Environment Protection Authority v Bowport All Roads Transport Pty Limited

Crimes (Sentencing Procedure) Act 1999 LEGISLATION CITED: Criminal Procedure Act 1986 Protection of the Environment Operations Act 1997 Protection of the Environment Operations (Clean Air) Regulation 2002

Director General, Department of Environment and Climate Change v Hudson (2009) 165 LGERA 256; [2009] NSWLEC 4 Environment Protection Authority v Bruce Panucci Transport Pty Ltd (2003) 131 LGERA 119 CASES CITED: Environment Protection Authority v Waste Recycling and Processing Corp (2006) 148 LGERA 299 Environment Protection Authority v Bowport All Roads Transport Pty Limited [2009] NSWLEC 103 Environment Protection Authority v Causmag Ore Co Pty Ltd [2009] NSWLEC 164 Minister for PLanning v Fancott Pty Ltd [2009] NSWLEC 170

APPLICANT Mr S Rushton SC SOLICITORS LEGAL REPRESENTATIVES: Department of Environment and Climate Change

RESPONDENT Mr S Alexander, solicitor of Alexanders Lawyers

JUDGMENT: THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES

50084-88 of 2007 ENVIRONMENT PROTECTION AUTHORITY v BOWPORT ALL ROADS TRANSPORT PTY LIMITED

EXTEMPORE JUDGMENT 1 His Honour: The respondent company (referred to in several documents as "BPA") appears today to be sentenced for five offences. These are believed to be the first prosecutions under Regulation 9(1) of the Protection of the Environment Operations (Clean Air) Regulation 2002 as it now stands. They involved technological detection of four "smoky vehicles", one of them twice, in the M5 East tunnel between 17 January and 7 March 2007. 2 The prosecutions were commenced on 24 December 2007 and the defendant pleaded Not Guilty on 2 May 2008. The charges were heard 2-4 February 2009. I found the charges proven on 30 June 2009 - see my judgment [2009] NSWLEC 103. 3 The prosecutor seeks a "substantial monetary penalty" in respect of the five offences viewed in "totality", the maximum fine for each being specified as $44,000, plus its costs agreed in the amount of $48,000, and a series of orders under Part 8.3 of the Protection of the Environment Operations Act 1997 ("POEO Act"). Such orders are said by the Act (s244(2)) to be "additional" to any penalty imposed. 4 The offence rests on detection of a continuous "visual emission" from a heavy vehicle for a defined period of ten seconds. It does not require any specification of any particular type of pollutant, or of a particular concentration of pollutant. The Regulation holds the emission to be of "excessive air impurities" if it is detected as visible for ten seconds, in accordance with Test Method 31, and the statutory observer is satisfied it is not visible "just because of heat or the condensation of water vapour". All of this was discussed at length in my earlier judgment at [1]-[15]. 5 The defendant concedes the "objective seriousness" of all five offences, but asks the court to bear in mind that Sydney has high levels of motor transport, and high levels of resultant air pollution, and that ten seconds of "smoke" of itself should be regarded as causing "negligible environmental consequences". 6 I found the likely causes of the emissions in these cases to be the age and mileage of the offending trucks, and/or their mechanical condition, and/or their loading (par [34]), and there was some evidence before me about relevant driver practices in relation to the load on board (see e.g. [31]). The subject vehicles were all manufactured prior to 1996, and so were more likely to offend by emitting oxides of nitrogen, hydrocarbons and particulate matter, if inadequate attention were given to proper maintenance and proper driving (see [3], [21] and [29]). 7 The court must apply the sentencing principles in s3A of the Crimes (Sentencing Procedure) Act 1999, and take into account the matters in s21A of that Act and s241 of the POEO Act. These provisions have been widely quoted and applied in this court, and I will not repeat now all that has been said about them before. See e.g. Director General, Department of Environment and Climate Change v Hudson (2009) 165 LGERA 256, [2009] NSWLEC 4 per Lloyd J; Environment Protection Authority v Causmag Ore Co Pty Ltd [2009] NSWLEC 164 per Pain J; and Minister for Planning v Fancott Pty Ltd [2009] NSWLEC 170 per Pepper J. 8 The particular issues facing the court today in this case are: · the need for both specific and general deterrence. · the need to protect the community and adequately punish the offender. · the extent of resulting environmental harm. · the relevant record of the offender. · the offender's state of mind, the reason for committing the offence, and the foreseeability of the risk of harm. · the personal or subjective circumstances of the offender. · the practical measures available to avoid the harm.

