WorkCover Authority of New South Wales (Inspector Belley) v Hughston & Sons Pty Limited

PROSECUTOR: Mr P Skinner of counsel SOLICITOR: Mr G Henderson Phillips Fox

LEGAL REPRESENTATIVES: DEFENDANT: Mr A Moses of counsel SOLICITOR: Mr E Haggerty Toomey Pegg Drevikovsky Lawyers

JUDGMENT: - 1 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES IN COURT SESSION

Inspector Belley v Hughston & Sons Pty Limited. Prosecution under s16(1) of the Occupational Health and Safety Act 1983.

Matter No. IRC3955 of 2000 Inspector Belley v Hughston & Sons Pty Limited. Prosecution under s15(1) of the Occupational Health and Safety Act 1983.

Matter No. IRC3956 of 2000 Inspector Belley v Hughston & Sons Pty Limited. Prosecution under s15(1) of the Occupational Health and Safety Act 1983.

Inspector Belley v Hughston & Sons Pty Limited. Prosecution under s15(1) of the Occupational Health and Safety Act 1983. JUDGMENT [2002] NSWIRComm 340

1 These proceedings involve three prosecutions pursuant to s15(1) and one prosecution pursuant to s16(1) of the Occupational Health and Safety Act 1983 ("the Act") brought by Inspector Gabriele Belley of the WorkCover Authority of New South Wales ("the prosecutor") against Hughston & Sons Pty Limited ("the defendant").

2 The prosecutions were heard concurrently by the Court. A plea of guilty was entered by the defendant in Matter Nos. IRC3954, 3955 and 3957 of 2000. The prosecutor offered no evidence with respect to Matter No. IRC3956 of 2000, which prosecution was thereby dismissed at the outset of the proceedings. The question of costs in that matter was decided in favour of the defendant but the assessment of those costs was reserved for consideration in conjunction with the question of costs arising in the balance of the proceedings. The Court received a communication on 21 October 2002, indicating the parties had reached an agreement as to costs in relation to the four prosecutions (which agreement shall be considered later in this judgment).

3 The defendant conducted a business as an apiarist near Wanaaring in the State of New South Wales. The defendant had conducted a business in beekeeping and the production of honey at those premises since about 1963. The business was located one kilometre from the remote township of Wanaaring which was situated approximately 200km west of Bourke and had a population of approximately 70.

4 On the evidence before the Court, the prosecutions do not arise out of an accident but rather from investigations conducted by Inspector Monahan of the WorkCover Authority of New South Wales on 11, 12 and 13 August 1998 (on two occasions accompanied by Constable Fleming of the Wanaaring Police Station) and Inspectors Monahan and Watson on 27 and 28 August 1998. Following upon those investigations Inspector Monahan issued four improvement notices and one prohibition notice. It was indicated in the evidence of Inspector Belley in these proceedings that the defendant had satisfied the requirements of the improvement and prohibition notices within the time period specified within those notices. Nevertheless, these prosecutions were brought. Broadly speaking, the charges (as earlier mentioned, under ss15(1) and 16(1) of the Act) concern a failure to safely store what was described in the proceedings by the defendant as "chemicals" and a failure to provide or maintain a system of work to ensure that plant at the premises was provided and maintained in a condition that was safe and without risk to health.

5 At the commencement of the proceedings the prosecutor was given leave to amend the charges in Matter No. IRC3954 of 2000. The charge against the defendant and the particulars thereof were set out in the amended summons as follows: I, Gabriele Belley of WorkCover Authority of New South Wales ... allege that HUGHSTON & SONS PTY LIMITED (ACN 001 279 125), an incorporated company with its registered office located at Vicary Street, Wanaaring in the State of New South Wales. DID FAIL To ensure the health, safety and welfare at work of its employees, contrary to Section 16(1) of the Occupational Health & Safety Act 1983 in such case made and provided in that: It is alleged that the Defendant, HUGHSTON & SONS PTY LIMITED (ACN 001 279 125), an employer, breached Section 16(1) of the Occupational Health and Safety Act 1983 on 12 August 1998 at premises located at Vicary Street, Wanaaring in the State of New South Wales ("the Premises"), in that it failed to ensure that persons not in its employment were not exposed to risks to their health or safety arising from the conduct of its undertaking whilst they were at it's place of work. In particular, the Defendant failed to ensure the safe storage of the chemical Phostoxin (Aluminium Phosphide) at the Premises.

6 The charge and particulars in Matter No. IRC3955 of 2000 were in the following terms: I, Gabriele Belley of WorkCover Authority of New South Wales ... allege that HUGHSTON & SONS PTY LIMITED (ACN 001 279 125), an incorporated company with its registered office located at Vicary Street, Wanaaring in the State of New South Wales. DID FAIL To ensure the health, safety and welfare at work of its employees, contrary to Section 15(1) of the Occupational Health & Safety Act 1983 in such case made and provided in that: It is alleged that the Defendant, HUGHSTON & SONS PTY LIMITED (ACN 001 279 125), an employer, breached Section 15(1) of the Occupational Health & Safety Act 1983 on 27 August 1998 at premises located at Vicary Street, Wanaaring in the State of New South Wales, in that it failed to ensure the health, safety and welfare of its employees, in that it failed to provide or maintain a system of work to ensure that plant at the premises was maintained in a condition that was safe and without risks to health. In particular, the Defendant failed to provide or maintain a system of work to ensure that: (a) a Paulcall docking saw was maintained in a condition that was safe and without risks to health, in that the saw blade was not adequately guarded; (b) a bench saw at the premises was maintained in a condition that was safe and without risks to health, in that it had no hood guard; (c) a pedestal drill was maintained in a condition that was safe and without risks to health, in that the flat and V belts and pulleys were inadequately guarded and the drill was not electrically wired to comply to Australian Standard AS3000.

7 The charge and particulars in Matter No. IRC3957 of 2000 were in the following terms: I, Gabriele Belley of WorkCover Authority of New South Wales ... allege that HUGHSTON & SONS PTY LIMITED (ACN 001 279 125), an incorporated company with its registered office located at Vicary Street, Wanaaring in the State of New South Wales. DID FAIL

To ensure the health, safety and welfare at work of its employees, contrary to Section 15(1) of the Occupational Health & Safety Act 1983 in such case made and provided in that: It is alleged that the Defendant, HUGHSTON & SONS PTY LIMITED (ACN 001 279 125), an employer, breached Section 15(1) of the Occupational Health & Safety Act 1983 on 28 August 1998 at premises located at Vicary Street, Wanaaring in the State of New South Wales, in that it failed to provide or maintain a system for the storage of liquid petroleum gas cylinders that was safe and without risk to health.

The Prosecutor's Evidence 8 At the hearing, the prosecutor tendered a statement of agreed facts, a document known as a "Material Safety Data Sheet" concerning the product 'phostoxin round fumigation tablets' which were known as 'aluminium phosphide' ("phostoxin"), nine colour photographs (although the prosecutor contended that the photograph numbered four was irrelevant to the proceedings) of the premises of the defendant, bee boxes and phostoxin containers in a box and machinery, and an extract from the WorkCover Authority Prior Convictions database indicating that the defendant had no prior convictions.

9 As earlier mentioned, the prosecutor also called Inspector Belley to give evidence. Inspector Belley essentially gave evidence responsive to evidence given by Mr Bruce Hughston, a director of the defendant, to the effect that the WorkCover Authority of New South Wales had closed down the defendant's factory or that the closure of the factory was as a consequence of the notices issued by that body. Mr Belley's evidence was that the WorkCover Authority of New South Wales had not closed the factory. Nor had the improvement or prohibition notices had the effect of closing the factory. These statements were not tested in cross-examination of either Inspector Belley or Mr Hughston. The issue was not raised by the defendant in submissions, save as to indicate that the closure of the factory worsened the financial position of the defendant. Having regard to the submissions in the proceedings (and manner in which the prosecutor and defendant approached the evidence in relation to this question), I do not consider that the issue requires any further assessment or determination, other than to take into account the fact that the factory was closed down at some time after the notices were issued and that such closure resulted in financial loss to the defendant. If the Court was required to make a finding in relation to the issue, it would conclude that the defendant had not established, on the evidence, that the notices issued by the defendant had caused the defendant's factory to close. However, the financial means of the defendant shall, in accordance with principles later discussed, be taken into account in sentencing the defendant in this matter.

