Environment Protection Authority v Kitco Transport Australia Pty Ltd

Relationship between Kitco and GWF 14At the time of the offences, Kitco had been transporting goods, including dangerous goods interstate between GWF's warehouses for eight to nine years, and had been doing so on average on a daily basis for at least four years. 15GWF and Kitco had an oral contract in relation to Kitco providing interstate transport services to GWF. 16As part of the EPA's investigation into the offences, GWF produced to the EPA under statutory notice an unsigned draft contract between GWF and Kitco titled "Transport Agreement Schedule", which was stated to commence on 1 January 2009 and continue for 24 months, which would have covered the period of the offences. There was no final signed version of the contract. An annexure to the draft contract describes the freight as "High percentage of Dangerous Goods classes include 8, 6, 5, 3". It appears that the draft contract was not provided to Kitco.

Loading of Kitco's vehicle on 23 December 2010 17Shortly prior to 23 December 2010, an officer of GWF orally requested that Kitco transport a load of GWF's products from GWF's premises at Braeside, Victoria (the Braeside premises) to GWF's premises in Stapylton, Queensland, approximately 40km south east of Brisbane. The GWF officer did not advise anyone from Kitco that the load contained dangerous goods. 23 December 2010 was the second last working day before Christmas. 18On 23 December 2010, Kitco employee Mr Dennis attended GWF's premises to pick up the load. Mr Dennis was not provided with any documentation or shipping documents prior to attending the GWF premises, to indicate that he would be transporting dangerous goods. 19Mr Dennis attended the Braeside premises driving Kitco's prime mover with registration VV97HI and towing trailers with registration VT28FL (Trailer A) and registration VT98FJ (Trailer B). The prime mover, Trailer A and Trailer B were each registered to Kitco. Both trailers were tautliners with curtain sides. Mr Dennis had only attended the Braeside premises on three or four previous occasions to collect a load. 20A GWF employee, most probably GWF's main loader Mr Benjamin Drake, loaded Trailer A with a number of goods, including (inter alia) the following dangerous goods, all of which are classified as class 8 (corrosive substances) packing group II: + CIP Alkali NA40 - 6 x 1000L intermediate bulk containers (IBCs) containing sodium hydroxide solution (heavy duty alkaline CIP detergent). + CIP Alkali NA40 - 32 x 20L drums containing sodium hydroxide solution (heavy duty alkaline CIP detergent). + EL Deckhand - 64 x 20L drums (corrosive liquid, acidic, organic). + Oven cleaner - 180 cartons (3 x 5L per carton) (caustic alkali liquid) (heavy duty oven and hot plate cleaner). 21After backing up his truck and pulling open the curtains to open the gates up, Mr Dennis waited out the front while Trailer A and Trailer B were loaded. Mr Dennis saw the GWF loader put the six IBCs of sodium hydroxide onto Trailer A. 22The presence of the six IBCs of sodium hydroxide triggered the dangerous good licensing requirements and placarding requirements, as described in more detail below. 23Also loaded onto Trailer A and/or Trailer B were some non-dangerous goods, including large quantities of laundry liquid, hand soaps and hand wash. 24GWF was the consignor of the dangerous goods and Kitco was the prime contractor for the dangerous goods, within the meaning of the Dangerous Goods Act. 25Once the goods had been loaded, Mr Dennis replaced the metal side gates and curtains on the trailers. One of GWF's staff provided Mr Dennis with consignment note no 247228 dated 23 December 2010. 26Mr Dennis did not read the documents he was given. 27No-one from GWF told Mr Dennis that dangerous goods had been loaded onto the vehicle. 28Neither GWF's employees nor Mr Dennis affixed any placards or emergency information panels (EIPs) to the vehicle. No one instructed Mr Dennis to affix placards or EIPs to the vehicle. 29When Mr Dennis drove away from the Braeside premises carrying the load of dangerous goods, there were no placards or EIPs displayed on Trailer A, Trailer B or the prime mover, in breach of the Australian Code for the Transport of Dangerous Goods by Road and Rail (7th edition, published in 2007) (ADG Code). 30Mr Dennis drove the loaded trailers to Kitco's premises at Koo Wee Rup in Victoria (the Koo Wee Rup premises). He parked the vehicle and detached Trailers A and B from the prime mover, so that the trailers could be picked up by another Kitco driver with another prime mover. He left the paperwork GWF had provided to him in the tool box of one of the trailers. 31At this time, Mr Dennis did not know about the dangerous goods licensing requirements for vehicles or drivers and he did not know about the requirements for displaying placards on vehicles carrying dangerous goods. 32Kitco had never provided Mr Dennis with any documentation, procedures or instructions in relation to transporting dangerous goods. 33Mr Dennis did not tell anyone from Kitco that there were dangerous goods in the trailers. 34Mr Dennis did not hold a dangerous goods driver licence under the Regulation. 35Neither trailer driven by Mr Dennis had a dangerous goods vehicle licence under the Regulation. As at 23 December 2010, Kitco had dangerous goods vehicle licences for 30 of its 80 registered trailers. 36As at 23 December 2010, Kevin Peter Keast was a licensed dangerous goods driver employed by Kitco, who was, in the ordinary course of business, often called upon to attend the Braeside premises when dangerous goods were to be transported.

