Environment Protection Authority v Cut and Fill Pty Limited [2005] NSWLEC 401 | Case summary

1 HIS HONOUR: The defendant, Cut and Fill Pty Limited, has pleaded guilty to an offence against s 120(1) of the Protection of the Environment Operations Act 1997 ("the POEO Act"), in that it polluted waters. The offence carries a maximum penalty of $250,000 in the case of a corporation. 2 The relevant facts have been agreed to in the form of a statement of agreed facts which has been tendered in evidence. Those facts may be briefly described as follows. 3 The defendant was contracted by the Roads and Traffic Authority ("the RTA") to undertake a road works some 10 kilometres north of Armidale on the New England Highway. The works included the re-alignment of part of the highway and the installation of a new bridge over Duval Creek. 4 The defendant arranged for a subcontractor to clear, grub and strip topsoil from an area of land of about 10,000 square metres adjacent to the creek. A 15 metre buffer zone of vegetation leading down to the creek was retained as a natural filter in respect of sediment contained in any runoff from the works. 5 There is no doubt that the defendant was on the site and caused the contractor to carry out the works. It had full control and management of the cleared area, which included the placement of appropriate sediment control measures to protect the environment. As part of its contract with the RTA the defendant's responsibilities included the design and installation of appropriate sediment and erosion controls for the cleared area. Also as part of that contract, the defendant was to comply with the specifications in the contract documents relating to erosion control and sediment control. The defendant was required to place sediment and erosion control devices in various locations so as to prevent sediment pollution. 6 On the afternoon of 13 January 2004 officers of the Department of Environment and Conservation were returning to Armidale on the New England Highway and passing over the Duval Creek Bridge. It was raining at the time and had been raining heavily for the past day. They observed the cleared area; they observed loose soil on the cleared area; and saw no sediment or erosion control works from the car. The officers saw substantial sediment runoff and erosion in the vicinity of the cleared area. They identified two discharge points with neither discharge point having sediment control and erosion controls in place to capture any sediment in the run off water. The water being discharged from both points was of a brown colour, obviously turbid with a muddy or fine silty appearance. The officers did not observe any other sites in the vicinity of the cleared area that could have contributed to the turbid water. 7 After inspection the officers located two employees of the defendant at the on-site office, approximately 200 metres away from the cleared area. The defendant's employees were directed to install some temporary sediment and erosion controls, and in accordance with those directions the defendant placed silt fences across the drain running underneath the road and a sediment basin in respect of one discharge point. Those steps were completed by the end of 16 January 2004. 8 A further inspection was carried out on 16 January 2004 and it was observed that the sediment controls and erosion controls were still inadequate and that sediment laden water, albeit a smaller amount, was still discharging into the creek. 9 On 13 January 2004 the only sediment and erosion controls in place were silt curtains located near the bridge and in the area where the new bridge was to be located. These would only have managed to control sediment runoff directly from the areas disturbed when the new bridge works were being constructed. 10 An old sediment fence was present beside the creek, but this was a small and inadequate sediment fence that again would not have assisted in controlling the discharges from the cleared area. If appropriate sediment controls had been installed, more of the sediment laden waters would have been controlled, and less of the sediment would have flowed to the creek. 11 As to the environmental impact, it is estimated that approximately 266,000 litres of sediment laden water flowed from the cleared area into the creek on 13 January 2004. Additional sediment laden waters would also have entered the creek on 12, 14 and 15 January 2004 during rain on those days. It is estimated that 470 kilograms of sediment was carried into the creek in this manner. 12 Highly elevated sediment loading in natural waterways has a detrimental impact on native aquatic fauna due to the impairment of development, smothering of substrate food sources and habitat, as well as smothering of eggs and embryo. However, the creek is not a pristine environment or of particular environmental sensitivity. The discharge would have had a significant impact on parts of Duval Creek, especially on the days of 13 and probably 14 January 2004. 13 The Australia and New Zealand Guidelines for the Protection of Fresh and Marine Water Quality (ANZECC 2000) provide indicative trigger values for New South Wales upland rivers with respect to total suspended solids. The trigger value is 25 milligrams per litre. The total suspended solid values measured in the creek on 13 January 2004 downstream of the observed discharge were, on average, 1300 milligrams per litre. 