Each witness was required for cross-examination.
9 Mr Yang, who gave evidence through a Mandarin language interpreter, was employed as a machine operator with the corporation at the time of the incident. He had been employed for approximately five years prior to the incident. A part of Mr Yang's duties was to clean the rollers on the Machine. Mr Yang was working on the machine when he was injured, cleaning the roller. He gave evidence that he had to stop the machine before cleaning it. This was standard procedure. Mr Yang said that before he was injured he had not seen Ms Ly in the area of the factory where he worked, nor had she ever talked to him about his work at the factory. Mr Yang gave evidence that before the accident he did not know Mr Sunny Ngai. He could not recall if he had ever seen him in the factory where he worked.
10 In cross-examination, Mr Yang agreed that the machine had stopped because paper had got stuck in the rollers. This required him to remove the paper, clean the rollers and feed the paper back into the rollers.
11 Mr Daryl de Vries, who has been employed by the corporation for approximately 15 years, has held the position of Production Manager for the corporation since 1998. Before taking up this position, Mr de Vries was involved in building and maintaining machines for the corporation. He holds a Bachelor of Engineering (Mechanical) and a Graduate Diploma in Engineering (Maintenance Management) and is a Member of the Institute of Engineers of Australia. He is also certified as a professional Engineer.
12 Mr de Vries' gave evidence that when he initially commenced working for the corporation, it had a single site at 34 Redfern Street, Wetherill Park. In approximately 1995 the corporation acquired 62 Redfern Street, Wetherill Park. At the date of the incident, Mr de Vries spent 95 per cent of his time at his office at 62 Redfern Street, Wetherill Park. Mr de Vries' recalled seeing Ms Ly at both sites. The majority of the time he saw her at 34 Redfern Street and occasionally at 62 Redfern Street. Mr de Vries saw Ms Ly mostly on the phone speaking in Chinese. Ms Ly had an office at 34 Redfern Street and from time to time, Mr de Vries would have a conversation with her about work.
13 There is a factory located at each of the sites. At the time of the accident tissue folders, napkin folders, finished goods and jumbo rolls were housed at the 34 Redfern Street site. Approximately 50 per cent of the site was used for storage with the other 50 per cent housing machinery. The factory at 62 Redfern Street was twice the size of that at 34 Redfern Street and housed machines.
14 Mr de Vries gave evidence that he saw Ms Ly at 62 Redfern Street with Mr Henry Ngai, her husband, showing what he thought were dignitaries or perhaps bank managers around the factory. This occurred approximately once a month. The site, on Mr de Vries evidence extended to 72 Redfern Street, which was part of the overall site extending from 62 Redfern Street. The machine, the subject of the incident was situated on this site. The three factories located at 62 - 72 Redfern Street are interlinked and Ms Ly and Mr Ngai were able to walk through the three factories without going outside.
15 Mr de Vries said he knew Mr Sunny Ngai. Although he never saw him perform work in the factory, he saw him on or before 21 February 2004 in his office, which was located upstairs at the front of 34 Redfern Street. He also observed him, from time to time, in the factory premises attached to 34 Redfern Street generally showing buyers from Woolworths or Coles or other supermarket chains around the factory.
16 Mr de Vries gave evidence that he had three "bosses": Chek Ming Ly, Houy Ly and Henry Ngai. Chek Ming Ly would look after, what was described as the front office, dealing with day-to-day business and external contracts. Houy Ly would deal with the factory (which I infer meant that he would ensure it was functioning properly) and Henry Ngai was the General Manager. Mr Henry Ngai was described by Mr de Vries as the final decision-maker. Employees would go to him with business decisions that had to be made.
17 Mr de Vries said that both he and Mr Houy Ly were responsible for the operation of the machines at the three premises at 62 Redfern Street before 21 February 2004. Mr Houy Ly was the Supervisor for night shift and Mr de Vries worked during the day. Mr de Vries had the authority to implement improvements or modifications to the machines. Mr de Vries gave evidence that Mr Siva, or Mr Houy Ly, or himself, had the authority to engage external maintenance persons to work on the machines. Mr de Vries and Mr Siva had Safety Inspection Lists for the machines, to enable them to check that guard doors were working, and in particular, that guard switches and emergency stoppers were working. Mr Siva was the Safety Officer who was responsible for implementing safety audits. Mr de Vries was unsure if the Safety Inspection List was in the form of a written document.
18 Mr de Vries said there was no system in place to report the state of guarding on the machines to any of the directors of the corporation. If a guard was missing from a machine, Ms Ly would probably be "one of the last people [he] would want to talk to about it" as there were many people in the chain-of-command who would be more important to talk to than her. He expressed a similar opinion in respect of Mr Sunny Ngai. Mr de Vries gave evidence that he saw little point in reporting guarding matters to Mr Sunny Ngai because in his opinion Mr Sunny Ngai exerted no control over the maintenance people and there were more senior people in the company he could talk to about such an issue. He said the first person he would talk to would be Mr Siva. If he saw a serious safety issue, he would approach Mr Siva before approaching Mr Henry Ngai, Mr Sunny Ngai or Ms Ly. Mr de Vries did not rule out speaking to Mr Sunny Ngai or Ms Ly about a safety issue. Mr de Vries said he was not given any written instructions as to what the responsibilities of the directors were prior to 21 February 2004.
