Fairfield City Council v TT Rubbish Removal Pty Limited; Fairfield City Council v Kim Thu Nguyen

KEY ISSUES: Prosecution :- Guilty pleas - sentence - multiple offences - draining truck wash waste water into public stormwater drain - whether defendant manager of the defendant company directed employee to commit offences - need for prosecutor to prove aggravating circumstances beyond reasonable doubt - need for specific and general deterrence

LEGISLATION CITED: Crimes (Sentencing Procedure) Act 1999 Protection of the Environment Operations Act 1997

Environment Protection Authority v Abigroup Contractors Pty Limited [2007] NSWLEC 712 CASES CITED: Fairfield City Council v Hong Son Ngo [2008] NSWLEC 200 Keir v Sutherland Shire Council [2004] NSWLEC 754 Tiger Nominees Pty Limited v State Pollution Control Commission (1992) 75 LGRA 71

PROSECUTOR Mr T Howard SOLICITORS Marsdens Law Group LEGAL REPRESENTATIVES: DEFENDANTS Mr IS Judd and Mr LW Judd SOLICITORS George Mallos

JUDGMENT: THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES

50049 of 2007 50050 of 2007 50051 of 2007 50054 of 2007 50055 of 2007 50058 of 2007

FAIRFIELD CITY COUNCIL Prosecutor TT RUBBISH REMOVAL PTY LIMITED Defendant 50062 of 2007 50063 of 2007 50064 of 2007 50065 of 2007 50066 of 2007 50067 of 2007

FAIRFIELD CITY COUNCIL Prosecutor KIM THU NGUYEN Defendant

JUDGMENT Jagot J: 1 TT Rubbish Removal Pty Ltd and Kim Thu Nguyen have each entered guilty pleas to six charges that they committed an offence against s 120(1) of the Protection of the Environment Operations Act 1997 (the POEO Act). Section 120(1) makes it an offence for a person to pollute any waters. The maximum penalty for each offence is $1,000,000 for TT Rubbish Removal and $250,000 for Mrs Nguyen (s 123(a) and (b)).

2 Mrs Kim Thu Nguyen's liability for the offences arises through s 169 of the POEO Act. Under that section, as a person concerned in the management of the corporation, Mrs Kim Thu Nguyen is taken to have committed the same offences as TT Rubbish Removal.

3 Most of the relevant facts were agreed. TT Rubbish Removal carries out the business of collecting and disposing of rubbish and waste for commercial reward. It operates four garbage trucks and employs several people for that purpose. As part of its business TT Rubbish Removal regularly picked up food waste from restaurants and commercial food premises in the Fairfield/Cabramatta area.

4 Tracey Thu Trang Nguyen is the sole director and secretary of TT Rubbish Removal. Mrs Kim Thu Nguyen is Tracey's mother. She is the manager of TT Rubbish Removal. In that capacity she exercised control and direction over employees of the company. Tracey and her mother are the shareholders in the company.

5 The offences occurred as follows: · 8 December 2006 at 6.11am; · 9 December 2006 at 1.28am and 3.26am; · 11 December 2006 at 3.32am; · 13 December 2006 at 5.50am; · 15 December 2006 at 5.20am.

6 On each occasion an employee of TT Rubbish Removal, Hong Son Ngo, drove a garbage truck into Spencer Lane in the Fairfield CBD. Mr Ngo opened a valve and drained wastewater from the truck into an open grate of the stormwater drain. The employee facilitated the flow of wastewater using a stick. He then drove away from Spencer Lane. These activities were captured on CCTV footage on 8, 9, 11, and 13 December 2006. Between 12 and 14 December 2006 officers of the Council placed a metal tray at the bottom of the drain.

