D'Anastasi v Environment Protection Authority and Anor

D'Anastasi v Environment Protection Authority and Anor - [2010] NSWLEC 260 - NSWLEC 2010 case summary — Zoe

[24]

24 Section 193 does not impose an obligation on the Applicant to inquire, investigate or go outside the notice in search of answers from third parties in relation to matters posed in the notice. The information sought is beyond the knowledge and/or capacity of the Applicant to provide, even if he exhaustively made inquiries of third parties by requiring information about "all persons" in most of the questions where that information is not within the Applicant's knowledge. Paragraph (h) seeks information about pest eradication without pesticide use and is beyond the scope of the Pesticides Act. While paragraph (bbb) seeks information about what the Applicant was supplied with it otherwise is not within s 193. (2) No legitimate forensic purpose 25 The information sought is a fishing expedition. The notice is by nature a preliminary discovery and subpoena process with sanctions attached in the event of failure. No legitimate forensic purpose is served by inquiry in the absolute terms of the notice. (3) Section 193 limited by s 184 26 A notice under s 193 is required to have an underlying purpose identified in s 184, which specifies the powers to be exercised by an authorised officer. There is tension between s 193 and s 184 of the PEO Act which should be resolved by reading down s 193 to come within the scope of the power identified in s 184. Statutory construction principles such as those identified in Parks and Playgrounds Movement Inc v Newcastle City Council [2010] NSWLEC 231 at [70]-[85] require that sections be read harmoniously. Section 184 is the statutory basis for the exercise of the draconian notice power and a notice under s 193 must fall within one of the subsections in s 184. Section 193 is drafted in wider terms than s 184 as a notice can be issued in connection with any matter within the responsibilities and functions of the regulatory authority. These are wider than environmental matters including, for example, occupational health and safety responsibilities for staff.

[25]

27 It is not part of the responsibilities or functions of the regulatory authority to issue notices which ask impossible and unfair questions. Section 193 must be read down by s 184. The Crown cannot require citizens to do impossible things per Haydon J in Kirk v Industrial Relations Commission [2010] HCA 1; (2010) 239 CLR 531 at [120]. (4) Jurisdictional fact 28 The decision to issue the notice is based on a jurisdictional fact, namely whether the notice is "any matter within the responsibilities and functions of the regulatory authority that appointed the officer". The notice does not embrace "...any matter..." as referred to in s 193 of the Act as it embraces matters at large by the use of the absolute language in the notice. It is not within the jurisdictional fact of the responsibilities and functions of the authority to require information or records in the absolute terms of the notice. It is a jurisdictional error to exercise a statutory power or discretion in the absence of a jurisdictional fact; Kirk at [72] quoted in Parks and Playgrounds Movement at [87]. Questions that are unfair or impossible to answer cannot be within the responsibilities and functions of the regulatory authority. In Calardu Penrith Pty Ltd v Penrith City Council [2010] NSWLEC 50 at [39] Biscoe J stated: (a) the expression "jurisdictional fact" generally "is used to identify a criterion the satisfaction of which enlivens the exercise of the statutory power or discretion in question. If the criterion be not satisfied then the decision purportedly made in exercise of the power or discretion will have been made without the necessary statutory authority required of the decision maker": Gedeon at [43], Enfield at [28]; (5) Duty to act fairly/reasonably 29 There is also a duty to act fairly imposed in all administrative processes under the common law per Kioa v West [1985] HCA 81; (1985) 150 CLR 550 at 584 and increasingly equitable principles also apply. The equitable principles in Batemans Bay Local Aboriginal Land Council v The Aboriginal Community Benefit Fund Pty Ltd [1998] HCA 49; (1998) 194 CLR 247 at [24]-[32] apply by analogy. The terms of the notice are unfair and beyond power. Further, the notice is unreasonable in the Wednesbury sense (Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1 KB 223) in that discretion must be exercised reasonably and therefore beyond power. The Applicant's counsel in his written submissions at par 21 outlined various circumstances of unreasonableness as identified in a paper by Beazley JA "The Scope of Judicial Review" and quoted in the paper "Australian Administrative Law" presented by McClellan J at the International Symposium, Hangzhou, People's Republic of China, 31 October 2006 - 4 November 2006. (6) Onus on EPA to establish authority 30 Further the onus is on the EPA to prove that the notice under s 193 has been properly issued and it has not done so. There is no affidavit of the authorised officer stating the basis on which the notice was issued under s 184. The notice itself does not need to state the section of the PEO Act pursuant to which the notice is issued but once challenged the onus is on the EPA to establish that it has been properly issued.

