Environment Protection Authority v Lithgow Coal Company Pty Limited

Introduction 1 HIS HONOUR: The defendant is charged that on 18 November 2001 at Cullen Bullen it committed an offence against s 64(1) of the Protection of the Environment Operation Act 1997 ("the PEO Act") in that it was the holder of a licence a condition of which was contravened. 2 The licence is No. 10341 Environment Protection Licence issued pursuant to s 55 of the PEO Act and the relevant condition is condition 03.2 which provides, Activities occurring in or on the premises must be carried out in a manner that will minimise the generation or emission from the premises of wind blown or traffic generated dust. 3 The defendant operates a colliery in what is unusually close proximity to the small township of Cullen Bullen. There is an agreed statement of facts that has been developed by the parties and has become exhibit "A". It would be a disservice to everybody if I read out and read onto the record the particularly salient aspects of the Statement of Agreed Facts ("SOAF"), particularly in so far as the background to the occurrence and the description of the particular events which took place on 18 November 2001. What I propose is that I specifically refer to [2] to [13] of the SOAF which is exhibit "A" to provide the general background to the manner in which this company comes to be operating the open cut, underground and what is described as continuous high wall coal mining activities at Cullen Bullen. Then for a very helpful description of the actual events which took place on 18 November 2001 I rely upon [14] to [27] of exhibit "A" which I will retain in the Court file as a record of those particular matters. 4 The extent of harm that the Court takes into account pursuant to s 241 is described by the prosecutor as a localised nuisance on the day of the offence. Although that may have been the case the Court does not have before it any specific and particular evidence of the extent or the nature of that localised nuisance. However it is clear from the material that the Court has had an opportunity to see through a video and photographs that there was what might be described as a significant cloud of dust that escaped from the site and proceeded airborne in a direction which would have at least threatened if not impacted upon the township of Cullen Bullen. So that whether there was actual harm is not altogether the sole point that arises pursuant to s 241(1) of the PEO Act, there was also certainly a potential that there was likely to be harm from the impact of that dust moving towards and possibly into the town of Cullen Bullen. 5 The defendant in the affidavit of its Chairman and Director in Charge of Lithgow Coal Company identifies precaution taken to deal with this type of eventuality that occurred on this occasion as additional precautions implemented to ensure there is no repeat of the dust incident. They included mining of the Middle River seam is permitted only on week days to ensure that adequate and appropriate supervision is available, only excavations are used in the Middle River seam to ensure that the coal is not ground up into fine particles that can be more easily picked up by wind and also that access for a water truck to the mining area is maintained at all times. 6 Furthermore, the Court is able to establish from the statement of agreed facts that shortly after 18 November 2001 the company installed a system to direct water to the areas at the site where the Middle River seam was being mined. This system includes four water cannons and approximately ten sprinklers. The purpose of the system was to suppress dust generated by mining activities at the Middle River seam because of the very fine nature of the overburden. 7 Furthermore, after 18 November 2001 the defendant has also changed the practices that it used to mine the Middle River seam. It has discontinued using a bulldozer to remove coal from the seam, it has found the operation of the bulldozer had the effect of grinding the overburden and thereby increasing the potential for dust emissions. 8 The company has begun as I said a moment ago to use an excavator instead of a bulldozer for the reason that the excavator does not grind the overburden of the coal that is being removed. 9 These matters are themselves indicative of the practical steps that could have been taken in order to minimise the prospect of emissions from the site which after all is the obligation imposed by condition 03.2 of the licence. Furthermore, they indicate as well the fact that the company has responsibly taken steps as far as practicable in such an operation as an open cut mine to avoid the prospect of further contravention of the condition. 10 The defendant, as Mr Lloyd quite properly concedes, takes no issue that it could reasonably have foreseen the harm caused or likely to be caused particularly when mining a seam such as Middle River seam in such close proximity to a township no matter how small. 11 The overburden at this part of the Cullen Valley Mine was composed as the facts show of a light powdery material that was similar in nature to talcum powder. This type of material was especially prone to becoming airborne if adequate dust suppression measures were not followed. I agree and I think this does not go outside the concession made by Mr Lloyd but I agree with the prosecutor's submission that the defendant was or should have been aware that emissions of dust could impact adversely upon the community of Cullen Bullen. 12 The SOAF confirm that the contravention of condition 03.2 resulted in the emission of large quantities of dust into the atmosphere and that the dust emissions were carried from the Cullen Valley Mine in the direction of the town of Cullen Bullen by the winds that were prevailing on that day. The extent of those winds of course is explained by the statement that I have taken and adopted from the statement of agreed facts and there seems to be no issue that they were of considerable force on that day. 13 There can be no question the defendant had control over the causes which gave rise to the offence in as much as the defendant is vicariously liable for the actions of employees of its contractors. 14 The defendant submits that the Court would find that the dust incident that occurred on 18 November was caused by an unusual and unlikely to be repeated combination of an unwise decision on the part of an employee of the contractor that carries out the mining operation on the site to remove overburden in an area where the nature of the removed material combined with an unexpected, unpredictable and major storm event rather than any deliberate or malicious act on the part of the defendant, its servants or agents. I accept that submission as being a reasonable approach for the Court to be taking in considering the extent to which any penalty should be imposed. 15 I do not embrace the concept of a breach of public trust where a licence condition is breached notwithstanding the strong language to that effect by the former Chief Judge of this Court in Environment Protection Authority v Port Kembla 115 LGERA 391. I prefer to be consistent and follow the line adopted in Environment Protection Authority v ADI Limited 1999 NSWLEC 14 at [23] where in the Court's opinion I said that the fact that the company held a licence heightened its responsibility to keep the level of discharge from the premises within the parameters set by the licence. As far as I can see that concept was not disturbed on appeal by the Court of Criminal Appeal when they dealt with ADI and dismissed the appeals in that case. 16 I also note in passing that Cowdroy J rejected the concept of a breach of public trust in Environment Protection Authority v Capral Aluminium (50019/98, 50020/98, 50021/98). 17 There is no doubt as the defendant recognises that any contravention of s 64 of the PEO Act is serious. The Parliament has recognised this by imposing a maximum penalty for each offence in the case of a corporation at $250,000. 18 The gravity of the offence is not in my view in the lowest range in this case as Mr Lloyd submits but the extreme windy conditions on the day were, the Court recognises, a major contributing factor. Although the weather effect is not an exculpating fact, it nevertheless was as I said a major contributing factor. Any company operating a development such as an open cut mine in close proximity to a township needs to take careful account of the weather conditions and I note from the statement of facts that indeed account was taken of the weather conditions and either a miscalculation or misunderstanding or failure to apprehend what was likely to occur later in the day or indeed the nature of the event was not predictable. Nevertheless, account was not taken of the particular eventualities that occurred. 19 It is submitted and I do not think seriously disputed by the prosecutor that there are a number of matters that mitigate the defendant's culpability and support the argument that the defendant should be given the benefit of those factors. 20 Firstly, there is no dispute that the defendant entered an early plea of guilty and is entitled to have the benefit of the full discount now widely and generally accepted in that respect as being at least twenty-five percent of the fine that would otherwise have been imposed. 21 I have read the affidavit material presented on behalf of the defendant and I accept that the company is concerned and was concerned at the time about the nature of the event and how it occurred to the extent that it clearly expresses a significant degree of remorse and indeed to the extent that it has already shown that it has taken steps there is not a real prospect that there will be a recurrence. However I do not discount that altogether having regard to the nature of the operations but nevertheless I accept that the company will be using its best endeavours in the future to ensure as far as practicable that it will not occur again. 22 There are matters of general deterrence that must be taken into account in dealing with prosecutions under legislation such as the PEO Act as well as the element of punishment of the individual who commits an offence. 23 It is acknowledged and recognised by the Court that the defendant cooperated with the prosecutor and its officers in the initial stages and provided the information, whatever it was that was requested by those investigating officers, and then subsequently and further and this is also important participated in the preparation of a statement of agreed facts in such a form that it could be presented to the Court as an exhibit thereby obviating the otherwise significant expense that could be incurred in the calling of individual witnesses and extending the court time. I note that the matter was originally set down for a period of two days. It is clear that the matter will be finished and completed including a judgment in less than half a day and both parties are to be congratulated on dealing with this matter in this efficient and practical way. 24 The prosecutor however does not get a great deal of benefit other than salutation but the defendant is entitled to a recognition in diminishing the amount of the penalty by way of mitigation. 25 I take into account this is a first offence and that the defendant has otherwise a clear record in relation to this type of offence. That is a matter that the Court obviously must take into account. 26 The question of costs has been settled between the parties and the defendant has agreed to pay the prosecutor's costs in the sum of $18,000. That in itself is not an inconsiderable sum of money but is not only that but it is indicative of the cooperation that the defendant has offered to the prosecutor in bringing this matter to finality in an efficient way. 27 I am satisfied further and Mr Lloyd makes the general submission that I can accept that the company has a positive commitment to the environment relying upon the affidavit evidence which has been read on behalf of the defendant. That evidence was read without objection and accordingly I record that this company is to be treated as a responsible corporate citizen and a company that readily recognises what its obligations are under the PEO Act, the particular licence that it holds and I suppose even to the extent of its legal obligations generally. 28 The offence in itself as I said I do not accept was in the absolutely low range. The operation that the company is carrying out is a delicate one in the sense that the conditions are not ideal. Two things that raise the expectation that the company would take particular care to comply with the term of its licence in the circumstances of its operation. 29 These are firstly that the material in which the company or its employees or its contractors, it does not matter as vicarious liability is accepted anyway - the materials in which those persons are working are not the general run of the mill conditions that one might expect where overburden is being removed and there is a type of soil that may not be as prone to windblown impact as the type of soil that is involved on this site. 30 Secondly the agreed fact that this mine is operating within 350 metres of several homes and that it is operating at a level above the general surrounding countryside if I can put it that way. The town of Cullen Bullen is in close proximity in terms of the distance that mines such as this are located in terms of a township. Those matters I think place perhaps some heightened responsibility upon this defendant. 31 This is not a case as other cases have been where the development comes first and then the residents turn up and the residents start to complain about something that was there all along, the Sydney Airport type of syndrome. This is a case where the town, and I think I can take judicial notice of this, has been there for a very, very long time and the mine of course has subsequently intruded into that environment. 32 In the circumstances it is the Court's view that an appropriate penalty before taking into account the mitigating factors that I have already referred to and will take into account would be in the order of $50,000 to $60,000. However, applying the appropriate discount for the early plea and the other mitigating factors in addition to that I propose to impose a penalty in the sum of $30,000. 33 The formal orders of the Court are as follows:- (1) The defendant is convicted. (2) The defendant is ordered to pay a penalty in the sum of $30,000. (3) By consent the defendant is ordered to pay the prosecutor's costs in the sum of $18,000. (4) The exhibits, apart from exhibit A, may be returned.