7 On 15 December 2006 officers of the Council saw Mr Ngo drive a garbage truck into Spencer Lane at about 5.20am. The truck stopped on the eastern side of the lane. Mr Ngo used a fire hose on the rear wall of a building backing onto the lane to hose the rear compartment of the truck. He then drove to the western side of the lane. He opened the valve at the rear of the truck and emptied the wastewater into the open grate of the drain. The Council officers approached Mr Ngo and directed him to stop. Mr Ngo complied. Mr Ngo was interviewed after being cautioned. He showed the officers his driver's licence and said he had worked for TT Rubbish Removal for two years. Mr Ngo explained that his job was to pick up the garbage truck after another employee had collected the waste from restaurants and then drive the truck to Parramatta where the waste was deposited on a tip site.

8 A Council officer took a sample from the rear of the truck and from the metal tray at the base of the drain. The officer noted that the liquid had a foul odour typical of garbage and seafood. The Council officer secured those samples. Council officers had taken four other samples from Spencer Lane between 8 and 12 December 2006. The Council officer directed Mr Ngo to have the waste removed before the truck could be moved. Mr Ngo agreed but was confused about how to comply. He used his mobile phone to contact Mrs Kim Thu Nguyen and used the speaker function so the Council officer could hear. Mrs Kim Thu Nguyen said she was the manager of TT Rubbish Removal. The officer told her that she would need to make arrangements to have the liquid removed from the truck as it would not be tipped into the drain. She replied that she did not understand. The officer then requested the contact details of Tracey Nguyen from Mr Ngo. Mr Ngo called a number and had a conversation not in English and then handed the phone to the Council officer so he could speak to Tracey Nguyen.

9 The Council officer observed a quantity of liquid waste in the rear of the truck. It consisted of a white greasy layer on top of waters where he saw crab legs, a crab nipper, a part of a broom handle, fragments of a polystyrene box, a small plastic takeaway food container, and a washcloth. The wastewater smelt like seafood waste. Based on some measurements the officer calculated that about 150 to 200 litres of water remained in the rear compartment of the truck. Mrs Kim Thu Nguyen arrived at about 8.00am. She said that Tracey owned the business and she (Mrs Kim Thu Nguyen) was the manager. Tracey Nguyen called the Council officer at about 11.30am to say she was having trouble finding someone who would remove the waste. The officer gave her the names and contact numbers of three contractors. At 2.00pm Tracey Nguyen called again to confirm that the liquid waste had been removed.

10 The stormwater drain in Spencer Lane ultimately connects to Orphan School Creek.

11 At the time of the offences Mr Ngo was acting as an employee of TT Rubbish Removal and within the scope of his employment. Mr Ngo has worked for TT Rubbish Removal (about 15 hours per week) since January 2005.

12 The Council conducted interviews with Mr Ngo on 15 February and 6 March 2007, Tracey Nguyen on 14 March 2007 and Mrs Kim Thu Nguyen on 25 May 2007. Mr Ngo's interviews were voluntary. The others were pursuant to compulsory notice.

13 Neither defendant has any prior convictions for any environmental offence.

14 The defendants have agreed to pay the Council's costs in the sum of $68,527.51.

15 Mrs Kim Thu Nguyen was born in Vietnam. She is in her mid 50's. Her life in Vietnam was very difficult. She was married and had one child. Her husband and child were able to immigrate to the USA but she could not get a visa and did not see her son for 20 years until she could visit the USA. She escaped Vietnam on a boat to Malaysia in about late 1979 or 1980. She was placed in an internment camp on Bidong Island for two months after arriving. She gave birth to her daughter Tracey at the camp. The conditions were harsh. They were granted Australian citizenship and arrived in Australia in 1981. She met her second husband in Australia after setting up a sewing business. After they married she and her husband worked in this business. They worked hard and after about 6 or 7 years purchased a factory and employed 15 people and an investment property. She had another child in the mid 1980's.

16 In about 1990 her husband purchased a rubbish removal business. Her husband ran this company while she ran the sewing business. She divorced in 1993 and retained the factory premises in Punchbowl and sewing business while her husband retained the waste business and second property. Her former husband sold the waste business some time later. The new owner offered to sell that business to her. As the sewing business was declining, she accepted. She purchased the business in late 2001 in partnership with another person who contributed some capital and drove one of the trucks. It was agreed she would manage the company.

