(2006) 145 LGERA 234
Burwood Council v Erector Group Pty Ltd
Burwood Council v Liverpool Developing Pty Ltd [2017] NSWLEC 20
Cameron v Eurobodalla Shire Council [2006] NSWLEC 47
Source
Original judgment source is linked above.
Catchwords
Zirilli v The Queen (2014) 253 CLR 58[2014] HCA 2
Bentley v BGP Properties Pty Limited [2006] NSWLEC 34(2006) 145 LGERA 234
Burwood Council v Erector Group Pty LtdBurwood Council v Liverpool Developing Pty Ltd [2017] NSWLEC 20
Cameron v Eurobodalla Shire Council [2006] NSWLEC 47Chief Executive of the Office of Environment and Heritage v Topview Brisbane Pty Ltd [2017] NSWLEC 54
Chief Executive, Office of Environment and Heritage v Orica Pty LtdEnvironment Protection Authority v Orica Pty Ltd [2015] NSWLEC 109
Chief Executive, Office of Environment and Heritage v Rummery [2012] NSWLEC 271(2008) 163 LGERA 71
Environment Protection Authority v Ballina Shire Council [2006] NSWLEC 289(2014) 206 LGERA 239
Environment Protection Authority v Queanbeyan City Council (No 3) [2012] NSWLEC 220(2014) 206 LGERA 11
Environment Protection Authority v Waste Recycling and Processing Corporation [2006] NSWLEC 419(2006) 148 LGERA 299
Gittany Constructions Pty Limited v Sutherland Shire Council [2006] NSWLEC 242(2006) 145 LGERA 189
Green v RQuinn v R (2011) 244 CLR 462[2011] HCA 49
Gordon Plath of the Department of Environment and Climate Change v FishGordon Plath v Orogen Pty Ltd [2010] NSWLEC 144
(2010) 179 LGERA 386
Liverpool City Council v Leppington Pastoral Co Pty Ltd [2010] NSWLEC 170
Markarian v R (2005) 228 CLR 357
[2005] HCA 25
Muldrock v The Queen (2011) 244 CLR 120
[2011] HCA 39
Newcastle City Council v Pace Farm Egg Products Pty Ltd [2002] NSWLEC 66
Plath v Rawson [2009] NSWLEC 178
(2009) 170 LGERA 253
R v De Simoni (1981) 147 CLR 383
[1981] HCA 31
R v Olbrich (1999) 199 CLR 270
[1999] HCA 54
R v Overall (1993) 71 A Crim R 170
R v Taktak (1988) 14 NSWLR 226
R v Thomson
R v Houlton (2000) 49 NSWLR 383
[2000] NSWCCA 309
Veen v R (1979) 143 CLR 458
[1979] HCA 7
Veen v R (No 2) (1988) 164 CLR 465
Judgment (27 paragraphs)
[1]
Background facts
The EPL held by P&M permits activities of livestock processing, rendering or fat extraction and slaughtering or processing ('licensed activities'). While P&M was at all material times the holder of the EPL, in March 2015 P&M was acquired by JBS Group (of which JBS is a part). JBS has accordingly, since 29 June 2015 occupied the premises, carried out the licensed activities, and employed the majority of staff.
Relevantly, the EPL contains the following conditions (though P&M was only charged in relation to breach of condition O2.1(b)):
L1.1 Except as may be expressly provided in any other condition of this licence, the licensee must comply with section 120 of the Protection of the Environment Operations Act 1997.
...
O2.1 All plant and equipment installed at the premises or used in connection with the licensed activity:
a) must be maintained in a proper and efficient condition; and
b) must be operated in a proper and efficient manner.
...
O4.2 Effluent application must not occur in a manner that causes surface runoff.
...
O4.5 Waste water must only be applied to the following areas: the effluent irrigation areas as shown on Figure A dated 30/8/02 and irrigation areas A, B and C shown on map entitled "TYRONE STUD IRRIGATION INFRASTRUCTURE" received by the EPA on 9 November 2006.
...
O5.1 The holding ponds must be maintained to ensure that sedimentation does not reduce their capacity by more than 20% of the design capacity.
The licensed activities generate effluent and wastewater from the manure waters from cleaning and holding ponds, wash-down from animal slaughter, evisceration and boning areas, edible offal wash-down, and carcass washing ('effluent').
The EPL permits the effluent (as well as effluent contaminated stormwater) to be stored and treated at the premises, which is carried out through the Waste Water Treatment System ('WWTS'). At the time of the incident the WWTS consisted of nine effluent storage and treatment ponds, through which effluent passed prior to being used on the premises for irrigation and soil amendment. The EPL permitted effluent to be discharged only at certain locations on the premises, which was managed by a series of pipes. The relevant irrigation area for the purposes of the incident was the "Tyrone Irrigation Area C".
The primary irrigation line supplying Tyrone Irrigation Area C had a small number of irrigation pipes leading from it, each of which was fitted with a valve that could be manually opened or closed. One such pipe ('discharge pipe') led to the discharge location. Although the discharge location was on the premises, it was outside Tyrone Irrigation Area C and, importantly, adjacent to and up-gradient from the Creek. The discharge pipe was partially obscured by earth and grass for much of its length, and was installed at the premises in approximately 2008, when the premises were under the care, control and management of P&M.
Prior to taking occupancy of the premises JBS conducted a desktop and on-site review in respect of the environmental management systems and controls on the premises. Neither the discharge pipe nor the discharge location were identified or referred to in any company documents. Relevantly, there was a Site Based Management Plan, which, in the section titled "Waste Management Plan" provided at cl 8.3:
Irrigation of treated effluent cannot occur during periods of wet weather, therefore, adequate wet weather storage is to be available to accommodate effluent production during wet periods. A primary consideration for not allowing irrigation of treated effluent during periods of heavy rain is to prevent runoff of the irrigated effluent to surface water.
At the time of the incident, the WWTS' capacity to treat effluent was reduced as two of the three anaerobic ponds were not in use.
The following people were employed at the premises and involved in the incident:
1. Shane Brown, who was a Farmhand Tractor Operator and had been employed at the premises since 28 August 2014;
2. Archie Golledge, who was a Farmhand Tractor Operator and had been employed at the premises since 16 June 2008; and
3. Alan Young, who was the Farm Manager and had been employed at the premises since 9 June 2015 (and whose employment was subsequently terminated on 3 September 2015).
From 23 to 25 August 2015 there were a number of heavy rainfall incidents in the Scone region. At approximately 6:30am on 26 August 2015 Mr Young instructed Mr Brown and Mr Golledge to open a valve on the discharge pipe to allow effluent to be discharged to the discharge location. The reason for this was that Mr Young did not want the effluent being discharged to Tyrone Irrigation Areas A or B due to his intention to sow crops in those locations. In addition, Mr Young did not consider that Tyrone Irrigation Area C was suitable for further irrigation as he had been informed that it was waterlogged.
Effluent was discharged from the WWTS to the discharge location from about 8:00am on 26 August 2015 to 6:30am on 31 August 2015. Mr Golledge closed the valve on 31 August 2015 after observing what he believed to be effluent from the discharge pipe pooling on a common road, which is situated inside the premises and traverses the premises and the Creek approximately 350 to 400 metres downstream of the discharge location ('common road'). It is estimated that between 70,000 to 140,000 litres of effluent was discharged from the WWTS through the discharge pipe to the discharge location. The effluent entered the Creek and flowed downstream towards the common road.
[2]
Evidence
The evidence before the Court comprised the Statement of Agreed Facts, summarised above, a letter from the EPA to JBS dated 16 February 2016 regarding an application for transfer of the EPL to JBS, and an A3 aerial photograph of the premises.