Pick up of load from Koo Wee Rup on 27 December 2010 37On or about 27 December 2010, on instructions from Kitco, Kitco's employee Mr Temby drove prime mover with registration VV35HC (registered to Kitco) to the Koo Wee Rup premises, and attached Trailer A and Trailer B (the prime mover and two trailers together hereafter referred to as the B-double). Trailers A and B still contained the load that had been picked up from the Braeside premises on 23 December 2010. 38Mr Temby then drove the B-double from Koo Wee Rup to New South Wales, towards the intended destination at GWF's premises in Stapylton Queensland. 39Mr Temby did not hold a dangerous goods driver licence under the Regulation. 40Neither trailer driven by Mr Temby had a dangerous goods vehicle licence under the Regulation.

Inspection by NSW Police on 28 December 2010 near Brocklehurst NSW 41Prior to 10.45am on 28 December 2010, NSW Police officers had stopped the B-double driven by Mr Temby as it was travelling north on the Newell Highway, north of Brocklehurst in central NSW. There is no evidence to indicate that the truck was being driven dangerously or at an excessive speed. 42NSW Police Senior Sergeant Unicomb subsequently arrived at that location. 43Officer Unicomb and Mr Temby had a conversation in words to the following effect: Officer Unicomb "What are you carrying?" Mr Temby "I don't know, I just hook onto it and go." 44Officer Unicomb inspected the paperwork for the load, which was carried on the B-double and consisted of: Consignment note 247228 (provided by GWF) Emergency Procedure Guides (provided by GWF) for: + CIP Alkali NA40 - sodium hydroxide solution UN No 1824, Hazchem 2R. + caustic alkali liquid (de-greaser) UN No 1719 Hazchem 2R. + caustic alkali liquid (oven cleaner) UN No 1719 Hazchem 2R. + A delivery docket dated 23 December 2010 listing the items to be shipped as including: + 180 x F/S Oven cleaner 2 x 5L, UN Number 1719, DG class 8.00, Packing Clause II + 64 x EL Deckhand 20L UN Number 3265, DG class 8.00, Packing Clause II + 6 x CIP Alkali NA40 1000L, UN Number: 1824, DG class 8.00, Packing Clause II + 32 x CIP Alkali 20L, UN Number 1824, DG class 8.00, Packing Clause II. Manifest 23051, printed 24 December 2010 (generated by Kitco). 45Officer Unicomb then had a further conversation with Mr Temby in words to the following effect: Officer Unicomb "Are you carrying dangerous goods? It would appear by these papers that you are." Mr Temby "I don't know, as I said, I just hook under it and go." Officer Unicomb "Are you or this vehicle licensed to carry dangerous goods?" Mr Temby "Well I'm not. I don't know about the truck." 46There were no placards or EIPs displayed on the B-double at this time. 47Mr Temby opened the curtains on the sides of Trailer A to reveal 6 1000 litres IBCs full of liquid, each of which was labelled with an EIP with information including: "SODIUM HYDROXIDE SOLUTION", "UN No 1824" "HAZCHEM 2R", "CORROSIVE 8". Each IBC weighed approximately 1 tonne. There were also other dangerous goods and non-dangerous goods on board the trailers. 48The six IBCs containing sodium hydroxide in Trailer A were not restrained. The metal side gates of Trailer A were in a vertical position and there was one worn hemp rope tied across the gates, however the rope was not in contact with the top of the IBCs. 49The six IBCs were not restrained in accordance with Part 8 of the Regulation, which incorporates the requirements of Part 8 of the ADG Code. The ADG Code in turn requires compliance with the Load Restraint Guide (prepared by the National Transport Commission and the Roads and Traffic Authority of NSW), 2nd edition, 2004. 50Adequate restraint of the six IBCs would have involved the application of force to the top of each IBC in an amount of at least 20 per cent of the weight of each IBC (see p 21 of the Load Restraint Guide), for example by the use of webbing straps. 51Officer Unicomb directed Mr Temby that the B-double was not to be moved from its location until the load was property restrained in accordance with the Load Restraint Guide and until the vehicle was appropriately placarded. 52Mr Temby was then placed under arrest on unrelated matters and taken into custody. The B-double remained on the side of the highway. 53NSW Police contacted the EPA to pursue the investigation. 54In a recorded interview during the EPA investigation, Kitco's sole director Mr Townley was asked by the EPA investigator whether Kitco asked GWF what was on the loads they carried. Mr Townley replied "We never worried about it because we didn't know it had anything on it, so we just assumed that it would have been a non haz load". When asked why he would assume that, he replied "Because no one told us anything...". 55GWF orally terminated its contract with Kitco on 18 March 2011.

