SafeWork NSW v DIC Australia Pty Limited

Judgment

1. On 7 December 2017, workers at an ink manufacturing plant were preparing an ink holding tank for cleaning. When the tank cleaning contractor was inside the ink holding tank, the agitator activated and his leg became trapped between the side of the tank and the anchor blade. He suffered fatal injuries. Workers at the plant who subsequently entered the tank to assist also suffered leg injuries.
2. DIC Australia Pty Limited ("DIC Australia") 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 Craig Tanner, Mr Yatin Mehta and Mr Mamadou Diallo to a risk of death or serious injury contrary to s 32 of the Act.
3. The maximum penalty for the offence is a fine of $1,500,000.

Reasonably Practicable Measures

1. Paragraph 16 of the Amended Summons pleads particulars of the defendant's failure to comply with the duty under s 19(1) of the Act as follows: "16. The defendant failed to ensure, so far as is reasonably practicable, the health and safety of workers, and in particular Mr Tanner, Mr Mehta and Mr Diallo, in that it failed to take one or more of the following measures, each of which is alleged to have been reasonably practicable, to eliminate or, alternatively minimise, if it was not reasonably practicable to eliminate, the risk: a. installing engineering controls in respect to the operating systems for the ink holding tank including controls; i. which permitted workers undertaking tasks that required entry into the ink holding tank to isolate the tank from all forms of energy; and/or ii. which permitted the locking out and tagging out of the means of energizing the operating systems by workers undertaking tasks that required entry into the ink holding tank; and/or iii. to alert workers when the operating systems, including moving mechanical parts, had not been electrically isolated; and/or iv. which permitted the operating systems, including moving mechanical parts, to be deactivated by means of an emergency stop. b. enforcing a safe work procedure for the task of cleaning the ink holding tank, including a requirement that: i. a Job Safety Analysis (JSA) be prepared prior to commencing the task; ii. a Confined Space Entry Permit be completed prior to commencing the task; iii. the ink holding tank be isolated from all forms of energy prior to commencing the task, with detailed guidance on the specific isolations required and how they were to be undertaken; iv. workers lock out and tag out of the means of energizing the operating systems prior to entry into the ink holding tank; v. workers consult and obtain approval from Buddco before commencing the work; vi. the hatch of the ink holding tank not be opened until the rotating anchor blade in the holding tank had been electrically isolated." [sic]

Background

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

Parties

1. DIC Australia conducted a business or undertaking manufacturing ink products for the printing industry.
2. DIC Australia employed 174 workers in five States. There were 86 employees at the Auburn premises where the incident occurred. The Managing Director was Mr Ian Johns, who also served as the Managing Director for DIC Australia New Zealand. The other three directors lived overseas.
3. Buddco Pty Ltd ("Buddco"), under an agreement with DIC Australia dated 9 September 2009, conducted a business or undertaking which involved designing, constructing, installing, commissioning, maintaining and servicing all DIC Australia ink manufacturing plant and associated equipment located at the Auburn premises.
4. Buddco had eight employees. The sole director of Buddco was Mr Josh Budd who had general responsibility for managing the business and the services provided to DIC Australia under the agreement.
5. RJB Electrical Pty Ltd ("RJB") conducted a business or undertaking that involved providing electrical services at the premises.
6. Mr Robert Graham, a qualified electrician, was subcontracted by RJB to work at the premises through his company RG Services Pty Ltd. Mr Graham had worked in that role for eight years.

Workers

1. Mr Craig Tanner was a 42 year old sole trader trading under the name "Complete Blasting Solutions". Mr Tanner provided a plant cleaning service and was engaged by Buddco as a subcontractor to clean the ink holding tank at the premises.
2. Mr Tanner was qualified to undertake confined space work and held a confined space licence. He had cleaned the ink holding tank at the premises on at least three previous occasions.
3. Mr Yatin Mehta was employed by Buddco as a fitter and turner. On the day of the incident, Mr Mehta was directed by Buddco to assist Mr Tanner as a standby person or spotter. Mr Mehta was qualified to perform the role, having undertaken confined space training. Mr Mehta had not performed the role before but had previously assisted Mr Tanner when the tank had been cleaned, by running or emptying the pumps.
4. Mr Mamadou Diallo was employed by DIC Australia as a production operative, in the Yellow Shop at the premises. Mr Diallo was not directed to assist in the cleaning of the ink holding tank but became involved in the incident after he came to the assistance of Mr Tanner and Mr Mehta.

The Plant involved in the Incident

1. The DIC Australia factory premises at Auburn included a number of workshops for the manufacture of different inks or ink-related products. The incident occurred in a part of the premises known as the Black Shop.
2. Several items of plant were used in the Black Shop to produce black ink, including an onslow mixer, a mill and the ink holding tank that was involved in the incident.
3. The onslow mixer and the ink holding tank were located towards the back of the Black Shop. They were constructed of steel and were circular in shape. The mill was located directly in front of the ink holding tank.
4. The ink holding tank measured approximately 4.5 metres x 2.8 metres and was positioned about one metre off the floor on three legs. It was connected to both the onslow mixer and the mill by a series of pumps.
5. The top half of the onslow mixer and the ink holding tank protruded up through a mezzanine floor in the Black Shop.
6. The ink holding tank was fitted with a side access hatch and a top access hatch. Both hatches were secured by bolts. The side hatch could only be accessed using a step ladder. The hatch opening measured 0.65 metres x 0.65 metres.
7. The process of manufacturing ink involved processing raw materials in the onslow mixer, before transferring the mixture to the ink holding tank and then to the mill for final processing.
8. The sole purpose of the ink holding tank was to allow DIC Australia to mill two batches of product at once. That was achieved by adding a second batch of raw materials from the onslow mixer to the ink holding tank, while the first batch was being milled.
9. The ink holding tank was able to hold two batches of mixed raw materials.
10. The ink holding tank was fitted with an agitator assembly, which included a U-shaped metal anchor blade, a gearbox and a motor.
11. The purpose of the agitator was to agitate the mixed raw material while it was being held in the ink holding tank to prevent the material from settling and hardening on the bottom of the tank.
12. The agitator could not prevent the build-up of residue material that accumulated on the bottom of the tank over time.
13. When build-up occurred, the mixed raw material hardened into a clay-like consistency and was unable to be pumped to the mill for final processing. This caused production to shut down. Processes were then used to clean the tank. These processes required a person to enter the tank with a jackhammer to break up the hardened material.
14. The assembly was commissioned and fitted to the top of the ink holding tank in about 2003 after the factory started producing a form of ink that "settled" more readily at the bottom of the tank than previous products.
15. The agitator itself was able to be operated in two modes: manual and automatic. These controls were added in 2005.
16. When set to automatic mode, the agitator was activated automatically when the ink held in the ink holding tank reached a certain weight. The weight was set at 900kg.
17. When activated in automatic mode, the agitator spun for approximately 1 minute and 20 seconds every 28 minutes ("the on/off cycle"). Once activated, the on/off cycle would continue indefinitely so long as the weight inside the ink holding tank did not fall below 875kg or the plant's overload protection switch was not tripped.
18. When set to manual mode, the agitator was activated by pressing a green "start" button. The agitator would only activate in this mode if the ink held in the ink holding tank reached a certain weight. The weight was set at 900kg.
19. Once activated in the manual mode, the agitator would spin indefinitely so long as the weight inside the ink holding tank did not fall below 875kg or the plant's overload protection switch was not tripped. When activated in either mode, the anchor blade spun at a slow walking pace.

Mechanisms for Isolating the Power to the Ink Holding Tank

1. Controls for isolating power to the onslow mixer and the ink holding tank were located on the inside and the outside of two orange electrical cabinets in the Black Shop, respectively identified as the "main switchboard" and the Black Shop mixer motor control centre.
2. The main switchboard was located near the entrance to the Black Shop on the right hand-wall. It was fitted with a large exterior switch labelled "main switch". While this switch was not able to be physically locked, it could be used to electrically isolate power to the entire Black Shop factory, including both the onslow mixer and the ink holding tank, if placed in the isolation (off) position.
3. The main switchboard also featured a lever labelled "CSF2 Onslow Mixer". This lever, which was fitted with a locking mechanism, could be used to isolate the power to the Black Shop mixer motor control centre to isolate power to both the ink holding tank and onslow mixer. The locking mechanism was broken at the time of the incident.
4. The Black Shop mixer motor control centre was located on the mezzanine level behind the onslow mixer. The exterior controls on the control centre included buttons for activating the agitator in automatic and manual modes. However, the buttons did not include an exterior isolating point for isolating the ink holding tank.
5. The only way to isolate the ink holding tank from the Black Shop mixer motor control centre was to isolate the circuit breaker or disconnect the ink holding tank motor contactor, both of which were located inside the locked electrical cabinet housing the Black Shop mixer motor control centre. This method of isolation could only be performed by an electrician who had the key to the cabinet. However, once isolated by this method, the isolation could be locked by placing a lock on the circuit breaker inside the cabinet. There was no other way to specifically isolate the power to the ink holding tank.
6. There were several red emergency stops located in the Black Shop. However, none of the stops related to the operation of the ink holding tank.

