NSWNSWLEC

J.K. Williams Staff Pty Limited v Sydney Water Corporation

[2021] NSWLEC 23

Land and Environment Court (NSW)|2021-02-19|Before: Preston CJ

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At a glance

Source facts

Court

Land and Environment Court (NSW)

Decision date

2021-02-19

Before

Preston CJ

Catchwords

[2012] EWCA 312 Benning v Wong (1969) 122 CLR 249
[1969] HCA 58 Buck v Bavone (1976) 135 CLR 110
[1976] HCA 24 Burnie Port Authority v General Jones Pty Ltd (1994) 179 CLR 520
[1994] HCA 13 Coventry v Lawrence [2014] AC 822

Source

Original judgment source is linked above.

Catchwords

[2012] EWCA 312 Benning v Wong (1969) 122 CLR 249[1969] HCA 58 Buck v Bavone (1976) 135 CLR 110[1976] HCA 24 Burnie Port Authority v General Jones Pty Ltd (1994) 179 CLR 520[1994] HCA 13 Coventry v Lawrence [2014] AC 822[2014] UKSC 13 Curtis v Harden Shire Council (2014) 88 NSWLR 10[2013] NSWCCA 382 Henville v Walker (2001) 206 CLR 459[2001] HCA 52 Hicks v Ruddock (2007) 156 FCR 574[2007] FCA 299 House of Peace v Bankstown City Council (2000) 48 NSWLR 498[2000] NSWCA 44 Hunt & Hunt Lawyers (A firm) v Mitchell Morgan Nominees Pty Ltd (2013) 247 CLR 623[2013] HCA 10 Hunter Industrial Rental Equipment Pty Ltd v Dungog Shire Council (2019) 101 NSWLR 1[1991] HCA 12 Marcic v Thames Water Utilities Ltd [2002] QB 929 Melaleuca Estates Pty Ltd v Port Stephens Council (2006) 143 LGERA 319[2006] NSWCA 31 Minister for Immigration and Citizenship v Li (2013) 249 CLR 332[2013] HCA 18 Minister for Planning v Walker (2008) 161 LGERA 423[2008] NSWCCA 224 Newcastle City Council v Shortland Management Services (2003) 57 NSWLR 173[2003] NSWCA 156 Northern Residential Pty Ltd v Newcastle City Council (2009) 75 NSWLR 192

Judgment (31 paragraphs)

[1]

] HCA 24 Burnie Port Authority v General Jones Pty Ltd (1994) 179 CLR 520; [1994] HCA 13 Coventry v Lawrence [2014] AC 822; [2014] UKSC 13 Curtis v Harden Shire Council (2014) 88 NSWLR 10; [2014] NSWCA 314 Elston v Dore (1982) 149 CLR 480 [1982] HCA 71 Environment Protection Authority v Du Pont (Australia) Ltd [2013] NSWLEC 98 Environment Protection Authority v Grafil Pty Ltd (2019) 238 LGERA 147; [2019] NSWCCA 174 Environment Protection Authority v Sydney Water Corporation [2015] NSWLEC 80 F Hannan Pty Ltd v Electricity Commission of New South Wales (No 3) (1985) 66 LGRA 306 Gales Holdings Pty Ltd v Tweed Shire Council (2013) 85 NSWLR 514; [2013] NSWCCA 382 Henville v Walker (2001) 206 CLR 459; [2001] HCA 52 Hicks v Ruddock (2007) 156 FCR 574; [2007] FCA 299 House of Peace v Bankstown City Council (2000) 48 NSWLR 498; [2000] NSWCA 44 Hunt & Hunt Lawyers (A firm) v Mitchell Morgan Nominees Pty Ltd (2013) 247 CLR 623; [2013] HCA 10 Hunter Industrial Rental Equipment Pty Ltd v Dungog Shire Council (2019) 101 NSWLR 1; [2019] NSWCA 147 Jeffman Pty Ltd and Lawrence Dry Cleaners Pty Ltd v Environment Protection Authority of NSW, Sydney Water Corporation and Douglas and Hilary Hutchinson [2011] NSWLEC 89 K&M Prodanovski Pty Ltd v Wollongong City Council (2013) 195 LGERA 23; [2013] NSWCA 202 Lake Macquarie City Council v Australian Native Landscapes Pty Ltd (No 2) [2015] NSWLEC 114 Lloyd v Robinson (1962) 107 CLR 142 at 154 [1962] HCA 36 March v E & MH Stramare Pty Ltd (1991) 171 CLR 506; [1991] HCA 12 Marcic v Thames Water Utilities Ltd [2002] QB 929 Melaleuca Estates Pty Ltd v Port Stephens Council (2006) 143 LGERA 319; [2006] NSWCA 31 Minister for Immigration and Citizenship v Li (2013) 249 CLR 332; [2013] HCA 18 Minister for Planning v Walker (2008) 161 LGERA 423; [2008] NSWCCA 224 Newcastle City Council v Shortland Management Services (2003) 57 NSWLR 173; [2003] NSWCA 156 Northern Residential Pty Ltd v Newcastle City Council (2009) 75 NSWLR 192; [2009] NSWCA 141 Oshlack v Irongates Pty Ltd (1997) 130 LGERA 189; [1997] NSWLEC 89 Patrick Stevedores Operations (No 2) Pty Ltd v Hennessy; FBIS International Protective Services (Aust) Pty Ltd [2015] NSWCA 253 Precision Products (NSW) Pty Ltd v Hawkesbury City Council (2008) 74 NSWLR 102; [2008] NSWCA 278 Quick v Alpine Nursery Sales Pty Ltd [2010] NSWSC 1248 R (on the application of Skelmersdale Limited Partnership v West Lancashire Borough Council [2016] EWCA Civ 1260 Randren House Pty Ltd v Water Administration Ministerial Corporation [2020] NSWCA 14 Rao v Canterbury City Council (2000) 112 LGERA 360; [2000] NSWCCA 471 Roads and Maritime Services v Grant [2015] NSWCA 138 Robson v Leischke (2008) 72 NSWLR 98; [2008] NSWLEC 152 Rowley v NSW Leather Trading Co Pty Ltd and Woollahra Municipal Council (1980) 49 LGRA 250 Rylands v Fletcher (1868) LR 3 HL 330 Southern Properties (WA) Pty Ltd v Executive Director, Department of Conservation and Land Management (2012) 42 WAR 287; [2012] WASCA 79 Strong v Woolworths Ltd (2012) 246 CLR 182; [2012] HCA 5 Telstra Corporation v Hornsby Shire Council (2006) 67 NSWLR 256; [2006] NSWLEC 133 Trump International Golf Club Scotland Ltd v Scottish Ministers at [2016] 1 WLR 85; [2015] UKSC 74 Tubbo Pty Ltd v Minister administering the Water Management Act 2000; Harvey v Minister administering the Water Management Act 2000 [2008] NSWCA 356 Vairy v Wyong Shire Council (2005) 223 CLR 422; [2005] HCA 62 Wallace v Kam (2013) 250 CLR 375; [2014] HCA 19 Warringah Shire Council v Sedevcic (1987) 10 NSWLR 335 Warth v Lafsky [2014] Aust Torts Rep 82-166; [2014] NSWCA 94 Weber v Greater Hume Shire Council (2019) 100 NSWLR 1; [2019] NSWCA 74 Western Australian Planning Commission v Temwood Holdings Pty Ltd (2004) 221 CLR 30; [2004] HCA 63 Wingecarribee Shire Council v De Angelis [2016] NSWCA 189 Winn v Director-General National Parks and Wildlife (2001) 130 LGERA 508; [2001] NSWCA 17 Wollondilly Shire Council v Foxman Environmental Development Services Pty Ltd (No 5) [2013] NSWLEC 68 Wyong Shire Council v Shirt (1980) 146 CLR 40; [1980] HCA 12 X (Minors) v Bedforshire County Council [1995] 2 AC 633 Texts Cited: John Austin, Austin: The Province of Jurisprudence Determined, ed Wilfrid Rumble (Cambridge University Press, 1995) Category: Principal judgment Parties: J.K. Williams Staff Pty Limited (Applicant) Sydney Water Corporation (Respondent) Representation: Counsel: Mr W G Muddle SC with Mr H El-Hage (Applicant) Mr S Donaldson SC with Mr S Glascott (Respondent)