P&M and JBS (collectively the 'defendants') also read two affidavits of Troy White, Group Environmental Manager of JBS, affirmed on 23 March 2017 and 28 May 2017 respectively.
In his first affidavit, Mr White deposed to the circumstances surrounding the offences, the action taken at the time of the incident, and the action taken since the incident. Relevantly, he says that there were processes and structures in place that were intended to prevent such an incident from occurring (namely the Environmental Management System Manual), however the incident occurred primarily due to a failure on the part of Mr Young, to follow the processes in place.
Mr White further states that since the incident JBS has taken a number of steps relating to the treatment of effluent water, waste and irrigation, the cost of which amounted to $2,196,649.62, and that further improvements to the plant, its operations and safety were undertaken at a cost of $5.2 million in 2015 and 2016. Mr White also affirms that further works are intended to be carried out at the abattoir, estimated to amount to a total cost of $430,000.
Mr White indicated that JBS has also strengthened its environmental policies to ensure that all staff have regular training in relation to their environmental obligations, and attested to the community contribution that JBS has made to the Scone community by providing employment for and making contributions to the local community. Mr White deposed that the defendants deeply regret the incident and have taken measures to prevent any future environmental incidents occurring.
Mr White's second affidavit clarified the measures taken by JBS since the incident. These included:
1. assigning an additional farmhand to remove the infrastructure from which the effluent had been discharged;
2. installing a dedicated central irrigation system capable of being transferred for Tyrone Irrigation Areas A and B, which allowed irrigation to be completed in a more efficient and controlled manner;
3. upgrading the wastewater pre-screening system, which is critical to ensuring that organic and inorganic load does not accumulate in the ponds over time;
4. replacing a faulty weather monitoring station, which is required pursuant to condition 2 of the EPL; and
5. carrying out further assessment of the irrigation areas reuse/runoff control dams, which revealed that the Tyrone Irrigation Area D did not have sufficient run-off control. This resulted in approval of pre-engineering works to design a suitable dam for this irrigation area.
[3]
Relevant legislation
The defendants have been charged under the following sections of the POEO Act:
64 Failure to comply with condition
(1) Offence
If any condition of a licence is contravened by any person, each holder of the licence is guilty of an offence.
Maximum penalty:
(a) in the case of a corporation - $1,000,000 and, in the case of a continuing offence, a further penalty of $120,000 for each day the offence continues, or
(b) in the case of an individual - $250,000 and, in the case of a continuing offence, a further penalty of $60,000 for each day the offence continues.
Note. An offence against subsection (1) committed by a corporation is an offence attracting special executive liability for a director or other person involved in the management of the corporation - see section 169.
...
120 Prohibition of pollution of waters
(1) A person who pollutes any waters is guilty of an offence.
Note. An offence against subsection (1) committed by a corporation is an offence attracting special executive liability for a director or other person involved in the management of the corporation - see section 169.
...
[4]
Principles relating to sentencing
The sentence that is to be imposed for an offence must reflect, and be proportionate to, the objective circumstances of the offence and the personal and/or subjective circumstances of the offender (Veen v R (1979) 143 CLR 458; [1979] HCA 7 at 490; Veen v R (No 2) (1988) 164 CLR 465; [1988] HCA 14 at 472). The Court is to identify all the factors relevant to the offence and weigh their significance to arrive at an appropriate sentence - a method that has been described as instinctive synthesis; see Markarian v R (2005) 228 CLR 357; [2005] HCA 25 at [37]-[39] and [50]-[84]; Muldrock v The Queen (2011) 244 CLR 120; [2011] HCA 39 at [26].
Section 241 of the POEO sets out a number of matters which are to be taken into account when sentencing for offences under that Act:
241 Matters to be considered in imposing penalty
(1) In imposing a penalty for an offence against this Act or the regulations, the court is to take into consideration the following (so far as they are relevant):
(a) the extent of the harm caused or likely to be caused to the environment by the commission of the offence,
(b) the practical measures that may be taken to prevent, control, abate or mitigate that harm,
(c) the extent to which the person who committed the offence could reasonably have foreseen the harm caused or likely to be caused to the environment by the commission of the offence,
(d) the extent to which the person who committed the offence had control over the causes that gave rise to the offence,
(e) whether, in committing the offence, the person was complying with orders from an employer or supervising employee.
(2) The court may take into consideration other matters that it considers relevant.
The Crimes (Sentencing Procedure) Act 1999 (NSW) ('Sentencing Act') is also of relevance, setting out general principles as to the purposes of sentencing, as well as any aggravating or mitigating factors to which the Court is to have regard. The relevant sections are:
3A Purposes of sentencing
The purposes for which a court may impose a sentence on an offender are as follows:
(a) to ensure that the offender is adequately punished for the offence,
(b) to prevent crime by deterring the offender and other persons from committing similar offences,
(c) to protect the community from the offender,
(d) to promote the rehabilitation of the offender,
(e) to make the offender accountable for his or her actions,
(f) to denounce the conduct of the offender,
(g) to recognise the harm done to the victim of the crime and the community.
21A Aggravating, mitigating and other factors in sentencing
…
(2) Aggravating factors
The aggravating factors to be taken into account in determining the appropriate sentence for an offence are as follows:
...
(d) the offender has a record of previous convictions (particularly if the offender is being sentenced for a serious personal violence offence and has a record of previous convictions for serious personal violence offences),
...
(g) the injury, emotional harm, loss or damage caused by the offence was substantial,
...
(i) the offence was committed without regard for public safety,
...
(o) the offence was committed for financial gain,
...
The court is not to have additional regard to any such aggravating factor in sentencing if it is an element of the offence.
(3) Mitigating factors
The mitigating factors to be taken into account in determining the appropriate sentence for an offence are as follows:
(a) the injury, emotional harm, loss or damage caused by the offence was not substantial,
...
(e) the offender does not have any record (or any significant record) of previous convictions,
(f) the offender was a person of good character,
(g) the offender is unlikely to re-offend,
…
(i) the remorse shown by the offender for the offence, but only if:
(i) the offender has provided evidence that he or she has accepted responsibility for his or her actions, and
(ii) the offender has acknowledged any injury, loss or damage caused by his or her actions or made reparation for such injury, loss or damage (or both),
...
(k) a plea of guilty by the offender (as provided by section 22),
(l) the degree of pre-trial disclosure by the defence (as provided by section 22A),
(m) assistance by the offender to law enforcement authorities (as provided by section 23).
[5]
Objective circumstances
The EPA submits that the offences against s 120 of the POEO Act fall within the top of the low range of objective seriousness, whereas the offence against s 64 of the POEO Act falls slightly below the middle range. The EPA further submits the s 64 offence was committed negligently, or at least recklessly. The defendants dispute this characterisation, submitting that the offences are all of low objective gravity.
[6]
Nature of the offences
The nature and purpose of the statutory provision that has been contravened and its place in the statutory scheme is illustrative of the objective seriousness of an environmental offence, see Environment Protection Authority v Coe Drilling Australia Pty Ltd [2005] NSWLEC 719 at [128]-[129], [133]; Bentley v BGP Properties Pty Limited [2006] NSWLEC 34; (2006) 145 LGERA 234 at 242-246, 259; Environment Protection Authority v Ballina Shire Council [2006] NSWLEC 289; (2006) 148 LGERA 278 at 290-291; Chief Executive Office of Environment and Heritage v Orica Pty Ltd; Environment Protection Authority v Orica Pty Ltd [2015] NSWLEC 109 ('EPA v Orica') at [59].
