident. Dongwha completed its own internal investigation of the incident involving interviews with witnesses, and provided a copy of its internal investigation report to the regulator.

59. As a result of the incident, Dongwha undertook action to reduce or eliminate the likelihood of a similar accident. Mr Lee attended meetings with Mr Olsen's manager, the safety officer, the engineering manager, the production manager, and the maintenance manager to discuss the risks of the machine and how to address those risks.

60. Dongwha now requires that safety pins are used in the event that any work is performed in the area close to or immediately below the tilt hoist. By placing safety pins in the tilt hoist, the tilt hoist arms are prevented from falling.

61. Mr Lee also detailed the other measures taken to change the premises including the installation of a floor anchor plate, a light curtain that isolates the tilt hoist machine once a person walks through the gate, as well as committing to the SafeWork NSW Inspector’s recommendation to install a SafeZone Safety Laser Scanner system. The system is essentially a motion detector so if a person continues into the no-go area, then the machine will be isolated. The court was informed that the laser system has now been installed.

62. Since the incident Dongwha has spent the following funds on safety in the workplace:

1. 2016 - $68,351.32;

2. 2017 - $80,689.82;

3. 2018 - $204,147.09 including Government funded training valued at approximately $100,000; and

4. 2019 - $52,299.96.

Community involvement and charitable works

64. At its Bombala premises, Dongwha currently employs approximately 130 people with 80-90% of these workers being from the local Bombala area. The population of Bombala is about 1,200 people.

65. Dongwha has also indirectly contributed to the Bombala local economy by:

1. hiring local tradespeople to assist with the improvement of its premises since 2013;

2. purchasing most of its materials and services for use at its premises from local businesses;

3. creating a demand for local accommodation because the 50 or so truck drivers who attend the Dongwha premises to collect and deliver materials often stay overnight in accommodation at Bombala due to fatigue management guidelines.

66. Dongwha is actively involved in supporting local causes. These include:

1. employing apprentices and trainees, including school-based apprentices;

2. hosting work experience students;

3. holding careers days for students and teachers from Bombala High School;

4. site tours for high school students and university students;

5. sponsoring local clubs, including Bombala Golf Club and the Bombala Cricket Club, totalling approximately $10,100 in 2019;

6. sponsoring sporting teams and events, such as the Bombala Cup, the Bombala Bike Show, the Bombala Blue Heelers Rugby Team and the junior team;

7. donating funds, materials and meeting spaces to local charity organisations or fundraising events, including the Bombala Lions Club, the Bombala Rotary Club, St Joseph’s School, Bombala Public School, Bombala High School, Bombala Delegate School and the Monaro Committee for Cancer Research, totalling approximately $2,500 in financial donations and $5,500 worth of materials in 2019.

Capacity to Pay

67. In his second affidavit, Mr Lee explained that since the date of his first affidavit dated 16 December 2019, Dongwha's operations have been significantly impacted by the recent bushfires in New South Wales.

68. However no evidence was called concerning the financial position of Dongwha, or its capacity to pay any likely fine.

69. In those circumstances, I find that Dongwha has not discharged its onus of convincing the court that it should exercise its discretion to reduce the amount of the fine.

Consideration

70. I have had regard to the objects in s 3 of the Act and the purposes of sentencing set out in s 3A of the Crimes (Sentencing Procedure) Act 1999 (NSW).

Objective seriousness of the offence

71. The proportionality principle requires that a sentence should neither exceed nor be less than the gravity of the crime having regard to the objective circumstances: Veen v The Queen (No. 2) [1988] HCA 14; (1988) 164 CLR 465 at 472, 485-6, 490-1 and 496. At common law, the term “objective circumstances” was used to describe the circumstances of the crime. The gravity of the offence was assessed by reference to its objective seriousness: R v McNaughton [2006] NSWCCA 242; (2006) 66 NSWLR 566 at [15].

72. The task requires the court to consider where in the range of conduct covered by the offence the conduct of the offender falls: Baumer v R [1988] HCA 67; (1988) 166 CLR 51 at 57. This assessment will generally indicate the appropriate range of sentences available which will reflect the objective seriousness of the offence committed, and set the limits within which a sentence proportional to the criminality of the offender will lie: BW v R [2011] NSWCCA 176 at [70].

73. The sentencing judge should take into account not only the conduct which actually constitutes the crime, but also such of the surrounding circumstances as are directly related to that crime and are properly regarded as circumstances of aggravation or mitigation: R v Wilkinson(No. 5) [2009] NSWSC 432 at [61].

74. The existence of a reasonably foreseeable risk to safety that is likely to result in serious injury or death is a factor relative to the gravity of the offence: Capral Aluminium Limited v WorkCover Authority of New South Wales [2000] NSWIRComm 71; (2000) 49 NSWLR 610 at [82]. The question of foreseeability of the risk is to be determined objectively.