10 The statement of agreed facts was in the following terms:

At all material times the Prosecutor was an Inspector appointed pursuant to the provisions of the Occupational Health and Safety Act, 1983 and empowered by section 48 of the Act to institute proceedings in this matter.

At all materials times the Defendant, Hughston & Sons Pty Ltd (ACN 001 279 125) was an incorporated company with its registered office located at Vicary Street, Wanaaring in the State of New South Wales.

At all material times the Defendant: (a) carried on bee keeping and the production of honey at premises located at Vicary Street, Wanaaring in the State of New South Wales ("the premises") (b) employed Wayne Edwards, a 30 year old beekeeper at the premises ("Edwards").

Wanaaring is a remote township approximately 200 kilometres west of Bourke in Western New South Wales and has a population of approximately 70.

The road between Bourke and Wanaaring is largely uncapped and travel to Wanaaring from Bourke and the return to Bourke is a two day trip.

In wet weather, in rain over 10mm, the road is closed except to emergency services vehicles.

Public services such as postal, are infrequent. Postal services are only twice a week.

On 10 August 1998 Edwards was relocating a ponding tank that was used as a reservoir for the honey during the refining process. The tank was a 200-litre drum with a honey feed pump and pipe work attached. The pump was operated by an electronically controlled float switch which was secured to the top of the drum.

On 11 August 1998, Inspector Monahan of the WorkCover Authority of New South Wales (together with a Police Constable from Wanaaring Police Station) attended the premises and observed as follows: (a) An L shaped building, the front entrance of the building was approximately 12 metres in width, the north western side of the building 50 metres in length, the south west and back of the building was approximately 47 metres in width in the south eastern end of the building was approximately 31 metres in width. The building had a pitched roof of corrugated iron and corrugated iron walls. (b) At the entrance of the building was a mechanical repair workshop. (c) At the back right hand side of the shed there was a large sliding door and a truck loaded with bee boxes was parked in the shed. (d) In the back of the shed was stacks of bee boxes covered with clear and black plastic sheeting. (e) In the middle of the back L shaped building there were honey extractors and a ponding tank also known as the "purging tank". This tank was identified by the Police Constable from the Wanaaring Police Station and the area had been fenced off with police tape.

On 12 August 1998 Inspector Monahan and Constable Flemming attended the premises and conducted investigations which disclosed as follows: (a) They identified a container marked "Phostoxin-aluminium phosphide". Constable Flemming established that the compound was a hazardous material if not used properly.

As a result of the investigations conducted, it was found that: (a) Had the chemical come into contact with water, it would have produced toxic fumes of phosgene gas. (b) The Defendant used Phostoxin for controlling bee wasps.

From his investigations on 12 and 13 August 1998, Inspector Monahan found that the Defendant had provided inadequate arrangements at the premises for the safe storage of the chemical Phostoxin (aluminium phosphide).

Phostoxin had been approved and continues to be approved by the Department of Agriculture for a number of uses including fumigation of honey frames to avoid wax moth, an insect pest that eats and destroys honey comb.

According to the Material Safety Data Sheet it is advised that the chemical should be stored in a safe, cool, dry place out of reach of children and irresponsible persons.

The Phostoxin is now stored in a locked cupboard in the Defendant's work area.

From their investigations on 27 and 28 August 1998, Inspectors Monahan and Watson found that the Defendant: (a) Failed to adequately guard a Paulcall docking saw at the premises on 27 August 1998 in that the saw blade was exposed. (b) Failed to adequately guard a bench saw at the premises on 27 August 1998 in that it had no hood guard. (c) Failed to provide a pedestal drill on 27 August 1998 that was safe and without risk to health in that the flat and V belts and pulleys were inadequately guarded and the drill was not electrically wired to comply to Australian Standard AS3000. (d) Both full and empty liquid petroleum gas cylinders were stored in a building on 28 August 1998 on the premises creating a risk of gas build up in the event of a leak.

On 14 August 1998 Inspector Monahan issued the following Improvement Notice to the Defendant: (a) Improvement Notice No. 166686 requiring the Defendant to ensure the safe use and storage of hazardous substances as required by the Material Safety Data Sheet for Phostoxin.

On 27 and 28 August 1998 Inspector Monahan issued the following Improvement Notices to the Defendant: (a) Improvement Notice No. 166687 on 27 August 1998 requiring the Defendant to ensure the safety of employees by providing effective guarding on a Paulcall docking saw and a bench saw. (b) Improvement Notice No. 166689 on 28 August 1998 requiring the Defendant to provide a pump or other means to extract petrol from containers. (c) Improvement Notice No. 166690 on 28 August 1998 requiring the Defendant to provide sufficient personal protection equipment for the use of employees.

On 27 August 1998 Inspector Monahan issued Prohibition Notice No. 103170 to the Defendant requiring it to provide effective guarding to a pedestal drill used for mixing, including guarding belts and pulleys of the machine.

The defendant had approximately 40 gas cylinders stored inside the factory at the premises.

On 28 August 1998 Inspector Colin Watson of WorkCover Authority of New South Wales issued the following Improvement Notices to the Defendant: (a) Improvement Notice No. 166734 requiring the Defendant to install full and empty liquid gas petroleum cylinders in an outside area to avoid gas build ups.

It is alleged that on 12 August 1998 the Defendant, an employer, breached section 16(1) of the Occupational Health and Safety Act 1983 at premises located at Vicary Street, Wanaaring in the State of New South Wales in that it failed to ensure that persons not in its employment were not exposed to risks to their health or safety arising from the conduct of its undertaking while they were at its place of work. In particular, the Defendant failed to ensure the safe storage of the chemical Phostoxin (aluminium phosphide) at the premises.

It is alleged that on 27 August 1998 the Defendant, an employer, breached section 15(1) of the Occupational Health and Safety Act 1983 at premises located at Vicary Street, Wanaaring in the State of New South Wales in that it failed to ensure the health, safety and welfare at work of its employees, in that it failed to provide or maintain a system of work to ensure that plant at the premises was maintained in a condition that was safe and without risks to health. In particular, the Defendant failed to provide or maintain a system of work to ensure that: (a) A Paulcall docking saw was maintained in a condition that was safe and without risks to health, in that the saw blade was not adequately guarded; (b) A bench saw at the premises was maintained in a condition that was safe and without risks to health, in that it had no hood guard; (c) A pedestal drill was maintained in a condition that was safe and without risks to health, in that the flat and V belts and pulleys were inadequately guarded and the drill was not electrically wired to comply to Australian Standard AS3000.

It is alleged that on 28 August 1998 the Defendant, an employer, breached Section 15(1) of the Occupational Health and Safety Act 1983 at premises located at Vicary Street, Wanaaring in the State of New South Wales in that it failed to ensure the health, safety and welfare at work of its employees, in that it failed to provide or maintain a system for the storage of liquid petroleum gas cylinders that was safe and without risk to health.

The Defendant's Evidence 11 Mr A Moses of counsel, who appeared for the defendant, tendered an affidavit in mitigation of sentence of Mr Bruce Hughston (together with a one paragraph extract of an earlier affidavit sworn by Mr Hughston concerning the aforementioned closure of the defendant's factory).

12 Mr Hughston gave evidence that due to the remote location of the business it was difficult for the defendant to secure the services of qualified tradespersons and other services. Business equipment is usually purchased from outside Wanaaring and transported by the defendant to the defendant's property.

13 He gave evidence that the defendant had not employed any new staff since 1998 and employed two employees as beekeepers who helped with the extraction of honey. It should be noted that, in cross-examination, Mr Hughston indicated that he was an employee of the defendant and thus the defendant presently had three employees. It should be noted that the statement of agreed facts referred to the employment of a Mr Edwards. It is not clear on the evidence whether that person was engaged by the defendant at the time of the hearing of this matter (so as to constitute four employees of the defendant).