19 During cross-examination, Mr de Vries stated that Ms Ly and Mr Gary Lim were responsible for purchasing jumbo rolls of paper that were used to make smaller packaged tissue paper and napkins. Mr de Vries said he spoke to Ms Ly on occasions about the quality of the paper the corporation was getting from overseas. He also said he may have spoken to her in very broad terms about production. Mr de Vries understood Mr Sunny Ngai's role to be in charge of all sales and marketing for the corporation in Australia.
20 Kuong Srung Tea gave evidence through a Cambodian interpreter. Mr Tea has been employed by the corporation since 29 July 1996. He was initially employed as a Leading Hand before he was promoted to the position of Supervisor, which occurred after the incident. In his position of Leading Hand, he was required to inspect the machines. Mr Tea gave evidence that his duties included ensuring that if a machine were not working, he would organise for it to be inspected and repaired, if necessary. He worked night shift and did not know Ms Ly or Mr Sunny Ngai. Mr Tea said he reported to Mr Houy Ly.
21 Mr Chek Houy Ly gave evidence through an interpreter of the Cambodian language. Mr Ly, who is employed as the Night Shift Manager, commenced employment with the corporation in 1987. He said he was not provided with a written statement of his duties by the corporation.
22 Mr Ly is Ms Ly's brother and thus Mr Henry Ngai's brother-in-law. He gave evidence that he did not see her at the factory before 21 February 2004 nor did he see Mr Sunny Ngai at the factory although occasionally he saw him inside the office at 34 Redfern Street. Mr Sunny Ngai is Mr Ly's nephew. Asked what he would do if a machine broke down, his evidence was that he would report it to Mr Check Ming Ly, who held the position of Manager and not to Mr Sunny Ngai. Such reports were made orally. Mr Siva would also assist him from time to time, as would Mr de Vries. Mr Ly said that he did not speak to Mr Henry Ngai about work matters.
23 Mr Chek Ming Ly gave evidence through an interpreter. Mr Ming Ly has been employed by the corporation since 1986, when it commenced operating. He currently holds the position of General Manager and become a director in 2005. He explained his role as "making sure everything was safe". He is in charge of the day-to-day operations at the factory. Mr Ming Ly normally works day shift. He did not have a duty statement.
24 Mr Ming Ly acknowledged that he had pleaded guilty to a charge relating to the general failure to guard the Rewinder Machine No 1 and to a charge dealing with the specific nip point. Mr Ming Ly is yet to be sentenced.
25 Mr Ming Ly gave evidence that before 21 February 2004, a special sensor had been put on the machine to minimise the risk of injury. The effect of his evidence was that if what was described as the red cord (sensor) was broken, the machine would stop.
26 Mr Ming Ly explained that prior to 21 February 2004 he was involved in ensuring safety at the factory. He gave evidence that he ordered guards to be placed on machines and that sometimes the guards were taken off because a door to the machine did not close properly. His evidence was that he was primarily responsible for safety and the day-to-day operations of the Rewinder machines. The Production Manager, Mr de Vries was also responsible for safety and the day-to-day operation of the machines. Mr Houy Ly was responsible for the machines on night shift.
27 Mr Ming Ly said that before 21 February 2004, he knew Mr Henry Ngai. His evidence was that if a machine(s) needed a new guard, or if guards changed, he had the authority to approve such work without having to obtain approval from Mr Henry Ngai. Mr Henry Ngai is Mr Ming Ly's Brother-in-Law. Mr Sunny Ngai is Mr Ming Ly's Nephew.
28 Mr Ming Ly stated that Mr Sunny Ngai was involved in sales and marketing and on occasions he spoke to him about sales. His evidence was that Mr Sunny Ngai had an office upstairs at 34 Redfern Street, Wetherill Park. On occasions he saw him in the lunchroom and accompanying people walking around the factory. He said he was never given any instructions about the work he was doing by Mr Sunny Ngai.
29 Ms Ly is Mr Ming Ly's sister. Although he saw Ms Ly at the factory, he never spoke to her about his work. His understanding was that her role was to purchase jumbo rolls of paper from overseas. On occasions when there was no paper, he would ask her to order it.
30 Mr Ming Ly gave evidence he was not required to report any problems in respect of the guarding of machines to Ms Ly or any of the Directors because there was no limit on the money he could spend in respect of the corporation's safety. He said that on occasions he spoke to Mr Henry Ngai about the machines but not the other Directors.
31 Mr Ming Ly gave evidence that the corporation did not have Board meetings, but on occasions, meetings were held between Mr Henry Ngai, Mr Sunny Ngai and Mr Ming Ly to discuss marketing if the sales slowed down or if there was a price change. Such meetings did not include Ms Ly. He only discussed the purchasing of jumbo rolls with Ms Ly and on occasions complained about the quality of the jumbo rolls. Prior to 21 February 2004, Mr Ming Ly observed Ms Ly in the factory on occasions in the company of bankers.