Further, considering the objects of an Act can assist in identifying the purpose of creating an offence, see Environment Protection Authority v Le Dome Pty Ltd [2002] NSWLEC 167; (2002) 125 LGERA 121 at 132; Environment Protection Authority v Coe Drilling Australia Pty Ltd [2005] NSWLEC 719 at [132]. Accordingly, in determining the appropriate sentence to be imposed on the defendants, it is instructive to have regard to the objects of the POEO Act.
The legislative objects of the POEO Act are set out in s 3, with the EPA submitting that the most relevant objects are:
(a) to protect, restore and enhance the quality of the environment in New South Wales, having regard to the need to maintain ecologically sustainable development,
...
(d) to reduce risks to human health and prevent the degradation of the environment by the use of mechanisms that promote the following:
(i) pollution prevention and cleaner production,
(ii) the reduction to harmless levels of the discharge of substances likely to cause harm to the environment,
(iia) the elimination of harmful wastes,
...
(e) to rationalise, simplify and strengthen the regulatory framework for environment protection,
...
In relation to the s 120 offences, the EPA submits that the offence of pollution of waters is a strict liability offence, and relies on the statement of Preston CJ of LEC in Environment Protection Authority v Baidia Poultry Pty Ltd [2008] NSWLEC 280; (2008) 163 LGERA 71 at [23] that "pollution of waters is a result offence where the proscribed result directly undermines the object of the Protection of the Environment Operations Act 1997". The EPA further submits that the offence of pollution of waters plays an important role in giving effect to the objects of the POEO Act, noting that the Act reflects the community's adoption of "a stern policy against pollution" as per Axer Pty Ltd v Environment Protection Authority (1993) 113 LGERA 357; per Mahoney J at 359.
[7]
Environmental harm
The harm caused or likely to be caused to the environment by the offences is relevant to the objective seriousness of the offence, pursuant to s 241(1)(a) of the POEO Act and s 21(A)(2)(g) of the Sentencing Act.
The EPA relies on Environment Protection Authority v Waste Recycling and Processing Corporation [2006] NSWLEC 419; (2006) 148 LGERA 299 at [146]-[147] to characterise the concept of environmental harm, noting that:
Harm can include harm to the environment and its ecology. Harm to an animal or plant not only adversely affects that animal or plant, it also affects the other biota that have ecological relationships to that animal or plant: Bentley v BGP Properties Pty Ltd [2006] NSWLEC 34 (6 February 2006) at [174].
Harm can be direct or indirect, individual or cumulative. Activities that contribute incrementally to the gradual deterioration of the environment, even when they cause no discernible direct harm to human interest, should also be treated seriously.
The EPA further relies on Newcastle City Council v Pace Farm Egg Products Pty Ltd [2002] NSWLEC 66 for the meaning of harm "likely to be caused to the environment" as per s 241(1)(a) of the POEO Act, where Lloyd J stated at [44]:
In considering the harm likely to be caused to the environment, it is to be noted that the word "likely" in this context has been held to mean "a real or not remote chance or possibility regardless of whether it is less or more than a fifty per cent chance" (Mathews v Goulbourn Wool Processors, NSWSC, Smart J, 6 November 1986, unreported)...
It was agreed between the parties that the offences caused actual harm to the environment by degrading the aquatic environment in a section of the Creek spanning between 50m to 315m between approximately 26 August 2015 and 1 September 2015. The parties further agreed that the actual harm occasioned to the Creek comprised concentrations of un-ionised ammonia at levels that were acutely toxic to ammonia-sensitive aquatic organisms. Further, the actual harm included levels of total nitrogen, biological oxygen demand and phosphorous significantly in excess of the default trigger values for the protection of slightly to moderately disturbed ecosystems for upland streams and rivers in NSW.
There is no evidence demonstrating that the offences caused actual harm to any aquatic or terrestrial flora or fauna in or around the Creek, or that the actual harm extended beyond the location where the common road traverses the Creek. The parties did however agree that the degraded aquatic environment in the Creek caused likely harm to some sensitive taxa of aquatic organisms likely to have been present in the section of the Creek impacted by the offences.
[8]
Practical measures that could have been taken to prevent the incident from occurring
Another factor relevant to objective seriousness is the practical measures that may have been taken to prevent, control, abate or mitigate harm to the environment resulting from the offences.
The EPA submits that both the defendants had a positive obligation to take proper precautions to ensure that pollution did not occur, see Axer Pty Ltd v Environment Protection Authority (1993) 113 LGERA 357 at 259. The EPA submits that the discharge pipe should never have been installed on the premises, and that, in accordance with s 169C of the POEO Act, knowledge of the existence of the discharge pipe by Mr Young can be imputed to JBS. Accordingly, the EPA submits that JBS failed to remove or otherwise isolate the discharge pipe.
The defendants accept that practical measures could have been taken to prevent the incident from occurring, namely not opening the valve on the discharge pipe however submitted in oral submissions that JBS has only been in occupancy of the premises for a short period of time, and since that time has implemented various measures to prevent a similar incident from occurring.
I find that there were clearly practical measures that the defendants could have taken to prevent the incident from occurring. Whilst I accept that JBS had only been in occupancy for a short period of time, that fact does not detract from the EPA's submission that the impugned discharge pipe should never have been installed by P&M. In accordance with s 169C of the POEO Act, knowledge of the existence of the discharge pipe by Mr Young may be imputed to JBS, thus, I accept that JBS failed to remove or otherwise isolate the pipe. Further, I find that a further practical step that would have avoided the incident occurring was for JBS to have discharged the effluent to one or more of the permitted areas.
[9]
Offenders' state of mind
The EPA submits, and I find, that in relation to a s 120 offence, the Court is not entitled to take into account the offenders' state of mind as, pursuant to Environment Protection Authority v Orica Australia Pty Ltd (Nitric Acid Air Lift Incident) [2014] NSWLEC 103; (2014) 206 LGERA 239 at [139], this would offend the principle in R v De Simoni (1981) 147 CLR 383; [1981] HCA 31 ('De Simoni') that where there is a hierarchy of offences in a particular Act, the Court cannot, in sentencing a defendant for a particular offence, take into account factors which in essence punish the defendant for a more serious offence contained in that same Act. Applied to these proceedings, the principle prevents me from considering whether the defendants acted negligently in committing an offence in contravention of s 120 because the POEO Act also contains the more serious offence in s 116 of wilfully or negligently causing any substance to leak, spill or otherwise escape.
I note that the scope of the principle in De Simoni is somewhat ambiguous, see e.g. R v Overall (1993) 71 A Crim R 170 at 175, and that there is some concern that it leads to an inconsistent approach in sentencing for strict liability environmental offences. Given however the strong line of authority, I nonetheless accept that consideration of the offender's state of mind is not permitted in sentencing of offences under s 120 of the POEO Act, see e.g. Environment Protection Authority v Tea Garden Farms Pty Ltd [2012] NSWLEC 89 at [101-[102]; Environment Protection Authority v Snowy Hydro Ltd [2008] NSWLEC 264; (2008) 162 LGERA 273 and Environment Protection Authority v Queanbeyan City Council (No 3) [2012] NSWLEC 220; (2012) 192 LGERA 415 at [178].
In relation to the s 64 offence however, the EPA submits that the offender's state of mind is a relevant sentencing consideration, and notes that a strict liability offence that is committed intentionally, negligently or recklessly is more objectively serious than one that is committed accidentally, see Chief Executive, Office of Environment and Heritage v Rummery [2012] NSWLEC 271; (2012) 192 LGERA 314 at [122]. To amount to negligence, it must be shown that the offender demonstrated an indifference to obvious risk; R v Taktak (1988) 14 NSWLR 226 at 247; Gordon Plath of the Department of Environment and Climate Change v Fish; Gordon Plath v Orogen Pty Ltd [2010] NSWLEC 144; (2010) 179 LGERA 386 at [81]). Further, the degree of carelessness must demonstrate such a disregard for the objects of the statute as to amount to a crime against the State; see Andrews v Director of Public Prosecutions [1937] AC 576 at 583; Alexander Cittadini v R [2009] NSWCCA 302 at [38]-[40].