14 The defendant gave particular evidence as to each charge. In relation to Matter No. IRC3954 of 2000 concerning the storage of phostoxin, the defendant gave the following evidence by affidavit: 14. The defendant purchased a box of Phostoxin in 1984. 15. Phostoxin had been approved and continues to be approved by the Department of Agriculture for a number of uses including fumigation of honey grames to avoid wax moth, an insect pest that eats and destroys honey comb. 16. The label which is attached to the Phostoxin canisters makes no reference to the storage of Phostoxin. 17. The box of Phostoxin lasted until 1999 and was the only purchase of aluminium phosphide made by the defendant prior to August, 1998. 18. The canisters of Phostoxin remained in the box in which they were purchased. That box was stored on a work bench behind a large lathe and a bench grinder in the defendant's factory. The bench and its immediate area is a dry area free of water or moisture or dampness. 19. The defendant's factory is locked each evening. 20. The WorkCover Authority recommended that the chemical should be stored in a locked cupboard to eliminate the possibility of inadvertent access to the chemical and the defendant has agreed to this recommendation. 21. The defendant was unaware of the requirement that the chemical be kept in a locked cupboard. 22. The defendant had been using Phostoxin for 14 years without incident. 23. The Phostoxin is now stored in a locked cupboard in the defendant's work area and the storage has been approved by the WorkCover Authority.

15 The box referred to in this evidence is shown in the photographs as a worn, open, cardboard box. In cross-examination, Mr Hughston agreed this had been used to store "phostoxin" since 1984. Mr Hughston also gave evidence that he was unaware that the phostoxin had to be kept in a locked cupboard or of the existence of the 'Material Safety Data Sheet' as to that substance (until informed by WorkCover).

16 The Material Safety Data Sheet revealed that the phostoxin is a dangerous substance which will create acute adverse health effects if ingested, contact is made with the skin or eyes or inhalation of dust or liberated phosphene gas occurs. The data sheet provided safe handling information. As to storage precautions, the data sheet specified that the tablets be kept dry and kept locked up in a safe, cool, dry place in their container out of reach of children and irresponsible persons. It was indicated that phostoxin should be stored away from habitation and protected from moisture exposure.

17 As to the charge in Matter No. IRC3955 of 2000 concerning the failure to provide or maintain a system of work to ensure that plant at the premises was maintained in a condition that was safe and without risk to health, the defendant gave the following evidence by affidavit:

24. Each of the pieces of machinery were purchased by the defendant approximately twelve months after the completion of the factory in 1968. The machinery was purchased in a second hand condition from a commercial retail supplier of machinery, Haire and Forbes, situated in Parramatta.

The machinery was purchased by my father, now deceased, and transported to the defendant's premises.

The pedestal drill was initially used for metal working and later used by the defendant for mixing feed for bees.

The drill was not "hard wired" but was on an extension lead so as to facilitate the movement of the drill around the workplace to enable work to be done at different locations.

The drill was used predominantly during the period late December to February for mixing feed. Thereafter the drill was not in regular use.

Until August, 1998 the defendant was unaware that the drill required additional guarding and it remained in the condition in which it was purchased.

In response to the WorkCover's notice, a grill guard was made by the defendant and fitted to the machine.

The pedestal drill is no longer in use. The defendant purchased a mixing machine which has superseded the pedestal drill.

The docking saw did not have a bottom guard which covered the blade whilst not in use and which rotated once the blade come into contact with wood.

The defendant was unaware that the docking saw required additional guarding.

The docking saw is used for wood work in repairing bee hive material.

The docking saw is used irregularly and is not a piece of equipment that is used regularly.

After the WorkCover Authority issued a notice, a guard was made from steel and fitted to the saw. The WorkCover Authority approved the guarding of the machine.

The bench saw did not have an emergency mushroom stop button and a guard had been removed by a former employee who was a carpenter and who found the guard made the saw difficult to use.

The defendant was unaware that it was necessary to have an emergency mushroom stop button.

Like the docking saw, the bench saw is used for wood work in repairing bee hive material.

An emergency mushroom stop button was installed by an electrician to the satisfaction of the WorkCover Authority in August, 1998 and the guard was refitted.

18 As to the prosecution in Matter No. IRC3957 of 2000 concerning the safe storage of liquid petroleum gas cylinders, the defendant gave the following evidence by affidavit:

The defendant has approximately 40 gas cylinders.

The gas cylinders are used for domestic use (stove and heating) and the defendant also sells gas to other residents.

The property is not connected to gas mains and it is necessary to use liquid petroleum gas for heating and cooking.

At the time of the infringement the gas cylinders were stored inside the defendant's factory.

Prior to 1996, the cylinders were refilled by the defendant when its directors visited Sydney. The cylinders were refilled at a gas plant at St Marys. The gas plant at St Marys ensured that all cylinders are maintained to a level required by regulations relating to the storage and transport of liquid petroleum gas. Since 1996, the cylinders are filled and delivered by Western Fuel Distributions to the defendant's premises.

Each gas cylinder has been dated for safety purposes and are checked regularly.

At no time has the defendant ever experienced leakage in relation to the cylinders.

The cylinders are now stored some 60 metres away from the factory. WorkCover has approved the storage of the cylinders.

19 In the evidence of Mr Hughston, it was revealed that as at August 1998, the defendant had an unblemished safety record and had not been the subject of any prosecutions or convictions under the Act. There had earlier been a visit to the workplace by an Inspector of the WorkCover Authority of New South Wales in relation to an old extracting area, but no improvement notices had been issued and no proceedings commenced against the defendant.

20 As to the financial situation of the defendant, Mr Hughston gave evidence that the company had as directors his step-mother, wife, an employee, Mr McLellan, and himself. Whilst the business had been incorporated, the defendant was, according to his evidence, effectively a family business. A profit and loss statement for the financial years ending 2000 and 2001 were produced with Mr Hughtson's evidence. He gave evidence that the company had traded poorly for those years and it was his expectation that the following financial year would be the defendant's worst year of operation since commencing in 1963. The defendant was producing at approximately ten percent of its usual production levels. It was very reliant on seasonal conditions and substantially affected by the drought.

21 Evidence was also given by Mr Hughston that the defendant would not meet the honey quota set by Capilano Honey Limited for the 2001 financial year. In that event, there would be a risk that the defendant would lose the quota entitlement for the next financial year, resulting in additional hardship.

22 The defendant had lost approximately $100,000 as a consequence of the closure of the factory after the WorkCover investigations. It had also incurred substantial costs which related to the preparation of its defences in these matters.

23 In cross-examination, Mr Hughston stated that the company had produced honey in every year since 1963. During that time it had had good and bad years of production. Mr Hughston was also cross-examined as to the company's turnover for the financial year ending 2000 (there being a turnover of $291,247). He stated that there was a "big turnover" but also stated the "overall profit on that particular year is a very small margin for the amount of assets involved". The financial records revealed the profits for that year to be $2,915.20. He gave evidence that the average profit was $20,000. Mr Hughston also agreed in cross-examination that wages were a component of the expenses incurred by the defendant. He was paid a wage of $650 gross per week.

24 Mr Hughston gave evidence that the company owned a station property at Ularara and a property at Wanaaring on which the factory was located. The defendant was presently selling the Ularara property for $175,000, the proceeds of which will be used to discharge a mortgage and pay off a debt to Mrs Catherine Ellen Hughston, his step-mother, and some other small bank loans. The money will also be used to pay legal fees and any fine imposed in these matters.

25 Mr Hughston gave evidence that, given the current state of the defendant's finances, a fine imposed by the Court in the vicinity of $50,000 would cause the defendant to go into liquidation. He gave evidence that the money could not be raised by a bank loan as the company was already working on a bank loan. However, he did indicate that if a fine in that vicinity was imposed, the debt which is owed to his step-mother would not be paid to her.

26 Evidence was also given as to the consequences of liquidation, including the relocation of the defendant and Mr Hughston, and the consequent loss of employment and services to the Wanaaring community.

27 Finally, Mr Hughston gave character evidence as follows: (a) I am a member and the captain of the local volunteer fire brigade;

(b) I am a member of the Health Centre Support Group which provides assistance to the resident health nurse and the flying doctor;

(c) I am an officer of the local Progress Association;

(f) I am a member of the Committee to seal the Bourke and Wanaaring Road; and

Submissions for the Prosecutor 28 Mr P Skinner of counsel, who appeared for the prosecutor, submitted that, in this matter, a risk had been identified before any accident or injury had occurred and this fact may be relevant to the assessment of the nature and quality of the offence.

29 It was submitted that the charge in relation to the failure to safely store phostoxin was objectively the most serious matter before the Court. There had been quite inadequate storage of a dangerous substance giving rise to a quite substantial risk. The prosecutor acknowledged that the defendant did not know about the storage requirements, although the Material Safety Data Sheet was quite clear as to both the danger of the substance and the storage requirements.