32 Mr Ming Ly undertook some on-the-job training in approximately 1996 or 1998 with Mr Siva when he employed someone from outside the corporation to conduct occupational health and safety training. Mr Ming Ly sent Mr Siva to TAFE to undertake occupational health and safety course. Mr Siva was required to report any safety issues to Mr Ming Ly and not the other Directors.
33 During cross-examination, Mr Ming Ly stated that Mr Siva had been employed for approximately six to eight years with the corporation and that he relied on him for safety matters. He worked on safety matters with him on a day-to-day basis.
34 Mr Ming Ly acknowledged that he had built the company up with Mr Henry Ngai since it was established in 1986. He looked after the production side, whilst Mr Henry Ngai looked after the financial side. This resulted in him learning more about the equipment over the years and about safety issues, which were left to him. He was the decision-maker in respect of spending money on the safety side of the business.
35 As the company grew, the number of machines increased. The company commenced operations with two machines and approximately five employees. There are now over 300 employees. When Mr Sunny Ngai was appointed to the marketing role, sales increased.
36 Prior to 21 February 2004, Mr Ming Ly said he had no discussions with Mr Sunny Ngai about any employees being injured in the factory or in respect of fines imposed for breaches of safety after accidents. Mr Ming Ly gave evidence that after the incident, an occupational health and safety consultant, Mr G Rowe, was engaged by the corporation. It was not until 2005 that he advised Mr Sunny Ngai of the incident involving Mr Yang. This was after Mr Sunny Ngai received a notice from Inspector James of WorkCover who was investigating the incident. This was the first time that he had had any discussions with Mr Sunny Ngai about safety matters. At this time, Mr Sunny Ngai assumed the role for safety matters in the corporation and became a member of the Occupational Health and Safety Committee. Ms Ly was not involved in these discussions, nor was she ever a member of the Safety Committee.
37 Mr Henry Ngai is the Managing Director of the corporation, which he established in 1985. At the time the company was incorporated, there were two Directors, Mr Henry Ngai and his daughter Anna Lai Chang Ngai, as it was necessary for there to be two directors and shareholders at the time.
38 Mr Henry Ngai has pleaded guilty to two charges that arise out of the incident that occurred on 21 February 2004. Mr Henry Ngai is yet to be sentenced. Mr Henry Ngai could not recall being told of convictions being entered against the corporation by the Chief Industrial Magistrate on 7 March 2001 and 8 November 2004. He gave evidence that he was only informed about these convictions prior to giving evidence in these proceedings. He stated that Mr Ming Ly, his brother-in-law managed the employees and he managed the finances. The incident, the subject of these proceedings, occurred when Mr Henry Ngai was overseas. He was informed of this incident upon his return.
39 Mr H Ngai stated that the corporation had no systems in place that required him, as the Managing Director, to be told that fines had been imposed on the corporation in respect of breaches of the Act. The reason for this was that Mr Ngai's Brother-in-Law, Mr Ming Ly, in his role as General Manager, was responsible for the employees and all health and safety matters in the factory. Mr H Ngai gave evidence that he told Mr Ming Ly to attend to anything he needed to do in respect of the employees or occupational health and safety issues. He was not required to report any such decisions he made to Mr H Ngai.
40 Mr H Ngai said he would talk to Ms Ly, his wife, about the purchasing of jumbo rolls, but could not recall talking to her about work matters generally before March 2004. Mr H Ngai stated it was a family business and his wife would use his office. His evidence was "there is no clear separation of offices because it is a family business and people can come in". In response to questions whether he talked generally about the work of the company to anyone, Mr H Ngai said he talked only about sales to Mr Sunny Ngai. Mr H Ngai stated that some times he would walk around the factory but "not too much". He did this to say hello to his staff. Mr H Ngai acknowledged that Ms Ly, from time-to-time, would accompany bankers on tours of the factory, so they could view the machines. I infer that such tours occurred prior to a bank determining an application by the corporation for a loan. However, Mr H Ngai's evidence was that he would reprimand Ms Ly if he became aware that she was walking around the factory because she had no knowledge of the machines and he considered it dangerous, particularly as there were forklifts moving around the factory. He said that Ms Ly was responsible for purchasing and that she had no knowledge about the machines. He was concerned that if she were injured, she would not be able to look after him.
41 Mr H Ngai gave evidence that before March 2004 and to the present day, he has endeavoured to prevent Ms Ly from going to that part of the factory where the machine are now located. He said she did not come to work every day and he would say to her "not go to the factory, I don't like you to go to factory." He did not want her to be involved in something she did not understand. He accepted that on occasions when he was unwell he would ask her to escort bank representatives around the factory in the company of the Production Manager or Mr Ming Ly.
42 Mr H Ngai stated that, from time-to-time he went overseas on business. He produced a three-page summary of his travelling record, which was tendered in the proceedings.
43 Mr H Ngai stated that as the business is a family business, there were no formal board meetings. Mr H Ngai signs the income tax returns and attends to any payment required to be made to the Taxation Office. The auditing of the business is done by his accountant and Mr Ngai signs the report. Unless there is a need for two directors to sign a document, the directors do not assemble as a board. Mr H Ngai owns 60 per cent of the company. If two directors were required to sign a bank loan or to buy property, they would come together. However, the effect of his evidence was that there were no formal board meetings. Mr H Ngai said there was no need for the directors to meet to discuss production matters or reports because he would speak to Ming Ly or the Production Manager about those matters. He confirmed Ms Ly was responsible for the purchasing of raw materials and Mr Sunny Ngai for selling the products.
