Environment Protection Authority v Transfield Pty Ltd

The defendant Transfield Pty Ltd has pleaded guilty to a "pollution of waters" charge under s 120(1) of the Protection of the Environment Operations Act 1997.

The hearing has been greatly abbreviated by agreement on a Statement of Facts (Exhibit P1), and by the presentation of comprehensive submissions.

The subject incident occurred on 15 July 1999 as the company was nearing the end of its work on the West Ryde Stormwater Tunnel project, in particular works in and near the Smalls Creek Stormwater Channel, which enters the Parramatta River from Meadowbank Park, a large recreation area on an old landfill site opposite Homebush Bay (see Annexure 'A' to Exhibit P1 for the street directory map).

The court is familiar with that channel and its environs, and Mr Fennessy's affidavit displays photographs of the poor quality of the water which used to enter the river via the channel prior to the subject works.

Work began on the project in early 1998, and on the channel itself in early 1999, and the project was concluded mid 2000. Details of it appear in Mr Fisher's affidavit, and in the agreed Statement of Facts ("ASF"), and need not be repeated.

Transfield held a Pollution Control Act licence 1 April 1998 to 1 April 2000 ( Exhibit P2), which permitted it to discharge water from a designated discharge point into the channel. The relevant conditions of the licence for this present case are : W1 The volume of liquid waste discharged must not exceed 500 kilolitres per day.

W2 The wastes that may be discharged must not: W2.1 contain more than 50 milligrams per litre of non-filtrable residue. W2.2 have a pH value below 6.5 or greater than 8.5 pH units. W2.3 contain more than 35 milligrams per litre of the coagulant Floctreat 71-34. W2.4 contain more than 5 milligrams per litre of the flocculant Floctreat 73-00. 7. Mr Fisher deposed to the cost and nature of steps taken by Transfield to treat and test a total of 150 million litres of water, in order to comply with the terms of the licence.

Substantially less water was collected in the culvert stages of the project nearer the river than in the tunnel stages further away, and Transfield's subcontractors ("QMC") installed a series of sumps, as a dewatering system at the site of those culvert works, in about March or April 1999. At that stage Transfield had some testing done and prepared what Fisher calls "a method statement outlining a plan of action for the clean and safe discharge of the water" (Exhibit P7).

The Method Statement provides in terms: If the required rate of dewatering is found to be greater than 5,000 litres per day, then further storage tanks are to be added to the storage rotation cycle. This will ensure that there is always a free tank able to accept groundwater from the sump.

There were 2 x 10,000L tanks specified earlier in the statement.

Relevantly Transfield also had in place an Environmental Management Plan (Exhibit P3), relevant sections of which are set out in the ASF (pars 10-14).

Water from the works filtered through agricultural pipes, sandbags and gravel on route to the sumps. Three or four times a week the main sump (#1), holding 200-300L of water, would be pumped out for between 10 and 30 minutes, either onto a grassy area, or into the channel. Sumps #2 to #4 would be pumped normally into #1, and discharged from there, but sump #2 began to be used for discharge purposes, as well as #1, as the project progressed. (See further details of the system, and the cost, in Exhibit P9 on 18).

As might be expected, a relatively thin layer of clay or sediment would form at the bottom of the sumps. Generally the pump inlet valve would be secured above the level of such sediment, and the evidence suggests that the water discharged by the system was apparently clear and free of visible suspended solids.

However, the charge specifies that on 15 July 1999: Liquid containing: A. soil or earth or mud or sand or clay or similar inorganic matter; and/or in the alternative B. suspended solids

The parties agree that the source was sump #3, which held only 100-150L. A two inch pump pipe from Sump #3 to #2 was disconnected at the sump #2 inlet, and taken over the site fence. See photograph EA in Marr's affidavit (ASF par 38).

The inlet pipe on that pump was not secured above the sediment.

Over the preceding few days there had been very heavy rain (Exhibit P8), well above the normal or expected levels; the culvert works were flooded, and the water treatment plant was at maximum capacity.

The dewatering subcontractors QMC had left the site no later than 12 July 1999, due to a dispute with the Defendant, which then also had a labour shortage of some sort. Casual labourers were engaged and were required to work with minimal supervision.