[10]
Foreseeability of harm
The EPA submits that the extent to which harm caused by the offences could have reasonably been foreseen is significant in these proceedings. The EPA relies on Craig J's statement in Environment Protection Authority v Centennial Newstan Pty Ltd [2010] NSWLEC 211 at [81] that:
...the holder of an environment protection licence is clearly on notice of the possibility of harm to the environment occasioned by any of the activities which it carries out on the site to which that licence relates.
The EPA submits that conditions O4.2 and O4.5 of the EPL (extracted above) made clear that there was a real risk of water pollution arising from the licenced activities, and the fact that JBS had an Environmental Management System in place and trained staff to prevent an incident of this type occurring demonstrates that it foresaw the potential occurrence of a s 120 offence.
I find that it was reasonably foreseeable that if there was an effluent discharge of the amount involved in the incident from the discharge location, after a period of heavy rainfall, the effluent would enter the Creek and cause water pollution. Further, I find in circumstances where the EPL contained conditions regulating the discharge of effluent, it was reasonably foreseeable that a breach of the conditions would result in environmental harm.
[11]
Control over causes
The extent to which the defendants had control over the causes which gave rise to the offences is another factor relevant to the objective seriousness of the offence pursuant to s 241(1)(d) of the POEO Act.
In relation to JBS, the EPA submits that it was aware of the existence of the discharge pipe, and had control over the physical existence of the pipe and its usage. JBS accepts that, as the operator of the abattoir, it had control over the causes which gave rise to the commission of the offence.
In relation to P&M, the EPA submits that its culpability is not diminished by reason of the fact that it did not, at the time of the offences, have control over the equipment and operations at the premises. Rather, the EPA submits that as the holder of the EPL, P&M was responsible for ensuring that appropriate procedures were in place to ensure compliance with the terms of the EPL.
P&M however denies that it had control at the relevant time, but rather submits that it is only deemed to be an occupier of the premises by virtue of s 258(2) of the POEO Act. P&M submits that accordingly, pursuant to s 241(1)(d) of the POEO Act, its lack of control is a mitigating factor.
I accept the parties' submissions in relation to JBS and find that JBS was clearly aware of the existence of the discharge pipe, and had control over its usage such that it had control over causes which gave rise to the offences. In relation to P&M, I find that its culpability is not diminished significantly by the fact that it did not have control over the equipment and operation of the premises. I find that as the holder of the EPL, P&M remained responsible for ensuring the appropriate procedures were in place. The fact that P&M is "deemed" to be the occupier by virtue of s 258(2) of the POEO Act may to some extent be a mitigating factor, but not one that I find is significant.
[12]
Maximum penalty
Both the s 64 offence and the s 120 offences attract a maximum penalty of $1,000,000 for a corporation: see ss 64(1)(a) and 123(a) of the POEO Act respectively. This assists in determining the objective seriousness of the offences; see Camilleri's Stock Feeds Pty Ltd v Environment Protection Authority (1993) 32 NSWLR 683 at 698.
[13]
Conclusions on objective circumstances
Whilst there was agreement between the prosecutor and the defendants in relation to a number of the objective circumstances, there was, as noted at [25] above, disagreement as to where the offences fall in the range of objective seriousness. In light of my specific findings above at [35], [46], [50], [60], [68], and considering all the objective circumstances referred to above at [26]-[69], I find that each of the offences is at the top of the low range of objective seriousness.
[14]
Subjective circumstances
Consideration of the subjective circumstances requires consideration of those matters that relate to the defendants themselves, rather than to the offences that give rise to the charges to which they have pleaded guilty. The matters I take into account include lack of prior convictions; the assistance given by the defendants to the authorities; the early pleas of guilty; the defendants' remorse; the measures taken to prevent recurrence; and the need for specific and general deterrence.
[15]
Financial gain
The parties agreed in the Statement of Agreed Facts that one of the reasons for Mr Young directing the effluent to be discharged to the discharge location is because he wanted to sow crops in Tyrone Irrigation Areas A and B. The EPA submits that this intention relates to the commercial imperatives of JBS, and because Mr Young's state of mind is deemed to be that of JBS by virtue of s 169C of the POEO Act, the s 120 offence was committed for financial gain, which is an aggravating factor under s 21A(2)(o) of the Sentencing Act.
While the defendants agree that the state of Mr Young's mind can be attributed to JBS, they submit that the Court cannot infer on the evidence that Mr Young had a view to financial gain. First, the defendants submit that Mr Young was renumerated by his wage, and therefore as an employee, would not have been financially motivated by the prospect of the crops being profitable. Further, the defendants submit that there is no evidence that there was any financial advantage to be gained by sowing crops in Tyrone Irrigation Areas A and B, rather this was part of usual land management. Finally, the defendants submit that the fact that JBS has invested significantly in improving its environmental performance is at odds with the proposition that it committed the offence for financial gain. The defendants submit that to establish the aggravating factor under s 21A(2)(o) of the Sentencing Act the EPA is required to prove, beyond a reasonable doubt, that the offence was committed for financial gain, and the EPA has not met this burden.
I am not satisfied on the evidence that JBS committed the s 120 offence for financial or commercial gain. There is no evidence of any financial advantage accruing to either of the defendants as a result of Mr Young's intention to avoid discharging the effluent to Tyrone Irrigation Areas A and B. Rather, I accept the defendants' submission that the intention to sow crops in those areas is "...part of usual land management". I do not accept that Mr Young perceived any financial gain accruing to himself by virtue of this decision. While his decisions regarding land management clearly contribute to the efficient running of the business of JBS, I do not accept this necessarily amounts to acts conducted for the purposes of financial or commercial gain in the sense contemplated to constitute an aggravating factor. The obvious corollary of this would be that any act committed for the purposes of a business would be committed for financial or commercial gain.
[16]
Early pleas of guilt
The defendants submit, and the EPA accepts, that they both entered pleas of guilty at an early stage of the proceedings. Because of the utilitarian value to the criminal justice system and pursuant to ss 21A(3)(k) and 22(1)(a) of the Sentencing Act and R v Thomson; R v Houlton (2000) 49 NSWLR 383; [2000] NSWCCA 309, I accept that this conduct attracts a discount of 25% off the penalty that would have otherwise been imposed in relation to each offence.
[17]
Prior convictions/ good character
The fact that neither defendant has any prior convictions for an environmental offence in NSW is a mitigating factor pursuant to s 21A(3)(e) of the Sentencing Act.
The defendants further submit that they are of good character, and that this is a mitigating factor pursuant to s 21A(3)(f) of the Sentencing Act. Specifically, the defendants submit that the following activities demonstrate the fact that they are good corporate citizens, and are directly involved in civic improvement and other activities in the local community:
1. employment of 407 persons, totalling a spending of approximately $21.4 million in annual wages;
2. the making of community contributions to Bush Fire Relief of 250 bales of hay in the amount of $18,750; and
3. engaging on a continuous basis to formalise contributions to the community of Scone in collaboration with the mayor of Upper Hunter including the Community Schools Initiative at Scone, Murrurundi Paige River Land Care, and the Upper Hunter Council parkland rehabilitation in the Barrington Tops National Park.