[2]

Solicitors: Holman Webb (Applicant) Makinson d'Apice (Respondent) File Number(s): 2019/396280 Publication restriction: Nil

[3]

Judgment

The water flows in a creek in western Sydney, Boundary Creek, are significantly eroding the bank within land owned by the applicant, J. K. Williams Staff Pty Ltd (Williams), at 44 Jack Williams Drive, Penrith. Central issues in these proceedings are: what is the cause and who is responsible for this erosion?
Williams claims that treated effluent discharged by Sydney Water Corporation (Sydney Water) from its sewage treatment plant at Penrith (Penrith STP), located about 1km upstream, is a material cause of the erosion and hence Sydney Water is responsible. Williams claims that Sydney Water has legal responsibility under three planning or environmental laws, the Environmental Planning and Assessment Act 1979 (EPA Act), the Protection of the Environment Operations Act 1997 (POEO Act) and the Sydney Water Act 1994 (SW Act), the common law of private nuisance, and the duty of care in relation to support for land under s 177 of the Conveyancing Act 1919 (Conveyancing Act). Williams claims that Sydney Water has breached these legal responsibilities in various ways by discharging treated effluent into Boundary Creek in such volume and such manner as to cause erosion of Williams' land.
Sydney Water accepts that water flows in Boundary Creek are eroding the bank within Williams' land and that Sydney Water has discharged and continues to discharge treated effluent into Boundary Creek. Sydney Water contests, however, that the discharged treated effluent is a material cause of the erosion of the bank of Boundary Creek. It claims that the volume of discharged treated effluent is insufficient by itself to cause the erosion. Instead, the main cause of erosion is runoff from the Boundary Creek catchment. In this factual circumstance, Sydney Water contends that it is not in breach of any of its statutory or common law legal responsibilities. If, however, the discharged treated effluent is a cause of the erosion, Sydney Water contests that it has breached any of its legal responsibilities, for various reasons that depend on the elements of the legal responsibility in question and any defence that is available to relieve it of responsibility.

[4]

The structure of the judgment

As a central issue in these proceedings is the cause of the erosion, I will commence with this issue. I will secondly address the claims of breach of the three planning or environmental laws, in the order of the EPA Act, POEO Act and SW Act. I will thirdly address the claim of breach of the duty of care under s 177 of the Conveyancing Act. Finally, I will address the claim of private nuisance.

[5]

The cause of erosion

Boundary Creek, in its natural state, is an ephemeral creek. It originates in land situated at 35 Coombes Drive, Penrith and heads first northwards under Hickeys Road then westwards through Ockeys Park and past Penrith STP. Boundary Creek is largely channelised in this stretch. At the point where Penrith STP discharges treated effluent into Boundary Creek, Sydney Water has constructed a protective stone layer on the embankment of Boundary Creek to prevent bank erosion.
After this point of discharge, Boundary Creek travels westwards under Castlereagh Road, through three parcels of land situated at 2166 Castlereagh Road, 2152-2164 Castlereagh Road and Mullins Road, before entering Williams' land. Before Boundary Creek enters Williams' land, it becomes a natural stream. The northern bank of Boundary Creek within Williams' land is high and steep and is significantly eroding. This northern bank is at the outside of a bend of Boundary Creek, where erosional forces are greatest.
After Boundary Creek leaves Williams' land, still heading westwards, it travels through a public reserve, owned by Penrith City Council, before discharging into the Nepean River about 50m downstream of Penrith Weir.
Since the commencement of operation of Penrith STP, treated effluent has been discharged into Boundary Creek from Penrith STP. The volume of the discharges increased substantially after the Replacement Flows Project was commissioned and commenced operation in August 2010. I will explain this project in the next section of the judgment.
In the period from January 2005 to July 2010, an average of 24ML/day of treated effluent was discharged from Penrith STP into Boundary Creek. During this period, there were days when more than 24ML/day were discharged in a single day (up to 94ML/day). Between August 2010, when the Replacement Flows Project was commissioned and commenced operation, and January 2018, the volume of treated effluent discharged from Penrith STP into Boundary Creek increased to be on average 44ML/day. During this period, there have also been days when more than 44ML/day has been discharged during a single day (up to 197ML/day). The increase in the average daily volume of treated effluent discharged before and after the Replacement Flows Project commenced operation is therefore 83%.
Expressed in terms of annual discharge volumes, in the period 2005 to 2009, Penrith STP discharged into Boundary Creek an average of 8,791ML per annum, which increased in the period 2010 to 2017 to an average of 15,562ML per annum, an increase of 77%.

[6]

The conditions of approval

Penrith STP was originally operated by Penrith City Council but was later purchased and then operated by Sydney Water. On 20 June 2007, the Minister for Planning, under the then Part 3A of the EPA Act, approved the Replacement Flows Project at Penrith STP (the RFP approval). This project included the construction of pipelines to transport tertiary treated effluent from Penrith STP and another sewage treatment plant at Quakers Hill for further treatment at a new advanced water treatment plant at St Marys (St Marys AWTP), and a further pipeline to transport the highly treated recycled water back from St Marys AWTP to Penrith STP, so that it could be released into Boundary Creek and ultimately to the Hawkesbury-Nepean River.
As a result of the Replacement Flows Project, Penrith STP releases effluent from two sources at the one discharge point: first, the highly treated recycled water sent back from St Marys AWTP and, secondly, tertiary treated effluent from Penrith STP, being the difference between the volume of effluent treated at Penrith STP less the volume sent to St Marys AWTP for further treatment.
The RFP approval was issued subject to conditions. Two conditions are important. Condition 1.1 requires Sydney Water to carry out the Replacement Flows Project "generally in accordance with": 1. the Major Projects Application 06_0190 that sought approval for the Replacement Flows Project; 2. the Environmental Assessment of the Replacement Flows Project dated November 2006 that accompanied that application; 3. the Preferred Project Report for the Replacement Flows Project dated February 2007; and 4. the conditions of the approval.
Condition 1.5 of the RFP approval requires that the Replacement Flows Project "shall be limited to the release of up to 50ML/day of highly treated recycled water (replacement flow) to the Hawkesbury-Nepean River…".
The documents referred to in condition 1.1(b) and (c) regulate the Replacement Flows Project in two ways of relevance to this case. First, the Environmental Assessment and the Preferred Project Report, documents prepared on behalf of Sydney Water as required steps in the process of applying for approval, included a Statement of Commitments by Sydney Water. Commitment 10 of the draft Statement of Commitments in the Environmental Assessment and commitment 11 of the revised Statement of Commitments in the Preferred Project Report each stated: "No degradation of bed or bank stability would occur within Boundary Creek downstream of Penrith STP as a result of the Project".