44 Mr H Ngai said he was not aware of Mr Sunny Ngai walking around the factory where the machines were located because he believed he was busy with the sales part of the business. He was not prevented by Mr Henry Ngai from walking around the factory but he was urged by him to concentrate on the sales part of the business.
45 Mr H Ngai explained that Mr Ming Ly was responsible for occupational health and safety in the factory. He gave evidence that as Mr Ming Ly is Mr Sunny Ngai's Uncle, if Mr Sunny Ngai involved himself in production or safety issues, that would upset Mr Ming Ly. This reaction was explained on the basis that it is customary in Chinese culture to have respect for your seniors. Mr Henry Ngai was therefore of the view that Mr Sunny Ngai should not tell Mr Ming Ly what to do. Mr H Ngai said he had asked Mr Sunny Ngai to concentrate on sales because the company employs in excess of 300 people and if there are no sales then employees may have to be terminated.
46 Mr H Ngai stated that he only became aware that WorkCover had issued prohibition notices in the past to the corporation, after the incident in March 2004. He acknowledged there was no system in place that required directors to be told that WorkCover had issued an improvement notice. There was also no system in place prior to the 2004 incident, which required the directors, apart from Mr Henry Ngai to be informed if an employee was injured whilst at work. Since the incident involving Mr Yang, such a system has been put in place. It includes informing all the managers on day and night shift and Mr H Ngai that an incident has occurred. The reason why such a system was not in place prior to March 2004, was because Mr H Ngai did not understand that there was an obligation for persons, including other directors to be informed of such incidents. There was no occupational health and safety committee in existence prior to March 2004, as occupational health and safety matters were dealt with by Mr Ming Ly and Mr Siva.
47 During cross-examination, Mr H Ngai stated that from 1985 when he established the company until March 2004, he decided who would carry out particular roles and have responsibility in the company. As more employees were engaged, he continued to allocate responsibility for areas in the business. As an example, Mr H Ngai referred to appointing Mr Sunny Ngai to be in charge of sales and marketing and inviting him to be a director. Mr Henry Ngai said that whilst Mr Sunny Ngai had been responsible for sales and marketing, he did not have any involvement in the management of the company outside that specific area of responsibility, for example, in the production area, or the occupational health and safety area.
48 Mr Henry Ngai gave evidence that Ms Ly, his wife, became a director during 1993. She does not receive any director's fees for her duties, or any salary. She is a shareholder in the company. The role he assigned her was purchasing jumbo rolls. At the time that she was appointed to carry out this role, she did not reside in Australia on a fulltime basis. She carried out her purchasing role from Hong Kong where Mr H Ngai also has a company that produces tissues products. From approximately 2000, Ms Ly commenced spending more time in Australia due, in particular, to Mr H Ngai's health problems. Mr H Ngai said that Ms Ly had no other responsibilities in the company. Mr H Ngai confirmed that it was his decision whether she undertook any other responsibilities in the company. He stated that she had recently resigned as a director of the corporation.
49 Mr H Ngai acknowledged that in order to sign audit documents and approve accounts, it was necessary for two directors to assemble for this purpose. Mr H Ngai provided a document which set out the reporting lines in the company. This document demonstrated that Mr Ming Ly, Mr Houy Ly and Mr Sunny Ngai all reported to Mr Henry Ngai. He said Mr Ming Ly became a director in 2005. Mr Ming Ly had an unlimited budget in respect of safety matters that arose in the Production Department of the factory.
50 Mr H Ngai said that in 2005, Mr Sunny Ngai's role was expanded to include his attendance at occupational health and safety meetings. He was also required to consider how to improve the company's position in that area. He has also been asked to take over the responsibility for the finances for the company in light of Mr H Ngai's pending retirement.
Evidence of the Defendants
51 Mr HJ Dixon SC, with Mr D O'Neil of counsel, appeared for the defendants and tendered the following documents:
· a job application by Sivagnanasundaram Sivashanmugarajah (known as Mr S Siva) to the company together with Resume and Certificates of WorkCover NSW in respect of courses completed in OHS Risk Management for Supervisors and Managers on 7 and 8 February 2005 and Certificate of Completion of Induction Training for Construction Work dated August 2005;
· Mr Siva's Certificate IV from the Western Sydney Institute in Workplace Safety dated 22 September 2000;
· Mr Siva's WorkCover Certificate - Introduction to Rehabilitation Co-ordination dated 9 May 2000;
· Mr Siva's WorkCover Certificate for attendance at four day Accredited Training Course on Occupational Health and Safety (Committees in Workplaces) Regulation 1999, such attendance being on 21, 22, 28 and 29 February 2000;
· Mr Silva's First Aid Certificate dated 24 November 2003;
· WorkCover Certificate in respect of Effective Case Co-ordination Training attended on 17 October 2000;
· Flow Chart setting out Reporting Lines in the Company and those involved in the Occupational Health and Safety Department before and after August 2005;
· Australian Securities and Investment Commission document in respect of the corporation dated 19 February 2007, together with Certificate of Incorporation on Change of Name of Company and the Memorandum and Articles of Association of ABC Products Pty Ltd.