[26]

31 In reply, the EPA cannot rely on s 188(4) of the PEO Act because that must be read in conjunction with s 188(3) which concerns regulatory authorities other than the EPA. Gleeson CJ in Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex Parte Lam [2003] HCA 6; (2003) 214 CLR 1 at [81] makes clear that legitimate expectation arises in these circumstances. There is no basis for refusing relief on discretionary grounds. If the notice is invalid it cannot be maintained. Delay in commencing this challenge is not an issue. The EPA can issue a new notice at any time it chooses. Given the interrelationship of the questions being asked it is not possible to sever parts of the notice and still have a comprehensible document. There is no obligation to make inquiries specified in the legislation and the notice should be strictly construed in light of the offence provisions in s 211. EPA's submissions (i) construction of notice 32 The powers of investigation under Ch 7 are wide, in keeping with the broad objects of the PEO Act. A notice under s 193 can be issued in relation to any responsibility or function of the regulatory authority. Section 188 concerning scope of authority, particularly subsection (4), confirms the wide basis on which a notice can be issued. Section 193 is not circumscribed in the PEO Act and can be issued for broad purposes. An investigation into the misuse of pesticides is squarely within the responsibilities and functions of the EPA under the Pesticides Act. A similar statutory power under the Income Tax Act 1986 (Cth) was considered by the High Court in Federal Commissioner of Taxation v Australia and New Zealand Banking Group Limited (Smorgon case) (1979) 143 CLR 499 and held to be wide. 33 The authorised officer in issuing the notice under s 193 was exercising the powers under the Pesticides Act and s 184 does not apply in these circumstances. Section 184 applies to the exercise of power for the purposes of the PEO Act. The notice pursuant to s 193 is based on s 40 of the Pesticides Act. The purposes of the Pesticides Act include punishing inappropriate use of pesticides.

[32]

