Council of the City of Botany Bay v Admiral Management Group Pty Ltd

EX TEMPORE Judgment 1The defendant, Admiral Management Group Pty Limited is the lessee of premises at 917 Byrnes Street, Botany. On 9 July 2011 the applicant, Botany Bay City Council, commenced proceedings against Admiral seeking an injunction to restrain Admiral from using the premises for the reception, warehousing and distribution of goods and freight and for the storage of maritime containers and for the administration of such uses. The council also sought an order that Admiral not recommence any such use in the absence of development consent. 2On 9 December 2011, Admiral entered into consent orders with the council, which were entered by the Court on 13 December 2011. The effect of the orders is that the injunction sought by the council was made but was postponed for six months to assist Admiral to regularise its use of the premises. Consequential orders were made setting out conditions under which the premises may be used in the interim and with a view to ameliorating the impact on nearby residences. 3The council now brings a notice of motion charging Admiral with contempt of court. Not only has Admiral not yet obtained development consent but in its use of the premises it has also breached some of the consequential orders designed to ameliorate its impact on nearby residences. 4The parties have relied upon an agreed statement of facts which I will now summarise. Admiral also relies upon an affidavit by Dennis Fateev, its sole director. Briefly stated, the subject premises are located in an industrial zone close to the Port of Botany. Residential homes, however, are located opposite and adjacent to the premises. One such street is Erith Street, Botany. Trucks operated by Admiral's employees use an entrance to, and exit from, the subject premises located in Erith Street. 5Admiral uses the premises for, amongst other things, the storage of maritime containers and as part of this use, trucks owned and operated by it, arrive at the premises where they load the containers which are then stacked and stored in the open. 6Truck drivers employed by Admiral collect containers from Port Botany in a system described by Mr Fateev in his affidavit. 7A difficulty facing Admiral is that priority is given in the bookings for the collection and delivery of containers to carriers registered with the Port as either category A or category B. Those in the A category are larger carriers. They are given priority and once they have made their bookings, the remaining clients' slots are available to the B carriers of which Admiral is a member, but these remaining slots are usually late at night or on the weekend. 8According to Mr Fateev, there are delays in collecting containers from the wharf which are beyond its control. Again, in delivering containers to the wharf for export, priority is given to the larger contractors. 9Admiral is responsible, according to Mr Fateev, for picking up containers that are packed by the Army for export to various war zones. These containers are marked as hazardous and therefore must be loaded on to the ship for export only within the last 12 hours of the ship's departure. This has meant that containers have in the past been delivered at hours which are either late evening or early morning and thus have caused disturbance to the local residences. 10As noted above, Admiral did not have development consent to use the subject premises. It still does not have development consent to use the premises for its purpose. It has lodged development applications in the past. The first was lodged in February 2007 but it was declined by the council because more information was required and the site was suspected to be contaminated as it was a former paint factory. Another development application was lodged in October 2008 but withdrawn at the request of the owner of the property. In March this year, another development application was lodged and rejected on the grounds that the owner of the property had not signed as a director of the company and thus the application lacked the owner's consent. 11According to Mr Fateev, Admiral has been frustrated in its endeavours for a number of reasons. One of those is the fact that the landowner had to lodge a development application for alterations to the premises to allow the council's requirements to be met. He states that the landlord's development application has now been approved but the landlord has not yet undertaken the necessary work. A further development application is now in an advanced state of preparation and Mr Fateev says should be lodged within three weeks. 12Admiral is in contempt of a number of orders made by the Court. In particular, it is in contempt of order 2 which requires the use of the premises by Admiral to cease within six months of the date of the orders having been made unless it has development consent. Other conditions regulate the use of the property in the interim, in particular limiting the hours of the operation to between 6am to 5pm, Monday to Friday and 8am to 1pm, Saturday. Use on public holidays and Sundays is prohibited by the orders. Nevertheless, until recently the property was being used between those prohibited hours. 13Mr Fateev states that Admiral was naïve in the extreme to allow the landowner's lawyers to represent it in December 2011 when there was clearly a conflict of interest. It has since obtained independent legal advice. It now knows the seriousness of the breaches. It has arranged for containers to be stored at another storage container facility until they can be moved to its yard at Byrnes Street without breaching the Court's orders. Those containers are simply not collected if there is a likelihood that they will breach the Court's orders. 14A charge of contempt is a serious matter and decisions of this and other courts establish that enforcement of the process and orders of the Court and punishment for breach of Court's orders is necessary as a vindication of the Court's authority. 15Admiral is a small family run company. I accept that it has a prior good record and is a good corporate citizen. An example is its reporting of the presence of contraband found in containers. Mr Fateev states that he wishes to apologise to the neighbours affected by the noise, for the inconvenience that has been caused, and states that the breaches were unavoidable due to pressures that were placed upon it by its clients. 16I accept that Admiral entered an early plea coinciding with its change in legal representation, that is it is now complying with all of the Court's orders other than the prohibition against the use without a development consent. I accept that it is within a designated industrial area, but there are five homes affected by its activities and that is a matter which must be taken into account. 17It is submitted that there has been not wilful disobedience of the Court's orders in the present case. I reject this submission. Admiral knew the terms of the orders that were made and knew that it could not operate outside certain hours, yet it chose to do so. It also continues to operate without a development consent contrary to order number 2. 18In considering the matter I repeat what I said in Environment Protection Authority v Pannowitz (No 2) [2006] NSWLEC 797, (2006) 153 LGERA 126: [20] The underlying purpose of the exercise of the power of the court to punish for contempt is to protect the effective administration of justice by demonstrating that the court's order will be enforced: Australasian Meat Industry Employees' Union v Mudginberri Station Pty Ltd (1986) 161 CLR 98 at 106-107. In Mudginberri the High Court referred (at 107) to Borrie and Lowe's Law of Contempt, 2nd ed (1983) at 3: If a court lacks the means to enforce its orders, if its orders could be disobeyed with impunity, not only would individual litigants suffer, the whole administration of justice would be brought into disrepute. [21] The function of punishment for contempt serves two purposes: the enforcement of the process and order of the court and punishment as vindication of the authority of the court: Mudginberri at 108. Thus, in addition to its coercive purpose punishment also served the purpose of deterring both the contemnor and others who might be so minded from flouting the authority of the court. [22] Non-compliance with an order or a judgment of the court necessarily constitutes an interference with the administration of justice: Witham v Holloway (1995) 183 CLR 525 at 533-534. Any punishment must therefore show that obedience to a court's order is important and should reflect its gravity. [23] Finally on the question of the nature and purpose of a penalty for contempt it is worth noting the judgment of Kirby J in Pelechowski v Registrar Court of Appeal (1999) 198 CLR 435 at 485 [149]: Unless courts are seen to respond firmly to deliberate defiance of their orders, their effectiveness in the authoritative determination of disputes of law would be undermined. And if they were not effective, "serious and lasting damage to the fabric of the law may result". [Australasian Meat Industry Employees' Union v Mudginberri Station Pty Ltd (1986) 161 CLR 98 at 115]. Obviously, the culpability of the contemnor is relevant to the order which must be made [Director of Public Prosecutions v John Fairfax & Sons Ltd (1987) 8 NSWLR 732 at 741] The contemnor must then be punished in an emphatic way. He or she must be deterred effectively from any temptation to re-offend. However, the focus of attention is not solely on the contemnor. It is also addressed to the community at large and to any others who might consider acting in a similar manner. 19An appropriate penalty may be determined by the instinctive synthesis of the objective seriousness of the offence and the subjective factors of the offender; Markarian v R [2005] HCA 25 or 228 CLR 357. I have referred to some of the subjective factors of the offender. Another is the fact that it is earning only a modest income from its activities. Its profit and loss statement to June 2012 shows that it made a net profit for the year of $10,974.83. As I have said, it is a small family company and its sole director has apologised for what has occurred and to the disturbance it has caused to the residents. I have already noted that it has ceased operating contrary to the orders of the Court designed to ameliorate its activities, although it continues to trade without development consent. 20In Wood v Staunton (No 5) [1996] 86 A Crim R 183 at 195, Dunford J set out the factors that a Court should consider in a charge of contempt. They are: (a)the seriousness of the contempt proved; (b) whether the contemnor was aware of the consequences to himself of what he did; (c) the actual consequences of the contempt on the relevant trial or inquiry; (d) whether the contempt was committed in the context of serious crime; (e) the reason for the contempt; (f) whether the contemnor has received any benefit by indicating an intention to give evidence; (g) whether there has been any apology or public expression of contrition; (h) the character and antecedents of the contemnor; (i) general and personal deterrence; and (j) denunciation of the contempt." 21I have already discussed some of these matters. As to (a) "the seriousness of the contempt", the system of planning control would become somewhat ineffective if persons were able to use land in a manner which as adverse consequences without obtaining the necessary development consent and thereafter complying with any conditions of such consent. 22As to (b), "whether the contemnor was aware of the consequences", it is self-evident that the defendant must have been aware that its activities were causing an impact upon the nearby residences and that it was operating in contravention of the Court's orders. 23As to (c) "the actual consequences of the contempt", actual consequences are self evident in disturbance to the neighbourhood and the residents who live in it. 24As to (d) "whether the contempt was committed in the context of serious crime", it has been held that contempt of court is a serious matter and this is reflected by the fact that contempt has to be proved to the criminal standard of proof. 25As to (e), "the reason for the contempt", Mr Fateev has explained the reason as being the inability to control the pickup and delivery times of containers to the port. He has, however, made other arrangements to overcome the problem. This suggests that such arrangements could and should have been made much earlier. 26As to (f) "whether the contemnor has received any benefit by indicating an intention to give evidence" the contemnor has given evidence by its director, Mr Fateev whose evidence has been received and accepted. 27As to (g), "whether there has been any apology", again Mr Fateev has apologised on behalf of Admiral. 28As to (h), "the character and antecedents of the contemnor", I have referred to the fact of the company's prior good character and its conduct as a good corporate citizen. Its conduct as a good corporate citizen however has been blotted by its conduct in disobeying the Court's orders in the present case. 29As to (i), I do not think there is any need in this case for an element of personal deterrence. There is a need, however, for general deterrence and a need for denunciation of the contempt. 30In all the circumstances it is appropriate that a fine be imposed. It is also appropriate that the contemnor pay the applicant's costs. In contempt cases it is usual for the costs to be ordered on an indemnity basis and that will be done in the present case. I accept the need for consistency in sentencing for contempt, but the range of penalties is wide and is unlimited and each case turns on its own facts. 31In reviewing other cases where penalties have been imposed following a plea of guilty and adopting the approach of the instinctive synthesis referred to in Markarian v R, I am of the view that a penalty of $20,000 is appropriate. Accordingly formal orders of the Court are: (1)The charge of contempt is proved. (2)The defendant is fined the sum of $20,000. (3)The defendant must pay the applicant's costs on an indemnity basis.