[7]

Williams' argument of breach of conditions

Williams claims that Sydney Water is breaching both condition 1.1 and condition 1.5 of the RFP approval. Sydney Water is breaching condition 1.1 firstly by not carrying out the Replacement Flows Project generally in accordance with the commitment in the Statement of Commitments (that is draft commitment 10 or revised commitment 11). That commitment by Sydney Water is that: "No degradation of bed or bank stability would occur within Boundary Creek downstream of Penrith STP as a result of the Project". Yet, the uncontested evidence is that degradation of bed or bank stability has occurred within Boundary Creek downstream of Penrith STP. Williams submits that such degradation is "a result of" the Replacement Flows Project, even if the project is not the sole cause as it "materially contributes" to the degradation.
Williams submits that the requirement of condition 1.1 that the Replacement Flows Project be carried out "generally in accordance with" the Environmental Assessment and the Preferred Project Report, and the Statement of Commitments in those documents, does not allow any material deviation in this case, having regarding to the terms in which the commitment is phrased. Under the commitment, Sydney Water undertook that "no degradation would occur within Boundary Creek" as a result of the Replacement Flows Project. That commitment is unequivocal. It does not allow degrees of compliance. Any degradation of Boundary Creek as a result of the Replacement Flows Project is a failure to comply with the commitment.
Williams submits that the causal element of the commitment, "as a result", imports a requirement for there to be a connection between the Replacement Flows Project and the degradation of Boundary Creek. A common sense approach should be adopted to determine this issue. The relevant question is whether discharges under the Replacement Flows Project "materially contributed" to the degradation of the bed and bank of Boundary Creek: see generally Henville v Walker (2001) 206 CLR 459; [2001] HCA 52 at [18], [61], [96], [153] and [158]. Sydney Water cited Hayne J's observations at [163] as apposite: "Secondly, seldom, if ever, will contravening conduct be the sole cause of a person suffering loss… What the Act directs attention to is whether the contravening conduct was a cause. It does not require, or permit, the attribution of some qualification such as 'solely' or 'principally' to the word 'by'." See also Wollondilly Shire Council v Foxman Environmental Development Services Pty Ltd (No 5) [2013] NSWLEC 68 at [234]-[237] dealing with the meaning of "cause".

[8]

Sydney Water's argument of no breach of conditions

Sydney Water contests that it has breached conditions 1.1 and 1.5 of the RFP approval.
In relation to commitment 11 in the revised Statement of Commitments in the Preferred Project Report, Sydney Water contests that it is under a legal obligation to comply with that commitment. Sydney Water noted that the then applicable s 75J(5) of the EPA Act empowered the Minister to grant an approval subject to a condition requiring the proponent to comply with any obligation expressed in a statement of commitments. The subsection provided: "The conditions of approval for the carrying out of a project may require the proponent to comply with any obligations in a statement of commitments made by the proponent (including by entering into a planning agreement referred to in section 93)".
Sydney Water accepted that condition 1.1 of the RFP approval required it to carry out the project generally in accordance with the Preferred Project Report, which included the Statement of Commitments made by Sydney Water. However, the terms in which commitment 11 in that Statement of Commitments is expressed does not impose any obligation on Sydney Water to do or refrain from doing anything. Rather, the commitment is expressed in terms of an understanding or belief. The impacts of the discharge from the project on Boundary Creek had been assessed and the result of that assessment was that there would be no degradation of bed or bank stability of Boundary Creek as a result of the project.
Sydney Water further submitted that condition 1.1, requiring the project to be carried out generally in accordance with the Preferred Project Report including the Statement of Commitments in it, cannot sensibly be read as requiring Sydney Water not to do precisely that which the approval permitted, of discharging treated effluent into Boundary Creek. Sydney Water submitted that it has carried out the project precisely in accordance with the Preferred Project Report, which contemplated that it would discharge highly treated recycled water into Boundary Creek. That serves to emphasise that a commitment in a statement of commitments, such as that contained in commitment 11, must be interpreted as a statement of belief and not an undertaking to modify the project in some undefined way at some time in the future.
Sydney Water contested that it was limited to discharging treated effluent from Penrith STP to Boundary Creek to 50ML/day. The environment protection licence issued under the POEO Act authorises the discharge of up to 238ML/day. Sydney Water accepted that, during wet weather events, discharges from Penrith STP have occasionally exceeded the average of 43ML/day since 2007 but have not exceeded the licence limit of 238ML/day.

[9]

Breach of condition 1.1 of the RFP approval established

I find that Sydney Water has breached condition 1.1 but not condition 1.5 of the RFP approval. These findings flow largely from the proper construction of the conditions of the RFP approval.
A development consent granted under Part 4 of the EPA Act or an approval granted under Part 3A of the EPA Act are to be construed having regard to the statutory provisions governing its grant (Hunter Industrial Rental Equipment Pty Ltd v Dungog Shire Council (2019) 101 NSWLR 1; [2019] NSWCA 147 at [268]) and "its enduring functions" of authorising the carrying out of the development or activity for which consent or approval was sought (Winn v Director-General National Parks and Wildlife (2001) 130 LGERA 508; [2001] NSWCA 17 at [4]). The consent or approval speaks "according to its written terms, construed in context but having regard to its enduring function": House of Peace v Bankstown City Council (2000) 48 NSWLR 498; [2000] NSWCA 44 at [37] and see [23]. The meaning of the language used in the consent or approval "is to be determined objectively having regard to the context in which the consent was issued and taking into account the fact that, unlike a contract between parties, the consent operates in rem and is for the benefit of subsequent owners and occupiers, as well as the applicant": K&M Prodanovski Pty Ltd v Wollongong City Council (2013) 195 LGERA 23; [2013] NSWCA 202 at [23].
It is permissible to look at the application seeking consent or approval and the documents and plans accompanying the application in order to determine the scope and operation of the consent or approval and the development or activity for which consent or approval was sought: Hunter Industrial Rental Equipment Pty Ltd v Dungog Shire Council at [57]-[59], [62], [80], [296]-[298], [302]-[305], [310] and [311].
A consent or approval is to be determined in accordance with the same principles of statutory interpretation that are applicable to interpreting other legal documents. Planning permissions are not in a special category requiring adoption of a completely different approach to their interpretation: Trump International Golf Club Scotland Ltd v Scottish Ministers at [2016] 1 WLR 85; [2015] UKSC 74 at [60], [66]. There is no general principle requiring laxity or flexibility in construing delegated planning legislation or statutory instruments, including development consents or approvals, nor do practical considerations permit a re-writing of delegated legislation or statutory instruments to meet what the court thinks is a permissible and practical outcome: Wingecarribee Shire Council v De Angelis [2016] NSWCA 189 at [20]; 4nature Incorporated v Centennial Springvale Pty Ltd (2017) 95 NSWLR 361; [2017] NSWCA 191 at [45]; Environment Protection Authority v Grafil Pty Ltd (2019) 238 LGERA 147; [2019] NSWCCA 174 at [257]-[261], [272].

