Hawkesbury City Council v Huang Brother Pty Ltd; Huang

Council's affidavits

1. The Council read the affidavit of Mr Khalifeh compliance investigator with the Council sworn 1 March 2024 in which he attested to the Respondents supplying the Council with a satisfactory Farm Management Plan via their solicitors on 16 May 2023, requiring the planting of the landscape area. A council officer inspection of the Land on 19 July 2023 identified that the landscape area was not planted. The Council's solicitor sent a letter by email to the Respondents' solicitor Ms Chen on 23 October 2023 stating that the 2022 Consent Orders had not been complied with. Ms Chen responded that she was uncertain whether she continued to represent the Respondents, that she had forwarded the Council's email to the Respondents and asked that the Council also post the letter to the Respondents. The Council's solicitor sent a letter to the Respondents on 23 October 2023 by express post stating that the 2022 Consent Orders had not been complied with, requesting that an undertaking be provided within seven days to the effect that the non-compliance would be rectified and notifying that contempt proceedings would otherwise be commenced. No response was received. A council officer inspection of the Land on 14 February 2024 identified that the landscape area remained unplanted. The Council's solicitor sent a further letter to the Respondents on 20 February 2024 by registered post to notify that proceedings for contempt of court would be commenced against them without further notice.
2. The affidavit of Mr Khalifeh sworn 24 May 2024 annexed a series of aerial images of the Land adjacent to Bushells Lagoon taken between 9 June 2022 and 21 October 2023 showing no planting where the 2022 Consent Orders required it.
3. Two affidavits of service of Mr Gamsby process server sworn 9 December 2022 attested to the personal service of a letter from the Council's solicitors dated 1 December 2022 and a copy of the 2022 Consent Orders at the Land on Mr Huang in his capacity as director of the First Respondent and as the Second Respondent on 5 December 2022.
4. Two affidavits of service of Mr Gamsby sworn 10 April 2024 attested to the personal service of a letter from the Council's solicitors dated 8 March 2024, a court order dated 7 March 2024 extending time for service of a sealed copy of the 2022 Consent Orders to 22 March 2024 and the 2022 Consent Orders with penal notice endorsed filed 7 March 2024 at the Land on Mr Huang in his capacity as director of the First Respondent and as the Second Respondent on 28 March 2024.

Respondents' affidavits

1. The Respondents read the affidavit of Mr Huang affirmed 12 July 2024 (Huang No 1) in which he attested to flooding in the Hawkesbury area occurring in February 2020, March 2021, March, April and July 2022, March 2023 and April 2024 [sic] which consequentially affected the Land including the landscape area. Mr Huang planted the landscape area in September 2020 however the subsequent flooding events killed the plants, none of which were recoverable. Four colour photographs dated 21 September 2020 showing planting in the landscape area were attached at Annexure J.
2. On or about 3 June 2021 Mr Huang received a letter from the Council's solicitor to the effect that the work presently being carried out by the Respondents on the Land was prohibited without a development consent and that the 2015 Consent had lapsed on 6 February 2020, inter alia. Mr Huang was notified that should he fail to provide a written undertaking within 14 days that he would either cease use of the Land or lodge a fresh development application, Class 4 proceedings would be commenced to restrain his breaches of s 4.2(1)(b) of the Environmental Planning and Assessment Act 1979 (NSW) and the Hawkesbury Local Environment Plan 2012 (NSW).
3. Mr Huang received the summons commencing the Class 4 proceedings for the lapse of the 2015 Consent on 28 June 2021. Mr Huang did not believe the 2015 Consent had lapsed and sought professional planning advice and legal advice. He subsequently instructed his solicitors to reach an agreement with the Council on or about 21 November 2021 [sic] following which the 2022 Consent Orders were made on 29 November 2022. Mr Huang's solicitor sent the 2022 Consent Orders to his son's email address. His solicitor advised him of his obligation to pay the Council's costs of $12,000 by telephone, but not of his planting obligations under the 2022 Consent Orders.
4. In October 2023 Mr Huang recommenced preparing the landscape area for planting in light of improved weather conditions. A screenshot of a group chat dated 30 October 2023 with three photographs and one video purporting to show the preparation of the landscape area for planting is attached at Annexure D.
5. On or about 8 March 2024 Mr Huang received documents from the Council to the effect that he had been charged with contempt. In April 2024 Mr Huang recommenced preparation work for the planting of the landscape area and purchased plants accordingly. By May 2024 Mr Huang completed the planting.
6. The affidavit of Mr Huang sworn 19 July 2024 (Huang No 2) was read which stated that the First Respondent has not been profitable for the past few years (no evidence supporting this statement was provided). Mr Huang has developed severe anxiety, depression and suffers from sleeplessness and nightmares since 2015, which he attributes to the commencement of court proceedings (no evidence of his mental state has been provided). Mr Huang has difficulty reading, understanding and speaking English. He is heavily reliant on his sons whom he does not see often. Mr Huang attempted to plant the landscape area in 2016 or 2017 and in October 2023. He also purchased plants in September 2020. Severe flooding events in February 2020, March 2021, March, April and July 2022 and after October 2023 caused damage to the Land and to his planting efforts. (I note that no reference is made to any events or actions on his part between November 2022 and October 2023.)
7. Mr Huang did not raise the impact of flooding events when agreeing to the 2022 Consent Orders as he was aware of the requirement to plant under the 2015 Consent. He was not aware of the requirements to comply with the 2022 Consent Orders within three months. He either did not receive the Council's letter dated 23 October 2023 or did not read it. In oral submissions his counsel stated that Mr Huang did not dispute receiving the 2022 Consent Orders.

Factors to consider in sentencing

1. Primary factors to consider in sentencing were identified by Robson J in Fairfield City Council v Camilleri [2024] NSWLEC 56 at [33] as generally reflecting the earlier decision of Dunford J in Wood v Staunton (No 5) (1996) 86 A Crim R 183 at 185 as follows: [33] The primary factors relevant when considering the appropriate penalty for contempt (which I respectfully adopt) are noted by Payne JA in [Council of the New South Wales Bar Association v Rollinson (No 2) [2023] NSWSC 1390] at [66], [67] referring to a list of factors identified by Barrett J in Australian Securities and Investments Commission v Matthews [2009] NSWSC 285; (2009) 71 ACSR 279 at [26]-[27] (and which generally reflect the earlier analysis of Dunford J in Wood v Staunton (No 5) (1996) 86 A Crim R 183 at 185. In my summary, the factors, which are overlapping, comprise: (1) the seriousness of the contempt proved; (2) the contemnor's culpability; (3) the reason or motive for the contempt; (4) whether the contemnor has received, or sought to receive, a benefit or gain from the contempt; (5) whether there has been any expression of genuine contrition by the contemnor; (6) the character and antecedents of the contemnor; (7) the contemnor's personal circumstances; (8) the need for deterrence of the contemnor and others of like mind; and the need for denunciation of contemptuous conduct; and (9) the likely effect that punishment will have on the contemnor, including any hardship it might cause.

Seriousness of contempt

1. The requirement of a 10m wide landscape area was imposed as part of the conditions of the 2015 Consent to address the impacts of the approved plant agriculture development use. The purpose and importance of the revegetation (including the 10m wide landscape area) is reflected in the Farm Management Plan (see above in [9]) which states: The purpose of the revegetation works is to provide an ecological buffer between intensive agricultural works that include potential nutrient/fertiliser leaching and chemical drift towards the sensitive lagoon habitats.
2. The Council is not seeking changes to the planting undertaken to purge the contempt. No allegation of environmental harm arising from the failure to plant giving rise to the contempt is made by the Council.
3. The charge is for civil contempt for failing to comply with a court order. Whether the contempt is technical (accidental), wilful meaning not accidental or contumacious being deliberate disobedience of a court order is relevant to considering the seriousness of the contempt, see Georges River Council v Mifsud [2017] NSWLEC 113 (Mifsud) at [22]. The contempt has been purged after a long delay in complying with the 2015 Consent condition and the 2022 Consent Orders requiring compliance within three months. Contempt proceedings were commenced on 1 March 2024 and notice given to the Respondents on 28 March 2024. As the Council submitted intermittent attempts to comply with orders over a lengthy period have been considered as wilful contempt, see Fairfield City Council v Adams (No 2) [2010] NSWLEC 45 at [19], cited in Council of the City of Sydney v The Owners Strata Plan No 18820 [2017] NSWLEC 81 (SP18820) at [39]-[41]. The particular history of the Respondents seeking to comply with the 2022 Consent Orders in light of flooding of the landscape area must be considered.
4. The evidence is undisputed that the Respondents sought to plant the landscape area in 2016 and 2017 on several occasions since development consent was granted in 2015 but regular flooding of the area prevented this being successful. Plants were purchased for planting in September 2020. Flooding occurred in February 2020. Flooding also occurred in March 2021, March, April and July 2022 and March 2023. The 2022 Consent Orders were made on 29 November 2022 requiring planting within three months. Mr Huang's evidence of flooding in 2023 is difficult to assess as his two affidavits treat this time period differently. In Huang No 1 Mr Huang states there was flooding in March 2023 and April 2024 [sic] but I infer this should be a reference to 2023. Huang No 2 states that the area was prepared for new planting around the end of October 2023 and no reference is made to any events or actions on his part between November 2022 and October 2023. October 2023 was well after the time for compliance with the 2022 Consent Orders. Contempt proceedings were commenced in March 2024. Planting was completed in May 2024.
5. While the affidavit evidence of Mr Huang was to the effect that he was not told of the timing of the planting requirements in the 2022 Consent Orders by his solicitor, as I understand the oral submissions made on his behalf he accepts that he was made aware of the requirement to plant in a specified timeframe. Further the Council read the two undisputed affidavits of Mr Gamsby process server sworn 9 December 2022 attesting to service of a copy of the 2022 Consent Orders on Mr Huang personally. That Mr Huang has a poor command of English does not excuse him from having to ensure he understands letters from the Council. He is the director of a company undertaking a commercial business operation which has the benefit of a conditional development consent. It is difficult to know what further efforts the Council could have reasonably taken to draw the 2022 Consent Orders to his attention particularly given that he was legally represented when these were made. As the Council submitted not reading mail is an inadequate excuse for non-compliance and in my view does not provide an adequate explanation by Mr Huang for his failure to comply with his obligations under the 2022 Consent Orders. There is no evidence that any planting activity was attempted in the three months required by the 2022 Consent Orders and no evidence of flooding in that period.
6. Mr Huang also appeared to dispute that he was made aware of the Council's intention to commence contempt proceedings because he did not receive the Council's letters sent by express post and registered address to his postal address being the Land. Mr Huang as the sole director of a company undertaking a commercial business operation should take responsibility for understanding formal communications from the Council and not be blind to the need to understand formal correspondence.
7. I accept the Respondents' submission that the contempt was not deliberate in the sense of contumacious, nor did the Council make such a submission. At issue is whether the above lengthy history should give rise to a finding that the contempt is wilful as the Respondents were aware of the 2022 Consent Orders and delayed in complying with them. There is not always a clear line between a contempt which is technical and accidental and one which is wilful meaning deliberate. The Respondents have failed to comply with a development consent condition imposed in 2015 ultimately resulting in enforcement action and consent orders being made which in turn were not complied with in the required time. While flooding has impacted the Respondents' efforts to plant the relevant area on several occasions the last flooding event referred to was in April 2023. Mr Huang bought plants to plant in September 2023. Planting did not occur until April/May 2024. Even allowing for the vagaries of the weather I consider there has been such delay in compliance with the 2022 Consent Orders so that there is an element of wilfulness in the Respondents' behaviour.

Reasons for the contempt and benefits for the Respondents

1. The Council submitted that correspondence from its solicitors provided a further time period to the Respondents to comply prior to any contempt proceedings being commenced. No steps were undertaken by the Respondents to seek to amend the time frames under the 2022 Consent Orders to address their failure to comply. The contempt proceedings were commenced on 1 March 2024 and the Respondents did not take steps to purge the contempt until recently.

Contrition

1. Although the Council submitted that there has been no expression of contrition from the Respondents, the Respondents have pleaded guilty to contempt. The first return of the contempt notice of motion was 12 April 2024. Pleas of guilty were promptly entered on the next occasion on 3 May 2024. The Second Respondent's evidence that his conduct in not complying with the 2022 Consent Orders was not intentional, given the number of times he attempted to plant the landscape area but was thwarted by flooding events, can be accepted albeit I have found above there was an element of wilfulness given the amount of time taken to comply with the 2022 Consent Orders.

Character and antecedents

1. The Council tendered a Local Court record of 12 convictions under the Water Management Act 2000 (NSW) of the First Respondent arising from prosecutions brought by the Natural Resources Access Regulator. This is contrary to the Second Respondent attesting in Huang No 2 at par 8 that he (as sole director of the First Respondent and the Second Respondent) has no criminal convictions. As these convictions do not arise from contempt of court charges I do not consider they have much of a role to play in this sentencing exercise, see Seven Network (Operations) Ltd v Dowling (No 2) [2021] NSWSC 1106 at [9] citing Ferguson v Dallow (No 5) [2021] FCA 698 at [20] stating the general principle that 'when determining a penalty for contempt, the relevant history of the offender includes, and is limited to, other findings of contempt' in Rolph, Contempt (Federation Press, 2023) p 797 fn 58.
2. The affidavit of Mr Dogramaci sworn 11 July 2024 was read in part. Mr Dogramaci is a member of the local community and met Mr Huang approximately 15-20 years ago around the time of the purchase of the Land by his company. He attested to Mr Huang's good character and standing in the local community as a farmer throughout that period. I am prepared to accept that Mr Huang is of good character.

Deterrence

1. In Mifsud I stated the following in relation to general deterrence at [41]: [41] It is important to consider deterrence generally in relation to contempt of court orders. The underlying purpose of the exercise of the power of the Court to punish for contempt is to protect the effective administration of justice by demonstrating that the Court's orders will be enforced. Kirby J in Pelechowski v Registrar of the Court of Appeal (1999) 198 CLR 435; [1999] HCA 19 at [149] described it as follows: Unless courts are seen to respond firmly to deliberate defiance of their orders, their effectiveness in the authoritative determination of disputes of law would be undermined. And if they were not effective, "serious and lasting damage to the fabric of the law may result" [Registrar, Court of Appeal v Maniam [No 2] (1992) 26 NSWLR 309 at 318; R v Sergiou (1983) 5 Cr App R (S) 227]. Obviously, the culpability of the contemnor is relevant to the order which must be made [Australasian Meat Industry Employees Union v Mudginberri Station Pty Ltd (1986) 161 CLR 98]. The contemnor must then be punished in an emphatic way. He or she must be deterred effectively from any temptation to re-offend. However, the focus of attention is not solely on the contemnor. It is also addressed to the community at large and to any others who might consider acting in a similar manner.
2. Given the ongoing nature of the maintenance requirements of Order 2b of the 2022 Consent Orders, the Council submitted that, in addition to general deterrence, personal deterrence has a role to play in these proceedings, citing Sutherland Shire Council v Perdikaris [2020] NSWLEC 111 (Perdikaris) at [61]. In Perdikaris the respondent had not purged the contempt. The Respondents have here purged their contempt suggesting personal deterrence is not a significant factor to consider.

Denunciation

1. The punishment imposed should also be a denunciation of the contempt, see Perdikaris at [62].

No maximum penalty

1. There is no statutorily defined maximum penalty for contempt where a penalty of a fine will be imposed. In SP18820 Robson J helpfully considered various authorities in relation to the range of penalties imposed for wilful contempt. At [62] his Honour stated: [62] In [Waverley Council v Tovir Investments Pty Ltd (No 4) [2013] NSWLEC 88] Biscoe J referred at [34] to the caution to be exercised in comparing sentences passed in different factual contexts. His Honour made similar comments in [Queanbeyan City Council v Sun (No 2) (2013) 195 LGERA 14; [2013] NSWLEC 64] at [38]-[41], where his Honour noted that the range of penalties imposed by this Court in cases of wilful contempt have generally been in the range of $7,500 to $50,000 with higher penalties (which were defined as being over $20,000) being imposed in cases involving environmental harm or the risk of environmental harm. These figures were sourced from [Burwood Council v Ruan [2008] NSWLEC 167] at [26]-[28], and so related to matters before the Court prior to 2008.
2. In SP18820 a fine of $15,000 was imposed for the failure to comply with the requirements of a fire safety order in relation to a 3 storey strata building. At the time of sentence the contempt had been purged, his Honour having adjourned the sentencing hearing for a month to permit compliance with the orders to be achieved, at [20]-[21].
3. Given my findings above concerning the seriousness of the offence, that no environmental harm is alleged and the various factors which I consider relevant, I will impose a penalty of $8,000 as appropriate subject to my application of the totality principle given the inter-relationship of the two Respondents and that their contempt arises from the same circumstances.

Capacity to pay fine

1. The definition of fine in s 4(1)(a1) for the purposes of the Fines Act 1996 (NSW) includes any monetary penalty imposed by a court for contempt of court. Under s 6 of the Fines Act the Court is to take into account the capacity of a defendant to pay a fine where information to do so is available. Huang No 2 (sworn essentially the day of the hearing) contained three paragraphs purporting to demonstrate the Second Respondent's limited finances. No supporting documentation was attached to that affidavit. As the Council submitted, these paragraphs can be given little weight given the absence of supporting documents and the extremely late provision of the affidavit which gave the Council no opportunity to issue subpoenas for the production of documents which would enable the statements to be tested.
2. The Respondents were provided with the opportunity to put additional financial information relevant to capacity to pay before the Court if they so wished. A further affidavit of Mr Huang sworn 9 August 2024 was provided subsequent to the hearing and attested to some aspects of the Respondents' current financial circumstances. A bank statement of Mr Huang for April to October 2024, a list of transactions from the First Respondent's business account for 22 to 26 July 2024, a business loan statement for June to December 2023 for the First Respondent, a business offset statement for January to February 2023 and a letter from the First Respondent's bank notifying of the business loan's pending maturity were annexed. The amount of the mortgage held by the First Respondent over the Land and adjoining property was clarified. It remains substantial. Mr Huang attested that the company is having trouble paying its currents bills. For the reasons advanced by the Council this further evidence does not provide useful information to the Court to enable the determination of the Respondents' capacity to pay. The Respondents failed to state or provide evidence of the following: 1. that the accounts relating to the annexed documents are the only accounts held by the Respondents; 2. whether all proceeds of the business carried out at the Land are deposited to the identified bank account; 3. the current balance of the Second Respondent's bank account; 4. the current balance of the First Respondent's business bank account; 5. what, if any arrangements were or are to be made regarding the refinancing of the business loan; 6. the value of the Land or the amount of equity held in that land by the First Respondent; 7. a statement of the assets and liabilities of the Respondents; 8. the annual income and expenses of the Respondents; and 9. any tax returns of the Respondents.
3. The totality of the evidence of the Second Respondent regarding capacity to pay is not sufficient to justify any reduction in any monetary penalty the Court may impose on either of the Respondents. Accordingly I will not reduce the amount of penalty imposed above.

Costs

1. The Council has incurred costs and seeks an order that these be paid by the Respondents on an indemnity basis. Costs are often ordered to be payable on an indemnity basis in contempt matters subject to the exercise of the court's discretion not to award costs.
2. In Queanbeyan-Palerang Regional Council v Banks (No 2) [2024] NSWLEC 99 I recently referred to Ritchie's Uniform Civil Procedure NSW with respect to costs in civil contempt cases and stated at [49]-[50]: [49] The Council seeks an order that its costs be paid on an indemnity basis from Mr Banks, as has been ordered in numerous cases referred to in the Council's submissions there described as the ordinary practice. Ultimately each case depends on its own circumstances. Ritchie's Uniform Civil Procedure NSW states at [SC Rules Pt 55 r 13.7]: Where contempt is established on an application by a private prosecutor, the usual order is for costs to be paid on the ordinary basis: McIntyre v Perkes (1988) 15 NSWLR 417; BC8801160; Ditfort v Katz (NSWCA, Full Court, 8 July 1991, unreported, BC9101811); Global Custodians Ltd v Mesh [2000] NSWSC 845; BC200005019 at [37] per Young CJ in Eq (no such apology proffered, restraining order made and costs on usual basis). But costs may be a consideration in the imposition of a penalty and, at least in that context, costs may be ordered to be paid on an indemnity basis: Farahbakht v Midas Australia Pty Ltd [2006] NSWSC 1322; BC200610117 at [58] per Brereton J; NCR Australia Pty Ltd v Credit Connection Pty Ltd [2005] NSWSC 1118; BC200509669 at [102] per Campbell J (full indemnity for costs); McGuirk v University of New South Wales [2010] NSWSC 448; BC201003075 (order for costs of the penalty proceedings to be paid forthwith on an indemnity basis); Circuit Finance Australia v Sobbi [2010] NSWSC 912; BC201005901 (order for costs alone not sufficient - conduct was deliberate and contrition too late and too little - fine ordered and indemnity costs). [50] The order for costs to be paid on an indemnity basis in civil contempt proceedings is common, but each case must be considered on its own facts, see Robson J in Fairfield City Council v Camilleri at [60], citing Colgate‑Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225; [1993] FCA 801 at 233-234 (Sheppard J).
3. I consider that indemnity costs is warranted in the circumstances given the time taken to comply with the 2022 Consent Orders.

Totality principle

1. In Ku-ring-gai Council v Baynie [2017] NSWLEC 172 I stated at [71]: [71] The sentencing principle of totality is relevant where more than one similar offence is committed to ensure that the sum of any fines imposed are not disproportionate to the total criminality of a defendant. In Environment Protection Authority v Wattke; Environment Protection Authority v Geerdink [2010] NSWLEC 24 at [98] I said: …That principle requires a judge to determine the appropriate sentence for each offence and when reviewing the aggregate sentence, consider whether it is just and appropriate. In this way the overall criminality of all the offences is reflected proportionately in the sentences imposed, Mill v R [1988] HCA 70; (1988) 166 CLR 59 at 62, Postiglione v R [1997] HCA 26; (1997) 189 CLR 295, and Pearce v R [1988] HCA 57; (1988) 194 CLR 610.
2. While the above matter is a criminal case the same principle should apply here where the Respondents are closely related and charged with contempt arising from the same circumstances. I will consider the charges of contempt together for the purposes of applying the totality principle. I will impose a penalty of $6,000 on the First Respondent company and $2,000 on the Second Respondent Mr Huang.

Orders

1. The Court orders: 1. The First Respondent Huang Brother Pty Ltd is fined the sum of $6,000 for failure to comply with Orders 2.a.i. and 2.b. of the Consent Orders made on 29 November 2022. 2. The Second Respondent Mr Huang is fined the sum of $2,000 for failure to comply with Orders 2.a.i. and 2.b. of the Consent Orders made on 29 November 2022. 3. The Respondents are to pay the Council's costs of the notice of motion filed 1 March 2024 on an indemnity basis as agreed or assessed.

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: 25 October 2024