Lead up to the Incident

1. There had been ongoing problems with blockages affecting the operation of the ink holding tank and the mill in the weeks preceding the incident.
2. A solvent was used in the days before the incident in an attempt to flush the residue in the ink holding tank. The flushing process was used to clean the tank but was never completely successful. The process of flushing the tank occurred every week.
3. Mr Phillip Roy (DIC Australia Operations Manager) became aware that there was a problem with the operation of the ink holding tank after being informed by other DIC Australia workers.
4. Emails between DIC Australia and Buddco workers also indicated that the maintenance issue was brought to the attention of Buddco in about mid-November 2017.
5. On 13 November 2017, Mr Steve Packham (DIC Australia Technical Services Manager) sent an email to Mr Andrew Furlong (DIC Australia Production Supervisor) and Mr George Berdyshevski (Buddco Engineering Manager) in which he stated: "We have ongoing blockages. The ink holding tank is now at 830kg and a visual inspection says we have a problem of needing to clean … We are going to inspect the mixing tank stirrer blade … I fear the cause is bead hardness rather than mixer/ink holding tank use. We have to face a cleaning of the ink holding tank …"
6. On 14 November 2017, Mr Packham sent another email to Mr Furlong and Mr Berdyshevski in which he stated: "Thanks for confirming today the black shop stirrer is not broken and the stirring pots side walls are clear. Phil is aware of the need for a ink holding tank clean out. I think it is best to arrange sooner rather than later. We have some 800kg to dig out."
7. On 14 November 2017, Mr Berdyshevski sent an email to Mr Tanner engaging his services for the tank clean and scheduling a date.
8. On 16 November 2017, emails were sent between Mr Roy, Mr Berdyshevski, Mr Furlong, Mr Packham and Mr Budd regarding the cost and the need for the clean.
9. After several date changes, the date for cleaning the tank was eventually fixed for 7 December 2017.
10. The ink holding tank was taken out of production and partly emptied one or two days before 7 December 2017 to allow the tank to cool before being cleaned.
11. A decision was made that the onslow mixer and mill would remain in operation while the ink holding tank was being cleaned. This is what occurred on 7 December 2017.

The Day of the Incident

1. A toolbox talk took place on the morning of the incident at about 6.00am before Mr Tanner attended the site.
2. Mr Mehta was informed that a contractor was coming in to clean the ink holding tank and he was directed by Mr Berdyshevski to assist as the standby person or spotter. He was also directed to prepare the area and was told that he would be assisted in that task by Mr Scott Eirth (DIC Australia fitter and machinist) and Mr Phillip Seaman (Buddco trades assistant).
3. Mr Berdyshevski stated to Mr Mehta, Mr Eirth and Mr Seaman that the preparation needed to be done before Mr Tanner came in.
4. Mr Graham, who was present at the toolbox talk, was not specifically directed or asked to perform any tasks in relation to the tank clean.

Preparation of the Area

1. Following the toolbox talk, Mr Mehta attended to his normal duties before making his way to the Black Shop.
2. A short time later, Mr Mehta completed a Job Safety Analysis ("JSA") form for the preparation work that he was about to complete.
3. The JSA had been developed by DIC Australia and provided to Buddco and was required to be completed for any non-repetitive maintenance work that was undertaken at the site.
4. The JSA required workers to describe the job and answer a series of yes/no questions in relation to the topics of training/competence, isolation of energy source, manual handling hazards, personal protective equipment, hazardous substances, work permits and other hazards.
5. The questions relating to "isolation of energy" were as follows: "Have you identified if isolation is required? Have you identified any energy source requiring isolation? Have you barricaded the area or displayed the adequate isolation signage? Have you locked and tagged the isolation and completed the tag out register? Have all personnel involved with the job tagged out using their own tags/locks?"
6. The second part of the JSA required workers to fill in a table outlining the sequence of task steps, the hazards and risks identified and the control measures required for those steps.
7. The document also contained space for sign off by a manager.
8. Mr Mehta commenced preparing the area by laying out cardboard on the factory floor in the Black Shop. Mr Seaman assisted Mr Mehta with a forklift to bring 44-gallon drums closer to the ink holding tank in preparation for the cleaning. Mr Mehta taped off the area with caution tape and removed the ink holding tank's lower hatch. Mr Eirth and Mr Seaman removed the ink holding tank's top hatch and set up a fan and lighting. Mr Eirth and Mr Seaman left the area after providing Mr Mehta with the items he needed. As part of the preparation, a sign that read "Danger Confined Space" was also set up in the area.
9. On 7 December 2017, at approximately 7.30am, Mr Tanner arrived at the premises and signed in on the "sign-in register".
10. Shortly after, Mr Tanner met with Mr Berdyshevski in his office to discuss the job and Mr Berdyshevski informed Mr Tanner that Mr Mehta was to perform the role of standby person.
11. Mr Berdyshevski then provided Mr Tanner with a Confined Space Entry Permit for completion and indicated that a JSA would also need to be completed.
12. Mr Tanner left Mr Berdyshevski's office and headed to the Black Shop.
13. Mr Mehta saw Mr Tanner in the Black Shop filling out some paperwork and observed that he had a gas detector in his hand but that he did not appear to be taking any readings. Mr Mehta had a brief conversation with Mr Tanner about the weather. They did not discuss the work that was to be performed.
14. At some stage, Mr Tanner partly completed the Confined Space Entry Permit that he received from Mr Berdyshevski.
15. The entry permit was a two-page pro forma. The first page contained fields for describing the "Location of Task" and "Description of Task". It also contained "Risk Control Measures" in the form of checks relating to "Isolation", "Atmosphere", "Hot Work", "Personal Protective Equipment", "Other Precautions", "Emergency Response" and "Stand-by Persons".
16. The last field on the page was headed "Authority to Enter".
17. The second page of the document included a table for listing "Persons required to enter confined space" and a field headed "Cancellation of Written Authority".
18. The first page of the permit that Mr Tanner appears to have partly completed described the "Location of Task" as "Black Shop" and the "Description" of task as "Tank Clean".
19. Many of the checks for relevant Risk Control Measures were only partly completed.
20. The "Authority to Enter" on the first page of the document was not completed.
21. The second page of the document listed the following persons as "Persons required to enter confined space": "Craig Tanner, 7/12, 8:30"; "Yatin, 7/12, 8:30".
22. Mr Mehta does not recall seeing the first or second pages of the document. However, he confirmed that the entry on the second page, "Yatin, 7/12, 8:30", was in his own handwriting. He stated in that regard: "I would have just copied the time and date from the entry above and have no specific memory of when I wrote my name and put the time and date next it."
23. Mr Mehta also stated that he and Mr Tanner had not got to the point of discussing the job or obtaining authorisation to enter the tank.
24. The entry permit recorded that locks and/or tags had been affixed to isolation points by circling "yes" to this question on the form. There is no evidence that that was done. Indeed, on the evidence relating to the controls for the plant, the controls did not feature an exterior isolation point that could be locked.
25. The entry permit also confirmed that an emergency response procedure was in place. There is no evidence that any such procedure was in place.
26. Mr Mehta expected to have a discussion in relation to these procedures and also expected that he and Mr Tanner would have obtained approval from Mr Berdyshevski or Mr Budd before commencing the task.
27. Mr Mehta understood that a JSA was required to be completed and that he would normally have signed it before the form was given to "the bosses". However, he did not see a JSA for the task on the day.