I accept that the good character of the defendants is demonstrated by participation in activities in the local community as per Plath v Rawson [2009] NSWLEC 178; (2009) 170 LGERA 253 at [143].
[18]
Assistance provided to authorities
The defendants submit, and the EPA agrees, that they have cooperated with the EPA during the investigation of the offences. The defendants submit that their high level of cooperation is demonstrated by:
1. making admissions as to the facts and circumstances giving rise to the offences;
2. the provision of interviews, documents and information;
3. assisting EPA officers during the inspection of the premises; and
4. willingly cooperating with the EPA to provide a detailed Statement of Agreed Facts.
[19]
Remorse
The defendants submit that JBS (and by extension P&M) has demonstrated remorse for the offence by accepting responsibility of its actions and acknowledging the damage caused. Specifically, JBS submits that its remorse is demonstrated by:
1. its proactive approach to responding to the incident;
2. the identification and implementation of measures to prevent a recurrence;
3. the express acceptance in the affidavit of Mr White affirmed 23 March 2017 of responsibility for the incident and expression of regret for the discharge;
4. the presence in Court of a senior representative, Mr White, during the course of the hearing;
5. its plea of guilty at the earliest opportunity; and
6. its agreement to pay the prosecutor's agreed costs.
I find that the conduct of the defendants as demonstrated by the matters noted above are indicative of "taking actions" rather than offering "smooth apologies" in the sense considered by Preston CJ of LEC in Environment Protection Authority v Waste Recycling and Processing Corporation [2006] NSWLEC 419; (2006) 148 LGERA 299 at [203]. Additionally, I have taken into account the written and oral submissions and I accept that the defendants have demonstrated contrition and remorse concerning the offences, and, by their conduct, have taken responsibility for the actions and acknowledged the harm caused.
[20]
Deterrence
The EPA submits that the penalties imposed in these proceedings should serve the purposes of both general and specific deterrence.
In relation to general deterrence, the EPA submits that:
1. a substantial sentence is needed in pollution offences to punish the offender, deter others and encourage full compliance with the Act by the offender and others: see Camilleri's Stock Feeds Pty Ltd v Environment Protection Authority (1993) 32 NSWLR 683 at 701;
2. the object of the legislation is to prevent pollution and to do so in part by the deterrent effect of a substantial fine, which persuades industries to adopt preventative measures: see Axer Pty Ltd v Environment Protection Authority (1993) 113 LGERA 357 at 359;
3. offenders will not be deterred from committing environmental offences by the imposition of nominal fines: see Bentley v BGP Properties Pty Ltd [2006] NSWLEC 34; (2006) 145 LGERA 234 at [140]; Elf Farm at [98]; and
4. the penalty must be sufficient to compel attention to the environmental issues to ensure that the offender and others are encouraged to comply with the law: see Environment Protection Authority v Robinson [2004] NSWLEC 629 at [30]; Elf Farm at [99].
The EPA submits that specific deterrence is required in relation to JBS as it continues to operate the premises. The EPA submits however that the need for specific deterrence is reduced by the fact that JBS has removed the impugned irrigation pipe and has taken positive steps to improve its environmental systems since the incident.
In relation to P&M, the EPA submits that specific deterrence is required to reinforce P&M's overriding responsibility for compliance with the conditions of the EPL, see Elf Farm at [100].
The defendants submit that there is no need for specific deterrence in these proceedings given the substantial steps that JBS has taken to ensure that a similar incident does not reoccur. Further, the defendants submit that there is no need for specific deterrence directed at P&M given that P&M is no longer actively involved in any operations at the premises.
Taking these matters into account, I find that there is a need for general deterrence. In relation to environmental offences, general deterrence is of some primacy. This has been stated in many cases, including Cameron v Eurobodalla Shire Council [2006] NSWLEC 47; (2006) 146 LGERA 349 at [71]-[81]; Gittany Constructions Pty Limited v Sutherland Shire Council [2006] NSWLEC 242; (2006) 145 LGERA 189 at [103]-[104]; Burwood Council v Erector Group Pty Ltd; Burwood Council v Liverpool Developing Pty Ltd [2017] NSWLEC 20 at [67]-[69]. I accept that persons will not be deterred from committing environmental offences by only nominal fines, see Bentley v BGP Properties Pty Limited [2006] NSWLEC 34; (2006) 145 LGERA 234 at [139]-[141], [150]-[151].
[21]
Totality
The parties submit, and I find that in relation to P&M the principle of totality applies to reduce the penalty otherwise applicable, as the conduct that gave rise to the licence contravention offence also gave rise to the water pollution offence.
As stated by Preston CJ of LEC in Chief Executive Office of Environment and Heritage v Orica Pty Ltd; Environment Protection Authority v Orica Pty Ltd [2015] NSWLEC 109 stated at [142]:
… The effect of the totality principle is to require the Court, which has passed a series of sentences, each properly calculated in relation to the offence for which it is imposed, to review the aggregate sentence and consider whether the aggregate is just and appropriate and reflects the total criminality before the Court. In the case of fines, adjustment may be made by reducing the amount of the fine for each offence. Care needs to be taken, however, to ensure that any adjustment of individual sentences does not cause the aggregate sentence not to reflect the total criminality of the offender's conduct or the sentence for any individual offence to become disproportionate to the objective gravity of that offence.
[22]
Parity
The defendants further submit that the principle of parity applies to these proceedings. The defendants submit that the principle can only be taken into account by the Court to reduce the applicable penalty, not increase it, and that ultimately it requires the respective sentences for co-offenders not to be disproportionate having regard to the differing degrees of criminality: Green v R; Quinn v R (2011) 244 CLR 462; [2011] HCA 49 at [28]-[32].
The defendants submit that the penalty to be imposed on P&M should reflect the fact that at the time the offences occurred, P&M was not involved in operations at the premises, and that its liability arises solely from a deeming provision.
In relation to parity, I find that the facts and the evidence before the Court demonstrate that the criminality of P&M is less than that of JBS in relation to the two s 120 offences.
[23]
Appropriate penalties for the offences
To assist the Court, bearing in mind the restriction on the EPA arising from Barbaro v The Queen; Zirilli v The Queen (2014) 253 CLR 58; [2014] HCA 2, the defendants submit that after applying an instinctive synthesis approach to the relevant objective and subjective circumstances of the offences and the offenders, an appropriate penalty would be $40,000 for the offence charged against JBS, and $25,000 for each of the offences charged against P&M.
The defendants submit that the notional starting point of $60,000 for the s 120 offence against JBS is appropriate and that this is reduced (cumulatively) by 25% for the plea of guilty and 10% for remorse, resulting in a total penalty of slightly under $40,000.
In relation to the penalty to be imposed on P&M, the defendants submit that the notional starting point should be $50,000 for each of the offences and that this penalty should be reduced by 25% for the plea of guilty, 10% for remorse, and 15% for totality, resulting in a fine of $25,000 for each offence charged.
In determining the appropriate penalty for the offences, I take into account the objective circumstances of the offences and the subjective circumstances of both JBS and P&M, as discussed above. Further, I take into account the purposes of sentencing in s 3A of the Sentencing Act. The purposes of punishment; retribution and denunciation are relevant in the present circumstances. There is a need for the Court, through the sentences it imposes, to ensure that both the defendants are adequately punished for offences committed, held accountable for their actions, and denounced for their conduct in a manner which is proportionate to the seriousness of the offences, see Environment Protection Authority v Custom Chemicals Pty Ltd [2016] NSWLEC 146 at [110].