14 There are two main effects of increases in total suspended solids concentration. Suspended particles block out light and thus alter the light regime in a water body; less light will be able to penetrate the water column and this can reduce the habitat available for the growth of submerged aquatic plants and degrade the habitat for predator animals that rely on vision to capture food. 15 Particles can also settle to the bottom of water bodies and alter the nature of the bed, or directly smother organisms that live on or in the bottom sediments. For example, a naturally sandy bottom can become more muddy with silt and clay sized particles. Again, this will either kill animals and plants if the deposition is large, or alter the range of animals and plants that can live there. 16 Particles that have settled into the bed of a stream or river are also subject to re-suspension and transport further downstream during subsequent higher flows. The more serious long term effects of such discharges are not local. Streams such as Duval Creek, are often degraded because of past catchment disturbance, mainly tree clearing for farming purposes and removal of riparian vegetation. The stream bed habitat has already been changed from pre-European conditions with increased catchment erosion and accumulations of sand and gravel deposits in pools. 17 A far more reaching and long term effect is the introduction of fine clay and silt sized particles that are carried through the fairly energetic river system, and eventually deposited in the river estuary. These particles will affect the ecology of the river system as they move through it, by decreasing water clarity, but in the estuary they will be virtually trapped. Here they will flocculate when they contact the brackish water of the estuary. Tidal currents will help keep them in suspension contributing to the turbidity of the estuary, but they will eventually settle in a quiet region, deposited as mud. These deposits are subject to re-suspension in windy conditions. 18 The overall effect is to change the clarity of estuarine waters from clear to perpetually murky. I note, however, that the estuary in this case would be the estuary of the Macleay River, some 200 kilometres away from the site of the pollution in this event. 19 In substance, the discharge in this case exposed parts of Dural Creek, Tillibuster Creek, which is downstream, and Commissioner Waters, further downstream, to an environmental stress for several days. It is unlikely to have had long term environmental consequences. In short, the effect of the discharge further downstream is likely to have been less obvious, but long lived and cumulative. 20 I now turn to the question of the appropriate penalty. In considering the question of penalty, the Court is required to have regard to a number of matters as set out in s 241(1) of the POEO Act. The first of those matters is the harm caused, or likely to be caused, by the commission of the offence. 21 It is accepted that the discharge would have degraded the waters of Duval Creek, although there is no evidence of actual harm. In other words, in this case, there is merely the possibility of actual harm. There is no doubt that an amount of 470 kilograms of sediment, which was the amount involved in the present case, is a significant amount and the two effects of that transport of sediment into the creek have been described. 22 The defendant has tendered material which shows that conditions in the creek improved considerably shortly after the event in question. That is, it is suggested, and I accept, that the sediment entering the creek remained localised and the creek quickly recovered to its pre-existing condition. I also accept that prior to the offence the creek was already in a somewhat degraded condition. Accordingly, this offence cannot be compared to the potential harm which such pollution would represent in a pristine waterway. 23 The next consideration is the practical measures which may have been taken to prevent, control, abate or mitigate that harm. In this respect the defendant was obliged by its contract with the RTA to put in place certain pollution and sediment controls, which it failed to do. After the event it did take steps to put in place erosion and sediment controls. Initially those controls resulted in the incurring of expenditure in the order of some $35,304, and, to the date of completion of its construction works, those sediment controls cost the defendant $87,608. 24 However those controls could and should have been put in place, and were required by the terms of its contract to have been put in place, prior to doing the work. The defendant did, however, retain a 50 metre buffer zone of vegetation leading down to the creek and did employ silt curtains at the bridge. It is self-evident however that those controls were far from adequate to prevent the incident that occurred in this instance. 25 The next consideration is the extent to which the person who committed the offence could reasonably have been foreseen the harm caused, or by it to be caused by the commission of the offence. The defendant concedes that some harm to the environment was foreseeable in the absence of erosion and sediment controls. Moreover, the requirement under the defendant's contract with the RTA to implement erosion and sediment controls must have alerted the defendant to the fact that those controls were designed to prevent harm. 26 I note, however, the submission that unusually heavy rain was a significant cause of the discharge. Nevertheless, the controls that the defendant were required to put in place were not in place. 