Dangerous goods licensing requirements for drivers 56Clause 192 of the Regulation provides that a person must not drive a road vehicle transporting dangerous goods that are in a receptacle with a capacity of more than 500 litres, or more than 500 kilograms of dangerous goods in a receptacle, unless the person holds a dangerous goods driver licence under Part 18 of the Regulation. 57As the volume of each of the six IBCs of sodium hydroxide on Trailer A was 1000 litres, a dangerous goods driver licence was required to be held by any driver transporting Trailer A containing the dangerous goods. 58In order to obtain a dangerous goods driver licence in NSW, a person must apply to the EPA and provide: (a) details of driving history, including any prior convictions for driving offences; (b) a certificate verifying that the person has recently completed the QLD30744 Course in Transport of Dangerous Goods by Road; and (c) evidence that the person is medically fit to drive a motor vehicle as assessed by a medical practitioner in accordance with the standards published by Austroads and the National Road Transport Commission. 59The QLD30744 Course in Transport of Dangerous Goods by Road provides training in topics including: + identifying dangerous goods by class and division; + preparing for the transport of dangerous goods including suitability of vehicle and packaging; + Hazchem codes and emergency procedures; + safety equipment and personal protective equipment; + load restraint; + safe transport of dangerous goods; + ADG Code and legislation; + risks and precautions; and + dangerous goods transport documentation. 60The EPA assesses applications and supporting evidence to establish whether the applicant is a suitable person to hold a licence to drive a vehicle carrying dangerous goods. 61At the time of the offences, the application fee in NSW for a dangerous goods driver licence was $57 and licence application forms were available on the EPA website. 62If a driver obtains a dangerous goods driver licence in any other Australian state or territory that has corresponding dangerous goods legislation, it is also recognised in NSW (cl 163 of the Regulation). 63Victoria has similar dangerous goods driver licensing provisions to NSW. In order to apply for a dangerous goods driver licence in Victoria, a person must apply to WorkSafe Victoria and provide competency evidence, medical fitness evidence and have no serious driving convictions within the last five years. There is no fee for applying for a dangerous goods driver licence in Victoria.

Dangerous goods licensing requirements for vehicles 64Clause 191 of the Regulation provides that a road vehicle must not be used to transport dangerous goods that are in a receptacle with a capacity of more than 500 litres, or more than 500 kilograms of dangerous goods in a receptacle, unless the vehicle is licensed with a dangerous goods vehicle licence under Part 18 of the Regulation. 65Dangerous goods vehicle licences are not issued for prime movers of combination vehicles. The part of the vehicle that is required to be licensed is the trailer carrying the relevant dangerous goods. 66The volume of each of the six IBCs of sodium hydroxide on Trailer A was 1000L. Kitco was therefore required to have a dangerous goods vehicle licence for Trailer A. 67In order to obtain a dangerous goods vehicle licence in NSW, a person must apply to the EPA and provide information including the type of dangerous goods to be transported on the vehicle. The EPA may require an applicant to provide additional information. 68If the EPA issues a dangerous goods vehicle licence, it will issue the licence holder with a licence label, which the licence holder must affix to the licensed vehicle in a conspicuous place (cl 214 of the Regulation). Licence labels in NSW and Victoria display the classes of dangerous goods that are permitted to be transported on the vehicle and the expiry date for the licence. 69The EPA may attach conditions to a licence, including in relation to the types of dangerous goods that may be transported in the vehicle. 70In order to transport a placard load of dangerous goods, a vehicle must be appropriately insured to cover the cost of dealing with an incident involving dangerous goods. Insurance cover or some other form of indemnity for not less than $5 million is required for any vehicle carrying a placard load of dangerous goods, to cover property damage, injury and clean up costs arising from any incident (Part 20 of the Regulation). It is part of the dangerous goods vehicle licence application process for an applicant to certify to the EPA that they have such insurance. Further additional information must be provided to the EPA in applications for licences for tank vehicles. 71At the time of the offences, the application fee for a new or renewed dangerous goods vehicle licence in NSW was $87 per vehicle and licence application forms were available on the EPA website. 72If Kitco had obtained a dangerous goods vehicle licence for Trailer A in any other Australian State or Territory that has corresponding dangerous goods legislation, such licence would have been recognised in NSW (cl 163 of the Regulation). 73Victoria has similar provisions to NSW in its legislation in relation to applications for dangerous goods vehicle licences. The application fee in Victoria for a dangerous goods vehicle licence was $60.

Placarding requirements 74A "placard" is a label or EIP that is required by the Regulation to be used in transporting dangerous goods (s 4 of the Dangerous Goods Act). 75A load of dangerous goods is a "placard load" if it meets any one of a number of requirements in cl 78 of the Regulation, including that it contains dangerous goods in a receptacle with a capacity of more than 500 litres or that the aggregate quantity of dangerous goods in the load is at least 1000 litres (cl 9 and cl 78 of the Regulation). A placard load of dangerous goods must have placards affixed to the vehicle in accordance with the Regulation and Chapter 5.3 of the ADG Code. 76The B-double's load constituted a placard load of dangerous goods. The B-double should therefore have been placarded in accordance with the Regulation and Chapter 5.3 of the ADG Code. 77To comply with Chapter 5.3 of the ADG Code: (a) a placard should have been displayed on the front of each prime mover that towed Trailer A (that is, both VV97HI and VV35HC); (b) an EIP should have been displayed on each side of Trailer A; and (c) an EIP should have been displayed on the rear of Trailer B. 78Under Chapter 5.3 of the ADG Code, EIPs on the B-double were required to display: (a) the proper shipping name for the dangerous goods being transported; (b) the UN Number for the dangerous goods; (c) any Hazchem Code assigned to the dangerous goods; (d) the expression: "IN EMERGENCY DIAL 000, POLICE or FIRE BRIGADE"; (e) the class or division label for the dangerous goods and any subsidiary risk label or labels applicable to the dangerous goods; (f) the name of an organisation responsible for providing a telephone advisory service, and a telephone number of the service.

