Environment Protection Authority v Bellingen Shire Council

Introduction 1 HIS HONOUR: Bellingen Shire Council ("the council") is charged with a breach of s 64(1) of the Protection of the Environment Operations Act 1997 ("the PEO Act") in that it did fail to comply with a condition of an Environment Protection Licence. The council entered a plea of guilty at an early stage on 28 October 2002. 2 The Environment Protection Licence is held in relation to the Raleigh Waste Management Centre at Shortcut Road, Urunga ("the premises"). The premises are located in an environmentally sensitive area, in that there is a creek and wetland adjacent to the premises. The licence was issued after protracted negotiation of a Landfill Environment Management Plan ("LEMP"). The conditions of the licence required the council, inter alia, to install a perimeter leachate interception trench, a leachate storage and a leachate recycling system as proposed by the council in the LEMP. The system commenced operation in July 2001. 3 The particular condition of the licence is L1.2 and it states as follows:- The level of leachate in the leachate sump (1) must not exceed the level of the invert of the leachate pipes where they enter the leachate sump, except as a direct result of rainfall events greater than or equal to 300 mm in total falling over any consecutive five day period. 4 The number (1) referred to in condition L1.2 above is the location of the leachate sump. 5 The council has operated at the premises for approximately thirty years. It appears not to be disputed that over that period there was no reported incident of environmental damage. Indeed the water that discharges from the area of the landfill ends up in the Bellingen River which, it is said, has a reputation as one of the cleanest rivers on the north coast. 6 The need for a licence arose as a consequence of changes made to the Waste Minimisation and Management Act 1996. The council engaged a consultant, Peter Jelliffe, who undertook an Environmental Impact Statement ("EIS"), prepared the LEMP and gave the council advice generally on the implementation of the plan. 7 During 2000 and 2001 extensive works were carried out in accordance with the EIS and the LEMP. The value of the works carried out is approximately $500,000. Included in the environmental works was the installation of the leachate management system involving construction of a trench approximately four hundred metres long and up to three metres deep around the base of the existing landfill and installation of pumping equipment, sumps and holding tanks. 8 The leachate system was, as I mentioned a moment ago, finally commissioned in the middle of 2001, namely on 2 July 2001. It was necessary to monitor the leachate output. This was initially done by attempting to relate the amount of electricity used on the pumping equipment. This proved to be unsatisfactory and a metering device was installed on 22 August 2001. Shortly after that installation the recorded volume of leachate increased significantly. This raised the possibility, as assessed by the council, that another source of ground water such as an aquifer may have been intercepted so that a combination of leachate and ground water was being collected in the leachate management system and being pumped out. 9 In September 2001, according to the monitoring undertaken by the council, the volume of leachate collected in the interception trench increased to approximately 80 kilolitres per day. The system had been designed to cope with twenty kilolitres per day. Clearly there was a significant discharge in excess of the design capacity. 10 The council's Manager of Building and Services, Robert Burgess, consulted Mr Jelliffe who became concerned that the system would not be able to cope and that the better option would be to turn off the pump. His belief at that time was that there could be some failure elsewhere within the system. That might be detrimental to the operation of the whole system generally. 11 The leachate collection pumps were actually turned off by Mr Burgess on 24 September 2001 in accordance with the advice that he had been given. Mr Burgess thereafter made observations regarding the discharge of leachate out of an overflow pipe. He inspected it on numerous occasions over the next six weeks. Although at times it was only a trickle, there were occasions when it appeared to be discharging around a quarter of the pipe capacity. For that to be occurring, that is, any discharge at all through the discharge pipe, it meant that the level of the leachate in the leachate sump exceeded the level of the invert of the leachate pipes where they entered the leachate sump. As a consequence of that occurring, condition L1.2 of the licence was breached. 12 During the time the pump was off the council did not take any other practical measures to prevent the escape, or potential escape of the leachate into the wetlands. 13 In the belief that water-monitoring results were necessary, together with the development of a strategy to deal with the problem, the council desisted from notifying the Environment Protection Authority ("the EPA") about the problems it was experiencing, until October. 14 When Mr Burgess contacted the EPA office in Grafton by telephone on 17 October 2001, the relevant officer, Christopher Hatton, was on leave. Three days after Mr Hatton returned from leave on 22 October 2001, namely on 25 October 2001, he had a conversation with Mr Burgess. Following that conversation, a meeting took place on 1 November 2001 between EPA officers, Mr Jelliffe and a council officer. There was general disagreement about whether or not the interception of a ground water spring was necessarily the cause. 15 On 5 November 2001 Mr Hatton attended the site. He observed the discharge. It was not reaching the wetland at that time. In any event, Mr Hatton instructed the council, through Mr Burgess, to turn the leachate pumps back on and to monitor the situation on a daily basis. 16 The council's initial suggestion was that off-site irrigation could be the preferred option. That was not an option favoured by Mr Hatton. Ultimately, however, several strategies have been introduced in an endeavour to better manage the leachate situation and to restrict the ingress of surface water into the landfill itself. 17 There is now a full time landfill operator, on-site irrigation (as opposed to off-site irrigation of leachate during dry periods) and excesses are dealt with by way of an off-site disposal and treatment process at the Urunga Waste Water Treatment Plant. Further investigations are still continuing and the council has engaged GHD Pty Limited as a consultant geologist to try and understand the problems. 