30 The prosecutor emphasised the significance of general deterrence in relation to the charge concerning the storage of phostoxin because of the need to compel investigation by businesses as to the characteristics of potentially dangerous chemicals and the need for their proper storage. However, the prosecutor submitted that having regard to both objective and subjective considerations, the Court may decide "to deal with this by way of remarks rather than penalty [-] the prosecution is brought in this jurisdiction and pressed to seek some statement from the Court of general application and general deterren[ce] ...".

31 As to the charge concerning the failure to ensure that plant at the premises was provided and maintained in a condition that was safe and without risk to health, the prosecutor submitted that the requirement for the guarding of machines and, in particular, saws, should be well known (and should have been known to the defendant which had operated since 1963). However, Mr Skinner submitted this charge was "a small thing in one sense objectively". It was conceded that any penalty arising from this matter should be at the lower end of the range.

32 As to the charge concerning the failure to safety store liquid petroleum gas, Mr Skinner conceded that the charge was pursued because of the possibility of gas build up from leakages but the Court was not assisted greatly by the photographs produced and there was little evidence as to the matter. There was no evidence that the cylinders maintained by the defendant were leaking. As to this charge, the prosecutor submitted that any penalty should be at the "lower to middle range".

33 The prosecutor made submissions as to general deterrence. It was submitted that it was necessary to deter breaches of the Act by businesses operating in remote areas so as to ensure that the duties under the Act are maintained, even in those areas. The prosecutor also submitted that the sentence should reflect the need for specific deterrence.

34 The prosecutor submitted that the Court should have regard to the standing of Mr Hughston in the community as a factor in favour of the defendant.

35 The prosecutor also conceded that the means of the defendant were relevant. As to the assessment of the financial means of the defendant, the prosecutor relied upon the decision of Wright J, President, in Ferguson v Nelmac Pty Limited (1999) 92 IR 188 and the decision of Haylen J in Inspector William Hopkins v Michael Wherritt t/as M J Wherritt Concrete Pumping Services [2002] NSWIRComm 16 at [59] - [60].

36 It was submitted that the defendant should not be dealt with as if it was an "individual" defendant. The Court should also have regard to the substantial turnover of the defendant and the variability of returns in rural operations. It was also submitted that the defendant had not contended that it was currently insolvent and that the defendant may have "good years" in the future.

37 The prosecutor also submitted that the defendant had the obligation to make out a case for the lack of financial means. The Court should not accept, it was contended, the proposition advanced by the defendant that the existence of bank loans would prevent the defendant being able to meet any fine by raising a loan or disposing of assets.

38 As to the question of the pleas of guilty, it was submitted by the prosecutor that the pleas in Matter Nos. IRC3955 and IRC3957 of 2000 had been entered at the earliest possible opportunity. However, Mr Skinner submitted that the prosecution could not concede that the plea in relation to the charge of failing to safely store phostoxin (Matter No. IRC3954 of 2000) was entered at the earliest opportunity. The prosecutor sought to distinguish the decision in Cameron v The Queen (2002) 76 ALJR 382 essentially on the basis that Cameron concerned a drug charge where the particularisation of the illegal substance was a matter of some importance to the offence charged. Here, the amendment to the charge on the day of the hearing, it was submitted, did not alter the substance of the charge and "the defendant was always able to plead to the offence upon which it now stands before your Honour for sentencing". The prosecutor did concede that there were additional elements to the new charge but sought to distinguish this case from Cameron upon the basis that there was still a substantial element of the original charge remaining after the amendment. It was submitted that, in essence, if the matter had gone to trial and the prosecution had proved the unsafe storage of phostoxin, there would have been a conviction.

39 Mr Skinner submitted that the prosecutor was reluctant to suggest a penalty range (in response to a submission on penalty range by the defendant). However, it was submitted that, whilst ultimately the prosecutor did not need to respond, a range, after the application of the principle of totality, should be "something higher than $10,000" and "certainly extend quite a way past $40,000 but there may be some overlap".

40 The defendant submitted that the Court should apply the principles for sentencing stated by Hungerford J in WorkCover Authority of New South Wales (Inspector McMartin) v Transfield Pty Limited t/as Transfield Maintenance (No. 2) (2001) 110 IR 160 at [44] in this matter. His Honour there applied, it was submitted, the judgment of a Full Bench of the Court in Lawrenson Diecasting Pty Limited v WorkCover Authority of NSW (Inspector Ch'ng) (1999) 90 IR 464 at 475 where it was held that the primary factor to consider in relation to the penalty to be imposed is the objective seriousness of the offence with subjective factors playing a subsidiary role in the determination of penalty. His Honour also referred, it was contended, to the judgment of Kirby J in Postiglione v The Queen (1997) 189 CLR 295 at 341 wherein reference had been made to the inappropriateness of imposing a "crushing" sentence. His Honour also referred to the decision of the Full Bench in Warman International Limited v WorkCover Authority of NSW (Inspector Ankucic) (1998) 80 IR 326 at 339 where it was held that "the level of penalty must, on the one hand, compel attention to occupational health and safety risks in order to ensure that persons are not exposed to such risks at their workplaces but, on the other, must not be oppressively high".

41 Mr Moses submitted that the maximum penalty with respect to each offence was $550,000. Having regard to the discussion of the principle of totality in Crown in Right of the State of New South Wales (Department of Education and Training) v Keenan (2001) 105 IR 181 at [36] and [37], it was submitted that the principle of totality should be applied with respect to the prosecutions in Matter Nos. IRC3954 and IRC3957 of 2000. The principle of totality, it was contended, was applicable to these matters as both of them related to the unsafe storage of chemicals at the defendant's premises, whereas Matter No. IRC3955 of 2000 did not attract the operation of the principle as it concerned a "guarding offence".

42 Further, the defendant submitted that in sentencing the defendant the Court should have regard to the circumstances of the offence in each of the prosecutions as well as the circumstances of the offender: WorkCover Authority of NSW (Inspector Lyons) v Warman International Limited (2001) 105 IR 236 at [80] (although I would note that this aspect of the judgment particularly concerned specific deterrence).

43 As to the failure to safety store "chemicals", it was submitted that the true depiction of the failure is given in the statement of agreed facts and the evidence of Mr Hughston and not by the photographs presented to the Court in the evidence of the prosecutor. It was further submitted that the defendant did not know that the method of storage used was unsafe. The defendant had assumed that all necessary steps had been taken in order that the chemical would not be the subject of inappropriate use by the method of storage utilised, although the defendant now understood that the "chemicals could have been more safely stored" on the defendant's premises. In the case of phostoxin, it is recognised that the substance should have been stored in a locked cupboard.

44 It was also submitted that the seriousness of the charges concerning the failure to safety store "chemicals" was diminished because no public access was available to the premises of the defendant. Further, there was only a small workforce.

45 As to the "guarding" charge, the defendant contended that it was unaware that the items of equipment required additional guarding as their condition remained unaltered from the date of original purchase by the defendant. In the case of the bench saw, the guard had been removed by a former employee who was a carpenter and who found the guard made the saw difficult to use.

46 Mr Moses agreed with the submission by the prosecutor that the absence of an injury featuring in relation to the offences did not necessarily detract from the gravity of the offence. However, the defendant submitted that the Court should have regard to the fact that in this case there was no injury sustained as a result of the breaches of the Act: Tyler v Sydney Electricity (1993) 47 IR 1 at 5 and WorkCover Authority of NSW (Inspector Ankucic) v McDonalds Australia Limited and Anor (1999) 95 IR 383 at 350.

47 It was submitted that "general and specific deterrence" were applicable in the assessment of penalty in this matter and that, in the result, the defendant did not make an application (properly in my view) that the Court should exercise its discretion under s10 of the Crimes (Sentencing Procedure) Act 1999. It was also submitted that deterrence would have a role to play with respect to the charges concerning the unsafe storage of chemicals but that the Court would also have regard to the context in which the offences occurred, including the location at which the offence has occurred. The Court should also consider the manner in which and the location at which the chemicals were stored, including the precautions taken by the defendant. The "deterrence factor" would be sufficiently served by the Court convicting the defendant of the offence and imposing a penalty on the defendant at a level that would be a sufficient deterrent to the general community, but have regard to the particular nature of the offence in this matter and the circumstances of the defendant.

