Yes, this custom He that stealeth ore twice is fined, and the third time struck through the hand with a Knife unto the haft into the stowe and is there to stand until death, or loose himself by cutting off his hand.”
comes up in the course of the story.

the book is about a town that is suffering from the effects of an outbreak of plague, and one of the former miners becomes a gravedigger, who overcharges, after the sexton has died of plague.

at one point, he takes a man who has gotten the plague, but has actually survived, and feeling cheated, the miner buries him alive, and steals his fee for gravedigging!
the surviver escapes (the grave was shallow) and the gravedigger is hauled before the mining board, the only authority left in town (alive!) and his pushiment is as decribed..

the narrator claims that most often, a family members came after nightfall, and removed the knife, (but the miner would be left crippled by the events) and it was not really a death sentence.