Procedures in place at the time of the offences 79Between early 2008 and the time of the offences, Mr Drake was employed by GWF as a full time storeman. He had been employed by GWF since 2002. In his role as storeman, Mr Drake was responsible for placing ordered items onto pallets, wrapping pallets ready for transport and loading and unloading trucks. 80When Mr Drake first commenced work as a storeman at GWF, his supervisor had given him some instructions on how to store and handle dangerous goods in the warehouse. However at the time of the offences, Mr Drake had received no instructions or training in relation to loading, unloading or transporting dangerous goods. He was unaware of the requirement to placard vehicles transporting placard loads of dangerous goods, he did not know what a placard load was, and he was unaware of the licensing requirements for the transport of dangerous goods. 81Between 2008 and the time of the offences, a Kitco truck was loaded at the GWF premises almost every day. Many of these loads contained placard loads of dangerous goods. On occasions the load contained over 3000L in IBCs, thus triggering the licensing provisions. 82At the time of the offences, GWF did not have any written procedures in place relating to the transport of dangerous goods. It had no procedures in place to ensure that drivers transporting its dangerous goods were licensed to do so, that vehicles transporting its dangerous goods were appropriately licensed, that vehicles were placarded where required or that dangerous goods were safely secured in vehicles. 83At the time of the offences, only two GWF employees had completed a training course in the transport of dangerous goods by road and one (warehouse supervisor Ray Haylock) had done a one day training course in the management of dangerous goods. Loaders of dangerous goods who were employed by GWF were not trained in relation to the transport of dangerous goods and were ignorant of the legal requirements. 84At the time of the offences, Kitco had oral procedures in place relating to the transport of dangerous goods, as well as licensed drivers and trailers. Kitco had no written procedures in place. 85Kitco had transported GWF's dangerous goods interstate on a daily basis since at least 2006. Kitco had no procedure in place to ensure that its drivers without a dangerous goods driver licence had received training in, or were aware of, the legal requirements for transporting dangerous goods. Unlicensed dangerous goods drivers employed by Kitco did not have sufficient training to be able to recognise a load of dangerous goods based on the load documentation or EIPs displayed on IBCs.

Action taken by defendants after the offences 86After the offences, Kitco paid for some of its office staff and drivers, including Mr Dennis, to do a dangerous goods course.

Nature of class 8 dangerous goods and potential for harm 87The dangerous goods that are the subject of these proceedings were class 8 dangerous goods. 88Class 8 dangerous goods are substances which, by chemical action, will cause severe damage when in contact with living tissue, or, in the case of leakage, will materially damage, or even destroy, other goods or the means of transport. 89Class 8 dangerous goods are divided among three packing groups according to their degree of hazard in transport as follows: (a) Packing group I: Very dangerous substances and preparations; (b) Packing group II: Substances and preparations presenting medium danger; (c) Packing group III: Substances and preparations presenting minor danger. 90All of the dangerous goods in the B-double were classified as packing group II, that is, presenting medium danger. These substances cause full thickness destruction of intact skin tissue within an observation period up to 14 days starting after the exposure time of more than three minutes but not more than 60 minutes. 91The failure to safely secure the six IBCs of sodium hydroxide in Trailer A increased the risk of human injury or death and increased the risk of environmental harm in the event of an accident. It posed a risk that the one tonne IBCs could have toppled out of the vehicle and thus injured or killed people, or damaged property. It also increased the risk of a harmful chemical spill in the event of an accident, in that IBCs being thrown from a vehicle would be more likely to break or leak due to increased impact, compared to a situation where IBCs are properly secured to the bed of a trailer. 92The purpose of having accurate placards and EIPs in prominent places on vehicles is to ensure that emergency response personnel are readily able to determine the most appropriate action to take in the event of an emergency. 93Hazchem Codes on EIPs indicate to emergency response personnel what procedure to follow in the event of an accident. In relation to the dangerous goods on the B-double, placarding should have displayed Hazchem Code "2R", which would have indicated to emergency personnel that: (a) in a fire, a fine water spray should be used, (b) there is no risk of violent reaction or explosion; (c) liquid-tight chemical protective clothing and breathing apparatus should be worn; and (d) the chemical may be diluted and washed away with large quantities of water, but wherever practicable, should be contained and prevented from entering drains and watercourses.

Prior offences 94Kitco has no prior convictions for environmental offences in NSW or Victoria. 95GWF has two prior convictions in the Land and Environment Court of NSW for water pollution offences: + On 5 May 1998, GWF was convicted of an offence under the Environmental Offences and Penalties Act 1989 in that it polluted waters in breach of s 16(1) of the Clean Waters Act 1970. GWF was fined $5,000 and ordered to pay legal costs of $11,096 (Environment Protection Authority v George Weston Foods Ltd unreported, NSWLEC, 50089/97, Lloyd J, 5 May 1998). + On 9 July 2010, GWF was convicted of an offence under s 120 of the Protection of the Environment Operations Act 1997 (PEO Act) and ordered under s 250(1)(e) of the PEO Act to pay $67,000 to theTamworth Regional Council for the Peel River Riparian Project and to publicise details of the offence in three newspapers. It was also ordered to pay investigation costs of $12,000 and legal costs of $18,000 (Environment Protection Authority v George Weston Foods Ltd [2010] NSWLEC 120). 96GWF has also been prosecuted for pollution offences in Victoria on three occasions.

Co-operation with the Prosecutor 97Kitco has fully co-operated with the EPA during its investigation and in the preparation of the SOAF.

Evidence for Kitco 98The affidavit of Mr John Townley dated 22 February 2013 was read. Mr Townley is a director and shareholder of Kitco and was authorised to make this affidavit on Kitco's behalf. Mr Townley states that from time to time GWF would call Kitco to advise that they had a load containing dangerous goods. If this occurred, Mr Townley states that the following procedure was observed: (1)a driver with a valid dangerous goods licence was allocated to the job; (2)a dangerous goods registered trailer was sent to perform the job ensuring that it had the necessary EIPs, placards, equipment and licences. The EIPs were kept at the Sunshine depot and would be put onto the trailer whenever Kitco was notified of the presence of dangerous goods, before the truck left Kitco's depot; (3)usually the consignment note prepared by GWF recorded in the special instructions section the letters "DG" standing for dangerous goods; (4)the manifest generated by Kitco would then note the presence of dangerous goods, including its quantity and class number; (5)Kitco's driver would, when calling up the Sunshine depot from the GWF warehouse, confirm the quantity and class of dangerous goods with Kitco's operational staff; and (6)the loads were almost always directed to the Sunshine depot. 99Mr Townley estimates that half the loads it transported for GWF contained dangerous goods. Whenever Mr Townley was advised that there was one IBC that was 500 litres or more he sent out a dangerous goods licensed driver and trailer. 100At 23 December 2010, Kitco employed at least 13 drivers who were trained and held dangerous goods driver licences. These drivers were trained by Mr Bruce Armstrong of Bruce Armstrong & Associates Pty Ltd at Kitco's expense. At 23 December 2010, Kitco had 30 registered dangerous goods licensed trailers. At all times the Sunshine depot had the required number of placards, EIPs, fire extinguishers and dangerous goods badges for all the dangerous goods licensed trailers. 101Mr Townley states that there were dangerous goods licensed drivers available on 23 December 2010 who would have been sent on the job if Kitco had been notified that the load contained dangerous goods. Mr Townley states that what occurred on 23 December 2010 was not in the ordinary course of business given that it was two days before Christmas and the Sunshine depot had closed early so the load was transported to the Koo Wee Rup depot. If the load had been transported to the Sunshine depot Kitco's staff would have inspected it and the dangerous goods identified. 102Mr Townley states that since neither Kitco nor himself were notified that the load contained dangerous goods, a dangerous goods licensed driver and trailer were not assigned to pick up the load. This is supported by the manifest annexed to the affidavit that was created by Mr Dennis who did not know about the presence of dangerous goods and therefore did not identify the presence of dangerous goods in the load. 103Mr Townley also states that Kitco pays its dangerous goods licence drivers the same rate as its non-dangerous goods licence drivers. There was no financial incentive for Kitco to use drivers without a dangerous goods driver licence. 104Mr Townley details the procedures that have been implemented by Kitco since the offence in order to remedy its procedures. Kitco has created a manual titled "Kitco Transport Operational and Driver Dangerous Goods Manual" which has been distributed to all operational staff and drivers. This manual contains checklists that operational staff and drivers must complete when booking a job. It also includes asking customers whether dangerous goods are present and if so the class and quantity of the dangerous goods. The manual also contains information on the requirements for loads containing dangerous goods. Mr Armstrong has been engaged by Kitco to formally implement a dangerous goods policy and procedure, train all staff and supply a copy of the dangerous goods procedures for Kitco's vehicles, drivers and subcontractors. 105Kitco has also enabled the processing of paperwork to be carried out at all its depots and not just at the Sunshine depot. This means that loads containing dangerous goods can be directed to depots other than the Sunshine depot and as a result, if dangerous goods are present, they will be detected and rectified. The diaries have also been amended to include a column to record whether dangerous goods will be contained in the load.

Public purpose of Dangerous Goods Act 106As submitted by the EPA, it is important to have regard to the purpose of the Dangerous Goods Act, as set out in s 3, which clearly imposes a positive duty on those involved in the transportation of dangerous goods to ensure that they are transported in a safe manner. The offences in the Dangerous Goods Act relate to breaches of duties which not only actually undermine public safety, but which also have the potential to do so. The legislation is specifically designed to cast a wide net of responsibility over those involved in the various aspects of the transportation of dangerous goods. I have already sentenced the consignor GWF for an offence under s 9 of the Dangerous Goods Act. The transporter, Kitco is charged with three offences under the dangerous goods legislation. The necessity for controls on the transport of dangerous goods is apparent when their destructive qualities are considered, here class 8 dangerous goods. 107The regime for the licensing of vehicles to carry dangerous goods is set out in the SOAF at par 63 - 72, including a requirement that adequate insurance is held. The system for obtaining a driver licence to carry dangerous goods, which includes mandatory training, is set out in the SOAF at par 55 - 62. Placarding requirements are set out at par 73 - 77 of the SOAF. Loading requirements for dangerous goods are identified in Part 8 clause 100 of the Regulation, referring in turn to the ADG Code.

Extent of harm caused or likely to be caused by the offence 108The EPA submitted that the objective harmfulness of Kitco's actions were relevant to determining the seriousness of the crime per Bentley v BGP Properties Pty Limited [2006] NSWLEC 34; (2006) 145 LGERA 234. In the terms of s 7 and s 9 of the Dangerous Goods Act that is adverse impact on road users, the general public and the broader environment. It includes the potential or risk of harm per Axer Pty Ltd v Environment Protection Authority (1993) 113 LGERA 357. No actual harm was caused by the offence but there was potential for harm. 109The dangerous goods that are the subject of these proceedings were Class 8 dangerous goods, being substances which, by chemical action, cause severe damage when in contact with living tissue, or, in the case of leakage, will materially damage, or even destroy, other goods or the means of transport. As set out in the SOAF, the six IBCs containing sodium hydroxide in Trailer A were not restrained in accordance with the requirements of Part 8 of the Regulation, which incorporates the requirements of Part 8 of the ADG Code. The ADG Code in turn requires compliance with the Load Restraint Guide (prepared by the National Transport Commission and the Roads and Traffic Authority of NSW), 2nd edition, 2004. 110Although the IBCs in Trailer A were behind vertical side gates and a rope was tied across the gates, this was clearly inadequate to restrain the load. The rope was not in contact with the top of the IBCs. Adequate restraint of the IBCs would have involved the application of force to the top of each IBC in an amount of at least 20 per cent of the weight of each IBC (see p 21 of the Load Restraint Guide), for example by the use of webbing straps. 111The purpose of having accurate placards and EIPs in prominent places on a vehicle transporting dangerous goods is to warn other road users of the risks relating to the vehicle's load, and to ensure that emergency response personnel are readily able to determine the most appropriate action to take in the event of an emergency. In the event of an accident involving the vehicle, the contents of the load would not have been immediately apparent to emergency personnel. This had the potential to delay any emergency response whilst the nature of the dangerous goods on board the vehicle was identified. Further, it is important that a driver is aware if he or she carries dangerous goods in order to alert emergency personnel and others in the event of an accident. 112Kitco accepted, as do I, the EPA's submission that there was potential risk of significant harm, as reflected in par 91 of the SOAF.

Practical measures that may be taken to prevent, control, abate or mitigate that harm 113The practical measures that could have been taken to prevent, control, abate or mitigate the harm caused or likely to be caused to the environment by the commission of the offence is another relevant consideration. Environment Protection Authority v Waste Recycling and Processing Corp [2006] NSWLEC 419; (2006) 148 LGERA 299 at [173]: An offence is objectively more serious if commission of the offence and the risk of harm occasioned by the commission of the offence, are foreseeable and there are practical measures that could be taken to prevent, control, abate or mitigate the occurrence of the offence or the harm, but those practical measures are not taken. 114I understand from the evidence of Mr Townley that Kitco did employ adequate numbers of licensed drivers and vehicles for the transport of dangerous goods and had the necessary placarding and other equipment. Due to the reactive nature of the system then in place when an order was received from GWF there was a failure by GWF and hence by Kitco to identify that dangerous goods being consigned. 115In this case, simple steps could have been taken to prevent the offence, as indicated by the steps Kitco put in place after the offence to prevent a recurrence. Kitco accepted these submissions. Its evidence through its director, Mr Townley, is that substantial measures have been introduced since the offence. These include the production of a manual to implement changes to procedures and compulsory training of drivers and operational staff to ensure that they are aware of dangerous goods being placed with Kitco. Each depot is also able to process paperwork and this will ensure inspection and therefore detection of dangerous goods. These changes are accepted by the Court as likely to prevent a recurrence of such an offence.

Foreseeability of the harm caused or likely to be caused by the commission of the offence 116The EPA submitted that the potential risk of harm caused by the offence was reasonably foreseeable. Kitco had been transporting goods interstate between GWF's warehouse for eight to nine years and on an almost daily basis from 2007-2010. Many loads contained dangerous goods and on occasions the load contained over 3000L in IBCs, triggering the licensing requirements. Kitco accepted that potential risk arose from the offences and therefore the foreseeability of harm arising from that potential risk.

Objective seriousness of the offence 117The objective seriousness of the offence is similar to that in George Weston Foods, namely, given the purpose of the legislative scheme and the absence of effective procedures of Kitco considering the size and nature of its business, is moderate but at the low end of that scale. There was no actual risk to human health or the environment resulting from the offences. I accept the conduct giving rise to the offences was neither deliberate nor motivated by financial considerations. While systems were in place, these were reactive, not proactive. Further, the offence was compounded in part from the use of a depot different from where the goods would usually have been transported and where the presence of dangerous goods was likely to be have been seen when inspected, as identified by Mr Townley.

Specific deterrence 118The EPA submitted that specific deterrence should be taken into account in the assessment of penalty in this case, because Kitco continued to be engaged in the transporting of dangerous goods. Kitco submitted that this consideration does not weigh heavily in the circumstances of this case having regard to the measures taken to prevent a recurrence and its lack of any prior offences of any kind. 119In Environment Protection Authority v Ravensworth Operations Pty Ltd [2012] NSWLEC 222 at [48]-[49] I stated: [48] Specific deterrence is a purpose of sentencing under s 3A(b) of the CSP Act and has been considered relevant where a defendant continues in the same area of operation in which an incident has occurred. In taking specific deterrence into account in Environment Protection Authority v Moolarben Coal Operations Pty Ltd (No 2) [2012] NSWLEC 80 (Moolarben (No 2)) Craig J cited at [113] the following passage in Axer at 359 per Mahoney JA: "The legislation does not seek merely to prevent deliberate or negligent pollution. It envisages that, at least in many cases, proper precautions must be taken to ensure that pollution does not occur. Experience has shown that it is not enough merely to take care: accidents will happen. The legislation envisages that in many cases care must be supplemented by positive precautions; business must be arranged and precautions taken so as to ensure that pollution will not occur". [49] Specific deterrence is appropriate for corporate defendants to catalyse rehabilitation so that the company takes the required steps to prevent repetition (See BJ Preston, "Principled Sentencing for Environmental Offences", a paper presented to the 4th International IUCN Academy of Environmental Law Colloquium, 16 - 20 October 2006 at p 5.) 120The extensive legislative obligations imposed on transporters of dangerous goods is identified in s 6, s 7 and s 9 of the Dangerous Goods Act and the Regulation. I accept that measures have been taken since the offence which would prevent a recurrence of a similar offence. Existing procedures were lacking at the time of the offence however. Kitco did not have any proactive procedures to identify whether dangerous goods were to be transported and no written procedures in place. As its drivers unlicensed to transport dangerous goods received no training in dangerous goods requirements, Mr Dennis and Mr Temby were not equipped to identify that they were in fact carrying dangerous goods despite the provision at the time of loading of the goods by GWF of a consignment note which stated that the goods were classified as dangerous. The IBCs loaded onto the trailer were clearly labeled as such. 121Given the nature of Kitco's business of transportation and that Kitco had been transporting dangerous goods on a close to daily basis between GWF's warehouses for several years (SOAF par 81), it is concerning that there were no effective procedures in place on the day of the offence to ensure compliance with the Dangerous Goods Act and Regulation. The procedures now implemented are necessary and fundamental if legislative compliance is to be achieved. In these circumstances specific deterrence is a relevant sentencing consideration.

General deterrence 122The EPA also correctly submitted that general deterrence is an important consideration. Cameron v Eurobodalla Shire Council [2006] NSWLEC 47; (2006) 146 LGERA 349 at [71] refers to a number of authorities which emphasise the importance of general deterrence in sentencing for environmental offences. The EPA also relied on the case of Axer which held, at 367, that: Those who handle dangerous chemicals must be regarded as under a heavy obligation to the rest of the community to do so with the utmost care. 123The transportation of dangerous goods involves the handling of dangerous chemicals and the potential for their exposure to road users and emergency services personnel and sentencing for offences under the Dangerous Goods Act should consider this.

Prior Convictions 124Kitco has no prior convictions for any offences.

Evenhandedness 125The principle of evenhandedness requires that the Court consider if there is any sentencing pattern for like offences in order to determine a consistent approach to penalty (R v Visconti [1982] 2 NSWLR 104). This principle must always be applied subject to the particular circumstances of the case before the Court (Hoare v R [1989] HCA 33; (1989) 167 CLR 348 at 354). 126Previous cases in this Court have dealt with offences under s 37(1) of the Road and Rail Transport (Dangerous Goods) Act 1997, which is equivalent to s 9(1) of the Dangerous Goods Act. The maximum penalty was then $250,000. These include Environment Protection Authority v Moama Refinery Pty Ltd [2002] NSWLEC 244 and Environment Protection Authority v Embridge Crest Pty Ltd [2002] NSWLEC 238. In Moama, the defendant was the operator of a refinery which packed and placarded dangerous goods for transport. It was the owner and consignor of these goods. That case involved leaking drums of solvent inside a truck which was not correctly placarded. These leaking drums created a risk of liquid catching fire in the area surrounding the vehicle. The defendant had no written procedure in place for assessing whether the storage drums were suitable for the liquid they contained. Embridge arose from the same incident the subject of which constituted the proceedings in Moama. The EPA accepted that the seriousness of the offence in this case is less than that in Moama and Embridge, where fines of $45,000 and $30,000 respectively were awarded after discounts for mitigating circumstances. 127In Environment Protection Authority v MacDermid Overseas Asia Ltd [2007] NSWLEC 225 where the offence resulted in significant environmental harm, a penalty of $75,000 was imposed and $55,000 costs awarded. The defendant was a manufacturer of chemicals which a different company transported from Victoria to NSW. The chemicals were not packed in accordance with the Road and Rail Transport (Dangerous Goods) Act 1997 then in force. The truck was involved in a serious accident in NSW and the clean up took two days. There was potential for serious harm because of the different chemicals concerned which were toxic and dangerous if mixed. That matter was much more serious than this matter. 128In Environment Protection Authority v Patrick Distribution Pty Ltd [2006] NSWLEC 123 the offence was the failure to placard. A fine of $9,750 was imposed. The defendant had no prior convictions. Kitco accepted this matter is more serious than Patrick. 129In George Weston Foods, an offence under s 9(1) of the Dangerous Goods Act, I imposed a penalty of $20,000 reduced from $30,000 due to various mitigating factors. That offence arose from the same circumstances before me in this matter. 130This matter is less serious than the circumstances in Moama, Embridge and MacDermid where actual and greater potential risk of serious harm arose to varying degrees. This matter is more serious than Patrick. It is similar to George Weston Foods.

Parity 131Kitco submitted that the principle of parity applies given the offence in George Weston Foods arose from the same set of circumstances. That principle provides that people who have committed the same offence with similar backgrounds should receive the same sentence (Lowe v R [1984] HCA 46; (1984) 154 CLR 606). I agree this principle generally applies in this matter but note that Kitco has been charged with three offences reflecting the specific obligations placed on transporters of goods under s 6 and s 7 of the DG Act and Regulation. I also note that Kitco comes before the Court with no prior convictions.

Totality 132Given that the three offences arise from the same set of facts the totality principle should be applied whereby there is a downward adjustment of penalty to reflect the appropriate overall criminality of the offences.

Matters in mitigation 133The CSP Act s 22 provides that when determining sentencing regard must be had to a plea of guilty, and the Court can impose a lesser sentence to reflect this. Kitco entered a guilty plea at the earliest opportunity. A plea of guilty entitles Kitco to a discount in penalty under s 22 of the CSP Act in the range of 10 - 25 per cent: R v Thomson; R v Houlton [2000] NSWCCA 309; (2000) 49 NSWLR 383; R v Sharma [2002] NSWCCA 142; (2002) 54 NSWLR 300. 134Kitco has demonstrated remorse and contrition by its early guilty plea and the actions it has taken to address its procedures for transporting dangerous goods and staff training procedures as identified in the affidavit of Mr Townley. Kitco accepted that it had an independent obligation under the Dangerous Goods Act to ascertain whether the goods to be transported were dangerous goods and to ensure that the vehicle and driver were licensed and that the goods were safely transported. 135Kitco's cooperation with the EPA can also be taken into account in mitigation.

Appropriate Sentence 136I agree with Kitco's submission that when the individual offences are considered, s 9 is an umbrella offence and was the offence GWF was charged with. In that matter it was particularised in a number of ways including a failure to ensure that this Defendant had a licensed driver and a licensed vehicle to transport the dangerous goods. Here Kitco has also been charged under s 6 and s 7 offences as more particular offences arising from specific obligations placed on transporters of dangerous goods. 137It is appropriate that I sentence for the s 9 offence first (509230/12) and consider a penalty of $30,000 is warranted. Allowing for the maximum reduction for an early plea of guilty and additional mitigating factors, contrition and remorse, and no prior convictions, this should be reduced to $18,000. There should be a reduction in penalty for each of the other offences taking into account both the need for parity and the application of the totality principle with a progressive reduction for each. For the s 6 offence (50928/12) the appropriate penalty is $5,000 and for the s 7 offence (50929/12) the penalty is $1,000.

Costs 138Kitco has agreed to pay the EPA's legal costs of $25,000.

Orders 139The Court orders that: (1)The Defendant is convicted of the offences in proceedings numbered 50930/12, 50928/12 and 50929/12. (2)In matter number 50930/12, the Defendant is fined the sum of $18,000 to be paid to the Registrar of the Court within 28 days of today's date. (3)In matter number 50928/12, the Defendant is fined the sum of $5,000 to be paid to the Registrar of the Court within 28 days of today's date. (4)In matter number 50929/12, the Defendant is fined the sum of $1,000 to be paid to the Registrar of the Court within 28 days of today's date. (5)The Defendant is to pay the Prosecutor's costs of $25,000. (6)The exhibits may be returned.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 04 April 2013