48 As to the subjective considerations, it was put by the defendant that the Court should apply the authority in R v Thomson; R v Houlton (2000) 49 NSWLR 383 and, having regard to the pleas of guilty and other relevant considerations arising from that judgment, a discount of 25 percent should be granted the defendant. It was submitted that the plea of guilty for the offence in Matter No. IRC3954 of 2000 was given at the earliest available time because the prosecution withdrew one of the particulars in that matter thereby giving rise to the plea of guilty being entered on the first day of hearing.

49 Mr Moses also submitted that the discount should have regard to the defendant's co-operation with the WorkCover Authority of New South Wales, express contrition and lack of any prior convictions.

50 It was contended that the Court should have regard to the prompt attention given by the defendant to the improvement notices issued by the WorkCover Authority of New South Wales and to the defendant's good character. In this respect, it was submitted that the good character of a director, Mr Hughston, who was, in effect, the controlling mind of the company, was admissible as a factor relevant to the defendant's character and credit: WorkCover Authority of NSW (Inspector Robins) v CT Plumbing Pty Limited [1991] NSWIRC 28 (16 December 1991). The good character of a director was admissible in favour of a corporate defendant, it was submitted, because that fact pointed to the likelihood that the corporate defendant, through the director, had made proper admissions. It also assisted in the assessment of the corporate defendant's commitment to safety when submissions as to that matter were advanced in relation to a plea of guilty.

51 Mr Moses submitted that the financial position and means of the defendant should be taken into account in relation to the question of penalty: Ferguson v Nelmac at 209. It was contended that the imposition of a heavy fine would be a burden on the defendant and its financial resources "sufficiently ... to in effect have it go out of existence with consequent loss to not only the company but obviously third parties". Whilst the financial resources of a defendant is a matter that should be given appropriate weight in relation to the question of penalty, it was submitted, that factor did not necessarily result in the Court refraining from the imposition of a heavy penalty when regard was had to the objective seriousness of the offence. The defendant submitted that, on the evidence before the Court, the Court would find that the company was a small concern, having regard to the income received by it and that a more substantial fine would cause the defendant to go out of business.

52 The defendant submitted that the Court should not adopt the principle proposed by the prosecutor, namely, that the financial means of the defendant should be assessed by reference to the future potential earnings of the defendant. It was submitted that the Court should have regard to the company's present financial standing and, to the extent relevant, take that matter into account in the assessment of penalty.

53 It was submitted that the penalty imposed by the Court, after the application of the principle of totality, should be in the lower range with respect to the three offences and, in particular, should be in a range of $10,000 to $40,0000.

54 At the conclusion of the proceedings, the Court gave leave for the prosecutor and the defendant to file further written submissions as to the question of costs or, in the event of a settlement of that issue, to file a document reflecting that agreement. As earlier mentioned, on 21 October 2002, the Court was advised that an agreement had been reached between the prosecutor and the defendant. That agreement required the prosecutor to pay the defendant the sum of $8,500 "in full and final settlement of all outstanding costs matters".

55 It is well settled that the primary factor to be examined in relation to the penalty to be imposed for breaches of the Act is the objective seriousness of the offence and, in that respect, as was observed by Hungerford J in WorkCover Authority of NSW (Inspector Carmody) v Consolidated Constructions Pty Limited (2001) 109 IR 316 at [43], the penalty imposed must be determined by reference to the offence as charged.

56 This matter does not emerge from an accident or incident at a workplace, but rather breaches of the Act detected by the prosecutor during a course of an investigation of the defendant's workplace. This fact does not deprive the charges of their validity or efficacy, as an offence under s15(1) or s16(1) of the Act concerns a failure to ensure that persons are not exposed to risks rather than the failure to prevent a particular accident per se. Thus, what is required to demonstrate a breach of those sections is proof of the existence of a failure on the part of the employer which is causally connected with a relevant risk to safety: Drake Personnel Limited t/as Drake Industrial v WorkCover Authority of NSW (Inspector Ch'ng) (1999) 90 IR 432 at 452 - 453. Nor does the gravity of the consequences of an accident, such as damage or injury, of itself, dictate the seriousness of an offence or the amount of penalty: Capral Aluminium Limited v WorkCover Authority of NSW (2000) 49 NSWLR 610 at [94].

57 I adopt, in this respect, the following passage from WorkCover Authority of NSW (Inspector Farrell) v Schrader (2002) 112 IR 284 at [66]: [66] It is not necessary to arrive at a precise conclusion as to how the accident occurred. It is now axiomatic that the general duties created by the Act are directed at obviating risks to the health and safety of persons in the workplace rather than to the circumstances or causes of a particular accident: see Haynes v C I & D Manufacturing Pty Ltd (1995) 60 IR 149 at 158; Drake Personnel Ltd t/a Drake Industrial v WorkCover Authority of New South Wales (Inspector Ch'ng) (1999) 90 IR 432 at 452 - 454 and Cleary Bros at [68]. Further, in assessing an appropriate penalty for the purposes of these proceedings, it should be firmly borne in mind that it is the objective nature and seriousness of the offence that should dictate the penalty as opposed to the actual consequences of the particular breach charged. ...

58 Further, the principal and particular purpose of the Act is the protection of workers from breaches of safety, health and welfare and to compel attention to occupational health and safety issues so that persons are not exposed to risks to their health and safety at the workplace: McDonalds at 427.

59 However, the gravity or otherwise of the potential risk to safety flowing from a breach is relevant as a measure of the gravity of the breach and the culpability of the defendant: Lawrenson Diecasting at 476. Hence, it was stated in Inspector Hannah v Wonar Pty Limited (unreported, Fisher CJ, Glynn and Cullen JJ, CT90/1214, 30 June 1992 at 9) that "a breach that was quite unlikely to lead to serious consequences, might be assessed on a different basis to a breach where there was a prospect of serious consequences". Further, a penalty flowing from a breach of the Act should not be such as would be "oppressively high": Alcatel Australia Ltd v WorkCover Authority of NSW (Inspector Clyant) (1996) 70 IR 99 at 106.

60 Having regard to these principles, I consider that the prosecutor is correct in submitting that the charge concerning the unsafe storage of 'phostoxin' is more objectively serious than the remaining charges. The risks occasioned by the failure to safety store phostoxin are substantial having regard to the dangers associated with any mishandling of that product. The seriousness of that risk, however, was diminished, to a moderate extent, by the following considerations: (1) Whilst the defendant had failed to take the comprehensive measures required by the Act to safely store phostoxin, the defendant had, throughout the long period in which it had held that substance, kept it within its factory which was locked each evening. (2) The charge in relation to the safe storage of phostoxin was brought under s16(1) of the Act and was thereby confined to persons not in the employment of the defendant (although the charge is one which refers to 'employees' of the defendant). The charge does not relate to the 'use' of phostoxin. The location was remote with visitation by non-employees being somewhat restricted.

61 As was properly conceded by the prosecutor, there are aspects of the remaining charges which diminish their seriousness as follows: (1) In the case of the storage of liquid petroleum gas cylinders, the cylinders were regularly maintained and checked and no leakage was demonstrated or experienced from the cylinders; (2) Whilst there was an absence of guarding from certain machinery, there was no evidence as to the exact nature of the missing guarding, its significance to the work performed or the nature of the risk exposed by it other than what might be understood as a general proposition, namely, that the guarding of saws and drills is an essential component of the provision of a safe system of work where those pieces of equipment are employed at the workplace.

62 The defendant submitted in mitigation that it had limited knowledge of the safe storage requirements for the chemicals or the guarding requirements for the equipment and machines (until advised of such requirements by the WorkCover Authority of NSW). It was also submitted that the defendant had been hindered, in the case of the storage of phostoxin, by the lack of particular information as to that product (although Mr Hughston conceded that the WorkCover Authority of NSW had made him aware of the Material Safety Data Sheet after the investigation). Further, the equipment investigated by the inspector, it was contended, was in its original state and that the defendant was not aware of any further requirements for the guarding of that equipment over its original purchased state.