52 Mr Dixon called the defendants to give evidence.
53 Ms Ly gave evidence through an interpreter that she became a Director of the Corporation in 1993 and resigned in approximately January 2007. She received no payment for being a Director, nor did she receive any salary for the work that she performed for the Corporation. Mr Ly gave evidence that she has an investment company in Hong Kong, which has shares in the corporation.
54 Ms Ly described the work that she has been involved in with the corporation since 1993 as purchasing jumbo rolls from overseas. This is the raw product from which tissue products are produced. She stated that her role did not change between 1993 and March 2004. She said she had no involvement in the management of the corporation, apart from being advised by employees of the corporation, on occasions, that the jumbo rolls were not of good quality. Ms Ly had no need to talk to anyone in management about how the business was run. She had no responsibility for safety and her evidence was that she only became aware that she had such responsibility approximately two months prior to these proceedings. Ms Ly said she did not have any knowledge of safety matters, nor was she allowed to take part in discussions regarding safety issues. These decisions were made by Mr Henry Ngai, her husband. She was unable to change her role or position, or do anything within the corporation without Mr Henry Ngai's agreement. This, she said, was the corporation's policy, which was firmly applied. She was required to follow instructions from the Managing Director.
55 Ms Ly gave evidence that she carried out her purchasing work in Australia, Hong Kong and New Zealand. From time to time she would visit suppliers located overseas. She was overseas at the time of the incident. For the majority of the period between 1993 and 2004, she resided in Hong Kong. During the past two years Mr H Ngai has not enjoyed good health, which has resulted in her spending more time with him in Australia. Between 2002 and 2004, about half her time was spent in Australia. In 2002 she spent 106 days overseas; 2007, 137 days and 2004, 182 days. Whilst in Australia, she carried out the work of purchasing rolls from both her home and an office in the factory. It was her decision where she worked.
56 Ms Ly gave evidence that sometimes she would go to the office once a week and on other occasions, twice a week, depending upon whether she had to look after her grandchildren. It was only on rare occasions that Ms Ly would enter the factory. Such occasions would be if a banker came to the factory and Mr Henry Ngai was not available. She would ask her brother, Mr Houy Ly, to accompany her and the banker to the factory. She stated that she did not have the knowledge to make a contribution regarding safety at the factory. Ms Ly concentrated on purchasing. Her evidence was that she also did not have the time to involve herself in other matters, as she had to look after her family. She stated that her English was very basic and she had not been informed about accidents which had occurred at the factory. I infer that she was informed about such accidents prior to these proceedings.
57 During cross-examination, Ms Ly stated that she was a Director of six companies in Hong Kong. Ms Ly gave evidence that she has a manager looking after those companies. One of these companies, Hong Kong Overseas Investment Limited owns 3,897,754 shares in the Corporation The sixth company manages the other five companies, who together, employ approximately 32 people. Ms Ly is a shareholder in the company. Some of these employees make up a management team who look after the companies.
58 Mr Ming Ly (her brother) would inform her when raw materials were required by the corporation. Without jumbo rolls, that were supplied either locally or from overseas, the corporation could not produce tissue products. Ms Ly had other employees to assist her in purchasing jumbo rolls. Mr Henry Ngai would accompany her when she was purchasing jumbo rolls overseas. Jumbo rolls were purchased from Taiwan, Japan, Korea, China, Thailand and Indonesia. Some of the purchases were effected by Ms Ly when attending locations overseas and negotiating face-to-face with suppliers. Prior to taking on the role of purchasing jumbo rolls for the corporation, Ms Ly had no purchasing experience in respect of jumbo rolls. She gained experience in this area by going overseas with her husband. The purchasing of jumbo rolls in Australia was organised by Mr Ming Ly and Mr Gary Lim.
59 Ms Ly could only recall Mr de Vries complaining about the quality of the jumbo rolls about once a year. If there were too many joins in the jumbo roll, this would cause the Rewinder Machines to stop. Ms Ly complained to the overseas supplier(s) when this occurred. Ms Ly did not understand how the plant or the machines operated. Ms Ly could not remember if Mr Ming Ly had also complained about the jumbo rolls prior to March 2004, except for one complaint that the paper was bulky. If there were complaints about the quality of the jumbo rolls, Ms Ly would refer the complaint to the supplier and ask them to send better quality paper on the next occasion. She did not go to the production area and ask about the problems or difficulties with the paper because she did not have any knowledge of the machines. Nor did she ask Mr de Vries or Mr Ming Ly about the problems poor quality paper caused the machines. Ms Ly disagreed that she could go the factory and observe what effect poor quality paper had on the machines. She stated that the Managing Director had put her in charge of purchasing and she did not have any knowledge of the machines, nor did she ask Mr de Vries, Mr Siva or Mr Ming Ly to explain to her the importance of health and safety in the factory.