75. The court must identify all the factors that are relevant to the sentence, discuss their significance and then make a value judgment as to what is the appropriate sentence given all the factors of the case: Muldrock v The Queen [2011] HCA 39; (2011) 244 CLR 120. This approach to sentencing, known as the “instinctive synthesis” approach, involves the making of a global judgment without any attempt to state precisely how any given factor has influenced the judgment.

76. The Court of Criminal Appeal has recently examined the sentencing process with regard to the Act in the matter of Nash v Silver City Drilling (NSW) Pty Limited; Attorney General for NSW v Silver City Drilling (NSW) Pty Limited [2017] NSWCCA 96. His Honour Justice Basten at par 34, under the heading “Assessment of Risk” said:

“The sentencing judge commenced his consideration with the proposition that ‘greater culpability attaches to the failure to guard against an event the occurrence of which is probable rather than an event the occurrence of which is extremely unlikely’. However the truth of that proposition depends upon other considerations including (a) the potential consequences of the risk, which may be mild or catastrophic, (b) the availability of steps to lessen, minimise or remove the risk, and (c) whether such steps are complex and burdensome or only mildly inconvenient. Relative culpability depends on assessment of all those factors.”

77. Further at par 42 his Honour continued:

“The culpability of the Respondent is not necessarily to be determined by the remoteness of the risk occurring, nor by a step‑by‑step assessment of the various elements. Culpability will turn upon an overall evaluation of various factors, which may pull in different directions. Culpability in this case is reasonably high because, even if the pressure event of the force which occurred might not be expected to occur often, the seriousness of the foreseeable resultant harm is extreme and the steps to be taken to avoid it, which were not even assessed, were straightforward and involved only minor inconvenience and little, if any, costs.”

78. At par 53 his Honour dealt with the proper approach to considering the objective seriousness of offences under the Act, saying:

“It is important to note that the risk to be assessed is not the risk of the consequence, to the extent that a worker is in fact injured, but is the risk arising from the failure to take reasonably practicable steps to avoid the injury occurring. To discount the seriousness of the risk by reference to the unlikelihood of injury resulting is apt to lead to error. The conduct in question is the failure to respond to a risk of injury, conduct which will be more serious, the more serious the potential injuries, whether or not they are likely to materialize. The objective seriousness of the conduct will also be affected by the ease with which mitigating steps could have been taken.”

79. My findings about Dongwha’s level of culpability are based upon the following:

1. The risk of a worker being impacted by the arms of the tilt hoist on the satellite line infeed unit when clearing or removing jammed timber from beneath the tilt hoist was obvious and foreseeable. Guidance material in any event made such a risk known to the industry.

2. The likelihood of the risk of a worker being struck by tilt arms falling as a result of dislodging a fillet stick was significant.

3. There was potential for serious injury or death. Mr Olsen could have easily died or suffered catastrophic injury if he had been struck on the head or neck.

4. There was no risk assessment undertaken relevant to the task that Mr Olsen was performing. This step would have assisted in minimising the risk. Additionally, the SOP should have referred to the fact that the hoist arms could become slack with the result that they may fall to the horizontal position if an obstruction is removed.

5. There was little or no burden or inconvenience in conducting a risk assessment relevant to the task that Mr Olsen was seeking to complete, nor would it have been a burden to formalise the undocumented informal procedure that required maintenance personnel to become involved in the clearing of jammed timber.

6. The significant injury suffered by Mr Olsen was a manifestation of the risk.

7. The maximum penalty for the offence is a fine of $1,500,000, which reflects the legislature’s view of the seriousness of the offence.

8. Dongwha did have a commitment to safety and a detailed (but incomplete) system of written safety documentation. The unwritten informal Clearance Procedure was not followed on this occasion, and the absence of that procedure being put in writing and taught to the workers is an important factor in understanding why the risk existed and why the accident occurred. To adapt the lawyer’s aphorism about verbal contracts, an unwritten safety procedure “is not worth the paper it is not written on”.

80. I find that the Dongwha’s level of culpability is in the mid range.

Deterrence

81. The penalty imposed in relation to this offence must provide for general deterrence. Employers must take the obligations imposed by the Act very seriously. The community is entitled to expect that both small and large employers will comply with safety requirements. General deterrence is a significant factor when safety obligations are breached: Bulga Underground Operations Pty Limited v Nash [2016] NSWCCA 37; (2016) 93 NSWLR 338 at [180].

82. The penalty must reflect the need for specific deterrence. Dongwha is still conducting a business. Its operations involve a timber sawmill and timber re-manufacturing facility involving the continuing engagement of workers and the operation of potentially dangerous machinery.

Aggravating factors

83. The injury, emotional harm, loss or damage caused by the offence was substantial: s 21A(2)(g) Crimes (Sentencing Procedure) Act 1999.

Mitigating factors

84. Dongwha does not have prior convictions: s 21A(3)(e) Crimes (Sentencing Procedure) Act 1999.

85. Dongwha is otherwise of good character: s 21A(3)(f) Crimes (Sentencing Procedure) Act 1999. The steps which it took after the incident demonstrate this. Dongwha has been in business for 17 years.