63 I consider that these matters should attract little by way of mitigation of the objective features of this matter. In coming to that conclusion, I have had regard to the decision of the Full Bench of this Commission in Ridge Consolidated Pty Limited v Mauger [2002] NSWIRComm 108 at [32] - [33] whereby the Full Bench, in adopting the decision in Schrader, emphasised the extent of the duty cast upon an employer, in the strongest possible language, by the Occupational Health and Safety Act, including the duty to be proactive and anticipate a risk that might arise at the workplace. The Bench adopted the following passage from Schrader: [56] In short, the duty is to be proactive. This duty was, in my view, correctly and forcefully stated by Bauer J in WorkCover Authority of New South Wales (Inspector Twynam-Perkins) v Maine Lighting Pty Ltd (unreported, CT94/1037, 13 April 1995 at p18) (approved recently by Full Benches of this Court in Profab at [37] and Riley v Australian Grader Hire (2000) 103 IR 143 at [15]): ... the Act was designed to protect against human errors including inadvertence, inattention, haste and even foolish disregard of personal safety as well as the foreseeable technical risks in industry.

[57] Equally forceful observations have been made, an example of which includes the judgment of Watson J in Carrington Slipways Pty Limited v Callaghan (1985) 11 IR 467, in which his Honour held (at 470): In their context and purpose, there would appear to be no reason to make any implication that the words "to ensure" are to be construed in any way other than their ordinary meaning of guaranteeing, securing or making certain. [58] It is pertinent to observe also the comments of Hill J in WorkCover Authority of New South Wales (Inspector Egan) v Atco Controls Pty Limited (1998) 82 IR 80 at 85: This case is yet another illustration of the need for employers to exercise abundant caution, maintain constant vigilance and take all practicable precautions to ensure safety in the workplace. It is essential that the approach should be a pro-active and not a re-active one; employers should be on the offensive to search for, detect and eliminate, so far as is reasonably practicable, any possible areas of risk to safety, health and welfare which may exist or occur from time to time in the workplace.

[59] I would also concur with the observations of Wright J, President, in Ferguson v Nelmac Pty Limited (1999) 92 IR 188 where, in the context of a s15 prosecution, his Honour observed that the Act imposed (at 209): ... an obligation on an employer which is not confined to the taking of precautions only when there are warnings or signals of danger or when experience indicates that a risk to safety has arisen and requires remedy. So much is clear from the structure and language of the section which is premised on the requirement to 'ensure ... health, safety and welfare at work' and the decided cases which make plain the nature of the obligation.

64 The prosecutor was correct, in my view, in emphasising in this matter the need for general deterrence. I also consider that Mr Moses properly conceded that the need for general and specific deterrence took this matter outside the limited class of cases which may attract the exercise of the Court's discretion under s10 of the Crimes (Sentencing Procedure) Act 1999. In these respects, I adopt what was stated by the Court in Schrader at [69] and [70]:

[69] The purpose of the Act is well known and often referred to in judgments of this Court. In my view, it is important, when considering notions of general deterrence, that the Court be cognisant of the fact that the Act is for the benefit of the public generally and particularly employees at work. The goal is the prevention, deterrence and punishment of breaches of health and safety requirements. The notion of general deterrence is well understood. However, in my view, and in accordance with what was stated by the Full Court in Capral Aluminium (at [72] - [74]), in cases such as this, it should be reiterated that "one of the main purposes of punishment, ... is to protect the public from the commission of such crimes by making it clear to the offender and to other persons with similar impulses that, if they yield to them, they will meet with severe punishment" (emphasis added): R v Rushby [1977] 1 NSWLR 594 at 597 per Street CJ citing R. v Radich [1954] NZLR 86 at 87 (adopted by this Court in Capral Aluminium at [72]).

[70] Further, I would note that it has been described as "the fundamental duty of this Court" to ensure that any penalty imposed is severe enough to "compel attention to occupational health and safety issues so that persons are not exposed to risks to their health and safety at the workplace": Fisher v Samaras Industries Pty Limited (1996) 82 IR 384 at 388 adopted in Capral Aluminium (at [74]).

65 Whilst the offences in this matter are less serious than those which may otherwise come before this Court, there is a need, in my view, for general and specific deterrence. It is necessary to emphasise that substances, such as phostoxin, must be stored with the utmost care and caution because of the very significant risks they pose to employees and to the public at large. It should also be emphasised that information is readily available, in the form of "Material Safety Data Sheets", as to the health hazards associated with such substances and the precautions which should be adopted for their safe use and handling. The failure to properly guard machinery continues to be a significant cause of injury in the workplace and should be deterred by an appropriate penalty.

66 It is also necessary to emphasise, having regard to some of the submissions of the defendant, that the conduct of a business in rural areas (even those conducted in remote locations), does not excuse full compliance with the terms of the Act which impose rigorous requirements as to the occupational health and safety of employees and other persons having contact with workplaces.

67 It is also appropriate to ensure the penalty reflects specific deterrence (having regard to the principles stated in Capral) because the defendant has made it plain that it intends to continue its beekeeping business in such a manner as will necessarily involve the use of chemicals and equipment of the kind referred to in the charges. However, the Court has paid regard, in this respect, to the circumstances of the offender and has noted that the defendant in this matter gave prompt and complete compliance with improvement and prohibition notices served upon it.

68 I have also had regard, in assessing the objective seriousness of the offence, to the fact that simple remedies were available to the defendant in order to remove the risk to safety in this matter.

69 The final matter concerning the objective seriousness of the offence which I have taken into account is that the maximum penalty for each offence charged is $550,000.

70 The Court shall turn now to the subjective features of this matter.

71 The Court shall firstly consider the discount that should be allowed for the defendant having entered a plea of guilty. It will be recalled that Mr Skinner submitted that the Court should treat the pleas of guilty entered in Matter Nos. IRC3955 and 3957 of 2000 as having been entered at the earliest opportunity (and thereby attracting a discount at the high end of the scale in R v Thomson, but that the plea in Matter No. IRC3954 of 2000 should attract a lower discount as the plea was not entered until the hearing of the matter.

72 During the course of his submissions on this matter, Mr Skinner referred, at the invitation of the Court, to Cameron. In the light of the judgment of the High Court in Cameron, those submissions tended to focus upon changes which had been agreed to be made to the charge in Matter No. IRC3954 of 2000 prior to the date of hearing and as to whether that circumstance would warrant the granting of a full discount for the plea of guilty. However, since the judgment in Cameron the Court of Criminal Appeal in this State has held that the reasoning of the judgment in Cameron does not apply in this State: R v Sharma (2002) 54 NSWLR 300 at [68]. Rather, it was held that the decision in R v Thomson at 383 should be followed (see also R v Cousins and Anor [2002] NSWCCA 340, although in that matter it was held that, although Thomson stated that the top of the range would be expected to be restricted to pleas entered at the earliest opportunity, that statement did not mean that an early plea automatically brought a discount at the top of the range as discounts would depend, amongst other things, on the length and complexity of the trial, the cost of which had been saved (at [21])).

73 Spigelman CJ (with whom Woods CJ at CL, Foster A-JA and Grove and James JJ agreed) in Thomson stated guidelines applicable to offences against the laws of New South Wales as follows: (i) A sentencing judge should explicitly state that a plea of guilty has been taken into account. Failure to do so will generally be taken to indicate that the plea was not given weight. (ii) Sentencing judges are encouraged to quantify the effect of the plea on the sentence insofar as they believe it appropriate to do so. This effect can encompass any or all of the matters to which the plea may be relevant - contrition, witness vulnerability and utilitarian value - but particular encouragement is given to the quantification of the last mentioned matter. Where other matters are regarded as appropriate to be quantified in a particular case, e.g. assistance to authorities, a single combined quantification will often be appropriate. iii) The utilitarian value of a plea to the criminal justice system should generally be assessed in the range of 10-25 percent discount on sentence. The primary consideration determining where in the range a particular case should fall, is the timing of the plea. What is to be regarded as an early plea will vary according to the circumstances of the case and is a matter for determination by the sentencing judge.

(iv) In some cases the plea, in combination with other relevant factors, will change the nature of the sentence imposed. In some cases a plea will not lead to any discount.