60 She saw her role as being limited to buying jumbo rolls of paper and was mindful that Mr Henry Ngai did not allow her to do other work. Ms Ly said that she was put into the role of purchasing jumbo rolls because she was the wife of the owner of the corporation. She was not aware that being a Director involved so much responsibility until these proceedings commenced. Ms Ly confirmed her earlier evidence that on occasions she would accompany bankers around the factory, together with Mr Ming Ly or Mr Henry Ngai. During these tours, she did not ask anyone to explain to her how the Rewinder No 1 Machine had to be guarded to ensure it operated safely, as she saw her role as not including looking after the machines. She was not aware that she was required to ask questions regarding the safety of the machines until these proceedings. Tours around the factory with the bankers occurred once or twice a year.
61 Ms Ly gave evidence that she had never received any training in occupational health and safety, nor had she asked to receive such training. She explained this was because there were many people in charge of this area in the corporation. After August 2005 Ms Ly, unlike other directors, did not attend occupational health and safety meetings. When she became aware of her obligations in this area, she chose to resign as a director, stating that it was too much responsibility, particularly when she was an unpaid director.
62 Mr Sunny Shu Kei Ngai is a defendant in these proceedings and a Director of the corporation. In November 1991, after graduating in Electrical Engineering from the University of Sydney, he commenced full-time employment as the Marketing Director with the corporation. He described his role and responsibilities as initially being those of a salesman, selling product to Franklins Supermarkets. His role expanded, as the business grew, to include marketing responsibilities, which involved advertising and researching the products in supermarkets, both in Australia and overseas.
63 Mr Sunny Ngai reported only to Mr Henry Ngai. For many years, Mr Henry Ngai "looked over (Mr Sunny Ngai's) shoulder". Initially, he was required to report frequently to Mr Henry Ngai. This became less, the longer he was with the corporation. He said 99.9 per cent of his time was devoted to sales and marketing, working 12 hours a day, six days a week. His roles and responsibilities were determined by Mr Henry Ngai. In approximately 2004, he undertook the sales and marketing function of the corporation in his own right. In 2006, as a result of Mr Henry Ngai's health problems, Mr Sunny Ngai took over negotiations with the banks. This decision was made by Mr Henry Ngai.
64 Mr Sunny Ngai's office was initially at 34 Redfern Street, Wetherill Park. In 2006, his office was moved to 32 Redfern Street, Wetherill Park. In the three years prior to March 2004, Mr Sunny Ngai spent approximately 70 per cent of his time in the office. Initially, he had no-one working for him in the sales and marketing area. In 1996, after discussions with Henry Ngai, he employed an assistant. By 2000, after the business continued to expand, he employed a further four or five people. By 2004, he had approximately seven people working with him in sales and marketing.
65 From time to time customers wanted to see the factory in operation. Mr Sunny Ngai would ask Mr Ming Ly if it was convenient to take a customer to the factory and give them a quick tour. Mr Ming Ly would explain how the factory operated during the tour, or ask other employees to do so. This occurred approximately twice a year.
66 Mr Sunny Ngai was one of the corporation's joint cheque signatories. He was also required, from time to time, to sign financial reports and land purchase transactions.
67 Mr Sunny Ngai could not recall participating in formal meetings of the corporation during which its business was discussed. On occasions, between March 1991 and March 2004, he said he would sit down with his mother and father, who were also directors, and talk about the business. Normally this occurred during lunch or dinner. There were no meetings at work between the three Directors where management matters were discussed. Mr Sunny Ngai could not recall having any discussions with any Directors or Managers of the corporation between 1991 and March 2004 about any safety matters in the production area of the corporation. He was aware that Mr Siva and Mr Ming Ly were looking after safety matters in the production area. His understanding was that Mr Ming Ly had the ultimate responsibility for safety matters in the production area.
68 In 2006, Mr Sunny Ngai was required to attend occupational health and safety meetings held at the factory. Discussions had initially taken place in respect of occupational health and safety, which involved Mr Sunny Ngai in the first half of 2005.
69 In 2005, the corporation engaged Mr Andrew Douglas, an Occupational Health and Safety Consultant. Shortly after being engaged, he requested a meeting with the Directors through Mr Ming Ly. After this meeting with Mr Douglas, Mr Sunny Ngai had discussions with Mr Henry Ngai regarding occupational health and safety at the factory. Mr Douglas informed the directors that WorkCover was interviewing employees of the corporation in respect of a safety issue. Mr Sunny Ngai spoke to Mr Ming Ly after his discussions with Mr Douglas and was informed by him that there was "no problem, everything ok". Mr Sunny Ngai did not become aware of the incident, which resulted in this prosecution, until his meeting with Mr Douglas. In the first half of 2005, after receiving a report from Mr Douglas, a further meeting took place between Mr Sunny Ngai, Mr Henry Ngai, Mr Siva and Mr Ming Ly. Prior to this meeting, Mr Sunny Ngai said he had not had any discussions with Mr Siva about safety matters in the corporation.