The Incident

1. Mr Tanner entered the ink holding tank through the side hatch which Mr Mehta had opened.
2. Mr Mehta was in the Black Shop but did not see Mr Tanner enter the tank.
3. While Mr Tanner was working in the ink holding tank, the agitator activated and Mr Tanner's leg became trapped between the side of the tank and the anchor blade.
4. Mr Mehta became aware that Mr Tanner was in the tank when he heard screams from within the tank.
5. Mr Mehta started calling for people to help and then went to the tank to assist Mr Tanner. Mr Mehta observed Mr Tanner trapped between the agitator blade and the wall of the tank. Mr Mehta also observed that the agitator blade had stopped at this point.
6. When Mr Mehta entered the tank, the agitator blade began to turn. Mr Mehta slipped over and his left leg became stuck under the agitator blade. Mr Mehta was in a sitting position, face up. Mr Tanner was next to Mr Mehta in the ink holding tank at the time and was keeping his body up by leaning on Mr Mehta.
7. At this time, Mr Diallo was located in the area of the premises known as the Yellow Shop, which was about 50 metres away from the Black Shop.
8. Mr Diallo heard screaming coming from the direction of the Black Shop and attended the location with Mr Mark Smith, a DIC Australia machine operator.
9. Mr Diallo looked inside the ink holding tank and saw Mr Tanner and Mr Mehta.
10. Mr Mehta observed faces through the hatch opening and at some point called out words to the effect of "You've got to get in here, I need you to hold something…".
11. Mr Diallo climbed up the ladder leading to the side of the hatch.
12. At this time, Mr Eirth and Mr Seaman, who were located in the area of the premises known as the Paint Shop, attended the Black Shop after being alerted to the incident by another worker Mr Fuc Song Lay, who had been working in the Black Shop at the time of the incident.
13. Mr Eirth observed that Mr Diallo was already present and had climbed up the ladder leading to the side hatch.
14. Mr Eirth went upstairs to the mezzanine level and started pressing every emergency stop button he could see. He then left the area and ran to Mr Berdyshevski's office and told him that there was an emergency.
15. Mr Eirth and Mr Berdyshevski ran back towards the Black Shop. On the way, Mr Berdyshevski called emergency services. While Mr Berdyshevski was on the phone with emergency services, he saw Mr Graham and asked him to isolate the ink holding tank.
16. In the meantime, Mr Diallo started to climb into the ink holding tank at which time Mr Seaman said to Mr Diallo: "Have you got your confined space?". Mr Diallo replied "Yes" and Mr Seaman said "Alright, let's go".
17. Mr Diallo placed his hands on the handles above the side hatch and put his right leg through the hatch opening. As he did this, Mr Diallo observed the agitator blade begin moving clockwise.
18. Mr Diallo heard screaming at this time but was unsure as to who was screaming.
19. The agitator blade hit the right side of Mr Diallo's right leg, squeezing Mr Diallo's right leg between the blade and wall of the tank. He felt himself being pulled into the ink holding tank.
20. Mr Diallo stopped himself from being dragged into the ink holding tank by grabbing the handles above the hatch.
21. After 10 to 15 seconds, Mr Diallo was able to free his leg from the ink holding tank. He fell backwards in pain.
22. Mr Mehta observed Mr Diallo fall back at this point and did not see him again.
23. Mr Seaman then climbed up the ladder leading to the side hatch and looked inside the tank and saw Mr Mehta. Mr Mehta yelled to Mr Seaman "isolate the motor".
24. Mr Seaman climbed down the ladder and he and Mr Lay pressed the isolate button which was on a pillar near the ink holding tank.
25. Mr Seaman climbed up the ladder leading to the side hatch on the ink holding tank again and had a further conversation with Mr Mehta. He handed him some tools so he could free himself. However, Mr Mehta indicated to Mr Seaman that he was not able to free himself using the tools.
26. Mr Seaman also had a conversation with Mr Tanner in which Mr Tanner requested a bucket. Mr Seaman gave Mr Tanner a bucket which he used to support his torso.
27. Around this time, Mr Kim Tam, a DIC Australia machine operator who had been working in the Black Shop operating the onslow mixer, but who was in another part of the premises when the incident occurred, attended the Black Shop.
28. When he attended the Black Shop in relation to the incident, Mr Tam saw that the ink holding tank power was still on.
29. Mr Graham attended the Black Shop a few minutes after Mr Tam and after receiving a telephone call from Mr Eirth asking him to "come quick" to isolate the ink holding tank. Mr Tam told Mr Graham to isolate the machine.
30. When Mr Graham arrived at the Black Shop, he quickly went up to the mezzanine level and isolated the plant by isolating the circuit breaker and disconnecting the motor cables inside the Black Shop mixer control centre. As he performed that task, Mr Graham noticed that the overload had not tripped. Mr Graham then came downstairs and pulled the fuses out of the switchboard.
31. Several emergency services attended the premises, including specialist paramedics from the Ambulance Service of NSW, firefighters from NSW Fire and Rescue and the police.
32. During the rescue efforts, two specialist paramedics and two firefighters entered the ink holding tank, while other emergency services outside the tank were working to unbolt the motor on the top of the tank to attempt to lift the anchor blade with a block and tackle.
33. The two firefighters from NSW Fire and Rescue who entered the ink holding tank observed that the agitator blade had impaled Mr Tanner's right thigh and that Mr Mehta's right foot was protruding from underneath the blade.
34. They used a hydraulic spreader between the vertical blade and the ink holding tank wall to try to bend the wall of the tank outwards, however the blade began to move so they stopped this attempt in order to prevent further injury to Mr Tanner or Mr Mehta.
35. The rescuers then attempted to lift the impeller by placing the hydraulic spreader between the floor and a horizontal blade. However, the hardened mixed raw material on the floor of the ink holding tank was spongy and prevented the hydraulic spreader from gripping.
36. An attempt was also made to free Mr Tanner by cutting a part of the agitator blade that had impaled his leg. However, by this time Mr Tanner had gone into cardiac arrest.
37. Emergency Services working outside the ink holding tank were able to lift the blade vertically a short distance using the block and tackle and were able to free Mr Mehta.
38. Despite efforts to rescue Mr Tanner from the ink holding tank, he suffered a cardiac arrest and died at the scene at about 11.03am.

Injuries

1. Mr Tanner sustained fatal injuries as a result of both legs being crushed by the anchor blade in the ink holding tank.
2. Mr Mehta sustained a deep cut to his lower left leg.
3. Mr Diallo sustained crush fractures to his right leg and foot requiring surgery. Mr Diallo also suffered a psychiatric injury.

Systems of Work prior to the Incident

1. DIC Australia had in place a "Confined Space Entry Permit", which was required to be completed by workers, including contractors engaged by Buddco, before entry to a confined space was authorised. In relation to isolation, this document asked the worker to consider the following question: "Are any mechanical, electrical, pipe, value or other isolations required?"
2. DIC Australia also developed a JSA form, which it also required contractors to complete before undertaking any maintenance work. This form included the following questions under the heading "Isolation of energy source": "Have you identified if isolation is required? Have you identified any energy source requiring isolation? Have you barricaded the area or displayed the adequate isolation signage? Have you locked and tagged the isolation and completed the tag out register? Have all personnel involved with the job tagged out using their own tags/locks?"
3. DIC Australia provided these forms to Buddco and expected that they would be completed before any work on the ink holding tank was performed.
4. Neither of these documents provided workers with any information on the electrical configuration of the ink holding tank, including the fact that it did not have an external isolator switch or that an electrician was needed to isolate the plant. There was also no requirement or stipulation on either document that the tank was to be isolated prior to the hatch being opened. In the incident, the hatch was opened prior to the tank being isolated thereby allowing access to a confined space that was not safe to enter.
5. The Confined Space Entry Permit had only been partially completed. The entry permit expressly recorded that locks and/or tags had been affixed to isolation points by circling "yes" to this question on the form. The entry permit also noted that an emergency response procedure was in place. No JSA was completed.
6. DIC Australia did not have a procedure in place to undertake any audits on the site to ensure that the JSA and Confined Space Entry Permits were being completed. Mr Tanner had completed a Confined Space Work Permit on only two previous occasions when he had cleaned the tank.
7. DIC Australia required contractors to undertake an online "contractor induction". This drew attention to the risks associated with working in a confined space including the risk of being crushed. Mr Tanner was certified as having completed the induction on 6 July 2016.