74 Having regard to those principles, it appears to the Court that the following history is relevant in determining the question raised by the prosecutor in this matter: (1) On 24 May 2001, the defendant indicated that it would enter a plea of not guilty in Matter Nos. IRC3954 and 3956 and a plea of guilty in Matter Nos. IRC3957 with the plea in Matter No. IRC3955 reserved until the next call-over before the Industrial Registrar. (2) On 7 June 2001, the defendant entered a plea of guilty in Matter No. IRC3955. In the result, the defendant entered two pleas of guilty by June 2001, which the prosecutor accepted were pleas entered at the earliest possible time. (3) On 8 August 2001, the prosecutor and defendant agreed that the matters for which a not guilty plea had been entered would be set down for trial over four to five days. The parties would agree on a programme. An agreed programme was forwarded to the Court on 22 August 2001 and, having regard to the available dates for the legal representatives of the prosecutor and the defendant, the matter was set down for hearing over five days in March 2002. (4) In February 2002, the defendant advised that it intended to enter a plea of guilty with respect to Matter No. IRC3954 of 2000 and that the prosecutor had agreed to withdraw the charge with respect to Matter No. IRC3956 of 2000. In the result, it was requested, by consent, that three days of hearing be vacated and the remaining two days be allowed for the plea. The Court forthwith vacated the days so as to make them available for other aspects of the Court's business. (5) The amended application in Matter No. IRC3954 of 2000 resulted in a reasonably substantial reduction in the particulars of the charge in that matter - the particulars being altered from a failure to safely use and store the phostoxin to a failure to safely store that substance.

75 Having regard to the history of the matter, the defendant should be given a moderate discount for the plea of guilty in Matter No. IRC3954 of 2000 (when the utilitarian aspects are assessed with other relevant factors referred to in R v Thomson). The defendant should receive a discount at the top of the range for its plea of guilty (and other relevant factors referred to in R v Thomson) for the remaining charges. The Court has taken into account the contrition of the defendant and the very substantial assistance to and co-operation with the authorities by the defendant both during the investigation and in the implementation of the improvement notices issued to the defendant. I have in mind, in this latter respect, the changes introduced to the operations of the defendant after the issuing of the notices.

76 Before turning to the actual discount allowed for the subjective features, it should be noted that the defendant has no prior record and given that, as at the date of the charges, the defendant had not been known to the prosecutor, the defendant should be treated as having a good record. It has been a good industrial citizen and is of good character.

77 Having regard to the aforementioned subjective features, I consider a total discount of thirty percent should be allowed for Matter No's IRC3955 and 3957 of 2000 and twenty percent for Matter No IRC3954 of 2000.

78 There are two further matters requiring attention in this matter, the financial means of the defendant and the principle of totality.

79 The defendant raised its financial means in mitigation of penalty. I shall apply, in the consideration of that issue, the discussion of the relevant principles concerning the financial means of a defendant in Schrader at [83] - [85], as follows:

[83] The financial means of the defendant was a matter that was submitted in mitigation of penalty. In this regard I would adopt what I stated in Department of Mineral Resources v A M Hoipo & Sons (at [50]): It is proper, nonetheless, to have regard to the financial position and means of the defendant when considering the question of penalty: see Ferguson v Nelmac Pty Limited (1999) 92 IR 188 at 209. The purpose of a fine is primarily to punish the offender. The burden which will be imposed by virtue of a fine at a particular level will, to some extent, depend upon the financial circumstances and resources of that offender. As a result, the amount and method of payment of a fine will need to take into account, as far as practicable, the financial resources and income of the defendant: see R v Sgroi (1989) 40 A Crim R 197 at 200 - 201.

[84] This approach was subsequently adopted in Manpac Industries where the Full Bench of this Court stated (at [81] - [82]): ... Section 6 of the Fines Act 1996 provides that in exercising a discretion to fix the amount of any fine a court is required to consider the means of the accused and such other matters as are relevant to the fixing of that amount. That statutory injunction, of course, has long been recognised as an appropriate part of the sentencing process: see, for instance, Warman International (80 IR at p339); WorkCover Authority of New South Wales (Inspector Dowling) v Overtop Pty Ltd (1998) 86 IR 319 at p333; and Profab Industries (49 NSWLR at p714, 100 IR at p76).

However, and given the primacy of the objective seriousness of an offence in determining an appropriate sentence, the financial situation of a defendant, in our view, needs to be carefully scrutinised. In Ferguson v Nelmac Pty Ltd (1999) 92 IR 188 at pp209 - 210, Wright J, President observed :

... Whilst I accept that the imposition of heavy fines would be a burden on the defendant and its financial resources and that consideration should be given appropriate weight on the question of penalty, it does not necessarily result in the Court not imposing a heavy penalty. ...

When viewed in the context of the statutory mandate in s 15 the offences were very serious and provided proper weight is given to the subjective considerations and insofar as deterrence is concerned some tempering thereof, the penalty should reflect the objective seriousness of the offence. ...

[85] I would reiterate what the Court stated in WorkCover Authority of NSW (Inspector Ankucic) v Lyndhurst Trading Co Pty Ltd (2000) 95 IR 462 (at 476): Where the means of the defendant to pay any fine is raised, the proper course will be to assess the appropriate amount of the fine having regard to the gravity of the offence charged and then reduce the fine to take into account the defendant's means and impecuniosity: see Rahme (1989) 43 A Crim R 81 at 86

(See also Inspector William Hopkins v Michael Wheritt trading as M J Wherritt Concrete Pumping Services [2002] NSWIRComm16 at [59] - [60]).

80 In addition to those matters and, having regard to the submissions of the prosecutor and the defendant, I also have taken into account the judgment of Wright J, in Ferguson v Nelmac and, in particular, the following aspect of his Honour's judgment (at 209): The financial position and more particularly the means of the defendant should be taken into account in relation to the question of penalty. Otherwise it is inappropriate to consider the fact or amount of legal costs, consulting and other fees. In any event, it was not submitted that I should. I should, as submitted by counsel for the informant, consider not only the financial information included in the correspondence from the accountants, but also the defendant's asset position. Whilst I accept that the imposition of heavy fins would be a burden on the defendant and its financial resources and that consideration should be given appropriate weight on the question of penalty, it does not necessarily result in the Court not imposing a heavy penalty. ...

81 I consider that the defendant has established that it is suffering financially from a variety of factors. In coming to this view, I have not taken into account the legal costs incurred by the defendant in these proceedings or the potential cost of the imposition of a fine but nonetheless find that the defendant has established a significant case warranting its financial means being taken into account in the assessment of penalty. This consideration will result in a lower penalty than might have otherwise been imposed in this case. Before leaving the question of the financial means of the defendant two matters are worthy of note: 1. It is relevant to consider whether a significant fine may have a major impact upon the defendant's viability: WorkCover Authority of NSW (Inspector Page) v Walco Hoist Rentals Pty Limited and Another (No 2) (2000) 99 IR 163; 2. I do not consider that the future prospects of the defendant are a material consideration in this respect, as was suggested by the prosecutor, particularly where, in this case, there was no substantial evidence as to just what those prospects might be.

82 Before imposing penalty it is necessary to have regard to the principle of totality. The defendant raised this issue and submitted that the principle should be applied to the two charges concerning the unsafe storage of "chemicals" because of the common elements of the offences. It was submitted that the principle of totality would not be applicable to the guarding offences. No contrary submission was advanced by the prosecutor.

83 In Crown (Department of Education and Training) v Keenan, a Full Bench of this Commission considered the principle of totality. It was stated (at [22] and [23]):

22 In Pearce v The Queen (1998) 194 CLR 610, however, the majority of the High Court rejected this approach. That case concerned an offender charged with two offences - the malicious infliction of grievous bodily harm and the infliction of grievous bodily harm during a break and enter - which both arose out of the same incident. The majority, McHugh , Hayne and Callinan JJ, stated: [45] To an offender, the only relevant question may be "how long", and that may suggest that a sentencing judge or appellate court should have regard only to the total effective sentence that is to be or has been imposed on the offender. Such an approach is likely to mask error. A judge sentencing an offender for more than one offence must fix an appropriate sentence for each offence and then consider questions of cumulation or concurrence, as well, of course, as questions of totality.

[46] Sentencing is not a process that leads to a single correct answer arrived at by some process admitting of mathematical precision. It is, then, all the more important that proper principle be applied throughout the process.

[47] Questions of cumulation and concurrence may well be affected by particular statutory rules. If, in fixing the appropriate sentence for each offence, proper principle is not applied, orders made for cumulation or concurrence will be made on an imperfect foundation.

[48] Further, the need to ensure proper sentencing on each count is reinforced when it is recalled that a failure to do so may give rise to artificial claims of disparity between co-offenders or otherwise distort general sentencing practices in relation to particular offences. (references omitted, emphasis added)

23 The effect of Pearce is that, in sentencing a defendant for more than one offence, the Court is required to fix an appropriate sentence for each offence and then consider questions of cumulation, concurrence and totality. It is only after determining an appropriate sentence for each offence that the Court should consider whether the sum of the separate sentences properly reflects the totality of the criminality involved.