70 In his record of interview with Inspector James, Mr Sunny Ngai stated that the Directors of the corporation did not have regular Board Meetings. He gave evidence that the Board only met once a year, which he explained was to sign "half yearly financial statements". At this Board Meeting, he stated that occupational health and safety issues were discussed informally with "Ming reporting and then we are given a budget to do." In oral evidence, Mr Sunny Ngai clarified this evidence by stating that he was referring to a meeting in February or March 2005 when Mr Ming Ly presented a budget concerning occupational health and safety. Mr Sunny Ngai said that Mr Ming Ly was advising Mr Henry Ngai that some changes he had introduced regarding safety in the factory were expensive. Mr Sunny Ngai attended this meeting to co-sign financial reports. He recalled Mr Henry Ngai directing Mr Ming Ly to do everything he needed to do regarding safety because he did not know what was required.
71 Inspector James also asked Mr Sunny Ngai whether the Board received feedback in respect of any safety improvements. He said this did not occur during the meetings he attended. Mr Sunny Ngai explained that feedback on safety improvements in the factory were provided through talking to Mr Ming Ly and Mr Siva. In oral evidence, Mr Sunny Ngai clarified this answer to mean that after 15 August 2005, there were regular discussions between himself, Mr Henry Ngai, Mr Ming Ly and Mr Siva regarding these matters. He confirmed that he did not attend meetings with other Directors prior to March 2004, during which feedback was provided to the Directors about safety improvements made in the corporation. Prior to February 2004, Mr Sunny Ngai's evidence was that he did not talk at all on a regular basis to either Mr Ming Ly or Mr Siva about occupational health and safety matters. Although this suggests that there were some irregular discussions about occupational health and safety, the evidence was not clarified and Mr Ming Ly's evidence was there were no discussions prior to February 2005. Therefore, being mindful of the nature of these proceedings, I do not propose to infer such discussions occurred. However, Mr Sunny Ngai's evidence was that if a machine stopped, thus affecting production, he would sometimes contact Mr Ming Ly and enquire what had happened. I infer from this evidence that Mr Sunny Ngai would be informed of the reason for the stoppage of the machine. Such reason would, of course, include a paper blockage, a mechanical problem, or an accident.
72 Mr Sunny Ngai confirmed that after meetings with Mr Douglas in 2005, he became aware that an occupational health and safety system was implemented in the factory and instruction and training in respect of that system was provided to employees. Mr Ming Ly and Mr Siva also informed him of the Occupational Health and Safety system. Mr Sunny Ngai was aware that Mr Siva was employed in about 1999 to deal with safety matters at the corporation. Immediately prior to his interview with Inspector James, Mr Sunny Ngai and Mr Henry Ngai had day-to-day discussions about safety matters. Mr Sunny Ngai's evidence was that he did not participate in any Board Meetings prior to 21 February 2004 where approval was given for a budget in respect of safety matters.
73 Asked by Inspector James whether the corporation had any other consultative process for safety issues, Mr Sunny Ngai said:
Now we have after, after when you have request to see the directors then we start to investigate the, what went wrong with Ming and Silva and we have identified that they need a lot of help from outside consultants and we immediately, the board immediately engage Andrew, that is the lawyer, as well as Steve as the practical guy and Gary to give us, an outsider professional opinion of what we need to do to bring up to speed with OH&S. In the past is my fault, my fault too I was believing that because we satisfy all the improvement Notice and most of them in lately, all on time, I thought we doing what is required under the OH&S WorkCover law and obviously after engaging the outside consultants, what we find that we not supposed to get an Improvement Notice at all. We should be more proactive in chasing up what is outstanding and continuing to improve in our workplace to make it actually no Improvement Notice is right. In the past my wrongful perceptions but from talking to Ming and Siva was fixing the Improvement Notice this enough. Now our mentality is proactive safety first and continue improvement and don't want to get any Improvement Notices again.
74 Mr Sunny Ngai explained the use of the words "Now we have after ..." as being a reference to receiving an Improvement Notice from WorkCover in late July 2005. Mr Sunny Ngai also clarified the reference to "we satisfy all the improvement Notice" as being a reference to a meeting with Mr Douglas during which he was informed by Mr Ming Ly and Mr Siva that they had satisfied all Improvement Notices, which the corporation had received in the past. He said he only acquired this knowledge prior to the interview with the Inspector on 15 August 2005. He also said he attended an occupational health and safety course at the corporation's premises on the Saturday prior to his interview with Inspector James where he learnt about improvement notices and that it was not a question of satisfying them, but rather ensuring that such notices were not received. This, he explained, was the basis for his reference to "wrongful perceptions", which he had gained from discussions with Mr Ming Ly and Mr Siva, that they were attending to all improvement notices.
75 In July 2005, Mr Sunny Ngai said Mr Henry Ngai told him to become proactive in respect of occupational health and safety. This direction occurred shortly before the interview with Inspector James. Mr Sunny Ngai could not recall whether his mother, Ms Ly, participated in the meetings that occurred in July 2005 regarding occupational health and safety. His evidence was that he did not have any discussions with her prior to the first half of 2005 regarding any safety matters.