Buddco

1. Buddco was also charged with a breach of the Act. It has pleaded not guilty. There was no evidence called from Buddco on this sentencing hearing for DIC Australia. It may have a different version of events. The following paragraphs set out facts agreed between SafeWork NSW and DIC Australia for the purpose of this hearing.
2. At the time of the incident, Buddco had in place an isolation procedure for locking out mechanical equipment, a copy of which was on display in the Black Shop, although it was partly obscured by a calendar.
3. Buddco also had an isolation procedure for electrical equipment. A copy of this document was on display on the noticeboard in the Black Shop but was again partly obscured by a calendar. A copy of this procedure was also contained within the Buddco Employee Work Health and Safety Induction Manual. The procedure specified that an electrical supervisor was to be informed of all electrical isolations on site.
4. On the day of the incident, Mr Graham was on site and was aware that isolation would be required. However, he was never contacted to undertake the isolation.
5. Buddco also had a Confined Space Entry procedure for contractors which required, inter alia: 1. A certified standby person/spotter to monitor the person conducting the confined space work. 2. A system in place related to isolation, locking out and danger warning/tagging of hazardous services and operations provided to and in the confined space. 3. A completed JSA and confined space permit prior to work commencing. 4. Communications processes in place with the contractor as to what had been isolated, locked out and tagged. 5. Consultation with the contractor regarding emergency rescue and ventilation. 6. A review of the JSA and confined space permit prior to work commencing. 7. A permit to work authority to be issued.
6. The procedure specifically stated that Buddco would be responsible for "isolation including communication with/to the contractor on what isolations, locking out and tagging procedures have taken place".
7. A copy of this Confined Space Entry procedure was never provided to Mr Tanner.
8. Buddco adopted the Confined Spaced Document that DIC Australia had prepared which was only partly completed on the day of the incident.
9. Buddco also required contractors to undertake an induction. The induction dealt with Buddco's policies and procedures, including confined space work, electrical isolation and lockout and tag-out procedures. Workers were also required to sign off to say they had received an induction. Mr Mehta completed his induction on 25 June 2016. There is no record of Mr Tanner receiving an induction.
10. As recited above, the confined space permit for the work in the ink holding tank on 7 December 2017 was only partially completed and was unsigned. The permit identified Mr Tanner and Mr Mehta as the persons completing the work and the answer "yes" had been circled in response to the question in relation to isolation points having tags and/or locks.
11. Buddco also had a system that required a representative from Buddco to contact an electrician to arrange isolation prior to accessing the tank. On the day of the incident, Mr Graham was on site and was aware that isolation would be required. He was never contacted to undertake the isolation.
12. The only time Mr Graham had spoken to Mr Tanner about isolation was on the first occasion Mr Tanner attended the premises to clean the tank. The conversation occurred while Mr Tanner was at the wash basin and it was very brief.

Code of Practice: Confined Spaces

1. The Safe Work Australia Confined Spaces Code of Practice (February 2016) ("Confined Spaces Code") is an approved code under s 274 of the Act and applies to persons conducting a business or undertaking who have management or control of a confined space, and to designers, manufacturers or suppliers of plant or structures that include, or are intended to include, a confined space. The Confined Spaces Code provides practical guidance on how to meet the requirements under the Work Health and Safety Regulation 2017 (NSW) ("the Regulation"). It focuses on the minimisation, if not the elimination, of risks to health and safety when carrying out work in confined spaces.
2. The Confined Spaces Code addresses the identification and management of risks associated with working in confined spaces and contains the following guidance on the nature of the relevant risk: "Confined spaces pose dangers because they are usually not designed to be areas where people work … The hazards are not always obvious and may change from one entry into the confined space to the next … Confined spaces are commonly found in vats, tanks, pits, pipes, ducts, flues, chimneys, silos, containers, pressure vessels, underground sewers, wet or dry wells, shafts, trenches, tunnels or other similar enclosed or partially enclosed structures... 3.1 What hazards are associated with a confined space? … Mechanical hazards Exposure to mechanical hazards associated with plant may result in entanglement, crushing, cutting, piercing or shearing of parts of a person's body. Sources of mechanical hazards include plant such as augers, agitators, blenders, mixers and stirrers… 5.5 Isolation All potentially hazardous services should be isolated prior to any person entering the confined space. Isolate to prevent: … • the activation or energising of machinery in the confined space • the activation of plant or services outside the confined space that could adversely affect the space (for example heating or refrigerating methods) • the release of any stored or potential energy in plant • the inadvertent use of electrical equipment. … Before entry is permitted to any confined space that can move, or in which agitators, fans or other moving parts that may pose a risk to workers are present, the possibility of movement should be eliminated. Equipment or devices with stored energy, including hydraulic, pneumatic, electrical, chemical, mechanical, thermal or other types of energy, should be reduced to a zero energy condition so that no energy is left in devices and systems that could cause injury or illness."

Code of Practice: Managing the Risks of Plant in the Workplace

1. The Safe Work Australia Managing the Risk of Plant in the Workplace Code of Practice (March 2016) ("Plant Code") is an approved code under s 274 of the Act and applies to persons who conduct a business or undertaking and have management or control of plant in the workplace, as well as to persons who install and commission plant. The Plant Code provides guidance on how to manage health and safety risks of plant in the workplace, from plant installation, commissioning and use through to decommissioning and dismantling. It includes information about specific control measures required under the Regulation for plant generally.
2. The Plant Code provides that: "Plant is a major cause of workplace death and injury in Australian workplaces. There are significant risks associated with using plant and severe injuries can result from the unsafe use of plant including: • limbs amputated by unguarded moving parts of machines • being crushed by mobile plant • sustaining fractures from falls while accessing, operating or maintaining plant."
3. In relation to emergency stops, the Plant Code provides: "In the case of plant or parts of plant designed to work together, stop controls (including the emergency stop control) should be capable of stopping the plant itself as well as all equipment interrelated to its operation where continued operation of this related equipment may be dangerous".
4. The Confined Spaces Code also provides the following information in respect to the need to isolate plant: "In order for the isolation procedure to be effective, you should identify all energy sources likely to activate the plant or part of it and isolate or de-energise these to avoid the plant being inadvertently powered."

Australian Standard: Confined Spaces

1. The Australian Standard 2865:2009, Confined Spaces (4 September 2009) ("Confined Spaces Standard") outlines the minimum standards for establishing a safe system for entry and the conduct of tasks in or on a confined space. The Confined Spaces Standard emphasises responsibilities for safety and sets out steps that need to be taken to eliminate or control risks that may arise during confined space operations. It also requires that all persons involved in the entry of a confined space be trained, assessed as competent, and instructed on the hazards and the risk control measures to be followed.
2. The Confined Spaces Standard makes express reference to the following risk: "…entrapment from the operation of moving equipment, e.g., being trapped by augers, or crushed by rotating or moving parts such as conveyor belts."
3. This Standard also contains the following guidance on the need to isolate plant: "3.4.5 Isolation requirements Prior to any person entering a confined space, all potentially hazardous services (including all process services) normally connected to that space shall, where it is possible to do so, be isolated in order to prevent - … (b) The activation or energising in any way of equipment or services that could pose a risk to the health or safety of persons within the confined space. 3.4.6 Isolation factors It may be necessary to withdraw a confined space from service before it is prepared for entry. Procedures should be in place to advise all person who may be involved with the repair, maintenance or operation of the confined space of the withdrawal of the confined space Positive steps should be taken to achieve the following: … De-energisation and lockout, or if lockout is not feasible then tag-out, or both lockout and tag-out, of machinery, mixers, agitators or other equipment containing moving parts in the confined space. This may require additional isolation, blocking or de-energising of the machinery itself to guard against the release of stored energy …"

Work Health and Safety Regulation 2017 (NSW)

1. Clause 66 of the Regulation states that a person conducting a business or undertaking must manage risks to health and safety associated with a confined space at a workplace including risks associated with entering, working in, on or in the vicinity of the confined space (including a risk of a person inadvertently entering the confined space).
2. Clause 70 of the Regulation states that a person conducting a business or undertaking must, so far as is reasonably practicable, eliminate any risk associated with work in a confined space in either of the following circumstances: "a) the introduction of any substance or condition into the space from or by any plant or services connected to the space, b) the activation or energising in any way of any plant or services connected to the space."
3. Clause 74 of the Regulation provides that a person conducting a business or undertaking must establish emergency procedures in relation to confined space work.
4. Clause 76 of the Regulation states that a person conducting a business or undertaking must ensure that relevant workers are provided with suitable and adequate information, training and instruction in relation to: "a) the nature of all hazards relating to a confined space, b) the need for, and the appropriate use of, control measures to control risks to health and safety associated with those hazards, c) the selection, fit, use, wearing, testing, storage and maintenance of any personal protective equipment, d) the contents of any confined space entry permit that may be issued in relation to work carried out by the workers in a confined space, e) emergency procedures."