[10]

No breach of condition 1.5 of the RFP approval established

The situation with condition 1.5 of the RFP approval is different. The breach of condition 1.5 alleged by Williams is dependent on construing condition 1.5 as capping all flows released from Penrith STP to the Hawkesbury-Nepean River via Boundary Creek and not just the highly treated recycled water under the Replacement Flows Project. This is because the evidence is that, although on occasions of high rainfall up to 238ML/day of liquid has been discharged from Penrith STP into Boundary Creek, of that volume no more than 50ML/day comprised highly treated recycled water under the Replacement Flows Project. On this evidence, Sydney Water would not have breached condition 1.5 if that condition only limits the release of highly treated recycled water to the Hawkesbury-Nepean via Boundary Creek.
I find that condition 1.5 should be construed in this manner. First, condition 1.5 states that "the project" is limited to the release of up to 50ML/day. The "project" is described in Schedule 1 of the RFP approval. This is the project that the Minister approved. The project described in Schedule 1 is the Replacement Flows Project.
One of the components of this project, as described, is the Advanced Water Treatment Plant at St Marys STP, which is described as producing "up to 50ML/day of highly treated recycled water for discharge to the Hawkesbury-Nepean River." The volume of 50ML/day is therefore the volume of highly treated recycled water produced by St Marys AWTP. This highly treated recycled water constitutes the "replacement flows" that are to be discharged into the Hawkesbury-Nepean River. This discharge of the replacement flows to the Hawkesbury-Nepean River is to be "via the Penrith STP discharge to Boundary Creek", which is another component of the project as described.
Secondly, condition 1.5 limits the volume of liquid that can be released to "50ML/day". As noted, this volume is the same volume of highly treated recycled water as is produced by the St Marys AWTP.
Thirdly, condition 1.5 defines the nature of the liquid to be released as being "highly treated recycled water". Only the AWTP at St Marys STP produces "highly treated recycled water". Penrith STP produces "tertiary treated effluent". The project involves the treatment at St Marys AWTP of the tertiary treated effluent that has been transferred from Penrith STP. To this end, the project involves the construction of a pipeline for the transfer of tertiary treated effluent from Penrith STP to St Marys AWTP and the construction of a further pipeline for the transfer of the highly treated recycled water produced by St Marys AWTP to Penrith STP. The project describes the discharge of only this "highly treated recycled water", being the recycled water produced by St Marys AWTP, and not any "tertiary treated effluent" from Penrith STP.

[11]

Breach of s 75D(2) of the EPA Act

Sydney Water, in carrying out the Replacement Flows Project in breach of condition 1.1 of the RFP approvals, has breached s 75D(2) of the EPA Act. That subsection requires a person, carrying out a project that the Minister has approved under Part 3A, to comply with any conditions to which such an approval is subject.

[12]

The claimed breach of the POEO Act

The second claimed breach of a planning or environmental law is that Sydney Water has polluted land in breach of s 142A(1) of the POEO Act. That section states simply that: "A person who pollutes land is guilty of an offence."
The action of polluting land includes causing or permitting any land to be polluted: s 142(2). "Land pollution" or "pollution of land" is defined to mean: "placing in or on, or otherwise introducing into or onto, the land (whether through an act or omission) any matter, whether solid, liquid or gaseous: (a) that causes or is likely to cause degradation of the land, resulting in actual or potential harm to the health or safety of human beings, animals or other terrestrial life or ecosystems, or actual or potential loss or property damage, that is not trivial, or (b) that is of a prescribed nature, description or class or that does not comply with any standard prescribed in respect of that matter, but does not include placing in or on, or otherwise introducing into or onto, land any substance excluded from this definition by the regulations."

[13]

Williams' argument of land pollution

Williams contends that Sydney Water's deliberate action of discharging treated effluent from Penrith STP into Boundary Creek, which flows downstream past Williams' land, causes the treated effluent to be placed in or on, or otherwise introduced into or onto, the bank of Boundary Creek within Williams' land and that such placing or introducing of the treated effluent in or on Williams' land causes degradation of that land and actual or potential property damage that is not trivial.
Williams submits that a person can pollute land indirectly, as illustrated by Environment Protection Authority v Du Pont (Australia) Ltd [2013] NSWLEC 98, where the Court held that the defendant's emissions of pollutant laden dust into the atmosphere, which fell onto land, caused the introduction of the pollutant laden dust into or onto the land: at [55]-[62], [76]-[79], [87] and [88].
Williams contends that Sydney Water's environment protection licences do not afford a defence against 142C of the POEO Act for proceedings for a breach of s 142A of the POEO Act. The defence under s 142C only operates if the person who pollutes land in breach of s 142A(1) establishes that the pollution of land was regulated by an environment protection licence and the conditions to which that licence was subject relating to the pollution of land were not contravened: s 142C(a) and (b).
Williams submits that the environment protection licences held by Sydney Water do not regulate the pollution of land at all and hence there are no conditions to which the licences are subject relating to the pollution of land. In short, Sydney Water's environment protection licences do not authorise the pollution of land. Instead, they regulate the carrying out of scheduled activities and the pollution of water.
Environment protection licence no. 1409 authorises the carrying out at the premises of Penrith STP of the scheduled activity of sewage treatment and the fee-based activity of sewage treatment processing by large plants, at the maximum scale of 10,000-20,000ML annual volume of discharge: Conditions A1.2 and A2.1. Conditions L4.1 and L4.2 limit the volume of liquids that can be discharged to water at nominated discharge points, both individually and combined, to a maximum of 238,000KL/day (or 238ML/day). Condition L7.2 limits the frequency of wet weather overflows from the reticulation system to a maximum of 36 overflows per 10 years, while condition L7.4 limits the total number of dry weather overflows reaching waterways from the sewage treatment system to a maximum of 8 in any reporting period.

[14]

Sydney Water's argument that no land pollution

Sydney Water contests that it has caused land pollution. Even if, as a matter of fact, the treated effluent discharged from Penrith STP into Boundary Creek has caused erosion of Williams' land, such erosion does not constitute land pollution of Williams' land. Erosion and pollution are distinct concepts. Pollution of land involves the placing or otherwise introducing some harmful matter into or onto the land. Land pollution is the state of affairs characterised by the continued presence of that harmful matter in or on the land. This is not the harm claimed by Williams, which involves the erosion of its land not the continued presence on its land of some harmful matter. Sydney Water argued that Williams' land "had not been polluted any more than a house washed away in a flood has sustained damage in the nature of pollution."
If, however, land pollution has occurred, Sydney Water submits that that pollution was regulated by the environment protection licences held by Sydney Water and the conditions of those licences were not contravened. Section 142C of the POEO Act therefore provides a defence. Sydney Water submits that environment protection licence 1409 permitted discharges of up to 238ML/day of treated effluent from Penrith STP (conditions L4.1 and L4.2) and for a limited number of wet and dry weather overflows (conditions L7.2 and L7.4). Environment protection licence 13210 permitted the transfer of flows from St Marys AWTP to Penrith STP pursuant to condition 1.5 of the RFP approval, which permitted 50ML/day of replacement flows to be released via Boundary Creek into the Hawkesbury-Nepean River.
Sydney Water contests Williams' argument that environment protection licence 1409 was issued in breach of s 50(2) of the POEO Act. Sydney Water contends that conditions 1.1 and 1.5 of the RFP approval only limit the maximum volume of liquid that can be discharged into Boundary Creek from the Replacement Flows Project, not the existing operation of Penrith STP. Sydney Water submits that this is clear from the use of the word "project" in condition 1.5 and the description of the project in the RFP approval. The "project" approved is only the Replacement Flows Project. Conditions of approval of that project could only relate to that project. Conditions could not lawfully be imposed to limit the operation of any other existing activity being carried out at Penrith STP, including setting limits on the volume of tertiary treated effluent that could be discharged from Penrith STP independently of the Replacement Flows Project.

[15]

No land pollution established

I find that Sydney Water has not caused Williams' land to be polluted in breach of s 142A(1) of the POEO Act. The reason is that the liquid (whether the highly treated recycled water or the tertiary treated effluent) discharged from Penrith STP does not cause degradation of land within the meaning of the definition of "land pollution" or "pollution of land" in the Dictionary to the POEO Act. To understand why this is so, it is helpful to set out again the definition: "land pollution or pollution of land means placing in or on, or otherwise introducing into or onto, the land (whether through an act or omission) any matter, whether solid, liquid or gaseous - (a) that causes or is likely to cause degradation of the land, resulting in actual or potential harm to the health or safety of human beings, animals or other terrestrial life or ecosystems, or actual or potential loss or property damage, that is not trivial, or (b) that is of a prescribed nature, description or class or that does not comply with any standard prescribed in respect of that matter, but does not include placing in or on, or otherwise introducing into or onto, land any substance excluded from this definition by the regulations."
Under this definition, pollution of land can occur in two ways: by doing the specified action referred to in (b) or by doing the specified action that has the specified results referred to in (a).
The first way involves "placing in or on, or otherwise introducing into or onto, the land (whether through an act or omission) any matter, whether solid, liquid or gaseous…(b) that is of a prescribed nature, description or class or that does not comply with any standard prescribed in respect of that matter." Clause 109(1) of the Protection of the Environment Operations (General) Regulation 2009 prescribes certain matter for the purposes of paragraph (b) of the definition, being asbestos waste, hazardous waste, restricted solid waste, and waste tyres in specified quantities. However, the matters in cl 109(1) are excluded from the definition if they are placed or introduced in a specific manner: cl 109(1)(a). This first way, therefore, focusses on the action of placing in or on or introducing into or onto land matter of such a nature or in such a quantity as to cause or be likely to cause harm to the land.
The second way that land can be polluted involves "placing in or on, or otherwise introducing into or onto, the land (whether through an act or omission) any matter, whether solid, liquid or gaseous…(a) that causes or is likely to cause degradation of the land, resulting in actual or potential harm to the health or safety of human beings, animals or other terrestrial life or ecosystems or actual or potential loss or property damage, that is not trivial." This second way requires not only the action of placing or introducing matter into or onto land, but also two results, the first result being degradation of the land and the second result being harm to human health or safety or the environment or property damage. The first result must be caused by the action and the second result must be caused by the first result.

[16]

The operating licence granted under the SW Act

The third claimed breach of a planning or environmental law is that Sydney Water has breached conditions of its operating licence granted under s 12 of the SW Act.
Section 12(1) of the SW Act provides: " The Governor may grant one or more operating licences to enable the Corporation in accordance with this Act, in the area of operations, to provide, construct, operate, manage or maintain systems or services for: (a) storing or supplying water, or (b) providing sewerage services, or (c) providing stormwater drainage systems, or (d) disposing of waste water."
Pursuant to s 12(1), the Governor has granted operating licences to Sydney Water, the most recent licence tendered being for the period 2015-2020. The operating licence authorised Sydney Water to provide services. Condition 1.2.1 provides: "This Licence is granted to enable and require Sydney Water to provide, construct, operate, manage and maintain efficient, coordinated and commercially viable systems for providing the Services within the Area of Operations."
The "Services" are defined broadly in the Definitions and Interpretations of the operating licence as meaning: "Subject to this Licence, any applicable law and any order made by the Governor under section 10(2) of the Act, the provision, construction, operation, management and maintenance by Sydney Water of systems and services for: (a) storing and supplying water (including Recycled Water and Drinking Water); (b) providing sewerage services; (c) providing stormwater drainage systems; and (d) disposing of wastewater."
These Services evidently include the operation by Sydney Water of Penrith STP, St Marys AWTP and the Replacement Flows Project.
The operating licence requires Sydney Water to meet certain objectives and comply with certain quality and performance standards. Condition 1.1.1 provides: "The objective of this Licence is to enable and require Sydney Water to provide the Services within its area of operation. Consistent with this objective, this Licence requires Sydney Water to: (a) meet the objectives and other requirements imposed on it in the Act and other applicable laws; (b) comply with the quality and performance standards specified in this Licence; (c) recognise the rights given to Customers and Consumers; and (d) be subject to Operational Audits."

[17]

Williams' argument of breach of operating licence

Williams submits that, by discharging effluent into Boundary Creek and either causing the erosion of Williams' land or permitting such degradation through various discharges, Sydney Water has not complied with its principal objective in s 21(1)(b) of the SW Act, namely to protect the environment by conducting its operations in compliance with the principles of ecologically sustainable development in s 6(2) of the Protection of the Environment Administration Act, which includes the precautionary principle. Williams submits that Sydney Water's conduct is at odds with the precautionary principle. It continues to deny responsibility and take any remedial action, despite the available evidence which demonstrates that there is reasonable scientific plausibility that erosion of the beds or banks of Boundary Creek has been caused by the discharges from Penrith STP: noting Telstra Corporation v Hornsby Shire Council (2006) 67 NSWLR 256; [2006] NSWLEC 133 at [144].
Williams notes that the importance of the principal objective in s 21(1)(b) of the SW Act is apparent from the decision in Environment Protection Authority v Sydney Water Corporation [2015] NSWLEC 80 at [94], where the Court took into account the obligation imposed by s 21(1)(b) as a mitigating factor on sentence for the commission by Sydney Water of environmental offences, including pollution of waters.
Williams submits that Sydney Water's actions are also in breach of the special objective in s 22(1)(b) of the SW Act, interpreted, as required by s 22(2), by reference to the objectives referred to in s 6(1)(b) of the Protection of the Environment Administration Act. Sydney Water has failed to prevent the degradation of the environment by promoting pollution prevention or adopting the principle of reducing to harmless levels the discharge into land of substances likely to cause harm to the environment. Again, Williams submits that the significance of this special objective is apparent from Environment Protection Authority v Sydney Water Corporation at [94], where the Court also took into account this special objective as a mitigating factor on sentence.