76 Mr Sunny Ngai stated that he was not a party to any discussions with Mr Ming Ly about safety matters prior to the first half of 2005. Mr Sunny Ngai was asked by Inspector James, in his record of interview, what he had done as a Director before 21 February 2004 to prevent access to the machines. Mr Sunny Ngai answered as follows:
Our systems? I was led to believe that it is continuing safety issue in term of guarding every machine is happening and I was led to believe that there was a system in place to prioritise the machines according to the risk and we also spending close to two or three hundred thousand dollar a year, as far as I know, to put guarding on to the machines and put any lock necessary to keep people out. So I cannot say whether we have done it, this machine or after we are spending a lot of monies on OH&S issues and but we know that the site is, actually make it an absolute top priority in organisation for safety and even mean that we have to be more involved in the future. More actively involved in the future down to the lower on the lower level and continue safe.
77 This knowledge was acquired by Mr Sunny Ngai from discussions with Mr Ming Ly and Mr Siva in preparation for the interview with Inspector James. Mr Sunny Ngai said he did not know what an improvement notice or prohibition notice was prior to his discussions with Mr Siva and Mr Ming Ly which took place shortly before his interview with Inspector James.
78 During cross-examination, Mr Sunny Ngai acknowledged that he had informal meetings with Mr Ming Ly from time to time, most likely in the lunchroom, where Mr Ming Ly would inform him that he was out of stock of a certain product and ask him for help in chasing it up. He confirmed that Mr Henry Ngai did not allow him to deal with health and safety matters prior to March 2004, although he did not stop him going to the factory with customers. Mr Sunny Ngai stated that he did not know whether a machine should or should not have guards on it until his involvement with Mr Douglas after the incident. His evidence was that he observed guarding on the machines in 2005. However, he stated that he did not have the knowledge to ask about the guarding of machines prior to March 2004. Mr Sunny Ngai accepted that the only reason that would have prevented him asking about the guarding of machines prior to March 2004 was that he did not have any occupational health and safety knowledge. His evidence was that he would have to ask Mr Henry Ngai first before approaching Mr Ming Ly to discuss safety matters. He acknowledged that prior to March 2004 he never asked Mr Henry Ngai if he could approach Mr Ming Ly or Mr Siva to ask them to explain to him the importance of guards on machines.
79 Mr Sunny Ngai gave evidence that Mr Henry Ngai did not instruct him to get involved in occupational health and safety. However, he said he did advise him to concentrate on sales and marketing. Mr Sunny Ngai recalled his mother, Ms Ly, attending meetings organised by Mr Gary Rowe and the National Occupational and Safety Manager, Mr Steve Johnson, after August 2005 and in 2006. These meetings occurred once every two months with Ms Ly missing up to three of them. Mr Sunny Ngai stated that in the first half of 2005, Mr Douglas brought occupational health and safety matters to Mr Sunny Ngai's attention and explained why workers were to be interviewed by WorkCover and that the Directors could be prosecuted for the incident in February 2004. Mr Sunny Ngai said he learnt a lot more about occupational health and safety through his discussions with Mr Douglas.
80 Mr Sunny Ngai was asked by Inspector James what he had done as a Director before 21 February 2004 to prevent access to the area where the Rewinder Machine was located. His answer was as follows:
We, I have been talking to Ming and Siva in term of whether they need monies to put safety guard and, around the machines and whether we are doing everything that WorkCover ask us to do and the answer from them is always yes, although we can't do everything immediately but we always meet the Improvement Notice on time and things, so I was led to believe that we done everything we could in a timely, timely manner according to the risk before I could, yeah not in any particular machines, but overall I thought we, our company were in a good standing in term of the safety by continue improving it and as I said before I believe that yes we have done things but is not enough and we have our staff need external professional help to get it correctly and be more proactive.
81 Mr Ngai was asked whether he was certain at the time he gave this answer what he had done as a Director prior to 21 February 2004. He answered "no".
82 At the conclusion of Mr Sunny Ngai's evidence, Mr Dixon sought to tender the Articles of Association of the corporation. Mr Docking objected to the tender and submitted that if the Articles were admitted, he required both personal defendants to be recalled for cross-examination and the Articles to be formally proved.
83 Mr Bill Li, a Chartered Accountant and the corporation's Accountant, was called for this purpose. I admitted the Articles of Association of the corporation.
84 Mr Sunny Ngai was recalled for cross-examination and gave evidence that he had not read the Articles of Association before he gave evidence, nor had he heard Mr Henry Ngai ever mention the Articles of Association prior to March 2004.
85 Mr Henry Ngai was also recalled for further cross-examination. His evidence was that when he decided to establish the corporation, he engaged an Accountant, Mr Yip, and gave him instructions that he wanted to have total control of the corporation. Mr Henry Ngai said that he instructed Mr Yip to prepare the Corporation's documents to ensure this occurred and that other Directors would only be entitled to exercise such control as he allowed. He explained that the reason he took this approach was that he was worried that people may sell the corporation or do something wrong to it. Mr H Ngai said Mr Yip informed him that he was protected and had "total rights".
86 Ms Ly was also required for further cross-examination. Ms Ly stated that she could not read the Articles of Association because they were in English. She said they had never been translated into a language that she could read. She gave evidence that she had never heard Mr Henry Ngai or Mr Sunny Ngai talk about the terms of the Articles of Association of the corporation.
87 The evidence enables the following findings to be made: