Court File and Parties

Court File No.: Central East - Newmarket - 10-2130 Date: 2013-12-18 Ontario Court of Justice

Between: Her Majesty the Queen — and — Reliable Wood Shavings Inc.

Before: Justice Peter N. Bourque

Counsel:

• Shantanu Roy, for the Crown
• John Ilingworth, for the accused

Heard: December 18, 2013

Reasons for Sentence

BOURQUE J.:

Overview

[1] On September 18, 2013, I found the defendant guilty of four offences under section 25 of the Occupational Health and Safety Act, arising from a workplace accident on July 14, 2009.

[2] The parties agreed at the time I delivered my judgment that count 1 should be stayed as a result of the principle in R. v. Kienapple, and the defence wished to make submissions that counts 3 and 4 should also be stayed. At the outset of the sentencing submissions, the Crown agreed that counts 3 and 4 should also be stayed. I therefore stay counts 1, 3, and 4, and a conviction will be registered upon count 2 only. Both parties agreed that the total sentence that I would impose in this matter would not change because of this and I could take into account the findings of fact behind the initial findings of guilt on all counts.

The Facts

[3] The complete factual basis upon which I made findings of guilt are contained in my Judgment. The following is a summary of my findings.

[4] Glen Gallinger was an employee of Reliable and worked as a "blower truck" operator. It was his job to attend at various wood working mills, and there to load into the box of his truck wood shavings which had been produced by the mill.

[5] Reliable was in the business of buying wood shavings from mills and then re-selling the product to other users including manufacturing and farming businesses.

[6] Northern Wide Plank Flooring ("Northern") is a mill where the defendant company regularly picked up wood shavings. Glen Gallinger had attended at these premises many times before. The wood shavings were collected by backing a truck into a shed underneath a silo where the shavings had been fed. The silo held approximately 74 cubic yards of wood shavings and the defendant company was summoned to empty the silo when it was almost full.

[7] The silo had a "clam shell" door at the bottom. When it functioned properly, the operator would stand back and operate a series of switches located on the end of a long chord. He would open the silo and the material would drop into the box of the truck. The operator would have to move the truck part way into the process to collect all of the material into all parts of the box of the truck.

[8] Ninety-five per cent of the time, the material would not fall into the truck when the doors were opened. The operator would have to stand inside the truck on a "rake" and prod the material with a stick (not specifically designed for this purpose) and after doing this, for sometimes up to an hour, the material would fall into the truck.

[9] I have found that this procedure as prescribed by the defendant to remove this stuck material was not a safe procedure under the Act.

[10] Some weeks before the accident, the deceased in conversation with the owner of Reliable, spoke of an "easier" procedure where he would sit on a plank across the box of the truck and prod the material with a fork. Notwithstanding the directions of the owner not to use the procedure, it is more likely that the deceased continued to use this procedure.

[11] On July 14, 2009, while attempting to dislodge this material the defendant fell into the box of the truck and the material engulfed him and he suffocated.

[12] I found that the defendant was guilty of four infractions under the Act for failure to have the material moved in a safe fashion, failure to provide a safe procedure for moving the material and for not taking every precaution reasonable in the circumstances for the protection of a worker.

[13] It is implicit in my Judgment that I felt that the workplace scene where the defendant expected the deceased to work was very unsafe and the procedure expounded by the defendant to perform the task was in and of itself unsafe and even if the deceased utilized a different procedure (that may in and of itself been more unsafe), it was not unreasonable that this worker would attempt to utilize a procedure that was "easier" than the one expounded by the defendant. There was nothing about this scenario which was not unsafe.

Positions of the Parties

The Crown

[14] The Crown is seeking a fine in the amount of $140,000.00.

[15] The Crown stresses general deterrence and points out that where there is a death, which is directly connected to the delict, the fines are in the range of $100,000.00 to $200,000.00. The Crown also points out that while the defendant is a small company, the gross receipts of the company are approximately $2 million per annum. The maximum fine for a corporation is $500,000.00.

The Defendant

[16] The defendant is seeking a fine in the range of $40,000.00 to $70,000.00.

[17] The defendant points out that Reliable Wood Shavings Inc. is a small company and has grown smaller in the past 3 years. He asks me to consider the small nature of the company and the fact that the financial statements show a very narrow or non-existent operating profit.

The Law

[18] As stated in R. v. Cotton Felts Ltd.:

The…Act is part of a large family of statutes creating what are known as public welfare offences. The Act has a proud place in this group of statutes because its progenitors, the Factory Acts, were among the first modern public welfare statutes designed to establish standards of health and safety in the work place. …They ensure standards of conduct, performance and reliability by various economic groups and make life tolerable for all. To a very large extent the enforcement of such statutes is achieved by fines imposed on offending corporations. The amount of the fine will be determined by a complex of considerations, including the size of the company involved, the scope of the economic activity in issue, the extent of actual and potential harm to the public, and the maximum penalty prescribed by statute. Above all, the amount of the fine will be determined by the need to enforce regulatory standards by deterrence.

[19] The Court went on to state in paragraph 22 that with regard to the fine, "…without being harsh, the fine must be substantial enough to warn others that the offence will not be tolerated. It must not appear to be a mere licence fee for illegal activity."