[18]

Sydney Water's argument of no breach of operating licence

Sydney Water contests that its operation of Penrith STP, St Marys AWTP and the Replacement Flows Project, including its discharge of treated effluent into Boundary Creek, gives rise to an actional breach of the SW Act. True it is that the operating licence granted under the SW Act requires Sydney Water to meet the objectives in the SW Act (condition 1.1.1). But these objectives are broad and unspecific, and potentially conflicting, as the circumstances of this case illustrate.
The first principal objective of Sydney Water is "to be a successful business and to this end to operate at least as efficiently as any comparable businesses" (s 21(1)(a)(i)). The second principal objective of Sydney Water is "to protect the environment by conducting its operations in compliance with the principles of ecologically sustainable development", which include the precautionary principle (s 21(1)(b)). Williams relies on this second objective to allege that the precautionary principle required Sydney Water to refrain from proceeding with the Replacement Flows Project, approved by the Minister for Planning following an exhaustive environmental assessment, in order to address, amongst other impacts, the possible risk of erosion of Williams' land. Sydney Water submits that this illustrates the potentiality for conflict between the objectives in the SW Act. Sydney Water submits that conflicting objectives must be balanced. An exercise of judgment that results in pursuing a course of action consistent with one rather than another of two conflicting objectives is not a breach of the SW Act that specifies those objectives.
Sydney Water drew the analogy to an exercise of statutory power conditioned on the formation of opinion, which leaves to the decision-maker "a very wide discretion which cannot be effectively reviewed by the courts", except on the narrow range of grounds outlined in Buck v Bavone (1976) 135 CLR 110; [1976] HCA 24 at 118-119: see Newcastle City Council v Shortland Management Services (2003) 57 NSWLR 173; [2003] NSWCA 156 at [51].

[19]

No breach of operating licence established

I find that Williams has not established that Sydney Water has breached its operating licence issued under the SW Act and hence the SW Act itself. The primary reason is that the objectives of the SW Act, which the operating licence required Sydney Water to meet in providing the services within its area of operations, do not give rise to directly enforceable duties. It may be accepted that condition 1.1.1 of the operating licence states that "this Licence requires Sydney Water to: (a) meet the objectives and other requirements imposed on it in the Act and other applicable laws." But the legal effect of a requirement to meet the objectives imposed on Sydney Water in the SW Act depends on the nature and content of the objectives themselves. There are three aspects of the objectives that cause them not to give rise to directly enforceable duties.
The first concerns the character of the objectives. The objectives imposed on Sydney Water by the SW Act comprise principal objectives (in s 21) and special objectives (in s 22). Both types of objectives are expressed to be objectives of Sydney Water, s 21(1) identifying "the principal objectives of the corporation" and s 22(1) identifying that "the corporation has the following special objectives". Both the principal objectives and special objectives of Sydney Water are expressed in terms of goals or policy outcomes that Sydney Water expected to achieve. The principal objectives are to be a successful business, to protect the environment and to protect public health. The special objectives are to reduce risks to human health and to prevent the degradation of the environment. Notwithstanding these objectives being expressed in terms of goals or policy outcomes, they still are a statement of the objectives of Sydney Water as a statutory corporation, rather than any identified action that Sydney Water is required to undertake.
Second, the principal objectives and special objectives are stated at a high level of generality, expressed as broad aspirations rather than specific actions. The goals of Sydney Water, expressed in the principal objectives, of being a successful business, protecting the environment and protecting human health, are apt to describe objectives but not to impose enforceable requirements: see Minister for Immigration and Citizenship v Li (2013) 249 CLR 332; [2013] HCA 18 at [51]. The too general expression of a legislative objective as an aspiration rather than as an identified action is an indicator against a legislative intention to create an enforceable duty.

[20]

The claimed breach of the duty of care in s 177 of the Conveyancing Act

Under s 177 of the Conveyancing Act, for the purposes of the common law of negligence, a duty of care exists in relation to the right of support of land: s 177(1). The duty of care is "not to do anything on or in relation to land (the supporting land) that removes the support provided by the supporting land to any other land (the supported land)": s 177(2). The concept of "supporting land" is broad and includes "the natural surface of the land, the subsoil of the land, any water beneath the land, and any part of the land that has been reclaimed": s 177(3).
Whilst s 177 of the Conveyancing Act imposes a duty of care in relation to the right of support for land for the purposes of the common law of negligence, it abolishes "any right at common law to bring an action in nuisance in respect of the removal of the support provided by supporting land to supported land": s 177(8). Accordingly, if the erosion of Williams' land involves the removal of support within the meaning of s 177, the section operates to abolish any action in nuisance arising from such erosion.

[21]

Williams' argument of negligent removal of support

Williams claims that Sydney Water is under this duty of care in relation to the right of support for land. Williams contends that the supporting land is the lower part of the bank of Boundary Creek within Williams' land that is subject to the erosional processes of treated effluent discharged from Penrith STP into Boundary Creek. The lower bank provides support to the upper bank above the lower bank and the earthen material deeper within the lower bank behind the exposed face of the lower bank. Williams contends that Sydney Water, by discharging treated effluent from Sydney STP into Boundary Creek, which then flows downstream and erodes the lower bank of Boundary Creek within Williams' land, is doing something "in relation to" this supporting land that removes the support provided by the supporting land to the supported land. Williams submits that the words "in relation to" are sufficiently wide to embrace the indirect relationship between the discharge of treated effluent from Penrith STP to Boundary Creek and the downstream erosion of the lower bank of Boundary Creek by the discharged treated effluent.
Williams submits that the evidence establishes that the discharged treated effluent is a material, if not the main, contributor to the cause of erosion of the lower bank of Boundary Creek within Williams' land.
Williams claims that Sydney Water has breached its duty of care not to do anything in relation to the supporting land that removes the support provided by the supporting land to the supported land. Williams submits that, although the duty imposed by s 177 is a duty to act with reasonable care, Sydney Water has failed to do so. Sydney Water at all material times has been aware that discharges from Penrith STP to Boundary Creek have flowed downstream onto Williams' land and that the lower bank of Boundary Creek within Williams' land has been eroded. Sydney Water has known at least from the time it prepared the Environmental Assessment and later the Preferred Project Report for the Replacement Flows Project, both of which included a Statement of Commitments that no erosion of bed or bank stability of Boundary Creek would occur as a result of the discharges from Penrith STP, that the risk of erosion of the bank of Boundary Creek within Williams' land was reasonably foreseeable. A reasonable person, in the position of Sydney Water, would take precautions to avoid this foreseeable risk of harm to Williams' land. Sydney Water had failed to do so, and has thereby breached its duty of care under s 177.

[22]

Sydney Water's argument that no negligent removal of support

Sydney Water contests that its activity of discharging treated effluent from Penrith STP into Boundary Creek was an activity "on or in relation to" any supporting land within Williams land, within the meaning of s 177 of the Conveyancing Act. The point of discharge of treated effluent from Penrith STP into Boundary Creek is immediately adjacent to Penrith STP, not "on or in relation to" the bank of Boundary Creek within Williams' land a kilometre downstream of the discharge point. Sydney Water submits that, although wide, the phrase "in relation to" is not so wide as to connect the discharge of treated effluent at the discharge point at Penrith STP with the bank of Boundary Creek within Williams' land a kilometre downstream.
Sydney Water further submits that Williams' argument blurs the clear distinction in s 177(2) between supporting land and supported land. Even if Sydney Water's activity of discharging treated effluent into Boundary Creek could be characterised as anything done "in relation to" Williams' land, because the discharges have an impact on Williams' land, Williams' land does not comprise both the supporting land and the supported land within the meaning of s 177(2).
Alternatively, if Sydney Water's activity of discharging treated effluent into Boundary Creek does meet the description in s 177(2), the duty imposed by s 177 is a duty to act with reasonable care. Sydney Water submits it has not breached this duty.
Sydney Water contends that it has carried out its activities at Penrith STP in accordance with the RFP approval and environment protection licences that permit those activities. Sydney Water submits it has carefully investigated the potential impacts of those activities, including the risk of erosion of bed and bank stability of Boundary Creek as a result of the discharges from Penrith STP, and has acted in accordance with the advice of appropriately qualified experts. This advice included that provided in the Environmental Assessment and the Preferred Project Approval that discharges from the Replacement Flows Project will not cause any significant additional erosion in Boundary Creek.
Prior to the commission of the Replacement Flows Project, Sydney Water commissioned surveys of Boundary Creek to facilitate monitoring of any erosion as a result of the project (in 2006 and 2009) and the pre-commissioning survey was the subject of an interpretation report (in 2010). After the Replacement Flows Project was commissioned and became fully operational, post-commission surveys (in 2010 and 2012) were also the subject of interpretation reports (in 2010 and 2012). The June 2012 interpretation report found that "the STP release flows are significantly less than an annual natural flow and much less again than any flows capable of geomorphically modifying the channel or its banks…there is no evidence of any episodic changes that have occurred since 2003, nor any systemic changes throughout the channel". Sydney Water also obtained qualitative visual riparian condition assessments to determine whether a visual change in the riparian zone along Boundary Creek had occurred following commencement of discharges from the Replacement Flows Project. The conclusion of the visual riparian condition assessments was that there had been no change in the integrity of the creek bank related to the Replacement Flows Project.

[23]

Breach of duty of care in relation to removal of support established

Section 177(1) of the Conveyancing Act declares that, "for the purposes of the common law of negligence, a duty of care exists in relation to the right of support for land." The content of that duty of care is that a person "is not to do anything on or in relation to land (the supporting land) that removes the support provided by the supporting land to any other land (the supported land)": s 177(2). That duty is owed to individuals of an identifiable class, being the owners and occupiers of land that is "supported land", under s 177(2).
The liability of a person in negligence for breach of the duty of care imposed by s 177 of the Conveyancing Act is to be addressed in accordance with Part 1A of the Civil Liability Act, whilst relief from liability of a public authority is addressed in Part 5 of the Civil Liability Act, particularly in this case in s 43A: s 5A of the Civil Liability Act and Weber v Greater Hume Shire Council at [28].
Williams bears the onus of proving, on the balance of probabilities, that Sydney Water owed a duty of care to Williams under s 177 of the Conveyancing Act, that Sydney Water breached its duty of care, that Sydney Water's negligence was a necessary condition of the occurrence of harm to Williams, and that it is appropriate for the scope of Sydney Water's liability to extend to the harm so caused to Williams. I find that Williams has established each of these elements.
The first element is that Sydney Water owed Williams a duty of care. The duty of care imposed by s 177(2) of the Conveyancing Act is "not to do anything on or in relation to land (the supporting land) that removes the support provided by the supporting land to any other land (the supported land)." Broken down into its components, establishing the existence of a duty of care involves: 1. identifying the action that is claimed to give rise to a duty of care (the doing of "anything"); 2. identifying the supporting land; 3. identifying the supported land; 4. establishing a causal connection between the action and the supporting land (so that the action is "in relation to" the supporting land); and 5. establishing that the action removes the support provided by the supporting land to the supported land.
I find each of these components to be established. First, the action of Sydney Water ("to do anything") is the discharge of treated effluent from Penrith STP into Boundary Creek, from whence it flows downstream to erode the bed and bank of Boundary Creek within Williams' land.

[24]

Defence under s 43A of Civil Liability Act not engaged

I reject Sydney Water's reliance on s 43A of the Civil Liability Act. Engagement of s 43A involves two steps: Weber v Greater Hume Shire Council at [44]-[46]. The first step is to identify the basis of liability relied on by the plaintiff. Here, the liability of Sydney Water depends on its failure to take precautions to avoid the risk of harm by its discharges from Penrith STP into Boundary Creek eroding the bank of Boundary Creek in Williams' land. The second step is to determine whether these activities involved the exercise of a special statutory power, as defined in s 43A(2). Here, this requires determining whether Sydney Water's failure to take precautions to avoid the risk of this harm involved the exercise or failure to exercise a special statutory power conferred on Sydney Water. This special statutory power is a power conferred by or under a statute that is of a kind that persons generally are not authorised to exercise without specific statutory authority: s 43A(2) of the Civil Liability Act. Furthermore, this special statutory power must be "conferred on" the public or other authority who is otherwise liable.
For this second step, it is not sufficient that Sydney Water is constituted as a state owned corporation under the SW Act (s 4(1)), that it has the functions conferred or imposed on it by the SW Act or any other Act (s 5(1)), and that it provides the systems and services in the area of operations that an operating licence granted under the SW Act authorises it to provide (ss 10 and 12). What is required, in order for s 43A to be engaged, is that the particular act or omission on which the liability is founded is dependent on the exercise or failure to exercise a special statutory power conferred on Sydney Water.
As Basten JA observed in Weber v Greater Hume Shire Council at [47], "there is a distinction to be drawn between activities which are reliant for their lawfulness on a statutory power and those which can be undertaken in accordance with the general law". This distinction is important for determining statutory immunity from civil liability: see also Curtis v Harden Shire Council at [254]. Basten JA illustrated the distinction by reference to a local government authority's activities on a public road: "Thus, a council officer requires no statutory authority to drive a vehicle on a public road beyond the licensing requirements applicable to all drivers; whereas statutory authority is required for the erection of signs along a roadway, an activity which is prohibited except by or with the consent of the relevant roads authority.": at [47].

[25]

Defence of statutory authority not established

Sydney Water also has not established the common law defence of statutory authority. Parliament may, by express direction or by necessary implication, authorise the construction and operation of an undertaking or activity, that carries with it an authority to do what is authorised with immunity from any action at common law, such as an action based on nuisance or negligence. There is, however, a qualification or condition "that the statutory powers are exercised without 'negligence'- that word here being used in a special sense so as to require the undertaker, as a condition of obtaining immunity from action, to carry out the work and conduct the operation with all reasonable regard and care for the interests of other persons": Allen v Gulf Oil Refining Ltd [1981] AC 1001 at 1011.
This is the defence of statutory authority. It may be raised in answer to any common law claim, although it is most commonly raised in answer to a claim in nuisance. It has been raised in answer to a claim based on the principle in Rylands v Fletcher (1868) LR 3 HL 330 (in Benning v Wong (1969) 122 CLR 247), but that claim would now be seen as absorbed by the principles of ordinary negligence (Burnie Port Authority v General Jones Pty Ltd (1994) 179 CLR 520 at 556; [1994] HCA 13). There are, however, conceptual and practical difficulties in establishing the defence of statutory authority in answer to a claim in negligence, because of the need to establish the non-negligent exercise of the statutory authority. This will be explained later.
Whether Parliament has by statute authorised the undertaking or activity with immunity from action is a question of statutory construction. The inquiry is to determine, by a proper construction of the statute, whether any statutory authority has been conferred and, if so, the scope of the statutory authority conferred. The inquiry involves two steps. The first step is to ascertain what on its proper construction the statute relevantly has authorised, including whether it authorises the particular undertaking or activity that has caused the interference with the plaintiff's private rights. The second step is to identify whether the authority which the statute gives is "absolute or qualified": Benning v Wong at 255. The second step involves ascertaining whether the interference with private rights is an inevitable result or consequence of carrying out the authorised undertaking or activity: Benning v Wong at 308; Allen v Gulf Oil Refining Ltd at 1013, 1014.