DIC Australia

1. Following the incident, DIC Australia advised SafeWork NSW that it had taken a number of steps to improve its systems. This included the following: 1. The ink holding tank was taken out of service, electrically isolated and ultimately decommissioned. 2. A directive was issued by the Managing Director Mr Ian Johns that hatch plates were not to be removed from ink holding tanks without electrical isolation first being implemented. 3. The cleaning of all ink holding tanks was suspended until a Standard Operating Procedure for that work was developed by Buddco and reviewed by DIC Australia. 4. RJB was engaged to undertake an audit of all Emergency Stops. 5. RJB was engaged to reconfigure the electrical circuitry of all emergency stops in the Black Shop so that the depression of any one of the stops effected a shutdown of both the onslow mixer and the ink holding tank. 6. RJB was engaged to affix "Emergency Stop" labels around the circumference of all Emergency Stops in the Black Shop.
2. DIC Australia also advised SafeWork NSW that a "high pressure cleaning system" was used to clean the tank that was involved in the incident. Despite being used twice, DIC Australia advised that the alternative cleaning system was unable to remove approximately 200 kg of solid residue from the tank.

Buddco

1. Buddco advised SafeWork NSW that it had also taken a number of steps to improve its systems following the incident: 1. Several policies were reviewed and updated, including the Buddco WHS Induction Manual. 2. Additions were made to the policies to emphasise the need for greater "consultation" between parties involved in projects, including "Buddco management and staff, Buddco contractors and the Site Principal/Principal Contractor". 3. An Isolation Procedure was developed, which expanded upon existing previous procedures. 4. A Tank Cleaning Procedure was developed.

Evidence for the Defendant - Affidavit of Mr Richard Kemp

1. Mr Richard Kemp swore an affidavit on 16 April 2021 which is summarised below.

Management Team

1. Mr Kemp has been the Chief Operating Officer at DIC Australia since 1 January 2019 and a director of DIC Australia since 29 August 2018.
2. Mr Johns was the Managing Director at the time of the incident but retired from that role on 31 December 2018.
3. Mr Roy, the Operations Manager and WHS Coordinator at the Auburn premises at the time of the incident, ceased employment with DIC Australia on 31 October 2019.

Background to DIC Australia

1. DIC Australia was registered on 1 June 1949 and has been continuously trading ever since. DIC Australia is a wholly owned subsidiary of DIC Australia Asia Pacific. DIC Australia Asia Pacific is a wholly owned subsidiary of DIC Australia Japan, a company listed on the Tokyo Stock Exchange. DIC Australia currently has 110 employees, 70 of whom are based at the Auburn premises.

The Arrangements for Maintenance Work at Auburn

1. On 9 September 2009 DIC Australia entered into an agreement with Buddco. Under that agreement Buddco was responsible for designing, constructing, installing, commissioning, maintaining and servicing all of DIC Australia's plant and associated equipment located at Auburn.
2. The Managing Director of Buddco, Josh Budd, has a Mechanical Engineering Certificate III and was experienced in the maintenance of the plant at Auburn. Buddco's Engineering Manager, Mr Berdyshevski, was a qualified fitter with extensive experience in the maintenance of machinery.
3. Mr Kemp stated that Buddco employed approximately eight people to carry out its contract with DIC Australia. They were located at that office. He said the effect of DIC Australia's arrangement with Buddco was that Buddco carried out or arranged for suitably qualified contractors to carry out all maintenance at Auburn and that Buddco supervised all maintenance work at Auburn.
4. At the date of the incident DIC Australia employed one maintenance worker, Mr Scott Eirth, who worked under the direction and control of Buddco. DIC Australia operational employees did not carry out any maintenance or repair work.

The Arrangements for Electrical Work at Auburn

1. DIC Australia had an agreement with RJB. Mr Graham worked full time at Auburn carrying out electrical work. Mr Graham had worked at Auburn for approximately eight years at the time of the incident. Mr Graham's day to day activities on site were performed as directed by Buddco.

The Job being Undertaken at the Time of the Incident

1. As at the date of the incident, the manufacture of black ink at Auburn involved the use of a holding tank. Product from the machine carrying out the first phase of the black ink manufacturing process (the onslow mixer) was transferred into the holding tank where it was held until it was transferred to the next machine used in the manufacture of black ink (the mill).
2. The holding tank was fitted with an agitator assembly which included the U-shaped metal anchor blade used to stir the ink product to prevent carbon residue from sinking to the bottom. Despite this, residue gradually accumulated on the bottom of the holding tank causing pipe blockage. When that occurred, efforts were made to wash out the residue. However, the stage was reached when it became necessary to remove the residue at the bottom of the holding tank.
3. The removal of the residue involved working in a confined space. This is the work which was to be undertaken at the time of the incident.

Procedures DIC Australia understood Buddco had in place for Cleaning the Tank

1. DIC Australia understood that the following procedures were in place at the time of the incident: 1. A JSA was to be completed. This is a DIC Australia document which was used by Buddco in relation to work it carried out, or was responsible for overseeing, at Auburn. The JSA identifies, amongst other things, whether electrical isolation is necessary to carry out the job in question. The JSA contains a risk assessment which includes control measures to be adopted to address identified risks. In the case of cleaning the holding tank the JSA was to be completed by the confined space licensed personnel carrying out the work. 2. A Confined Space Entry Permit was to be completed relating to the job to be undertaken by the confined space licensed personnel carrying out the work. It had to be approved by a Buddco manager authorising entry to the confined space before the confined space work could commence. That authorisation required confirmation that appropriate risk control measures and precautions had been put in place. It identified whether electrical isolation was necessary. 3. A Buddco representative contacted the Mr Graham to electrically isolate the holding tank before signing off the Confined Space Entry Permit and authorising entry. Mr Graham would, in the presence of the person carrying out the confined space entry, electrically isolate the holding tank. Mr Graham electrically isolated the holding tank by opening the Black Shop Control Centre panel located on the mezzanine level of the Black Shop, de-energising the relevant circuit breaker and removing the cables for the motor which operated the anchor blade from the contactor. Mr Graham would drop the cables out of the bottom of the motor contactor and put them in a connector strip. This procedure electrically isolated the anchor blade. 4. Electrical isolation authorisation would be given by a Buddco manager for entry to the confined space. 5. Once that had occurred, the hatch providing access to the holding tank could be opened and the tank could be entered.

Craig Tanner

1. It was Mr Kemp's understanding that Mr Tanner was contracted by Buddco to clean the holding tank on the day of the incident and that he had carried out that work on at least four previous occasions in 2016 and 2017.
2. Mr Tanner held a confined space licence and had undergone DIC Australia's contractor induction for high risk work on 6 July 2016. That induction included reference to the DIC Australia confined space procedures and the requirement for electrical safety/isolation. DIC Australia understood that Buddco took Mr Tanner through the process to be adopted to clean the holding tank, including the electrical isolation of tank.
3. Mr Kemp understood that on the four previous occasions when Mr Tanner cleaned the tank, Mr Graham was called to the Black Shop and implemented electrical isolation of the anchor blade in Mr Tanner's presence before he entered the tank.
4. Mr Kemp understood that Mr Tanner had been provided with a lock which he used to lock out the Black Shop Control Centre when the tank was electrically isolated.

The Incident on 7 December 2017

1. Mr Kemp explained that prior to the holding tank being cleaned, the area in the vicinity of the tank was to be cordoned off by Buddco. From that time Buddco had control of the holding tank and surrounding area. DIC Australia operating staff were not to be permitted into that area until the cleaning of tank was completed and the Confined Space Permit had been cancelled.
2. Mr Kemp stated that he understands that on the day of the incident the side access hatch to the holding tank was opened before the anchor blade was electrically isolated. That exposed Mr Tanner, and those who came to assist him, to a risk of injury which manifested. Mr Kemp acknowledged that removing the access hatch before electrical isolation should not have been done and that DIC Australia understood that to do so was contrary to the system of work Buddco was meant to be following to ensure the holding tank was safe to enter.

