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Safeguard OSH Solutions - Thomson Reuters

Safeguard OSH Solutions - Thomson Reuters



OSH Tracker

Department of Labour v Thomas Logging Ltd (DC, 05/07/11)

OSH Tracker

Defendant:
Thomas Logging Ltd
Thomas Logging Limited was fined $17,000 and ordered to pay reparation of $20,000 under s6 of the HSE Act after an employee was hit in the back by a log. The log had been flung out of a grapple operated by another employee while it was being slewed. The location of the safe zone had not been changed as required (Greymouth DC, July 5). 
Industry:
Agriculture, Forestry and Fishing
Sub-Industry:
Forestry and Logging
Risk:
Struck by moving object
Harm:
Injury
Penalty Amount:
$37000.00
Reparation Amount:
$17000.00
Appeared in Safeguard issue 129

Judgment Text

NOTES OF JUDGE C J DOHERTY ON SENTENCING 
Judge C J Doherty
[1]
On 22 September last year Antony Francis Finch was injured on a work site which was operated by Thomas Logging Limited. Thomas Logging is, unsurprisingly given its name, a logging contractor which has been operating in this area for the last five years. It operates in the bush had hauls out logs for various purposes. 
[2]
Mr Finch was one of the operators and, I take it from the facts which I have been given, was a chainsaw operator. He was not operating any of the machinery but was working on what is known as a skid site. That is an area which is carved out of the bush or the forest for the production of logs to go to either mills or for export. 
[3]
On this occasion Mr Finch was working in an area which had been designated a safe area. That is an area set aside after assessment and identification by all those involved so as to enable workmen on site to be safe. 
[4]
Unfortunately a small stem it has been called, I presume that means a small log, was flung out of a grapple attached to an excavator. The excavator was shifting logs in or about the site. This seems to have been a rather unusual occurrence but must have been something that was foreseeable. One never knows when things are not going to go the way you think. 
[5]
Mr Finch, as I have said, was standing in the designated safe area. The designated safe area had originally been identified and was an appropriate one when work first started on the skid site but things changed and the layout of the site had been altered a day or two beforehand. That meant the location of the safe area and changed relative to the rest of the site and was no longer in a safe position. 
[6]
Mr Finch sustained significant injuries and I have a list of them which is in medical speak. But to put it in simple terms, he was significantly compromised in his internal organs, his peritoneum was bruised. His pancreas and duodenum were displaced. He had a significant injury to one of his kidneys. At least three of his vertebrae in the lumbar spine, which is the middle bit of the spine, were fractured. He had trauma injuries to some of the internal veins which are significant in the body. He was hospitalised for nine days and has now made a recovery and is back at work. However he still suffers from lumbar back pain and pain around the kidney area. He says he sometimes feels nauseous and suffers from headaches. 
[7]
In between then and now he underwent significant trauma not just physically but also emotionally and mentally. He was not able to enjoy his family over the Christmas time. His being homebound caused him significant angst. It also caused significant financial hardship. It put great pressure on his partner and their relationship. His physical difficulties meant he had to have assistance for things such as personal hygiene, washing and his toiletry. There was a strain put on the relationship between him and his partner because of his inability to fulfil her needs as well as his. They have had to rely significantly on their own friends and family to assist them which must have been a difficulty for independent people. 
[8]
He also had the angst of not really knowing whether he was going to get better or, if he was, to what extent and whether or not he could work in the same industry. He was worried about relocation. Ultimately that seems to have resolved itself and he is back at work in the same place. 
[9]
I think it would be fair to say that his existing financial situation was not necessarily on a tightrope but the fact that he was unable to work and receive less than his full wage because he was on ACC was a significant aspect and caused a great deal of stress between himself and his partner. 
[10]
All of this is significant because the Higher Courts have said that in the sentencing process such as this one must first start with assessing whether or not there ought to be compensation to people like Mr Finch by way of reparation for either physical, consequential or emotional loss or harm. One ought not to underestimate the emotional harm caused by such things as evidenced in that list that I have just expounded relating to Mr Finch's exact position. The inability to care for oneself, the pressures it puts on family and partners and the wider family ought not to be underestimated. It is very easy to think that just because someone is not as badly hurt as another person that that means that the harm to their emotional wellbeing is any the lesser. 
[11]
I have the job of assessing where that harm might lie and how it should be compensated. I have been assisted by submissions for both the informant and Thomas Logging. They, in referring to other cases, seem to be agreed that something in the region of $15,000 would be an appropriate award. 
[12]
They have referred me to cases such as BBL Contracting (DC Gisborne, CRI-2009-016-1603, 13 April 2010) and AI Contractors Limited (DC Hastings, CRN1004150093 11 April 2011) but read what information is available in relation to those cases. It is very hard to determine just exactly how the Judges came to those amounts. So while they might be a guidance, I have got to make up my own mind. I have done that as best I can. I do not agree with the informant or the company on the level. I think that $15,000 is a bit low but my figure is in the ball park and as best I can I think that Mr Finch ought to be compensated to the tune of $20,000 by way of reparation. 
[13]
The next task is to look at what other penalties should be imposed on Thomas Logging. One must do that in the setting of a fine because that is the only other mechanism there is under the section of the Health and Safety in Employment Act 1992 because this is a fineable only section that the company has been charged under. To do that I have to take into account the purposes of sentencing from the Sentencing Act which in this case is to hold the company accountable, to denounce the conduct of it and to deter not just Thomas Logging but any other person in this or a wider industry from committing the same or similar offences. 
[14]