84 The Court then proceeded to examine "Common Elements of Multiple Offences" and stated (at [30]):

30 The principle underlying the appellant's submissions was that a defendant should not be punished more than once for the same failures which may be the subject of multiple offences. This issue was considered by the High Court in Pearce at 623. In that case, McHugh , Hayne and Callinan JJ stated the principle in the following way: To the extent to which two offences of which an offender stands convicted contain common elements, it would be wrong to punish that offender twice for the commission of the elements that are common. No doubt that general principle must yield to any contrary legislative intention, but the punishment to be exacted should reflect what an offender has done; it should not be affected by the way in which the boundaries of particular offences are drawn. Often those boundaries will be drawn in a way that means that offences overlap. To punish an offender twice if conduct falls in that area of overlap would be to punish offenders according to the accidents of legislative history, rather than according to their just deserts. (emphasis added)

85 After considering the judgment of Wright J, President, in WorkCover Authority of NSW (Inspector Mulder) v Yass Shire Council (2000) 99 IR 284, the Full Bench undertook the following further discussion as to the principle of totality (at [34] - [38]): 34. In Warman International Limited v WorkCover Authority of New South Wales (1998) 80 IR 326 (a case decided before Pearce ), a Full Bench of this Court treated the fact that different offences have strong connecting features as supporting the application of the totality principle. In that case, the Full Bench considered the appropriate penalties for a defendant convicted of five offences under the Occupational Health and Safety Act (under both sections 15(1) and 16(1)), and one offence under s 27(1) of the Factories Shops and Industries Act 1962. Those offences arose out of four accidents and one inspection at the defendant's premises. The Full Bench stated (at 339) that:

There were in our view clear features connecting a number of these events to each other. The first prosecution concerned a sheet metal rolling machine, which would appear to stand alone. The second and third prosecutions both related to the use and fencing of a fast loop moulding machine. The fourth prosecution related to a table mounted circular saw of some age which was sought to be replaced after the relevant accident by a new saw which itself, although freely available on the market, had two identified safety weaknesses which led to the fifth and sixth prosecutions. This inter-relationship seems to us to satisfy with considerable ease the proposition involved in the principle of totality that there be some similarity in the offences. 35. Subject to one consideration, that judgment reflects an appropriate application of the principle of totality, reflecting the need to avoid excessive punishment and to avoid "double punishment" for common elements of multiple offences. The last sentence of the passage cited, however, which seems to limit the circumstances in which the principle of totality is to be applied, appears to state the principle too narrowly and may well require reconsideration in subsequent Full Bench proceedings. See, for example, the judgment of the Court of Criminal Appeal in Close (1993) 65 A Crim R 55 at 59-60 where Hunt CJ at CL stated: Whenever sentences are accumulated, careful consideration must always be given to the principle of totality - as to whether the simple addition of two or more sentences which may individually be appropriate has nevertheless produced a total figure which is excessive having regard to the totality of the criminality involved: Glenister [1980] 2 NSWLR 597 at 612; Holder and Johnston [1983] 3 NSWLR 245 at 260-261; (1983) 13 A Crim R 375 at 389-390. That principle is not restricted to sentences imposed for offences committed as part of a connected and roughly contemporaneous series of offences: L Vogel & Son Pty Ltd v Anderson (1968) 120 CLR 157 at 168; Bakhos (1989) 39 A Crim R 174 at 176, 177-178; Harrison (1990) 48 A Crim R 197 at 198-199. It was clearly relevant in this case. In such circumstances, all of the sentences which are accumulated should usually be adjusted downwards in order to produce an acceptable total sentence. A similar approach was taken by Sheller JA at 56-57 and by Sully J at 70. However, this appeal does not require for its determination the resolution of that issue.

36. This review of the authorities establishes that in determining penalties for multiple offences under the Occupational Health and Safety Act the Court is required to determine separately an appropriate penalty for each offence. Having done so, the Court should then consider what the appropriate penalty should be by applying the principle of totality. Where the multiple offences contain common elements, the principle of totality must, for that reason alone, be applied to ensure that the defendant is not punished more than once for the common elements of the offences and to avoid the double jeopardy that would follow if that occurred. The principle must also be applied for the reasons stated in Pearce and Mill .

37. We should emphasise that the principle that a defendant is not to be punished more than once for the common elements of the offences does not require that a single penalty only should be imposed for the multiple offences. The Court is required to determine a separate penalty for each offence before applying the principle of totality. It will then usually be appropriate to fix separate penalties for each offence. It is in applying the principle of totality - which requires the consideration of the overall criminality involved in the offences - that regard should be had to the principle that a defendant is not to be punished more than once for elements which are common to the offences as well as ensuring the aggregate sentence or penalty is just and appropriate.

38. In accordance with Pearce , we must first consider the appropriate penalty for each offence, assessed separately.

86 The decision in Crown (Department of Education and Training) v Keenan has been applied in a number of decisions of this Court where common elements have been found between offences: WorkCover Authority of NSW v Transfield at [42]; WorkCover Authority of NSW (Inspector Thomas Clark) v Ledonne Constructions Pty Limited [2001] NSWIRComm 272 at [32]; Inspector Mayo-Ramsay v Rail Infrastructure Corporation [2002] NSWIRComm 217 at [69] and Inspector Brett Martin v True Perspective Pty Limited [2002] NSWIRComm 197. However, in Inspector John Patton v Brambles Australia Limited t/as Gardner Perrott [2002] NSWIRComm 178, Kavanagh J expressed a view that Keenan was not authority for the proposition that it was a necessary precondition for the application of the principle of totality for there to be similarity in the offences or common elements in the offences. In that matter her Honour found that the charges did not contain common elements "in the nature of the breaches as pleaded" but nonetheless had regard to the "overall criminality of the defendant in setting final penalty". 87 88 Having regard to submissions of the defendant in this matter (and the prosecutor by its failure to adopt any contrary position), it may not be necessary to explicitly deal with the question as to whether the principle of totality may be confined to circumstances where there are common elements of multiple offences. It is certainly beyond doubt that where multiple offences contain common elements, the principle of totality must, for that reason alone, be applied to ensure that the defendant is not punished more than once for those offences and to avoid double jeopardy. The 'storage' offences in this matter, whilst arising respectively under ss15 and 16 of the Act, nonetheless contain common elements which properly require the operation of the principle of totality in the assessment of the penalty for those offences. As to the broader question raised in Brambles, it is sufficient, for present purposes, to note that the Full Bench in Crown (Department of Education and Training) v Keenan left open the question, in my view, as to whether the principle of totality might be applied in circumstances where a defendant was convicted of multiple offences which did not have 'common elements'. In any event, I have also had regard to the circumstances of the offences and the offender in assessing the overall criminality of the defendant in this matter.

89 I consider that the pleas of guilty were properly made in this matter and enter a verdict accordingly. Having regard to the proper approach to the operation of the principle of totality referred to by the Full Bench in Crown (Department of Education and Training) v Keenan, I shall firstly determine the penalty for each offence before applying the principle of totality. In doing so I will apply at that point the discount arising from the financial means of the defendant and the subjective considerations earlier identified. I consider that, having regard to the objective seriousness of the offence, and after allowing a discount for the subjective factors and taking into account the financial means of the defendant, an appropriate penalty with regard to each offence is as follows: Matter No. IRC3954 of 2000

I consider the appropriate penalty to be $5, 000. 90 Matter No. IRC3957 of 2000

91 However, applying the principle of totality to the charges in Matter Nos. IRC3954 and 3957 of 2000, I consider that the appropriate total penalty for the storage charges should be $25, 000. The penalty for each offence should then be: Matter No. IRC3954 of 2000

92 Finally, I note the parties' agreement as to costs that the prosecutor will pay the defendant the sum of $8,500. Further, the prosecutor should have a moiety of the fine. I also confirm the dismissal of charges in Matter No. IRC3956 of 2000.

93 I make the following orders: 1. The following fines are imposed on the defendant with a moiety thereof to the prosecutor: (a) As to Matter No. IRC3954 of 2000, $23, 000.

(c) As to Matter No. IRC3957 of 2000, $10, 000. 2. The prosecutor shall pay the defendant's costs in the sum of $8,500.

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.