86. Dongwha is unlikely to re-offend: s 21A(3)(g) Crimes (Sentencing Procedure) Act 1999.

87. Dongwha has good prospects of rehabilitation: s 21A(3)(h) Crimes (Sentencing Procedure) Act 1999. It has taken positive steps to guard against the risk of an incident such as this ever happening again. It has brought its documentation and its procedures into line with those which, on all the evidence, should have been in place before this accident occurred.

88. Dongwha has shown remorse for the offence: s 21A(3)(i) Crimes (Sentencing Procedure) Act 1999. It has provided evidence that it has accepted responsibility for its actions and has acknowledged that the injury to Mr Olsen was caused by its actions.

89. Dongwha entered a plea of guilty: s 21A(3)(k) Crimes (Sentencing Procedure) Act 1999. The court must take into account the fact that it has pleaded guilty, when it pleaded guilty, and the circumstances in which it indicated an intention to plead guilty: s 22(1) Crimes (Sentencing Procedure) Act 1999. It is appropriate to give Dongwha a 25% discount for an early plea, a matter agreed between the parties.

90. Dongwha gave assistance to law enforcement authorities: s 21A(3)(m) Crimes (Sentencing Procedure) Act 1999. It co-operated at all times with the prosecutor and provided all documents requested in a prompt fashion.

Capacity to pay a fine

91. I am required to have regard to s 6 of the Fines Act 1996 (NSW) before imposing a fine. Where an offender seeks to have a fine reduced on the basis of a limited capacity to pay, it bears the evidentiary onus of convincing the court that it should exercise its discretion to limit the amount of the fine. The offender’s capacity to pay is relevant but not decisive: Mahdi Jahandideh v The Queen [2014] NSWCCA 178 at [16]. A substantial fine may still be warranted as a result of the seriousness of the offence and the need for general deterrence.

92. In Unity Pty Limited v SafeWork NSW [2018] NSWCCA 266 at [79] the Court of Criminal Appeal said:

“First, and more generally, questions of specific deterrence should take into account the size and scope of the operations of the defendant; a fine which may be crippling to a small business may have virtually no impact on the financial operations of a large corporation. The maximum penalty for the offence is undoubtedly set having regard to such a factor. Secondly, the Court is required to have regard to ‘the means’ of the defendant, pursuant to s 6 of the Fines Act 1996.”

93. The submissions made by the defendant in regards to capacity to pay, in particular by reference to the financial loss Dongwha has suffered due to the effects of the recent NSW bushfires, has been previously dealt with.

Costs

94. The prosecutor is entitled to an order that Dongwha is to pay the prosecutor’s costs.

Penalty

95. Counsel for the defendant submitted that it would be appropriate to deal with Dongwha by way of a bond under s 10 of the Crimes (Sentencing Procedure) Act1999 (NSW). This section enables a court to deal with a matter without convicting the offender, having regard to the offender’s character, antecedents, the trivial nature of the offence, any extenuating circumstances and any other appropriate matter. Counsel submitted that the court should consider “the consequences of a conviction to Dongwha’s business”. There was no evidence that there would be any consequences arising from a conviction per se.

96. I am of the view that it would not be appropriate to decline to record a conviction against Dongwha. The offence was not of a trivial nature. There are no extenuating circumstances. The risk was there to be foreseen and it was not perceived. The character and antecedents of Dongwha operate in its favour, but not to the extent sufficient to lead the court to give it the benefit of an order under s 10. To deal with the matter without imposing a conviction would fail to recognise the objective seriousness, the principle of deterrence and the nature of the offence – see Safework NSW v Freyssinet Australia Pty Ltd [2018] NSWDC 66 at [62].

97. Counsel for the defendant also submitted that an order could be made under s 239 of the Act to adjourn the matter upon Dongwha giving a “court-ordered WHS undertaking”. It was submitted that such an undertaking should require Dongwha to make reasonable enquiries as to which other businesses within New South Wales operate satellite line infeed units, advise them of Dongwha’s prosecution, the particulars of the prosecution and the orders made by the court. It was submitted that this would achieve one of the objects of the Act, by alerting similar businesses to the particular risk which came home in the present case.

98. There was no evidence placed before the court that the risk involved in this case, or the type of accident which occurred, was a common occurrence. There was no evidence that any such enquiries had been made to date, and there must be doubt as to whether Dongwha’s competitors would be keen to speak to it about their particular commercial operations. I cannot see any utility in making an order under s 239 of the Act and I decline to do so.

99. My orders are:

1. The offender Dongwha Timbers Pty Limited is convicted.

2. The appropriate fine is $120,000 but that will be reduced by 25% to reflect the plea of guilty.

3. Order the offender Dongwha Timbers Pty Limited to pay a fine of $90,000.

4. Order pursuant to Section 122(2) of the Fines Act 1996 that 50% of the fine is to be paid to the prosecutor.

5. Order the offender Dongwha Timbers Pty Limited to pay the prosecutor’s costs.

**********

Decision last updated: 13 February 2020