17 Managing the company turned out to be much harder than Mrs Kim Thu Nguyen expected. She was totally unprepared. She had difficulty because she was a woman whereas the employees were all men. The other major problem was truck maintenance. The collection routes were narrow and thus she needed to have narrow trucks. New trucks are too wide with side collection so the old trucks have to be carefully maintained.

18 She also had no understanding of the day-to-day operations of the business. In the early days she had to go with the employees and also had to drive and load trucks herself. She recalled having to work more than 80 hours a week sometimes and on a few occasions had to borrow money to keep the company afloat.

19 She bought out her partner in 2003. She then sold these shares to her daughter and continued to manage the company. At that time the name was changed to TT Rubbish Removal.

20 Mrs Kim Thu Nguyen said that she grows her own fruit and vegetables at home. She waters them using water she collects in a bath, drums and buckets. She hardly ever uses pesticides and recycles paper, cardboard, plastic and aluminium when she can. She is regretful and sorry that the environment has suffered because of the actions of TT Rubbish Removal.

21 She earns around $300 per week from managing TT Rubbish Removal. She owns a home worth $750,000 subject to a mortgage of $274,000. She also owns a car (1994 Toyota Camry) and a small number of shares in Telstra and AMP. Her superannuation is about $4700. She has a credit card debt of about $2200 and weekly outgoings of $375. Her eyesight is deteriorating and she has to have her cataracts removed every two years.

22 Tax returns and financial statements lodged for TT Rubbish Removal show the company running at a loss between 2005 and 2007.

23 The one fact in dispute was whether Mrs Kim Thu Nguyen directed Hong Son Ngo in November 2006 to wash out the garbage truck using the fire hose attached to the building in Spencer Lane and then drain the wash wastewater into the stormwater drain.

24 Mr Ngo gave evidence. He said that in November 2006 Mrs Kim Thu Nguyen and he were at a Caltex Service Station in Cabramatta. Mrs Kim Thu Nguyen told him the truck was dirty and showed him where to clean the truck. She took him to Spencer Lane and pointed out to him the fire hose and the stormwater drain where he was caught discharging wastewater on 15 December 2006. She told him to take the truck there, use the hose to wash the truck, and drain off into the drain and then bring the truck back. The drain was right at the place where the Council officer stopped him. When he was caught on 15 December 2006 he told the officer he worked for Mrs Kim. He then called her. He told her he was at the place where they drained the water behind a restaurant. Mr Ngo still worked for TT Rubbish Removal and no one had told him since that he had done the wrong thing.

25 Mr Ngo said he had never discharged wastewater into the drain before the conversation with Mrs Kim Thu Nguyen in November 2006. He used to return the truck to the depot unwashed before the first incident on 8 December 2006. Mr Ngo was asked why, when asked in his record of interview about what he saw on the video taken of him on 15 December 2006, and he responded "Kim told him that morning that go to that location using the water from the hydrant to clean the truck and then go to the location where the stormwater pit is and to discharge the water in there". Mr Ngo said he recalled on that date she asked him to wash the truck. He did not accept that this was different from his evidence about a conversation in November 2006 and said there was such a conversation.

26 Mrs Kim Thu Nguyen gave evidence. She denied any conversation with Mr Ngo at any time in which she told him to wash the truck using the fire hose and drain the wastewater into the stormwater drainage system. She said: (i) TT Rubbish Removal and the Council were the only garbage collection services in the Cabramatta and Fairfield areas, (ii) trucks were not required to be washed every day, (iii) she would check the trucks and arrange cleaning at commercial premises if they needed it, (iv) she had never taken Mr Ngo to Spencer Lane to tell him to wash the truck and use the drain there, (v) she gave him and other drivers money to have the trucks washed at commercial premises, (vi) when Mr Ngo called her on 15 December 2006 he said the Council officers had detained him at the carpark in Fairfield (Spencer Lane wraps around a Council carpark), (vii) TT Rubbish Removal was in financial difficulty, (viii) she was concerned that a large fine would mean TT Rubbish Removal would cease trading and make four people (herself included) unemployed, (ix) if TT Rubbish Removal did not collect waste Cabramatta would be full of rubbish, (x) if she could not run the business then she would have to sell her house, and (xi) she was very angry when she heard what Mr Ngo had done and later discussed it with the other drivers and gave them instructions that they were not allowed to do such things.