Harm 9 While air pollution can be transient and less lasting than some other types of pollution, incidents of air pollution have a cumulative effect on, and incrementally contribute to the gradual deterioration of, the environment. Environment Protection Authority v Waste Recycling and Processing Corp (2006) 148 LGERA 299. 10 Pollution of the type caused here takes the form of visible smoke or haze, plus increased toxicity in the atmosphere. These offences were committed at a well-known location in respect of which there is widespread community concern about pollution, and its consequences for the environment in general, and for both public and individual health. 11 The Environment Protection Authority expert Susan Quigley, to whose evidence no objection was taken nor challenge offered, stressed how urgent and important it is for the community to achieve a 25% reduction in the incidence of the oxides of nitrogen and of volatile organic hydrocarbons, both of which are disproportionately sourced from diesel vehicle emissions, when compared with petrol vehicle emissions. She opines that there is no safe level of human exposure to diesel emissions and that the use of diesel technology is increasing. Mr Heraghty (Managing Director of the defendant company) deposes to his understanding of these issues (see par 58 of his affidavit and the annexed scientific study). 12 Specifically, Ms Quigley says (in her affidavit 25 September 2009, par 27, as amended by affidavit 15 October 2009, par 2) that, when the subject offences were committed, the defendant's emissions: " a. would be likely to contribute to air pollution in the Sydney region; b. would be likely to contain oxides of nitrogen and fine particles; c. would be likely to contribute to the formation of photochemical smog; d. would be likely to react with other pollutants to form particles; e. would be odorous, visibly offensive and contribute to haze levels in the Sydney region; f. would contribute to soiling and premature deterioration of buildings in the Sydney region; g. would likely absorb other potentially carcinogenic compounds such as polycyclic aromatic hydrocarbons; h. may contribute to a range of respiratory, cardiovascular and cancer related morbidity and mortality as well as other health problems." Foreseeability, control and practical measures 13 Judging by Mr Heraghty's own evidence, the defendant appears to have been well aware that many of its vehicles could infringe the standards required to minimise air pollution. It had at its disposal all the necessary authority, and the means, to achieve a better outcome. Yet it had over the years received many infringement notices, and been prosecuted five times, for smoky vehicle incidents, prior to these five incidents. Whatever remedial measures and testing, etc. it undertook prior to January 2007, did not prevent these incidents from occurring. Reasons for the offence 14 These offences clearly resulted from insufficient relevant investment in the most environmentally efficient vehicles, maintenance programmes, and driver education. Mr Heraghty's evidence asserts the leadership role the defendant company seeks to take in its industry, and the court believes that such leadership requires optimum performance in the area of minimising emissions, even if at a large capital cost, and/or at the cost of foregone financial gains. 15 There is no evidence of any real change in the company's policy or performance since early 2007 to give the court confidence there is a significant reduction in the risk of further similar offences, despite Mr Alexander's assertion, from the bar table and in his written submissions, that the defendant has a clean record since March 2007. Deterrence 16 Clearly both general and specific deterrence must inform the court's decision on penalty in this matter. 