On the relevant date the pump was started and the contents of sump #3, including some sediment, were discharged directly into the channel (Photo EC in Marr's affidavit). Mr Fisher admits "there was no reason" for such steps to be taken, but suggests it was done by one of the casual labourers (c.f. Exhibit P11).

This circumstance was discovered by EPA officer Marr at about 7.20am on that day on a routine inspection (See ASF pars 41ff).

Transfield site personnel were alerted, and responded quickly. Relevant Transfield personnel are identified in the ASF (pars 15-18), and their roles described in Exhibit P5. Some statements from them were tendered in evidence (Exhibits P9, P10 and P11), and the defendant responded to a Statutory Notice (Exhibit P12) "calling up" as it were, Mr Albano's statement (Exhibit P11), especially questions 11 and 12 therein.

I am satisfied that the pump ran from no earlier than 6am until no later than 7.35am, and most likely from only about 6.30am until 7.30am.

I am also satisfied that, in the worst case scenario, about 10.26kg of suspended solids were discharged into the channel at about 0.75L per second, and flowed on into the Parramatta River.

On 20 April 1999 Transfield received some test results showing Total Suspended Solids ("TSS") at 103oC of 25 mg/L (Exhibit P6).

Mr Marr took samples on 15 July 1999. At the pipe outlet in the channel the TSS was 3800 mg/L; upstream it was 16 mg/L, and 1.5m downstream it was 1400 mg/L.

He noticed discolouration of the water up to 50m downstream.

Senior EPA Environmental Scientist Paul Rendell (affidavit 15 September 2000, pars 16-24) found that no actual environmental harm occurred. The likely harm from such TSS has been frequently discussed in the court, and details are set out in the later paragraphs of his affidavit. These days the public expects such risks to be avoided wherever possible.

I have considered all the matters set out in s 241 of the POEO Act and I come to the following conclusions.

In the absence of proper securing of premises, and supervision and/or induction of the personnel on the site, harm such as described by Rendell is clearly foreseeable by an experienced corporation such as this defendant.

However, the defendant took many precautions to prevent the harm or mitigate the risk of it. Regrettably, further precautions should have been taken once the expert subcontractor left the project because the defendant was in absolute control of the premises.

Mr Tomasetti asks, however, that I not proceed to a conviction.

The benefit of s 10 of the Crimes (Sentencing Procedure) Act 1999 is rarely extended by this court, and the principles this court applies have been discussed in many cases. The Court of Criminal Appeal's decision in EPA v Attard [2000] NSWCCA 242 reinforces those principles, and I accept Mr McElwain's submissions regarding s 10, despite the fact that a conviction may be of relevance to the Defendant's tendering for public sector contracts.

While this is, indeed, a relatively minor breach of the law, it should still attract a monetary penalty, as industry must be vigilant to meet the community's expectations and aspirations for the environment. The defendant had come under minor, but adverse, notice from the EPA in regard to this project (see Exhibit P13), and the EPA had provided some information to guide the defendant in further anticipating, and mitigating, the consequences of such an incident as this. (See Exhibit P14).

Nonetheless, this major Australian company has a remarkably good environmental record, and in this matter it has displayed a high level of contrition and co-operation, and agreed to pay the Prosecutor's reasonable costs.

It pleaded guilty at a reasonably early stage in the proceedings, and is entitled to a substantial discount in the penalty in accordance with the principles in R v Thomson [2000] NSWCCA 309.

I believe the severity of this matter would generally be viewed as no higher than 10% of the worst case scenario when put at its highest. See EPA v Orange City Council (50045 of 1995, 23 June 1995, Stein J).

In all the circumstances I have decided to impose a fine of $12,500.

The formal orders of the court will be: 1. The defendant is convicted of the charge in the summons. 2. The defendant is ordered to pay a fine of $12,500. 3. The defendant is ordered to pay the reasonable costs of the Prosecutor, to be agreed, or assessed according to law, within one month of such agreement or assessment. 4. Exhibits P1, P9 and P11 are to remain with the court file, and all the other exhibits may be returned.

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