27 Both Mr Ngo and Mrs Kim Thu Nguyen were asked about the truck wash facilities at the two commercial tips where TT Rubbish Removal unloaded rubbish and elsewhere. Mr Ngo denied the existence of such facilities whereas Mrs Kim Thu Nguyen said there were wash facilities at Eastern Creek. By the close of the evidence it emerged that the wash facilities at Eastern Creek were limited to wheel wash facilities only. I deal with this issue and the way in which the Council relied on it below. In cross-examination Mrs Kim Thu Nguyen confirmed that, when required to produce documents relating to activities of cleaning trucks, TT Rubbish Removal produced four dockets only for a commercial truck wash at Narellan between December 2005 and December 2006 (where truck washing costs $88). She said that she only kept receipts for payments by cheque not cash and could not claim on tax without the receipts. When asked about her instruction to Mr Ngo to wash the truck in Spencer Lane Mrs Kim Thu Nguyen said she did not even know there was a fire hose or water pit in Spencer Lane. She denied that she had so instructed Mr Ngo to save on commercial wash fees. In Cabramatta there are frequent Council inspections and the risk of being caught was too high. She had not heard Mr Ngo say that she had instructed him until she heard his evidence but was aware that Mr Ngo's record of interview was provided to her lawyers. She knew Mr Ngo's wife and children and felt responsible for him financially.

28 The Council submitted that I would be satisfied beyond reasonable doubt that Mrs Kim Thu Nguyen had instructed Mr Ngo to wash the trucks and drain the wash wastewater into the public stormwater system in Spencer Lane. The Council relied on: - (i) the lack of coherence and changing position of the defence about the availability of other truck wash facilities at the tips and elsewhere, noting (amongst other things) the withdrawn suggestions about washing facilities at the tips, the belated evidence about giving cash to Mr Ngo and Mr Ngo being instructed to wash trucks at commercial facilities (which were never put to him) and the lack of corroboration by way of evidence from other drivers, (ii) the frankness and consistency of Mr Ngo's evidence, (iii) the unlikelihood of Mr Ngo acting on his own initiative, (iv) the likelihood of TT Rubbish Removal wanting to save costs with respect to commercial truck washing facilities, (v) the lack of evidence of use of truck washing facilities (other than the four receipts), and (vi) the fact that Mr Ngo was still employed by TT Rubbish Removal and had not been told he had done anything wrong.

29 Even if not satisfied about the direction from Mrs Kim Thu Nguyen the offences were serious. There was no system in place to prevent the offences. TT Rubbish Removal was responsible for its employee's actions and Mrs Kim Thu Nguyen is vicariously liable under s 169 of the POEO Act as the manager of the corporation. Specific and general deterrence requirements were both entitled to weight, according to the Council, given the nature and the circumstances of the offence.