27 The next consideration is the extent to which the person who committed the offence had control over the causes which gave rise to the offence. In this case it is conceded that the defendant had full control over the implementation of erosion and sediment controls and the initial failure to do so. 28 The final consideration under s 241(1) of the POEO Act is whether, in committing the offence, the person was complying with orders from an employee or supervising employee. That is not a relevant consideration in this case. 29 Section 241(2) also provides that the Court may take into consideration any other relevant matter. The primary consideration in sentencing for any offence is the objective gravity or seriousness of the offence. 30 A number of factors highlight the seriousness of the offence in this instance. The first is that this is an offence of strict liability, carrying a maximum penalty of $250,000. Next is the quantity of material that was discharged into the system, some 470 kilograms of silt and waste. This was discharged without the necessary sedimentation controls being in place. 31 There is also the question of general deterrence. It is a major consideration in the imposition of penalties for environmental offences. A penalty for a breach must therefore be sufficient to compel attention to environmental issues and to ensure that not only the defendant, but others, are encouraged to comply with the law so that the environment is not exposed to a risk of harm. 32 For strict liability offences however, care must be taken to ensure that the penalty imposed does not cause this offender to shoulder an unfair burden of community education: see Waldon v Hensler (1987) 163 CLR 561 at 570. 33 Then there is the question of specific deterrence, which aims to deter the particular offender from repeating the environmental offence that has been committed. In the present case the defendant has, firstly, no prior convictions and has demonstrated contrition through its cooperation with the EPA, its cooperation in the preparation of the statement of agreed facts, and the fact that it incurred considerable expenditure in mitigating the harm that had been caused. I think there is little risk of this defendant re-offending, and I thus do not place great weight on the need for a specific deterrence in this case. 34 There are a number of other principles that have to be taken into account. The principle of even-handedness requires the Court to consider any pattern in sentencing in similar cases. There is, however, a difficulty in applying this principle as Badgery-Parker J noted in Axer Pty Ltd v Environmental Protection Authority (1993) 133 LGERA 357 at 365: There is always a difficulty in attempting to compare the penalty in one case with the penalty in another because of the wide divergence of facts and circumstances. That task is difficult enough when one has the full text of all the relevant judgments, and more difficult when the material is provided in summary form. 35 My attention has been drawn to a number of cases that are said to be similar, but none of them, I think, are truly similar. For example, one of the cases cited by the prosecutor is Environment Protection Authority v Taylor Woodrow (Australia) Pty Ltd (1997) LGERA 368 where the penalty imposed for the siltation of a creek was $20,000. In that case, however, some 80 to 140 tonnes of sediment was discharged into the creek. That is nothing like the offence in this case, where some 470 kilograms were discharged. I do not think this case is anywhere near as serious as that. For similar reasons the other cases that are said to be comparable, when looked at in detail, are not truly comparable. 36 There are a number of other mitigating circumstances. The defendant pleaded guilty at the earliest opportunity and is therefore entitled to a full discount on penalty for so doing. The defendant has a hitherto unblemished record. The defendant, as I have said, has cooperated with the Prosecutor and has incurred considerable expense in mitigating the harm that occurred. I take all of those mitigating factors into account. 37 Having regard to the fact that in this case there is no evidence of actual environmental harm, I am inclined to the view that the penalty called for must be at the lower end of the scale. That is to say, bearing in mind fact of the maximum penalty, this penalty should be in the vicinity of about $12,000. In R v Thomson; R v Houlton (2000) 49 NSWLR 383 it was held by the Court of Criminal Appeal that it is appropriate to allow discounts on pleas up to 35 per cent, encompassing all relevant matters. Accordingly, the penalty will be discounted by 35 per cent for all the mitigating factors to which I have referred, resulting in a penalty of $7,800. 38 The formal orders of the Court therefore are: 1. The defendant is convicted of the offence as charged. 2. The defendant must pay a penalty of $7,800. 3. The defendant must pay the Prosecutor's costs in accordance with s 253 of the Criminal Procedure Act 1996 . 4. Exhibit A shall be retained and Exhibit 1 may be returned.

Environment Protection Authority v Cut and Fill Pty Limited

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