Steps taken by DIC Australia before the Incident

1. Mr Kemp detailed the steps taken by DIC Australia before the incident to ensure that Buddco's systems of work were safe.
2. In 2015 DIC Australia's WHS Manager, Ms Lisa Reid, along with Mr Roy, reviewed and were satisfied with the quality of Buddco's safety procedures.
3. Buddco's procedures at that time included: 1. Buddco WHS Induction Manual July 2015, which incorporated: 1. a direction that a Safe Work Method Statement ("SWMS") must be completed for all jobs undertaken; 2. a direction that if entry was to be made to a confined space a confined space entry permit was required; 3. a procedure for electrical isolation. 1. Buddco's Isolation Procedure for Electrical Equipment. 2. Buddco's Isolation Procedure for Mechanical Equipment (Lock out and Tag Out). This procedure was to be followed whenever maintenance was being done around any machine. 3. Buddco's Ten Steps to Lock Out/Tag Out Hazardous Energy. This addressed, in part, the location and neutralisation of all power sources. 4. Buddco's Confined Space Procedure. This procedure: 1. directed the completion of a written risk assessment prior to the commencement of work. A JSA was to be used for this purpose; 2. directed that a confined space entry permit must be prepared for all confined space work; 3. stated that a Buddco site manager or nominee was responsible for planning and preparation of all confined space entry. Work by contractors was to be overseen by the manager or nominee; 4. stated that Buddco was responsible for: 1. isolation, locking out and tagging of hazardous services to the confined space; 2. communicating what isolations have been undertaken to the contractor; 3. reviewing the risk assessment and confined space permit prior to commencement of work. 1. stated that the Contractor was responsible for: 1. completing the risk assessment and confined space entry permit prior to work commencing; 2. consulting with Buddco on any issues regarding isolation and entry to the space; 3. reporting to Buddco's supervisor with the risk assessment and confined space permit prior to commencing work. 1. stated that the risk assessment and confined space entry permit were to be checked by the site supervisor before commencement of the work and then a confined space permit would be issued. 1. Buddco's Confined Space Entry Permit provided for: 1. isolation from mechanical/electrical drives; 2. locks and/or tags being affixed to isolation points; 3. all persons having been trained; 4. standby person arrangements; 5. control measures to be observed for entry to and work in the confined space; and 6. authority to enter based on risk control measures being appropriate for safe entry.
4. Mr Kemp explained that DIC Australia was aware that Mr Ray Anthony (Buddco's WHS Manager) was reviewing Buddco's WHS procedures and work activities, carrying out audits of JSAs and reviewing confined space entry. Mr Kemp said that Mr Anthony was meant to observe the confined space entry on 7 December 2017.
5. DIC Australia was aware Buddco had a number of other systems including: 1. Regular reviews of JSAs at weekly WHS meetings. 2. Random work inspections by its management. 3. Regular toolbox meetings at which WHS was discussed. Those meetings addressed, in part, completion of JSAs, confined space entry and tag out. 4. Planned meetings before job starts.
6. Mr Kemp noted that although Mr Roy was appointed as DIC Australia's WHS Co-ordinator from 2016, he also had prior involvement in WHS at DIC Australia. In that role: 1. Mr Roy frequently attended Buddco's maintenance office at Auburn and checked that JSAs were being properly completed. 2. Mr Roy frequently observed Buddco staff carrying out their duties and checked they were filling out JSAs and following procedures. 3. Mr Roy regularly spoke to Buddco management about WHS matters.

DIC Australia's WHS Systems before the Incident

1. DIC Australia had in place a number of WHS policies, procedures, systems and initiatives relating to its operations at Auburn. They included the following: 1. WHS documentation, including a DIC Australia Health Safety & Environment Principles & Policy (November 2017), a DIC Australia Workplace Health & Safety Manual and an Auburn Emergency Response Plan. 2. DIC Australia's policy, from at least 2009, was that none of its employees were permitted to enter or work in a confined space. Such work could only be done by an appropriately qualified confined space contractor. Buddco was aware of that policy. 3. Staff induction and ongoing education in WHS. 4. Computer-based contractor induction for all contractors which covered hazard identification and risk management including confined space work as well as the requirement to obtain a Confined Space Entry Permit before entry to a confined space. This induction had been completed by Buddco managers and by Mr Tanner. 5. An active WHS Committee. The Committee met quarterly and, as part of its regular agenda, the WHS Committee reviewed WHS issues, including work place injuries, and tracked corrective actions. Buddco was copied into the minutes of those meetings. 6. WHS Committee members carried out formal quarterly site inspections at Auburn. 7. Formal WHS site supervisor inspections were carried out every four months at Auburn. 8. DIC Australia had retained a number of WHS consultants to assist it with its WHS systems and compliance. 9. Daily safety "huddles" with DIC Australia production staff addressing workplace safety. 10. Regular toolbox meetings with staff which included safety matters. 11. Monthly DIC Australia Executive Committee meetings at which WHS was an agenda item. That item included safety incidents/near misses, remedial action, status of WHS training, status of WHS initiatives in progress, status of new WHS policies and procedures, review of existing WHS policies and procedures, and capital expenditure for WHS. 12. WHS audits, which included the development of a self-auditing tool in 2016. 13. Incorporating WHS as an agenda item at all DIC Australia directors' meetings. 14. Ensuring ongoing oversight of work by supervisors and managers. 15. DIC Australia's then CEO, Mr Johns, regularly walked around Auburn to observe, comment on and, if necessary, correct work activities. During his factory walks, Mr Johns spoke with workers about safety, made safety observations and raised any safety issues he identified for further action. 16. DIC Australia used the services of external WHS consultants to provide advice and training.

Actions taken by DIC Australia following the Incident

1. Mr Kemp summarised the steps DIC Australia took following the incident: 1. On the day of the Incident Mr Johns directed that the Auburn site be closed and all staff were sent home. The holding tank was taken out of service and electrically isolated immediately following the incident and was subsequently decommissioned. 2. Cleaning of all tanks was suspended until a safe operating procedure for that work task was developed by Buddco and reviewed by DIC Australia. 3. On 15 and 17 December 2017 RJB was engaged to reconfigure electrical circuitry of all emergency stops in the Black Shop so the depression of any one of the emergency stops immediately shut down machines in the shop. 4. RJB Electrical was engaged to affix 60mm diameter yellow stickers or labels bearing the words "Emergency Stop" around the circumference of all emergency stops in the Black Shop so they were clearly and readily identifiable as emergency stops. 5. From December 2017 RJB was engaged to perform an audit of all emergency stops across the Auburn site. 6. Piping and instrument diagrams for plant and equipment within all three colour shops were reviewed to verify their accuracy and were amended as necessary. 7. A hazard and operability study of plant and equipment within the Black Shop and all three colour shops was undertaken. 8. DIC Australia updated its Contractor Procedure highlighting the expectations for safety on site that must be adhered to by all contractors and subcontractors. That included reference to contractor induction, requirement to complete a JSA or SWMS for activities undertaken on site and the provision of relevant qualifications for high-risk activities. 9. DIC Australia's WHS Manual was updated and reviewed in September 2018. A number of changes were made from the previous Manual which had last been updated in 2014. Those included sections regarding contractor management, changes to WHS responsibilities and authorities, changes to WHS consultation, inclusion of a clearance system and additional WHS policies. 10. DIC Australia undertook a 2018 review of all its other WHS policies and procedures including those on confined space procedure/entry. 11. DIC Australia developed a schedule of high-risk "training and competency" for contractors who perform work at its site. 12. DIC Australia reviewed revised procedures developed by Buddco, including Buddco's Confined Space Entry Procedure (dated 1 February 2018), Buddco's Tank Cleaning Procedures for the DIC Australia Auburn Site (dated 1 June 2018) and Buddco's Confined Space Entry Procedure (dated 11 June 2019). 13. DIC Australia conducted monthly audits on written JSAs created by Buddco. Any anomalies were communicated back to Buddco for rectification. 14. As part of its revised contractor management system, DIC Australia introduced an electronic location and monitoring system called "Who's on Location" ("WOL"). On arrival at a DIC Australia site and prior to being granted entry, all contractors are required to attend site reception and log in to the WOL system. When a contractor logs into the WOL system, prior to granting the contractor entry, the system: verifies the contractor's DIC Australia site induction status; logs the contractor's attendance at the site; and issues an electronic notification of the contractor's site attendance to site management. Where a contractor's DIC Australia site induction status and /or insurance status is not verified, the WOL system declines entry to the contractor and issues an electronic alert to site management. 15. Since August 2019 DIC Australia has employed a full time WHS Manager, Mr Usman Akram. Mr Akram holds a Masters degree in WHS Management. 16. During 2020 DIC Australia developed and adopted a new Work Health and Safety Management System following the retention of Deloitte to undertake a review to ensure its systems were in compliance with the requirements of ISO 45001-2018 Occupational Health & Safety Management Systems (March 2018). The new DIC Australia Work Health and Management System was finalised in February 2021. 17. DIC Australia has also developed new procedures regarding confined space work and the isolation and tag out of plant. 18. DIC Australia employed an in-house Engineering Manager, Mr Josiah Mpofu, from 1 November 2019. He holds a Bachelor of Science in Mechanical Engineering and a Master of Science in Project Management. He works with appropriate engineering support staff to undertake or oversee all maintenance at DIC Australia sites, including Auburn.
2. DIC Australia's contract with Buddco was terminated with effect from the end of March 2020.

ISO Accreditation and Independent Auditing

1. DIC Australia proposes to seek accreditation of the DIC Australia WHS management system in accordance with ISO 45001-2018 Occupational Health & Safety Management Systems. Once the system has been accredited, DIC Australia plans to maintain accreditation, including compliance with the requirement for annual independent third party compliance audits.

Cessation of News Ink Manufacturing and Rationalisation of Branch Operations

1. Mr Kemp stated that DIC Australia's business is subject to significant pressure from falling demand for the supply of ink products to the printing and publishing industry. During the financial year ending 31 December 2020 DIC Australia undertook a substantial restructuring of its Australian business. DIC Australia no longer manufactures news inks in Australia and all news inks are now imported. Plant formerly used by DIC Australia in the manufacture of news ink has been largely decommissioned. In addition, DIC Australia has closed its branch offices in Western Australia, South Australia and Queensland.

Co-operation with the Authorities

1. DIC Australia co-operated with both NSW Police and SafeWork NSW in relation to the investigations conducted in relation to the incident.

Other Matters

1. Mr Diallo remains off work. DIC Australia generally communicates with Mr Diallo once a month to check in with him. DIC Australia continues to invite him to staff functions. His job remains open for him.
2. Mr Johns communicated, on behalf of DIC Australia, with Mrs Tanner on two occasions expressing his, and DIC Australia's, extreme sorrow about her husband's death following the incident.
3. On the day of the incident, DIC Australia had critical counselling support on site within a number of hours. In the week following the incident, the support team held a number of onsite briefings and support sessions for all staff (including the Buddco team). Follow-up sessions were also held. 24/7 support services were also made available and communicated to all staff and their families. That support remains available.
4. Mr Johns gave a number of briefings and updates on site to which union officials and agency representatives were invited.

Remorse and Contrition

1. On behalf of DIC Australia, Mr Kemp expressed remorse, and acknowledged and accepted responsibility, for the breach of the defendant's health and safety duty that occurred in the incident.
2. With respect to DIC Australia's breach of its workplace health and safety duty and in relation to the injury, loss and damage suffered as a consequence of that breach, Mr Kemp apologised to Mr Tanner's family and friends, Mr Mehta, Mr Diallo and workers who were affected by the incident.
3. Mr Kemp went on to say that the Board of DIC Australia and DIC Australia's senior management team are committed to constant improvement in the company's safety management systems and safety outcomes.

Financial Position

1. Mr Kemp also provided information on DIC Australia's financial situation. This information will be dealt with later in this judgment.

Consideration

1. 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

1. 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].
2. 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].
3. In Muldrock v The Queen [2011] HCA 39; (2011) 244 CLR 120 at [27] the High Court said: "The objective seriousness of an offence is to be assessed without reference to matters personal to a particular offender or class of offenders. It is to be determined wholly by reference to the nature of the offending."
4. 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].
5. 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.
6. 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. 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.
7. The Court of Criminal Appeal has 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. Justice Basten at [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."
8. Further at [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 [event] 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."
9. At [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."
10. My findings about the defendant's level of culpability are based upon the following: 1. The risk of injury or death of a worker being crushed by an anchor blade in an ink holding tank in circumstances where the agitator is activated was obvious and foreseeable. 2. Failing to isolate mechanical hazards in a confined space and using plant unsafely are well-known and obvious risks in Australian workplaces. Relevant guidance materials specifically dealt with such risks. 3. The potential consequences of the risk were death or very serious injury. Mr Tanner lost his life. Mr Diallo sustained crush injuries to his right foot and leg. Mr Mehta's lower left leg was injured. 4. There were several steps that were readily available, which could have been implemented to eliminate or minimise the risk at the time of the incident, including: 1. installing adequate engineering controls for DIC Australia's ink holding tank including isolating the tank from all forms of energy, alerting workers when moving mechanical parts had not been isolated, and incorporating an emergency stop mechanism; 2. enforcing a safe work procedure for the task of cleaning DIC Australia's ink holding tank that included the requirement that a JSA and a Confined Space Entry Premises be completed prior to the task, the use of a lock out and tag out system, the requirement that approval be obtained from Buddco before work commenced and the requirement that the hatch not be opened until the rotating anchor blade had been isolated. 1. These measures would not have been particularly complex, costly or burdensome to implement. Such steps were taken straight after the incident by DIC Australia. There was no evidence that there was undue expense involved. 2. The fatal injuries sustained by Mr Tanner and the serious injuries suffered by Mr Mehta and Mr Diallo on 7 December 2017 could have been avoided had appropriate measures been implemented. 3. All of the matters in (1)-(6) above were conceded by the defendant (MFI 2, par 73). 4. 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.
11. Counsel for the defendant submitted that the contribution of Buddco was relevant in mitigation: Workcover Authority (Inspector Howard) v Baulderstone Hornibrook Pty Ltd [2009] NSWIR Comm 92; (2009) 186 IR 125 at [241].
12. Counsel for the defendant submitted that: 1. DIC Australia had in place a system in respect of the preparation of a JSA and the approval of a confined space work permit which would have eliminated the risk if Buddco had complied with that system. 2. DIC Australia had surrendered control of the holding tank and Buddco had assumed control of the holding tank for the purpose of undertaking the periodic manual cleaning of the tank. 3. Buddco was directly responsible for the conduct of all the relevant works, including supervision of Mr Tanner and Mr Mehta in their preparation for, and conduct of, the work which required confined space entry. 4. DIC Australia had a lesser opportunity than Buddco to discover and rectify the non-compliance which occurred on the morning of the incident.
13. In considering the contribution which Buddco made to creation of the risk I keep in mind the following: 1. Section 16 of the Act provides that more than one person can concurrently have the same duty. Each duty holder must comply with that duty to the standard required by the Act even if another duty holder has the same duty. 2. Section 16(3) of the Act provides that each person retains responsibility for their duty in relation to the matter and each person must discharge their duty to the extent to which that person has the capacity to influence and control the matter. 3. Buddco has been charged with an offence under the Act and has pleaded not guilty. Buddco will come to trial later this year. 4. The court should not embark upon an inquiry in sentencing proceedings which, in substance, would require the court to make specific findings as to the culpability of other parties and the nature and quality of any offence committed by them: Workcover Authority of New South Wales (Inspector Ankucic) v McDonald's Australia Ltd (1999) 95 IR 383 at 437 per Walton J. 5. On this sentencing hearing the court has not received any evidence from Buddco and will consider the involvement of that company on the basis of the Agreed Statement of Facts, the documents tendered as evidence in the case, and the assertions made by Mr Kemp in his affidavit concerning the involvement of Buddco, which were not the subject of any cross-examination.
14. The reasonably practicable measures which the prosecutor pleaded should have been taken by DIC Australia are set out above. As counsel for the prosecutor put it in oral submissions, they can be categorised as failings in relation to plant and failings in relation to a system of work. The plant which created the risk was DIC Australia's plant. The system of work which created the risk was DIC Australia's system. By its plea of guilty DIC Australia has accepted that it failed to take all of the reasonably practicable measures pleaded in the Amended Summons in relation to its plant and its systems.
15. I accept the submission that based on the material in relation to Buddco identified above, Buddco's actions appear to be a significant factor in creation of the risk. However, having not heard any evidence from Buddco, I will not descend into making factual findings or making a finding about relative culpability.
16. I find that the level of culpability of DIC Australia is in the high range.

Deterrence

1. 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].
2. The penalty must reflect the need for specific deterrence. DIC Australia is still conducting a business. While it has experienced changes in its manufacturing operations, it is still in the business of supplying inks, coatings, systems and services and is involved in the continuing engagement of workers.

Aggravating Factors

1. The injury, emotional harm, loss or damage caused by the offence was substantial: s 21A(2)(g) Crimes (Sentencing Procedure) Act 1999. This was acknowledged by the defendant (MFI 2, par 93).