In determining the appropriate penalty, the Court should be consistent with any pattern of sentencing for like offences. Each of the parties referred to various sentencing decisions of this Court, including Environment Protection Authority v Orica Australia Pty Ltd (Nitric Acid Air Lift Incident) [2014] NSWLEC 103; (2014) 206 LGERA 239; Environment Protection Authority v Sydney Water Corporation [2015] NSWLEC 80; Environment Protection Authority v Hunter Water Corporation [2016] NSWLEC 76. In relation to s 64 of the POEO Act, the parties made submissions in relation to Environment Protection Authority v Truegain Pty Limited (No 4) [2014] NSWLEC 179; (2014) 206 LGERA 11; Environment Protection Authority v M A Roche Group Pty Ltd [2015] NSWLEC 29; and Environment Protection Authority v Coal and Allied Operations Pty Ltd [2013] NSWLEC 134, amongst others.
[24]
Additional orders sought
In addition to the monetary penalty, the EPA seeks orders under s 250(1)(a) of the POEO Act that the defendants each be required to place a notice in a proposed form in the following publications, and according to the following specifications:
1. Within 28 days of the date of any order, at its expense, cause a notice in a proposed form at a minimum size of 13.9cm x 12.9cm to be placed in:
1. the first five pages of the Singleton Argus; and
2. the first five pages of the Newcastle Herald.
1. Within 35 days of the date of this order, provide to the EPA a complete copy of the page of each of the publications in which the notice appears.
The EPA also seeks an order for costs as agreed or assessed, pursuant to s 257N of the Criminal Procedure Act 1986 (NSW). The EPA submits that payment of the prosecutor's costs are a constant aspect of Class 5 proceedings in this Court, and of itself is not a reason for reducing the penalty otherwise applicable: see Liverpool City Council v Leppington Pastoral Co Pty Ltd [2010] NSWLEC 170 at [50].
The EPA further seeks an order pursuant to s 248(1) of the POEO Act for reimbursement of its investigative costs in the sum of $1,402.95, as well as a publication order pursuant to s 250(1)(a) of the POEO Act.
The defendants have agreed to pay the EPA's investigative and legal costs, with the pre-assessment amount advanced by the EPA for the latter being $80,000.
Notably, the defendants submit, that pursuant to Environment Protection Authority v Barnes [2006] NSWCCA 246 at [88] (cited in Environment Protection Authority v Hardt [2007] NSWLEC 284 at [66]), the total penalty to be imposed on an offender should also take into account any order for costs. The defendants note the comment of Biscoe J in Liverpool City Council v Leppington Pastoral Co Pty Ltd [2010] NSWLEC 170 at [49] that the imposition of costs is part of the punishment imposed.
The defendants submit that the EPA's notified costs of $80,000 are not an insignificant amount relative to what is submitted to be an appropriate penalty for each offence, and this relatively high proportion should place downward pressure on the penalty imposed pursuant to the instinctive synthesis approach.
In relation to the notified costs of $80,000, I accept the position that in considering the appropriate penalties to be imposed on each of the defendants, it is legitimate to take into account the associated costs order and publication order as per Harris v Harrison (2014) 86 NSWLR 422; [2014] NSWCCA 84 at [100].
[25]
Finding
While the two offences charged against P&M have, for most part been dealt with together, I am conscious that the charges pursuant to s 64 and s 120 of the POEO Act are distinct, and separate sentences must be imposed for each.
Adopting an instinctive synthesis approach, and considering all the relevant objective and subjective circumstances, the purposes of sentencing, and the difference between the offences, I find that the appropriate penalty to be imposed on P&M is $80,000 for the s 64 offence and $70,000 for the s 120 offence. I find the appropriate penalty to be imposed on JBS in relation to the s 120 offence is $80,000. These amounts should be reduced for the utilitarian value of the early pleas of guilty, which are assessed at 25%.
In relation to P&M, this results in a monetary penalty of $60,000 for the s 64 offence and $52,500 for the s 120 offence. I consider the aggregate amount of these two fines, being $112,500, exceeds what is just and appropriate in the circumstances and the total criminality involved, and as such the totality principle requires an adjustment of the combined fines for the offences. I consider the appropriate adjustment, to remove the extent of double punishment, is to reduce the aggregate penalty by 20%. Accordingly, the fine to be imposed on P&M for the s 64 POEO offence is $48,000 and the fine to be imposed for the s 120 offence is $42,000.
In relation to JBS, once the adjustment for the plea of guilty is applied, the fine to be imposed is $60,000.
The EPA and the defendants agreed that it was appropriate for the monetary penalties that the Court determined to be paid to the Environmental Trust established under the Environmental Trust Act 1995 (NSW) for general environmental purposes pursuant to s 250(1)(e) of the POEO Act.
Publicising the prosecution and punishment of environmental offenders improves the effectiveness of general deterrence by bringing broader attention to the consequences of such conduct, Environment Protection Authority v Waste Recycling and Processing Corporation [2006] NSWLEC 419; (2006) 148 LGERA 299 at [242]; Environmental Protection Authority v Dyno Nobel Asia Pacific Pty Ltd [2017] NSWLEC 64 at [163]. Accordingly, I find that it is appropriate in the circumstances to make the publication order sought, however I have made some minor changes to the terms of the notice proposed by the parties to reflect my findings.
[26]
Orders
The Court makes the following orders:
In proceedings 00256458 and 00256459 of 2016:
1. In respect of proceedings 00256458 of 2016, pursuant to s 250(1)(e) of the Protection of the Environment Operations Act 1997 (NSW), the defendant is to pay the amount of $42,000 to the Environmental Trust established under the Environmental Trust Act 1998 (NSW) for general environmental purposes.
2. In respect of proceedings 00256459 of 2016, pursuant to s 250(1)(e) of the Protection of the Environment Operations Act 1997 (NSW), the defendant is to pay the amount of $48,000 to the Environmental Trust established under the Environmental Trust Act 1998 (NSW) for general environmental purposes.
3. Pursuant to s 257B of the Criminal Procedure Act 1986 (NSW), the defendant is to pay the prosecutor's legal costs as agreed or assessed in accordance with s 257G of the Criminal Procedure Act 1986 (NSW).
4. Pursuant to s 248(1) of the Protection of the Environment Operations Act 1997 (NSW), the defendant is to pay the prosecutor's investigation costs of $701.47.
5. Pursuant to s 250(1)(a) of the Protection of the Environment Operations Act 1997 (NSW), the defendant is:
1. Within 28 days of the date of this order, at its expense, cause a notice in the form of Annexure A at a minimum size of 13.9cm x 12.9cm to be placed in:
1. the first five pages of the Singleton Argus; and
2. the first five pages of the Newcastle Herald.
1. Within 35 days of the date of this order, provide to the prosecutor a complete copy of the page of each of the publication in which the notice appears.
In proceedings 00256495 of 2016:
1. Pursuant to s 250(1)(e) of the Protection of the Environment Operations Act 1997 (NSW), the defendant is to pay the amount of $60,000 to the Environmental Trust established under the Environmental Trust Act 1998 (NSW) for general environmental purposes.
2. Pursuant to s 257B of the Criminal Procedure Act 1986 (NSW), the defendant is to pay the prosecutor's legal costs as agreed or assessed in accordance with s 257G of the Criminal Procedure Act 1986 (NSW).
3. Pursuant to s 248(1) of the Protection of the Environment Operations Act 1997 (NSW), the defendant is to pay the prosecutor's investigation costs of $701.47.
4. Pursuant to s 250(1)(a) of the Protection of the Environment Operations Act 1997 (NSW), the defendant is:
1. Within 28 days of the date of this order, at its expense, cause a notice in the form of Annexure B at a minimum size of 13.9cm x 12.9cm to be placed in:
1. the first five pages of the Singleton Argus; and
2. the first five pages of the Newcastle Herald.
1. Within 35 days of the date of this order, provide to the prosecutor a complete copy of the page of each of the publications in which the notice appears.
[27]
Annexure A
On 21 July 2017 the Land and Environment Court of New South Wales found P&M Quality Smallgoods Pty Ltd ('P&M') guilty of one offence of polluting waters and one offence of contravening a condition of an environment protection licence in breach of the Protection of the Environment Operations Act 1997 (NSW). The offences occurred between 26 August 2015 and 31 August 2015.
At the time of the offences, P&M was the holder of a licence issued by the Environment Protection Authority ('EPA') in relation to an abattoir at Muffett Street, Scone ('site'). P&M and all of its assets was acquired by the JBS Group in March 2015. The offences occurred when between 70,000 and 140,000 litres of partially treated effluent generated from the animal slaughter and wash-down processes was discharged to a location on the site not permitted by the licence, before travelling over land and entering Two Mile Gully Creek.
P&M breached a condition of the licence when it failed to operate the effluent irrigation system at the site in a proper and efficient manner. The pipe through which the discharge giving rise to the offences occurred has been removed.
The offences caused actual and likely harm to a section of Two Mile Gully Creek between 50 and 315 metres in length. The harm to the environment lasted for approximately five days.
P&M was ordered to:
in lieu of a fine, pay $90,000 to the Environmental Trust for general environmental purposes;
pay the prosecutor's legal costs as agreed or assessed;
pay the prosecutor's investigation costs in the amount of $701.47; and
at its own expense, cause this notice to be placed in the Singleton Argus and the Newcastle Herald.
Annexure B
On 21 July 2017 the Land and Environment Court of New South Wales found JBS Australia Pty Limited (CAN 011 062 338) ('JBS') guilty of one offence of polluting waters in breach of the Protection of the Environment Operations Act 1997 (NSW). The offence occurred between 26 August 2015 and 31 August 2015.
At the time of the offence, JBS operated an abattoir at Muffett Street, Scone ('site') the subject of an environment protection licence issued by the Environment protection Authority. JBS had been operating the site since 29 June 2015. The offence occurred when between 70,000 and 140,000 litres of partially treated effluent generated from the animal slaughter and wash-down processes was discharged to a location on the site not permitted by the licence, before travelling over land and entering Two Mile Gully Creek.
The pipe through which the discharge occurred has been removed and JBS have taken measures to prevent the recurrence of similar incident.
The offence caused actual and likely harm to a section of Two Mile Gully Creek between 50 and 315 metres in length. The harm to the environment lasted for approximately five days.
JBS was ordered to:
Environment Protection Authority v Hunter Water Corporation [2016] NSWLEC 76
Environment Protection Authority v Huntsman Corporation Australia Pty Ltd [2011] NSWLEC 39
Environment Protection Authority v Le Dome Pty Ltd [2002] NSWLEC 167; (2002) 125 LGERA 121
Environment Protection Authority v M A Roche Group Pty Ltd [2015] NSWLEC 29
Environment Protection Authority v Orica Australia Pty Ltd (Nitric Acid Air Lift Incident) [2014] NSWLEC 103; (2014) 206 LGERA 239
Environment Protection Authority v Queanbeyan City Council (No 3) [2012] NSWLEC 220; (2012) 192 LGERA 415
Environment Protection Authority v Robinson [2004] NSWLEC 629
Environment Protection Authority v Snowy Hydro Ltd [2008] NSWLEC 264; (2008) 162 LGERA 273
Environment Protection Authority v Sydney Water Corporation [2015] NSWLEC 80
Environment Protection Authority v Tea Garden Farms Pty Ltd [2012] NSWLEC 89
Environment Protection Authority v Truegain Pty Limited (No 4) [2014] NSWLEC 179; (2014) 206 LGERA 11
Environment Protection Authority v Waste Recycling and Processing Corporation [2006] NSWLEC 419; (2006) 148 LGERA 299
Gittany Constructions Pty Limited v Sutherland Shire Council [2006] NSWLEC 242; (2006) 145 LGERA 189
Green v R; Quinn v R (2011) 244 CLR 462; [2011] HCA 49
Gordon Plath of the Department of Environment and Climate Change v Fish; Gordon Plath v Orogen Pty Ltd [2010] NSWLEC 144; (2010) 179 LGERA 386
Liverpool City Council v Leppington Pastoral Co Pty Ltd [2010] NSWLEC 170
Markarian v R (2005) 228 CLR 357; [2005] HCA 25
Muldrock v The Queen (2011) 244 CLR 120; [2011] HCA 39
Newcastle City Council v Pace Farm Egg Products Pty Ltd [2002] NSWLEC 66
Plath v Rawson [2009] NSWLEC 178; (2009) 170 LGERA 253
R v De Simoni (1981) 147 CLR 383; [1981] HCA 31
R v Olbrich (1999) 199 CLR 270; [1999] HCA 54
R v Overall (1993) 71 A Crim R 170
R v Taktak (1988) 14 NSWLR 226
R v Thomson; R v Houlton (2000) 49 NSWLR 383; [2000] NSWCCA 309
Veen v R (1979) 143 CLR 458; [1979] HCA 7
Veen v R (No 2) (1988) 164 CLR 465; [1988] HCA 14
Category: Sentence
Parties: Environment Protection Authority (Prosecutor)
P&M Quality Smallgoods Pty Ltd (Defendant)
JBS Australia Pty Limited (Defendant)
Representation: Counsel:
P J English (Prosecutor)
C R Ireland with J Wyner (Defendants)
Mr White also attested that JBS will carry out the installation of a dedicated fixed irrigation system to Tyrone Irrigation Area C.
In relation to the s 64 offence, which is also a strict liability offence, the EPA relies on Environment Protection Authority v Orica Australia Pty Ltd (Nitric Acid Air Lift Incident) [2014] NSWLEC 103; (2014) 206 LGERA 239 at [104] to submit that strict compliance with the conditions of an EPL is necessary to ensure that the objects of the POEO Act are met. The EPA also relies on the statement of Craig J in Environment Protection Authority v Huntsman Corporation Australia Pty Ltd [2011] NSWLEC 39 at [65] that:
Conditions imposed upon an environment protection licence traverse a spectrum of obligations. Some may be seen to be merely procedural, the consequences of non-observance of which are not necessarily adverse to the environment. Others may be regarded as more fundamental in the control of the regulated activity. A condition requiring that the activity be carried out in a competent manner is a condition of the latter kind...
In these proceedings, the EPA submits that the condition of the EPL that was contravened is a standard condition imposed on licence holders, and is fundamental to the control of the licensed activities. The EPA further submits that given the existence of the discharge pipe and its proximity to the Creek, the environmental risks were significant.
The defendants submit that the EPA's submissions artificially separate, in terms of objective seriousness, the pollution of waters and contravention of licence offences, and seek to establish that the s 64 offence is more objectively serious than the s 120 offence in circumstances where the offences arise from the same act.
The defendants submit that the fact that P&M was taken over by JBS meant that P&M was not actually operating the equipment during the charge period, and therefore is not liable due to its physical acts, but rather due to its status as a licence holder. A further written submission was made that the EPA mistakenly characterised the offence as a failure to maintain the equipment in a proper and efficient manner (condition O2.1(a) of the EPL) rather than a failure to operate the equipment in a proper and efficient manner (condition O2.1(b) of the EPL), however this was resolved by the parties on the day of the hearing, with the EPA noting that the proper characterisation is indeed a contravention of condition O2.1(b).
Finally, the defendants dispute the EPA's submission that because some EPL conditions are more important to the control of an activity, breach of those conditions automatically gives rise to a more objectively serious offence. Rather, the defendants submit that there may be serious breaches of less important conditions, and innocuous breaches of more important conditions, the latter of which the defendants submit corresponds with the circumstances in these proceedings.
Considering the above submissions and the circumstances of each of the offences, I find that the conduct of each of the defendants significantly undermines the legislative objectives and statutory schemes established under the POEO Act and in doing so thwarted the attainment of the objects of the POEO Act, in particular those set out in s 3(a), (d)(i) and (ii), and (e).
The objects of the POEO Act include to protect the quality of the environment and to prevent pollution. The provisions of the POEO Act prohibit various forms of pollution, including relevantly in the present circumstances, pollution of waters. The prohibitions can be relaxed by obtaining forms of authority, such as an Environment Protection Licence.
It is well accepted that there is a need for the regulatory system established under the POEO Act to be upheld. The system depends upon persons, first, taking steps to ascertain where a licence is required and, if so required, making applications for a licence. It is also clear that the imposition of conditions on a licence is intended to avert the risk of environmental harm that would otherwise eventuate were the activity not regulated. It is clear that the objects of the POEO Act are achieved by complying with authorisations and licences which enable certain conduct, which would otherwise be prohibited, to be carried out on specific conditions.
In summary, the conduct of the defendants in relation to polluting waters undermines the statutory scheme. The same can be said for P&M's conduct in relation to the contravention of the licence conditions.
The EPA does not submit that the extent of actual and likely harm was substantial for the purposes of s 21(2)(g) of the Sentencing Act. The EPA does however submit that the s 64 offence caused the water pollution and accordingly caused the same extent of potential harm as the water pollution offence.
The defendants submit that the actual and likely harm caused was minimal, and when compared to similar cases, should be assessed as falling in the lowest range of the scale of seriousness.
I find that although the extent of actual and likely harm was not substantial for the purposes of s 21(A)(2)(g) of the Sentencing Act, it is clear that the s 64 offence did occasion water pollution and, as submitted by the EPA, caused the same extent of potential harm as the water pollution offence. The incident clearly degraded the aquatic environment, albeit for a small section of the Creek, and the harm arose from concentrations of chemicals that were actually toxic to ammonia-sensitive aquatic organisms. It is agreed, and I find, that the actual harm included levels of total nitrogen, biological oxygen demand and phosphorous significantly in excess of the default trigger values for the protection of disturbed ecosystems for upland streams and rivers. Although there was no evidence that there was any actual harm to aquatic or terrestrial flora or fauna, the degraded aquatic environment caused likely harm to some sensitive taxa of aquatic organisms.
In these proceedings, the EPA submits that P&M, as the owner of the premises at the time the discharge pipe was installed and the holder of the EPL, was responsible for creating the circumstances giving rise to the s 64 offence and as such displayed an indifference amounting to negligence in the face of a known and obvious risk: see Environment Protection Authority v Elf Farm Supplies Pty Ltd [2017] NSWLEC 60 ('Elf Farm') at [79].
Alternatively, the EPA submits that P&M committed the s 64 offence recklessly. To be so satisfied, the EPA submits that the Court is to find that P&M was put on notice of (see Chief Executive of the Office of Environment and Heritage v Kurstjens; Chief Executive of the Office of Environment and Heritage v Topview Brisbane Pty Ltd [2017] NSWLEC 54 at [59]; Chief Executive, Office of Environment and Heritage v Rummery [2012] NSWLEC 271; (2012) 192 LGERA 314 at [126]); or aware of the law and facts concerning (see Council of the City of Sydney v Adams [2015] NSWLEC 206 at [44]) the risk posed to adherence to the relevant licence condition by installing the discharge pipe and allowing for effluent to be released to the discharge location.
The EPA submits that P&M was aware that the discharge pipe connected the WWTS to the discharge location, and that the discharge location was not a licensed discharge point. Further, the EPA submits that the discharge point was undocumented and uncontrolled by P&M. Accordingly, the EPA submits that the s 64 offence was committed if not negligently, then recklessly, which is an aggravating factor in determining the objective seriousness of the offence.
P&M disputes that the s 64 offence was carried out negligently or recklessly, primarily on the basis that P&M was not involved in the actual operation of the premises at the time of the offence, and there is therefore no physical conduct on P&M's part to be characterised as reckless or negligent. P&M submits that its liability arises by virtue of a deeming provision, and that this basis of liability cannot be committed negligently or recklessly. Relevantly, P&M emphasises that the basis of the charge is in relation to the operation of equipment, rather than the maintenance of equipment.
Further, P&M submits, relying on R v Olbrich (1999) 199 CLR 270; [1999] HCA 54, that any aggravating factor in sentencing needs to be proved beyond a reasonable doubt, which has not been established by the EPA.
It is clear that P&M did not have control of the premises from 29 June 2016 and that P&M's liability (in relation to the s 64 offence) is not due to any act of operating equipment because, during the charge period, JBS was operating the equipment. I am conscious of the fact that P&M was on notice of the risk posed and was aware of the area where the discharge pipe was connected and of the fact that the discharge location was not a licenced discharge point. However, I repeat that P&M was not involved with the actual operation of the premises at the time and that the basis of the s 64 offence was in relation to the operation rather than maintenance of the equipment. Combining this with the fact that P&M's liability arises by virtue of a deeming provision, it is clear and I am satisfied that there is no physical conduct on P&M's part that amounts to recklessness or negligence.
Accordingly, I find that the evidence does not establish that P&M committed the licence contravention offence either negligently or recklessly. The evidence in this case does not establish that P&M had the degree of carelessness, disregard for the objects of the POEO Act, or indifference to the risk of causing environmental harm, as can properly be characterised as criminal negligence. Whilst it is not beyond proper argument that P&M's conduct amounted to recklessness (as opposed to negligence), any aggravating factor to this effect would need to be proved beyond reasonable doubt, and the only evidence before the Court is constituted in the Statement of Agreed Facts, which I do not find satisfies the necessary standard of proof.
In relation to specific deterrence, I find that despite JBS still conducting operations on the premises, the need for specific deterrence is reduced by the removal of the discharge pipe and the other steps undertaken by JBS. In relation to P&M, I find that there remains some requirement for specific deterrence in relation to compliance with conditions of the EPL.
Of particular assistance was the EPA's submissions regarding Elf Farm, in which the defendant was similarly charged with contraventions of ss 64 and 120 of the POEO Act for its acts in causing water containing ammonia to be discharged into a creek. Importantly, the EPA submits that this case can be distinguished on the basis that the irrigation conducted by the defendant in Elf Farms was in fact permitted by the relevant environmental protection licence, with the offences occurring due to an absence of proper systems being in place. Further, the EPA submits that the case was distinguishable on the basis that Elf Farms concerned only the potential for harm, whereas the offences in these proceedings occasioned actual and likely harm.
I have had regard to the matters considered by this Court in the decisions referred to by the parties. Nevertheless, each case turns upon its particular facts and caution must be exercised in considering other cases because of the "… inevitable disparity between subjective and objective circumstances applicable to those cases, compared to the same circumstances found to exist in this case": Environment Protection Authority v Borg Panels Pty Ltd [2016] NSWLEC 71 at [45].
in lieu of a find, pay $60,000 to the Environmental Trust for general environmental purposes;
pay the prosecutor's legal costs as agreed or assessed;
pay the prosecutor's investigation costs in the amount of $701.47; and
at its own expense, cause this notice to be placed in the Singleton Argus and the Newcastle Herald.
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: 01 August 2017