17 The heavy vehicle industry has to improve its performance, and so does this major player in it. The defendant's record 18 The defendant admits to having paid 29 infringement notices for emission offences in the period 15 November 1991 to 3 October 2006. The last few of those notices imposed fines of $400 each. I note this factual evidence, conscious of s338 of the Criminal Procedure Act 1986. 19 However, more relevantly, the defendant acknowledges five court appearances on smoky vehicle charges between 8 November 2002 and 19 January 2007, concerning incidents which occurred between 28 October 1996 and 11 October 2005 (Exhibit P1). Three of those charges involved the same vehicle in a three month period, but none concerned any of the four vehicles involved in these five charges. On 6 March 2003 the company was twice fined $3,500, and on 19 January 2007 (in the period covered by the five present offences) the company was fined $8,000. 20 The court accepts that this record has to be viewed against the background of the size of the defendant's operation, its growth and details being fulsomely set out in Mr Heraghty's evidence - 60 trucks, 70,000 truck movements per annum, extensive rail infrastructure and other investment, and 166 employees. Mitigating features of the case 21 The defendant relies on what Mr Alexander described as its institution of a "responsible system of monitoring and testing its trucks for compliance with the required standards dealing with truck emissions". 22 It also submits that, although it defended the charges, it ran the liability hearing in a constructive way and "did not waste valuable court time". 23 The defendant company states its remorse in Mr Heraghty's affidavit and apologises for its behaviour. It is a matter of regret that there is no really positive evidence of its efforts to rectify, in a lasting and ongoing way, the problems underlying these 2007 failures. The court can take judicial notice of concerns about air quality in the M5E tunnel, but they do not exculpate the company from its role in aggravating these problems. 24 The court notes and accepts Mr Heraghty's evidence about the company's intention to step up replacement of older vehicles, and its involvement in various relevant programmes run by the RTA and by the industry. 25 The court also notes the various statements of commendation and support for both Mr Heraghty and his company from a range of industry and community leaders and organisations. 26 This defendant is a large and successful enterprise, and it must pay its penalty for past infractions and do better in the future. 27 In terms of penalty both parties have referred me to the judgment of Bignold J in Environment Protection Authority v Bruce Panucci Transport Pty Ltd (2003) 131 LGERA 119, which predated the advent of Test Method 31, but involved the same offence and maximum penalty, a late plea of guilty, and observation of offending emissions for 20 seconds. His Honour was satisfied that the defendant would work harder in the future to ensure it did not reoffend. 28 His Honour imposed a sentence of 50% of the maximum and applied a discount of 25%. 29 Applying the principle of totality, and taking into account the imposts represented by a costs order and by orders I propose to make under Part 8.3, I have determined that the defendant should pay in each of the five matters a fine of $20,000 less a discount of 20%, meaning total fines of $80,000. I will not impose any higher fine in respect of the second offence by vehicle UMA 803. 30 The defendant has agreed to the making of several of the orders the prosecutor seeks under Part 8.3. Orders 7, 8, 9 and 10 of what follows were not opposed, but the defendant resists:

(a) the s250(1)(a) publicity order; (b) any order requiring testing of company trucks other than those involved in these charges; and (c) any requirement that drivers, as well as mechanics, undertake appropriate training. 31 I consider the prosecutor's s250(1)(a) order and the suggested advertisement, as drafted, to be entirely appropriate, and I also consider, given the evidence about driving practice, and the expert evidence of Mr Mobberley, that the prosecutor's draft s250(1)(f) order is also appropriate. 32 However, on this first occasion of sentencing for a Test Method 31 matter, I consider that the proposed s250(1)(d) order, covering as it would the whole of the defendant's fleet, to be too oppressive. The AVERS system under which these offences were detected began its trials in 2003, and I propose to make the s250(1)(d) order apply to all the trucks in the defendant's fleet which were first registered before 31 December 2002. Orders 33 The orders of the court will, therefore, be:

1. In matter No. 50084 of 2007 the Defendant is convicted and fined the sum of $16,000. 2. In matter No.50085 of 2007 the Defendant is convicted and fined the sum of $16,000. 3. In matter No. 50086 of 2007 the Defendant is convicted and fined the sum of $16,000. 4. In matter No.50087 of 2007 the Defendant is convicted and fined the sum of $16,000. 5. In matter No. 50088 of 2007 the Defendant is convicted and fined the sum of $16,000. 6. Within 28 days of the making of these orders, the Defendant shall pursuant to s250(1)(d) of the POEO Act engage at its cost a suitably qualified independent expert ("Independent Expert") approved by the EPA to conduct on-road smoke tests on all of the defendant's current fleet of trucks which were first registered before 31 December 2002 ("the Independent Audit"). In the event that the Defendant and the EPA cannot agree upon the identity of the Independent Expert the Independent Audit shall be carried out by an independent expert appointed by the RTA. 7. The Independent Audit referred to in Order 6 above must include driving each of the Defendant's vehicles fully laden in a range of representative conditions and on roads of varying gradients as determined by the Independent Expert. The Independent Audit shall also include any other test or measurement as required by the Independent Expert. 8. Should any vehicle fail the Independent Audit it must not be driven again, except for the purposes of being repaired or retested, until it is repaired, retested and passed by the Independent Expert. 9. The results of the Independent Audit, including details of any failures, must be submitted to the EPA within 60 days of the making of these orders. 10. Within 60 days following completion of the Internal Audit the Defendant will at its cost take all steps necessary to complete any outstanding obligations to obtain accreditation as a member of the Clean Fleet Program of the RTA. 11. Pursuant to s250(1)(f) of the POEO Act the Defendant will ensure at its cost that within 90 days of the making of these orders that each of its current drivers and mechanics attend the TAFE run " Diesel Emissions Awareness Course " and will provide certified copies of their certificates of attendance to the EPA within 10 days thereafter. 12. Pursuant to s250(1)(a) of the POEO Act the Defendant will at its cost within 28 days from the making of these orders place a Notice within the first 6 pages of the general news section of the Sydney Daily Telegraph and the St George and Sutherland Shire Leader at a minimum size of 8cm by 12cm in the form of Annexure A. 13. The Defendant is to pay the prosecutor's costs of $48,000 within three months of today's date. 14. All the exhibits tendered by the prosecutor at the February 2009 hearing are now returned, but Exhibit P1 from today's hearing is to remain with the court files. 34 A formal version of these orders will be issued to the parties and I will publish these reasons. ANNEXURE A

CONVICTION FOR SMOKY VEHICLE OFFENCES - BOWPORT ALLROADS TRANSPORT PROPREITARY LIMITED

On 30 June 2009, the Land and Environment Court of New South Wales found BOWPORT ALLROADS TRANSPORT PROPRIETARY LIMITED guilty of five offences against the Protection of the Environment Operations (Clean Air) Regulation 2002, in that it was the owner of trucks which on five separate occasions were found to be emitting excessive air impurities. The offences were detected between 17 January and 7 March 2007 in the M5 East tunnel by the RTA's digital imagery which is generated by its vehicle emission recording system. Visible air impurities from diesel engines are likely to contribute to air pollution, photochemical smog and may also contribute to a range of human health problems. BOWPORT ALLROADS TRANSPORT PROPRIETARY LIMITED was prosecuted by the Environment Protection Authority, part of the Department of Environment, Climate Change and Water (NSW) and pleaded not guilty to the charges. On 20 October 2009 BOWPORT ALLROADS TRANSPORT PROPRIETARY LIMITED was convicted and fined $80,000 for the five offences against the Protection of the Environment Operations (Clean Air) Regulation 2002. BOWPORT ALLROADS TRANSPORT PROPRIETARY LIMITED will take a number of steps to improve its performance including obtaining accreditation under the RTA's Clean Fleet program. This notice is placed by order of the Land and Environment Court and is paid for by BOWPORT ALLROADS TRANSPORT PROPRIETARY LIMITED.

21/10/2009 - Judgment Title (No.2) added - Paragraph(s) title only 21/10/2009 - title - Paragraph(s) title

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