I also have to take into account the principles of sentencing that apply and I agree with both counsel that in this case it is the gravity of the offending, the seriousness of the offence and the effect on Mr Finch. It is the assessment of culpability or blame-worthiness that is the primary task here. In doing that the counsel are agreed that there are a number of matters that need assessment - the identification of the acts or omissions which related here. The informant says that it is particularly important to reassess site hazards when there is a change to them and that is the case. The defendant says that the employer, that is Thomas Logging, did conduct a hazard assessment but made the wrong decision. Therefore that is, in my view, the recognition by the company of the importance of hazard identification and frankly they fell down here. 
[15]
I have already talked about the risk of harm in circumstances where one is in a logging industry with hazardous conditions, machinery lifting and placing logs in proximity to those who are cutting and administers to them. There is a high risk of potential for serious injury. 
[16]
It seems to me also that there was an obviousness here which the company missed. It must have been within their contemplation that with a tighter work site or tighter skid site the risks would have increased. It is also important to note that the identification of a safe area by its very name is something which employees and workers ought to be able to rely on. It was a designated area set aside for them to ensure that they could work there with safety, without having to look over their shoulder every minute of the day. I have talked about the harm that did occur to Mr Finch and I will say no more. 
[17]
The company ought to have been aware, and I think was aware, of the need to do things right on sites like this. There are approved codes of practice for safety in forest operations and there are best practice guidelines for such logging operations. A perusal of those shows that these skid sites are identified with the hazards that we have been talking about in this case. It is a fact that the company did not follow these industry guidelines and therefore departed from what would be the ordinary industry standards. 
[18]
The Higher Courts have given indications to sentencing Courts that in cases of this nature there are a number of what are known as bands of culpability. For low culpability fines of up to $50,000. For medium culpability a fine between $50,000 and $100,000. High culpability, $100,000 to $175,000. It must be remembered that the maximum fine applicable to cases such as this is in excess of $200,000. 
[19]
Both counsel are agreed and I agree with them that in this case we are in the medium culpability band. That is a fine between $50,000 and $100,000. My job is to set a starting point and to decide where in that band I should start before making any additional or deductions for other matters. The informant thinks I should be at $80,000. The company's lawyers, somewhat less than that and I think the informant has got it pitched a bit high. This was not a case within the band of medium culpability where there was an ignoring of all these procedures. There had been an appropriate assessment and designation made at the outset. There were some errors made in reassessing that and then setting an appropriate point. To an extent it is al little arbitrary but I think that within the band a starting point of $60,000 is appropriate. 
[20]
There are no other aggravating features such as to enable or to mean I should increase that. There are, however, a number of mitigating factors which are agreed between counsel and which seem to me to be appropriate. Those are the fact that the company did co-operate with the investigating department. It took remedial action in relation to its processes. It has expressed remorse both through the submissions of counsel and by way of interaction between it and Mr Finch. It has an exemplary safety record to date and it has made offers of reparation and has paid some money to Mr Finch. 
[21]
For that, I need to make an appropriate reduction. I also need to reduce that starting point of $60,000 to take into account the reparation figure that I have just set. Having done that I agree with counsel that 25 percent in reduction is appropriate. That reduces my starting point to $45,000. 
[22]
There is no doubt also that Thomas Logging pleaded guilty at the first available opportunity. When the matter was brought before the Court on the first appearance it entered a guilty plea and for that the Higher Courts recognise, as sentencing Courts like this do, that a further reduction of 25 percent is appropriate or thereabouts. 
[23]
That therefore brings me to $34,000 by way of a fine. That is not where it ends though because I have to assess the ability of Thomas Logging Limited to pay that fine. I have had a couple of affidavits both from the managing director and ostensible principal, Mr Thomas and also from his accountant as to the financial position of the defendant. What they are really saying is that this company is not in a position to pay the full fine or indeed any fine at all. They say that they would find great difficulty although I think somewhere Mr Thomas said that the company would be able to borrow up to $10,000 to meet a fine. 
[24]
It is very difficult to make these assessments but when I look at the financial accounts in the affidavits it is clear that this is a business that goes up and down and has its moments where it is making money and perhaps money where it is not. It has been going through a bit of a tough patch of late but it is an industry where there is a dependence perhaps on the ability to sell logs overseas or in the local market which comes and goes. This company has been able to survive the last five years and it has also been able to survive notwithstanding what have cropped up in its business as surprises in the past. There is evidence here of an unexpected increase in the amount of GST that has had to have been paid. The company seems to have been able to accommodate that. 
[25]
It also has a majority shareholder which is a trust which, at least as far as I can make out, is the alter ego of Mr Thomas, the managing director. At least he has an influence over it. That is a company that has been making significant advances and, having been repaid, I note the latest set of accounts show effectively a loan from that trust in excess of $143,000 but it has taken back out nearly $120,000. So there seems to be accommodations within their business arrangements. 
[26]
Having said that I do not think this is a company which ought to have to bear the full brunt of the $34,000. As best I can determine, looking back and taking into account reparation of $20,000 an appropriate fine is $17,000 and that is what I impose. I also impose Court costs of $132.89. Reparation of $20,000 is to be paid to Mr Finch within 28 days. 

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