18 Finally, an additional 40,000 litre holding tank has been installed as a further safety net. 19 For the purpose of s 241(1)(b) of the PEO Act, the strategies that I have just described reflect potential practical measures that were available to overcome the problem. As I said, until that was done, the council had been entertaining the prospect of off-site irrigation. 20 It should be noted, however, that initially, and indeed subsequently, the council relied at all times on the advice of its expert, Mr Jelliffe. The delay in contacting the EPA is explained by the council as a need to understand the seriousness of the situation by undertaking monitoring. In a way the seriousness of the potential harm that could have been caused can be gauged by the EPA's response to the notification. By saying that I do not mean to reflect upon the EPA's diligence, but it did take between 17 October 2001 and 5 November 2001 for an EPA officer to visit the site. This shows the element of urgency with which the situation was approached. 21 I might say of course, that the real contact with the relevant officer was not made until 25 October 2001, although, as I explained a moment ago, an initial contact was attempted on 17 October 2001 and there was a meeting between the officers and experts at the EPA office in Grafton on 1 November 2001. 22 For the purpose of s 241(1)(c) of the PEO Act, it is not clear that the council reasonably could have foreseen the influx of ground water from another source, at least to the extent that occurred and caused the increase in leachate output. It did, after all, take the advice of its own expert before turning off the pump, and indeed, the system was designed in accordance with the expert's advice. 23 The Court has the benefit of an affidavit from the General Manger of the council, Peter John Doyle. He says that the action in turning off the leachate system was naively taken in good faith in reliance upon the advice of council's independent consultant. 24 He recognises, however, that with the benefit of hindsight it is clear that the EPA should have been consulted before this action was taken. However, he does observe, and I think fairly, that by turning off the leachate system the council was returning the leachate situation to the position it was in prior to the commissioning of the leachate management system only a matter of weeks before, rather than creating a new problem. 25 There is no question that the council was in control of the site for the purposes of s 241(1)(d) of the PEO Act. 26 The situation is, as Mr Clay submits for the council, that for all intents and purposes, there was no environmental harm caused as a consequence of the discharge. Indeed, the Court accepts that it is reasonable to foreshadow that environmental harm was not likely to occur. 27 The council was at all times acting on advice. The system was introduced to deal with, and indeed, ultimately now solves, the issue of protecting the environment from the discharges of leachate from the premises. It is a situation that has existed for decades. The act of turning off the pump was deliberate, but not done for a purpose that ignored the environmental consequences. Indeed, the council submits, and I think quite reasonably, that the turning off of the pump was the adoption of what it saw as the best option in the circumstances, having regard to the alternative consequences that might have flowed if it had not taken that action. 28 The council, through Mr Doyle, has deposed as to the rather constrained financial resources of the council, and the difficulties under which it operates, having regard to the peculiar circumstances of the area which it administers and the fiscal disadvantages that it suffers as a consequence of the land mix within the area. Moreover, according to what Mr Doyle says, the reduction in rate revenue is not adequately offset by other compensating sources of revenue. It is his plea that the impact of a substantial penalty in this case would further erode the council's scarce financial resources otherwise required for providing much needed and important community services and infrastructure works. For example, Bellingen Shire, he says, has an unemployment rate of 20 per cent, which is well above the average. 29 Furthermore, the Court is asked to take into account the early plea of guilty, the extent of co-operation between council officers and the EPA officers, even to the extent that Mr Burgess swore an affidavit in support of the prosecutor's case. 30 The lack of harm to the environment is a matter that works in favour of the council. The fact that the council has a public function is a double-edged sword. It has a responsibility to administer activities which could be detrimental to the environment within its own area. In managing this very site it has a responsibility to see that the public benefit is best served by the way in which it carries out its duties. 31 It should also be borne in mind that the ultimate liability for any fine that will be imposed by the Court will fall squarely into the pocket of the ratepayers. 32 I accept the expressions of regret and contrition frankly given by Mr Doyle on behalf of the council and I am satisfied that the council is genuinely concerned that it finds itself in this position before the Court. I perceive that this defendant is unlikely to offend again in the way that it has in this particular case. It has clearly shown a willingness to deal with the problem despite its limited resources. 33 It must be remembered that the liability for an offence under the PEO Act is a strict liability. There is no question that the council had any intention to breach the conditions of its licence. 34 The consequence of adopting the prosecutor's submission in relation to the amount of penalty would be that, in circumstances where the maximum penalty is $250,000, the Court could be asked to impose a penalty of something like $60,000. Such a penalty, in my view, would be significantly in excess of what is a reasonable penalty in the circumstances. Given the consequences of the offence, the manner in which it arose, the way in which it was subsequently dealt with and the undertaking for which the council was responsible in respect to the site, in my opinion, a reasonable penalty would be in the order of $20,000 to $25,000. 35 Allowing for the utilitarian value of the early plea and the co-operation between the prosecutor and the defendant following the incident, including the investigation of it, and the steps taken to remedy the situation, the council is entitled to the benefit of the full discount in that respect. 36 In the circumstances, therefore, I am satisfied that a penalty of $15,000 is fair and reasonable in the circumstances. Furthermore, the council has agreed to pay the prosecutor's costs. These costs have not been determined at this stage--