39 The terms of the notice are clear and capable of being understood by applying the usual meaning to words such as "managed" and "premises". The terms of the notice seek information in relation to confined periods of time. Paragraph (h) is issued in the context of a misuse of pesticides in order to establish whether the offence has been committed and also whether a defence exists. It is legitimate to ask whether bird deaths were caused by other means. Paragraph (bbb) is clearly within the Applicant's knowledge. (ii) no jurisdictional fact 40 No jurisdictional fact is a legal antecedent to issuing a notice under s 193. There are no statutory prerequisites to the issue of a notice by an authorised officer. The same conclusion was reached in Southon at [45]. This view is confirmed by s 188(4) which provides that it is within the scope of authority of an authorised officer to exercise powers to determine if a matter concerns the functions of the regulatory authority. Section 188(4) is not to be read with s 188(3) but relates to all the subsections in s 188. In any event it is unnecessary to resolve the issue of jurisdictional fact. If there is one, the jurisdiction was properly exercised as can be seen from the terms of the notice. (iii) exercise of discretion 41 The Court has discretion in determining whether it should grant the relief sought. It should not do so in view of the delay by the Applicant in challenging the notice. The time to answer the notice was extended at the request of the Applicant and the appeal was filed on the last day of that period. (iv) other matters 42 There is no demonstrated failure to accord procedural fairness, the Applicant having filed no evidence to suggest that there has been. The equitable/common law principles relied on by the Applicant do not apply. If they do they have been complied with. There is no onus of proof on the EPA to establish that a notice is correctly issued every time a notice is challenged. Such a requirement would be onerous and there is no basis for this to be found in the PEO Act. Finding (i) power/whether s 184 limits s 193 43 Statutory construction of parts of the PEO Act are necessary for determination of the parties' issues. Section 33 of the Interpretation Act 1987 requires that construction promoting the purpose or object underlying an Act is to be preferred to a construction that would not promote that purpose or object. Additional principles of statutory construction are usefully identified in Parks and Playgrounds at [74]-[79] which case had to resolve potentially conflicting statutory constructions which fortunately is not the case before me. Statutory provisions should be construed to be consistent with the language and purpose of all the provisions of the statute and a court must strive to give meaning to every word of a statutory provision per Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA, 194 CLR 355 at [69] [71] cited in Parks and Playgrounds at [74]-[75]. 44 The scheme of the PEO Act and of the Pesticides Act must be considered when construing s 193. Section 186(b1) of the PEO Act and s 40 of the Pesticides Act are companion provisions and provide similarly that authorised officers exercising Ch 7 powers can investigate in relation to the Pesticides Act. These provisions suggest that the notice power in s 193 in this case is being exercised for the purposes of the Pesticides Act. The objects of the Pesticides Act (s 3) are identified above at par 16 and include the regulation of pesticide use and minimisation of risk to human health and the environment, inter alia. The notice is directed to the investigation of a possible offence under Pt 2 of the Pesticides Act. Given that the notice is issued under the PEO Act and is within the regime for investigation in Ch 7 the objects of the PEO Act are also relevant. Once again these are broad and complement the objects in the Pesticides Act in relation to achieving environmental protection. 45 The importance of a notice issued under s 193 was recognized in Cessnock City Council v Qintaz Pty Ltd; Cessnock City Council v McCudden [2010] NSWLEC 3; (2010) 172 LGERA 52. That case was a prosecution for the failure to comply with a s 193 notice within the time specified in the notice, inter alia. In her judgment on sentence, the importance of the notice provision was recognised by Pepper J at [66] as: … any compromise in the access to information required by the authority results in a concomitant compromise in the ability of that authority to ensure compliance with the Act and to protect against environmental harm. 46 Considering firstly the wording of the provisions of Ch 7 which the parties have referred to in argument, it is important to note that s 193 is drafted in wide terms. A notice issued under s 193 can relate to any matter within the functions or responsibilities of the regulatory authority appointing the officer who issues the notice. The power to issue a notice is discretionary with capacity to requisition any person to furnish such information or records. There is no temporal or geographic boundary in s 193. 47 The broad scope of the notice power exercisable by an authorised officer under s 193 is confirmed by s 188 of the PEO Act identifying the scope of authority of an authorised officer. Section 188(4) states that an authorised officer may exercise powers to determine whether a matter concerns the functions of the regulatory authority. The Applicant's submission that s 188(4) must be read only with subsection (3) is incorrect when the whole of s 188 is read. The scope of authority of an authorised EPA officer includes the exercise of power consistent with s 188(4). This further confirms the EPA's submission that the broad powers of authorised officers underpin a notice issued under s 193.

[34]

49 Numerous authorities have considered statutory notices in other regulatory regimes including earlier environmental statutes, such as Environment Protection Authority v Multi-Fill and Hardie Holdings. The authorities relied on by the EPA emphasise the wide ranging powers of investigation which are conferred under similar provisions in other schemes such as the TP Act (Cth). In ANZ Banking in separate judgments the High Court emphasised the width of investigatory powers underpinning a notice requiring information inter alia. Gibbs ACJ at 524 held there was no justification for reading into the relevant section of the Income Tax Act a condition precedent which was not express. 50 A useful discussion of relevant authorities on principles governing statutory notices is found in Hardie at [32]-[40] considering a notice issued under s 36 of the Native Vegetation Act 2003 requiring information and documents to be produced and whether this was issued in excess of power or was oppressive. Lloyd J refers to ANZ Banking (considered above), its application in Pyneboard and Integrated Financial Group Pty Ltd v Australian Securities & Investments Commission [2004] WASC 75; (2004) 183 FLR 8 inter alia. In Pyneboard the Full Federal Court was considering the validity of a notice issued by the Trade Practices Commission under s 155 of the TP Act (Cth) seeking information and documents. It held that the requirement that such notices convey what they required with reasonable clarity should not apply in a "precious or hypercritical fashion" (at 570). In Integrated Financial Group Roberts-Smith J at 17 adopted the approach of Bryson J in Currency Brokers (Australia) Pty Ltd v Corporate Affairs Commission (NSW) (1986) 5 NSWLR 483 at 489 that it is in the nature of the investigation that the person giving the notice may not be well informed but the process would be futile if this disabled the officer from giving a valid notice. 51 Southon concerned s 203 of the PEO Act which provides authority for a statutory notice requiring attendance to answer questions. Jagot J emphasises the breadth of the powers of investigation in the PEO Act in the context of the validity of such a notice. The notice under s 203 was issued by an authorised officer who was investigating matters under the National Parks and Wildlife Act 1974 (the NPW Act). The NPW Act had provisions whereby investigatory powers under the PEO Act could be used for the purposes of the NPW Act. The terms of the NPW Act were different to s 40 in the Pesticides Act. There is no reference to the NPW Act in s 186 of the PEO Act. I note these differences because the analysis of s 203 powers by Jagot J at [36] - [41] was solely in the context of the PEO Act rather than the NPW Act. The sections of the Pesticides Act and the PEO Act mirror each other so that the analysis in this case at par 44 differs slightly from that in Southon.