Mitigating factors

1. DIC Australia does not have a prior record of convictions: s 21A(3)(e) Crimes (Sentencing Procedure) Act 1999. DIC Australia has been in business for 72 years. This is a remarkable safety record and the penalty which would otherwise be imposed will be moderated to reflect such record.
2. DIC Australia is otherwise of good character: s 21A(3)(f) Crimes (Sentencing Procedure) Act 1999. The steps which it took after the incident demonstrate this.
3. DIC Australia is unlikely to re-offend: s 21A(3)(g) Crimes (Sentencing Procedure) Act 1999.
4. DIC Australia 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 plant, documentation and procedures into line with those which, on all the evidence, should have been in place before this incident occurred.
5. DIC Australia 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 death of Mr Tanner and the injuries to Mr Mehta and Mr Diallo were caused by its actions.
6. DIC Australia entered a plea of guilty: s 21A(3)(k) Crimes (Sentencing Procedure) Act 1999. The court must take into account the fact that the offender has pleaded guilty, when the offender pleaded guilty, and the circumstances in which the offender indicated an intention to plead guilty: s 22(1) Crimes (Sentencing Procedure) Act 1999. It is appropriate to give 25% discount for an early plea.
7. DIC Australia 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

1. 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.
2. 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."
3. There was no submission that the defendant had a reduced capacity to pay a fine.
4. In his affidavit and annexures to his affidavit, Mr Kemp set out the financial performance of DIC Australia for the past few years. In 2017 there was a turnover of $115.9 million, with a $758,000 loss. In 2018, there was a turnover of $112.1 million with a $9,832,000 loss. In 2019, there was a turnover of $114.2 million with a $5,089,000 loss. In 2020, there was a turnover of $99.8 million with a $12,607,000 loss.
5. Mr Kemp highlighted that the loss sustained in the year ending 31 December 2020 includes exceptional losses of approximately $10 million and a loss at an operating level of approximately $2.6 million. The exceptional losses include allowances related to the writing down of assets and other expenses associated with the cessation of news ink manufacturing in Australia and the closure of the DIC Australia branches in Western Australia, South Australia and Queensland.
6. I will take into account the size of the defendant company in fixing a sentence.

Victim Impact Statement: Ms Rachel Louise Tanner

1. The defendant was convicted at the sentence hearing on 23 April 2021.
2. Part 3 Division 2 of the Crimes (Sentencing Procedure) Act 1999 deals with Victim Impact Statements. The provisions apply to an offence being dealt with by the District Court where the offence results in the death of, or actual physical bodily harm to, any person - s 27(2)(a). By s 28(2) a family victim in relation to an offence may prepare a Victim Impact Statement that contains particulars of the impact of the primary victim's death on the family victim or other members of the primary victim's immediate family. Members of a primary victim's immediate family include children of the deceased - s 26.
3. A Victim Impact Statement may be tendered to the court only by the prosecutor - s 30A(2). A court must accept a Victim Impact Statement tendered by a prosecutor if the statement complies with the requirements of the Division - s 30B. A victim to whom a Victim Impact Statement relates may read out the whole or part of their Victim Impact Statement - s 30D(1).
4. A court to which a Victim Impact Statement has been tendered must consider the statement at any time after it convicts but before it sentences, and may make any comment on the statement that the court considers appropriate - s 30E(1).
5. A Victim Impact Statement of a family victim may also be taken into account by the court in connection with the determination of punishment for the offence, on the basis that the harmful impact of a primary victim's death on family victims is an aspect of harm done to the community - s 30E(3). Such statements can only be taken into account on punishment if the prosecutor applies for this to occur, and the court considers it to be appropriate. In the present instance the prosecutor applied for this to occur and I determine that it is appropriate to take the statement into account.
6. Ms Rachel Tanner read out her Victim Impact Statement in court. She is the wife of Craig Tanner and mother of their three sons. Ms Tanner said that she has a shattered heart. She does not feel she will ever be the same person, mother, sister, daughter or friend she once was. Mr Tanner's death had a devastating impact on the lives of Ms Tanner's immediate family and extended family.
7. As a result of Mr Tanner's death, a huge financial burden has been placed on the family leaving Ms Tanner concerned about the future. Ms Tanner explained that the emotional toll has been even greater.
8. Ms Tanner described Mr Tanner as "an amazing man, husband and father" who was "a kind, hardworking, generous and caring human…loved by everyone". Ms Tanner explained that her husband's death has denied their three sons so much. There are many milestones that Mr Tanner cannot be present for. Ms Tanner said that the family grieves Mr Tanner's absence every day and stated: "We miss him so much and will forever".
9. Ms Tanner explained that just two weeks before the sentence hearing, her 6 year old youngest son told her that "every time the doorbell rings he wishes it could be his daddy". She went on to say that for a long period of time after the incident if her son ever "bled, he panicked and thought he would die just like his father had if he lost too much blood. He doesn't have many memories of his father only ones we have been imprinting for him".
10. Ms Tanner said that she has had to watch her 8 year old middle son come running out of school on Father's Day Week in a hysterical state. This was in response to the fact that the other children could buy gifts for their fathers but he could not. After this event, her son told his aunt that he "hated God for ruining his life by taking his Dad away from him". Ms Tanner described this as "truly heart breaking to watch".
11. Ms Tanner's 10 year old eldest son "wished that he had got an award at school that tragic day as by his logic his Dad would have been at school to see him get the award and still be alive". Ms Tanner explained that her son has "now become accustomed to being the man of the house". Ms Tanner expressed concern that this is too much of a burden for a child but she thinks it is his way of him helping and protecting her.
12. Ms Tanner said: "No child should have had to go through what our sons have had to endure and the long-term effects of this cannot even be known yet". She is heartbroken that her husband will never see his sons grow up and become men. Their sons "will never have the opportunity to surf with their dad, play soccer (which they love) or go camping with him ever again".
13. On the day of the incident, when Ms Tanner found out about what had happened to her husband, she collapsed on the driveway. Two of her children were in the car at the time, asking if the police had killed their dad. Ms Tanner explained that it took five days before she was allowed to go to the morgue. The moment when she was asked to identify her husband's body was one of the worst moments of her life. Ms Tanner said: "Whilst I was grateful that I was able to say goodbye to him - which gave me some comfort - it's not something I will ever get over".
14. Ms Tanner explained that reading about the fatal injuries and pain her husband endured when being trapped in the ink tank for over two hours will forever be engraved in her brain. Ms Tanner said that this knowledge of the pain he suffered haunts her daily.
15. Ms Tanner explained that raising three young boys and running a household independently can be exhausting. She is always tired. Prior to the incident, she never thought she would be raising her children on her own as their marriage and family were wonderful and happy. Ms Tanner had to give up her career as a nurse in order to support her children and thinks that she is no longer the fun mum they used to know. Ms Tanner said there is not one day that goes by when she does not think of her husband. She said: "He was my best friend and soulmate and what I thought was going to be my forever. My heart aches endlessly for him, my life still feels like a nightmare - but for my husband and sons I go on".
16. Ms Tanner said that it is truly her biggest hope that no family ever has to go through the nightmare and heartache her family has experienced, saying: "Every Australian should be able to go to work and come home safely to their family".
17. As I said to Ms Tanner after she courageously read aloud her Victim Impact Statement in honour of her late husband, the court is grateful to receive such material to obtain a picture of the harm done by the commission of the offence.
18. The court extends its own sympathies to Ms Tanner and the family. It would be understandable if the family thought that whatever penalty was imposed was inadequate. As the sentencing judge I am bound to apply the decisions of higher courts which bind me as a matter of law. I have obtained guidance as to the appropriate sentence from the decision of the Court of Criminal Appeal in Attorney General for the State of New South Wales v DSF Constructions Pty Ltd [2019] NSWCCA 33.

Costs

1. The parties have agreed to an order that the defendant is to pay the prosecutor's costs agreed in the amount of $45,000.

Penalty

1. My orders are: 1. DIC Australia Pty Limited is convicted. 2. I take into account the Victim Impact Statement of Ms Rachel Tanner. 3. The appropriate fine is $600,000 but that will be reduced by 25% to reflect the plea of guilty. 4. Order DIC Australia Pty Limited to pay a fine of $450,000. 5. Order pursuant to Section 122(2) of the Fines Act 1996 (NSW) that 50% of the fine is to be paid to the prosecutor. 6. Order DIC Australia Pty Limited to pay the prosecutor's costs agreed in the amount of $45,000.

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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: 30 April 2021