30 The defendants submitted that the uncontradicted evidence was that the first offence occurred on 8 December 2006. Mr Ngo had never washed the truck in Spencer Lane before that day. Accordingly, all of the evidence about what system for truck washing was in place before that day was largely immaterial. Whatever the system was it was lawful. Mrs Kim Thu Nguyen had very poor English (her evidence, as with that of Mr Ngo, was given through an interpreter). She had no education and could not communicate abstract concepts. Hence, the difficulties the defendants' counsel had in obtaining instructions about the system (leading to the confusion about wash facilities and what was done) could not be used against the defendants. According to the defendants, Mr Ngo's evidence about being told on the morning of 15 December 2006 to wash the truck in Spencer Lane was inconsistent with his evidence about a conversation in November 2006. The fact that the defendants cannot explain why Mr Ngo did what he did, they submitted, does not alter Mrs Kim Thu Nguyen's evidence in which she consistently denied any instruction. Her evidence on that essential issue was consistent and credible. The defendants did not have to disprove any aggravating factor. The Council had to prove any such factor beyond reasonable doubt. Further, the defendants submitted the fine has to be proportionate. In Environment Protection Authority v Abigroup Contractors Pty Limited [2007] NSWLEC 712 a very large company was required to pay $32,000 (reduced to $20,000) for an offence causing substantial actual harm to bushland. A similar penalty in this case, the defendants said, would be disproportionate given the defendants' limited means to pay. TT Rubbish Removal carried out an environmentally useful activity. Mrs Kim Thu Nguyen had taken steps to ensure the offences were not repeated. A heavy fine would close the business down and place three employees out of a job. It would deprive Cabramatta of a garbage collection service. The Council had brought 24 charges relating to this incident. The costs the defendants had agreed to pay ($68,527.51) were very high and would be a very substantial burden to the defendants. Taking into account all those circumstances and the early plea the defendants said the fine should be in the order of $4000 to $5000.

31 Section 241(1) of the POEO Act identifies matters that must be considered on sentence. As to each matter: · Under s 241(1)(a), the offences caused actual harm to the stormwater drainage system by introducing wastewater and some solids. The Council does not allege any harm to the creek but, in terms of likelihood, the system drains to the creek.

· Under s 241(1)(b), the defendants could have taken practical measures to avoid the offences by Mr Ngo simply not carrying out the acts.

· Under s 241(1)(c), the defendants could have reasonably foreseen the harm and likely harm as I accept it is common knowledge that stormwater drains drain to creeks, rivers and the sea.

· Under s 241(1)(d), the defendants had full control over the causes of the offences. Mr Ngo was an employee and subject to the control and direction of the defendants.

· Section 241(1)(e), about complying with orders, is immaterial to the position of these defendants. 32 Mr Ngo and Mrs Kim Thu Nguyen both gave their evidence through an interpreter. I accept the defendants' submission that the obvious difficulties their counsel had in obtaining coherent instructions should be seen as a material cause of the inconsistencies in the position put to Mr Ngo and disclosed by Mrs Kim Thu Nguyen in evidence about washing facilities and practices before 8 December 2006. I do not consider that any inference adverse to the credit of Mrs Kim Thu Nguyen should be drawn from those inconsistencies and inadequacies in the particular circumstances of this matter.

33 The evidence of Mr Ngo and Mrs Kim Thu Nguyen about the giving of a direction was irreconcilable. As the defendants submitted, a prosecutor must prove any aggravating circumstance not admitted beyond reasonable doubt. Mrs Kim Thu Nguyen gave evidence categorically denying any direction to Mr Ngo about washing trucks in Spencer Lane. She was unshaken in this evidence. It is not unknown in human experience for irreconcilable positions to be explicable on bases other than those immediately apparent. Ultimately, having seen and heard Mrs Kim Thu Nguyen give evidence, I am not prepared to disbelieve her on her oath.

34 The lack of a finding of a direction from Mrs Kim Thu Nguyen to Mr Ngo does not make the offences by the defendants merely trivial or technical. TT Rubbish Removal is carrying out a socially useful activity. For that to be beneficial to the community, however, the activity must be carried out in compliance with environmental laws that safeguard the well being of the community. Mrs Kim Thu Nguyen is responsible for managing TT Rubbish Removal. What employees do in the course of their employment is her responsibility. TT Rubbish Removal is a commercial enterprise. The evidence provides no real confidence at all that TT Rubbish Removal is managed in such a way as to ensure compliance with environmental laws. Mr Ngo is an employee of TT Rubbish Removal. He thought he could wash out the rear compartment of a garbage truck in a public lane using a fire hose and drain the wash wastewater (contaminated by waste left over after dumping from the compaction in the rear compartment) into a public stormwater system in the middle of the Fairfield CBD. That fact alone indicates a business with a potential to cause environmental harm being managed without any real understanding or capacity to ensure that it does not do so. The evidence of Mrs Kim Thu Nguyen about the steps she had taken to ensure no repeat offence was vague and unsatisfactory. And no one had told Mr Ngo he had done the wrong thing. If TT Rubbish Removal wishes to continue operating then it and Mrs Kim Thu Nguyen have to take responsibility for and be capable of taking all necessary precautions to prevent and avoid environmental harm and comply with environmental laws. The evidence does not permit that inference to be drawn with any confidence.