[36]

54 In Southon Jagot J held at [45] that there was no jurisdictional fact created under s 203. Section 203 states that an authorised officer may require a person suspected of having knowledge of matters about which information is required for the purposes of the PEO Act to answer questions in person. Consideration of the factors identified by Spigelman CJ in Pallas Newco at [30]-[63] particularly whether the factual matter was legally antecedent to the decision-making process and the degree of inconvenience that would arise if the fact were to be found to be a jurisdictional fact were paramount in her Honour reaching this conclusion. The same approach is also warranted in relation to s 193 for the reasons given by Jagot J and in the previous paragraph. Further, my finding at par 47 that s 188(4) is not limited to s 188(3) so that the powers of an authorised EPA officer can also be applied to determining whether a matter concerns the functions of a regulatory authority also suggests there is no jurisdictional fact in s 193 in relation to whether a matter is within the responsibilities and functions of the regulatory authority. 55 I do not consider there is a jurisdictional fact which must be met before a notice under s 193 can be issued and I agree with the EPA's submissions to that effect. It is not necessary in order to resolve this issue to further consider the numerous authorities on jurisdictional fact relied on by the Applicant. (iii) no analogy to subpoena/notice to produce 56 The broad scope of investigatory powers has been recognized as including "fishing" for information. In EPA v Multi-Fill the validity of a notice to produce issued under s 29(2) of the Clean Waters Act 1970 was in issue. Stein J at 140 described the section as investigatory in nature and allowed the regulatory authority to "fish" for information. He held the power is not limited in the same way as a subpoena is limited in court proceedings. Mason J in ANZ Banking also referred to the need for the Commissioner of Taxation to make wide ranging enquiries so that the prohibition on "fishing" for information in court proceedings is not relevant to the exercise of investigatory powers. 57 The question of legitimate forensic purpose applied to subpoenas is not a relevant test for s 193 notices requiring information and records. Such a limitation would inappropriately and substantially curtail the power otherwise available under s 193. (iv) duty to act fairly/legitimate expectation/duty to act reasonably 58 The Applicant has relied on general authorities such as Kioa v West to argue that there is a duty to act fairly in the issuing of notices. Lam was also referred to in support of a submission that legitimate expectation (undefined) arises in this case. The Applicant's counsel submitted that common law principles of fairness and due process were required to be applied in this statutory process. While that general submission can be made, the particular statutory scheme must be considered. There are no procedural requirements, such as the giving of a notice of an intention to issue a notice, in s 193 or elsewhere in the PEO Act. No particular form of notice is specified in the PEO Act. In Southon Jagot J considered the statutory scheme under the PEO Act and stated at [39] that the Act was directed to a wide range of events of differing character, seriousness and urgency which include immediate harm or risk of harm. This was relevant in construing s 203. That section also does not require that advance notice be given before a statutory notice is issued. 59 I adopt her Honour's observations concerning the circumstances in which investigative powers will need to be exercised, including in emergency situations. Section 72(2)(b) of the Pesticides Act imposes a time limit on commencing prosecutions of 12 months for this type of potential offence which means that the need for the investigation and the answers to the notice are urgent. Under s 73 of the Pesticides Act the EPA is the only authority which can institute proceedings for an offence under that Act. 60 No link to Ch 7 in the PEO Act and the general authorities relied on by the Applicant which refer to administrative processes in civil matters was made by the Applicant's counsel. How the duty to accord procedural fairness and/or that the circumstances gave rise to an (undefined) legitimate expectation can arise is unclear, particularly in the absence of evidence which could found the possible application of such duty or right. 61 The Applicant's counsel also relied on Batemans Bay LALC to make a general submission that equitable relief ought be granted. Precisely what equitable principles apply was not made clear. I note that case deals with the misapplication of public funds obtained by statutory bodies. Without further elaboration as to how it applies in this statutory context I do not consider that case to be relevant to an assessment of the authorised officer's obligations under the PEO Act and the Pesticides Act. 62 The Applicant also submitted that a notice should not be unreasonable in the Wednesbury sense because the notice is impossible to answer. It unreasonably requires inquiries of third parties and the Applicant would not be able to check the veracity of these in order to answer the notice which requires that "all persons" be identified. The grounds of unreasonableness contended for are otherwise unclear as the written submissions summarised seven grounds of judicial review referred to a paper on the scope of judicial review by Beazley JA (par 29) but did not elaborate on how these applied in this matter. 