[20] In the case of R. v. Servello Carpentry Ltd., my sister Judge A.M. Hourigan of the Ontario Court at Newmarket, on an appeal from Provincial Offences Court, set out the appropriate and the inappropriate factors to take into account when considering the fine under this legislation. She found that the legislation specifically treats corporations and individuals differently and thus issues of "parity" between them are irrelevant. Hierarchy of responsibility is also irrelevant as the statute specifically speaks of the joint and several liability of different parties. (In this case, I noted the potential liability of the owner of the silo, but noted the joint liability).

[21] The Court also noted that with regard to the scope of economic activity of the defendant, it is the total economic activity of the defendant over a number of years that must be considered (not just the value of the project where the accident occurred), so that the ultimate fine "makes a significant impact upon their pocketbook".

[22] The Court restates that the court must have due weight to the injury caused (in our case death) and its further effects upon the family of the deceased, and the principal of general deterrence. As stated by Hourigan J. in her decision, "he (Justice of the Peace) did not give this concept any teeth, given the relatively low fine he imposed."

[23] As stated in more than one case the concept of general deterrence is to not only give a message to this defendant, but to give a message to the industry as a whole that the integrity of the public welfare protection system must be maintained, and that health and safety in the workplace and compliance will be insisted upon, and that failure to comply will have serious consequences.

The Factors

The Harm and Potential Harm

[24] As stated in the cases, the actual and potential harm to the public must be considered. I have had the opportunity of reviewing the letter from the sister of the deceased, Ms. Deborah Gallinger-Peacocke. She speaks most eloquently of the loss of her brother and also with kindness to those that assisted her, including the defendant. She speaks of the most telling issue to family members when one of their siblings has died by saying, "I will miss the comfort of having him by my side as we grow old".

[25] Death is the most serious result of an industrial accident and I must keep this in mind as I proceed.

[26] The defence has argued that where there is "employee misconduct" or "worker error" then I can consider that in reducing the fine. He cites to me the case of R. v. Hershey, where Justice March imposed a fine of $50,000, and took the "worker misconduct" into account. I have the greatest deference for Justice March but I do not see that principle enunciated in any of the other jurisprudence, other than to take the blameworthiness of the defendant into account in each specific situation. In any event I did not find worker error and explicitly noted that it was foreseeable that the deceased would look for an easier method of doing the silo unloading at the Northern mill. I also note the distinction here, in that I explicitly found that the method of unloading the silo as directed by the defendant was in itself an unsafe method.

The Economic Circumstances of the Defendant

[27] The defendant has filed a draft financial statement for the year ending July 31, 2013. The gross revenues of the business are just in excess of $2 million. I note that this is almost unchanged from the previous year.

[28] The gross profit of the company (deducting only cost of sales) is approximately $1.5 million. There are several expenses and deductions from these figures and while the company had net earnings of $202,000.00 in 2012, in 2013 it shows a loss of $31,677.00.

[29] I note that this discrepancy could be attributed to management salaries (which were not previously payable) and significant legal fees (the cost of this litigation perhaps). Ultimately, I must consider that the defendant has been operating for many years a business which generates some $2 million in revenues and this seems to be a consistent figure. I cannot delve into each and every facet of his business and accounting practices to determine what the net worth of this business would be. I can only say that if it was only in business to lose money, it could not have stayed in business for so long. I also am aware that this business is not a large multi-national with hundreds of employees.

[30] The cases repeat however in many different circumstances that the ability to pay a fine should never trump the consideration of general deterrence. Even in situations where the company is insolvent does not mean that a lower fine should be imposed.

[31] I also note that with regard to the ability to pay a fine, courts have held that time to pay is a useful ameliorating factor when the fine would do a significant harm to the operation of a business.

Other Mitigating Factors

[32] I found that the defendant was sincere in his belief that his method of unloading the silo at Northern was a safe one. I found that he took steps afterwards (leaving the trucks there) which contributed to worker safety. While there was no plea of guilty, I find that the defendant was sincere in his remorse for the death of his employee and by the victim impact statement, he did reach out to the family of the deceased employee. I also found in my reasons that there was some responsibility upon the silo owner (Northern) for the sorry state of the functioning of the silo. I also take into account that the defendant did have some safety procedures in place and had taken steps to admonish the defendant for an unsafe practice.

[33] Don Maschinter, the principal of the company spoke at the sentencing. He was sincere in the sorrow that this accident has caused himself and his wife. He believed that he had tried his best and wished to move on.

[34] I assess all of these factors in coming to an appropriate sentence.

Range of Sentence

[35] Reviewing the cases, where there is death, there is a general (and very large) range of sentence from $70,000.00 to $175,000.00, with extreme lows of under $50,000.00 and highs of over $200,000.00. The majority of the cases appear to be within a range of $100,000.00 to $150,000.00. It is my opinion that the appropriate sentence in this matter falls within this range. It is within that range that I can take into account the financial and other factors which I have referred to above. I also consider the impact of the victim fine surcharge which ultimately increases by 25 per cent any fine that I impose.

Conclusion

[36] The defendant will be fined the sum of $115,000.00. I will give the defendant 2 years within which to pay the fine.

Signed: "Justice P.N. Bourque"

Released: December 18, 2013