35 The offences were objectively serious. As I observed in sentencing Mr Ngo (Fairfield City Council v Hong Son Ngo [2008] NSWLEC 200 at [12]): Regulations preventing these types of actions are critical to the orderly and healthy functioning of our urban environment. The community depends on people not to carry out these types of acts for its continued well being. They are of basic and fundamental importance particularly in an urban environment. It is usually difficult to detect those responsible for these types of acts. They tend to be carried out, as here, in the middle of the night and the early hours of the morning. Such actions simply cannot be tolerated.

36 The offences bear no resemblance to those in Abigroup. In Abigroup the offences resulted from a combination of unfortunate circumstances (particularly very heavy rainfall and a difficult site). The defendant had taken significant precautions to avoid environmental harm. It had in place sophisticated compliance systems. The offence nevertheless occurred despite the defendant's efforts and risk management systems. The present offences involved a deliberate act by the employee to use a public drain as a form of garbage receptacle not once but six times, in the hours of the early morning when difficult to detect. Nothing in the systems in place (whatever they were) ensured that this did not happen. The company, and the manager of a company, are responsible for those actions and bear significant culpability for failing to take precautions to prevent such actions.

37 I accept that the fine must be proportionate. I also accept that, in this case, the presence of two defendants and their common exposure to a fine is largely accidental in the sense that TT Rubbish Removal is a small family company. It is the alter ego of Mrs Kim Thu Nguyen (and her daughter who has no active role in the company). Hence, the fine will be reduced in recognition of this fact (Keir v Sutherland Shire Council [2004] NSWLEC 754 citing Tiger Nominees Pty Limited v State Pollution Control Commission (1992) 75 LGRA 71 at 77 - 78). Even recognising those facts, I am unable to accept the defendants' submissions about the appropriate range of the fine. A fine as proposed by the defendants would not serve the objects of sentencing, particularly in terms of adequate punishment, specific and general deterrence, protection of the community, and denunciation of the defendants' conduct (s 3A of the Crimes (Sentencing Procedure) Act 1999).

38 In addition to the accidental multiplicity of defendants I have also given significant weight to the factors of the defendants' means having regard to the very substantial costs of the Council that they have agreed to pay ($68,527.51). Other factors are also relevant. The defendants have no prior convictions and are of good character. The harm was of a low order. A plea of guilty was entered at the first opportunity showing remorse (a factor separately accounted for below).

39 Having regard to all these factors (and leaving aside the totality principle) I consider that a single fine of $50,000 for each offence should be imposed (being 20% of the maximum for Mrs Kim Thu Nguyen and 5% of the maximum for TT Rubbish Removal). However, the aggregate penalty would then be disproportionate given that the offences were a connected series of events over the space of just over a week. I therefore reduce the penalty for each of the subsequent offences to $2000. The total penalty would thus be $60,000. I give both defendants the full discount available for their early guilty pleas (25%). This leads to a total penalty of $45,000. In accordance with the Council's submission I propose to split the penalty evenly between the defendants.

40 For these reasons: (1) The defendants are convicted of the offences charged. (2) TT Rubbish Removal Pty Limited is fined the sum of $22,500. (3) Kim Thu Nguyen is fined the sum of $22,500. (4) The defendants are ordered to pay the Council's costs agreed in the sum of $68,527.51. (5) The exhibits are returned.

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