63 I have held above that the wide powers underpinning a s 193 notice allow a notice to seek information from third parties. Section 211 makes it an offence to neglect, fail to answer or to mislead or provide false information. Provided that the Applicant uses his best endeavours to answer the questions in the notice following the making of inquiries and gives answers he believes are correct within the time frame specified he will comply with the notice. I do not consider that the notice is impossible to answer. Nor is it unreasonable in its terms. 64 The Applicant has not submitted that the notice is oppressive or burdensome and there is no evidence to that effect. The EPA relied on the finding in Riley in relation to a notice under the TP Act (Cth) that the fact the notice was burdensome or oppressive is not a basis for invalidity. It is not necessary to determine whether the same considerations ought apply in relation to a notice issued under s 193 in this case as the issue does not arise. (v) onus 65 I agree with the EPA that there is no statutory basis for arguing that the EPA has an onus to establish the notice has been issued lawfully by the relevant authorising officer where a notice is challenged. Under s 189(2) of the PEO Act an authorised officer must show his or her written authority if requested to do so in the course of his duties. No additional duty to establish authority falls on the EPA in these proceedings. (vi) terms of notice 66 My findings above, which are in the EPA's favour, are that authorised officers have broad powers under s 193 and can ask seek information and records which require the recipient to make inquiries of third parties and report on those answers in a response to the notice. Requiring that to be done in order to identify all persons does not give rise to impossibility. Notices are not limited to seeking information and records only within the person's knowledge. As submitted by the EPA, answers to earlier questions which are similar to those in the notice were provided and would be a partial answer to the notice. The notice seeks information in three defined periods of time which does limit the time frame in which inquiries are to be made to reasonable periods in my view. The Applicant relied on the notice issued in Mood as being appropriately worded. That is simply one example of a notice drafted a certain way. It does not provide any guidance as to the application of the broad powers under s 193. 67 Section 195 of the PEO Act specifies that only records which are within a person's possession or that are within the person's power to obtain lawfully may be sought in a notice under s 193. The notice contains that qualification. 68 The notice is clear in its terms and is comprehensible, applying a commonsense reading to the words used, per Cockburn at [25]. 69 In relation to the Applicant's further criticism of particular terms of the notice, paragraph (h) which seeks information about pest eradication without the use of pesticides is within the terms of s 193. As submitted by the EPA that is really an inquiry about a possible defence which is relevant to any investigation of misuse of pesticides. Paragraph (hhh) is also within the scope of the power of the authorised officer in light of s 188(4) of the PEO Act. 70 The orders sought by the EPA ought be made. The EPA seeks its costs of this summons. It has been successful, there is no disentitling conduct suggesting it should not be awarded its costs and the usual rule is that costs ought follow the event. A costs order to that effect will be made after 4 pm Friday 17 December 2010 unless the Applicant advises that he seeks a different costs order. Orders 71 The Court makes the following orders: 1. That the injunction made by order 2 of the short minutes of order on 26 November 2010 restraining the First and Second Respondent from seeking to enforce: (a) the document entitled "Notice to Provide Information and/or Records" (notice no 1118170) dated 1 September 2010; and (b) the document entitled "Variation of Notice to Provide Information and/or Records" (notice no 1119472) dated 16 September 2010 (together, "the statutory notice"); be lifted. 2. That the summons filed on 29 October 2010 be dismissed. 3. That the Applicant answer the statutory notice within 10 business days of publication of the Court's reasons for judgment in the proceedings. 4. Costs of the proceedings are reserved until 4 pm Friday 17 December 2010.

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