[26]

Claim in nuisance

If s 177 of the Conveyancing Act does not apply, Williams claims that the discharge of treated effluent from Penrith STP into Boundary Creek and the resulting erosion of Williams' land amounts to a nuisance at common law.
Nuisance is an unreasonable interference with the use and enjoyment of one person's land by the use of another person's land: Melaleuca Estates Pty Ltd v Port Stephens Council (2006) 143 LGERA 319; [2006] NSWCA 31 at [22]; Gales Holdings Pty Ltd v Tweed Shire Council at [132]. Whether there has been "unreasonable interference" is to be determined objectively by considering the ordinary usages of people living in a particular society: Gales Holdings Pty Ltd v Tweed Shire Council at [132]. Fault of some kind must be established (Robson v Leischke (2008) 72 NSWLR 98; [2008] NSWLEC 152 at [44]-[46] and Gales Holdings Pty Ltd v Tweed Shire Council at [132]), although it is not necessary to establish negligence (Elston v Dore (1982) 149 CLR 480 at 487-488; [1982] HCA 71). The type of fault required to establish nuisance depends on whether the wrongdoer created the nuisance or rather adopted or continued the nuisance: Robson v Leischke at [47]-[53].

[27]

Williams' argument of nuisance

Williams submits that establishing fault in this case involves proving only foreseeability of harm and material damage to property: Quick v Alpine Nursery Sales Pty Ltd [2010] NSWSC 1248 at [141], [142], [147]. Damage to land occasioned by the presence of unpolluted stormwater runoff is an accepted form of nuisance: Gales Holdings Pty Ltd v Tweed Shire Council at [174].
Williams submits, having regard to the experts' agreement that parts of the bank of Boundary Creek within Williams' land have eroded, there can be no dispute that there has been material damage to Williams' land. Equally, there can be no dispute that Sydney Water was aware that discharges from Penrith STP have flowed onto Williams' land and that there has been erosion of Williams' land. Williams submits that, from the time Sydney Water prepared the Environmental Assessment for the Replacement Flows Project and subsequently the Preferred Project Report, both of which included a Statement of Commitments, including commitment 11, the risk of erosion of the banks of Boundary Creek within Williams' land as a result of the discharges from Penrith STP was reasonably foreseeable to Sydney Water. Such conduct amounts to nuisance that Sydney Water has failed to abate.
Williams again disputes that s 43A of the Civil Liability Act affords Sydney Water a defence to liability in nuisance, for the reasons it gave in relation to the claim in negligence under s 177 of the Conveyancing Act. Sydney Water's liability in nuisance cannot be said to be "based on" Sydney Water's exercise, or failure to exercise, any "special statutory power" conferred on Sydney Water. However, even if s 43A were to be engaged, Sydney Water's act or omission involving an exercise of, or failure to exercise, a special statutory power was, in the circumstances, so unreasonable that no authority having the special statutory power could properly consider the act or omission to be a reasonable exercise of, or failure to exercise, its power.
Williams also contests the applicability of the common law defence of statutory authority. The common law defence of statutory authority requires, in order to be engaged, that there be specific statutory authority to carry out the activity of discharging the treated effluent into Boundary Creek. Williams submits that the discharges from Penrith STP into Boundary Creek have contravened both the RFP approval and the environment protection licences by Sydney Water discharging more than 50ML/day in contravention of the conditions of the approval and the licences.

[28]

Sydney Water's argument that no nuisance

Sydney Water disputes that it has committed a nuisance in discharging treated effluent from Penrith STP into Boundary Creek. Sydney Water submits that Williams has not established factual causation, that the discharges of treated effluent from Penrith STP have caused unreasonable interference with the use and enjoyment of Williams' land. Williams has not proven that the alleged erosion of the bank of Boundary Creek within Williams' land would not have occurred but for the Penrith STP discharges or that such erosion would not have produced the same impacts upon Williams' use and enjoyment of its land as are evident or anticipated.
Furthermore, in order to establish an actionable nuisance, Williams needs to establish fault, which effectively requires a failure on the part of Sydney Water to exercise reasonable care: Robson v Leischke at [48], [52], [53] and Quick v Alpine Nursery Sales Pty Ltd at [142]-[147]. Sydney Water submits that no fault has been established, for the reasons it gave in relation to the claim in negligence under s 177 of the Conveyancing Act.
Alternatively, if liability in nuisance is established, Sydney Water contends that the common law defence of statutory authority relieves it from liability. The defence of statutory authority is available where the operations of a public authority, here Sydney Water, arise from the non-negligent performance by it of a duty imposed by statute: Marcic v Thames Water Utilities Ltd [2002] QB 929 at 988; Melaleuca Estates Pty Ltd v Port Stephens Council at [49].
Sydney Water submits that it was not negligent in the performance of its statutory functions, for the reasons it gave earlier. Sydney Water acted in accordance with the RFP approval and environment protection licences in discharging treated effluent from Penrith STP into Boundary Creek. The approval and the licences provided statutory authority for the discharges.

[29]

Nuisance claim not maintainable

I have found that Sydney Water is liable in negligence under s 177 of the Conveyancing Act for removing the support provided by the supporting land of the lower bank of Boundary Creek within Williams' land to the supported land above and behind the lower bank. By dint of s 177(8) of the Conveyancing Act, Williams' right at common law to bring an action in nuisance against Sydney Water in respect of this removal of the support provided by the supporting land to the supported land has been abolished. The only cause of action Williams can maintain is that in negligence for breach of the duty of care in relation to the support for Williams' land under s 177. Accordingly, there is no utility in determining Williams' claim in nuisance that Sydney Water's actions of discharging treated effluent into Boundary Creek led to the erosion of the lower bank of Boundary Creek in Williams' land, thereby removing the support provided by the lower bank to the land above and behind the lower bank. That claim in nuisance is not maintainable.

[30]

Relief for established breaches of the law

I have found that Williams has established two claims: first, that Sydney Water has breached s 75D(2) of the EPA Act by carrying out the Replacement Flows Project not in accordance with condition 1.1 of the conditions to which the RFP approval is subject and, secondly, that Sydney Water is liable in negligence for breaching its duty of care in relation to support for land under s 177 of the Conveyancing Act. The question that now arises is the relief that should be granted to remedy and restrain these breaches.
Williams seeks injunctive orders to remedy the breaches. In its amended summons commencing the proceedings under s 9.46 of the EPA Act, Williams sought orders, firstly, restraining Sydney Water from breaching s 75D (2) of the EPA Act by failing to comply with condition 1.1 of the RFP approval, which required that, throughout the operation of the Replacement Flows Project, no degradation of bed or bank stability would occur within Boundary Creek downstream of Penrith STP as a result of the project and, secondly, remedying the degradation of bed and bank stability within Boundary Creek downstream of Penrith STP, including the erosion of Williams' land and other parts of Boundary Creek downstream of Penrith STP.
In its summons commencing the proceedings for breach of the duty of care under s 177 of the Conveyancing Act and for nuisance, Williams sought the following orders: "1. An order that the Defendant forthwith do all such things, and perform all such acts, as are necessary to prevent further damage to the land owned by the Plaintiff comprised in Folio Identifier 441/1092750 and situated at 44 Jack Williams Drive, Penrith (Plaintiff's Land) caused by the discharge of water from the Penrith Sewerage Treatment Plan[t] operated by the Defendant upon the land comprised in Folio Identifier 110/774782 also owned by the Defendant (the Penrith STP). 2. An order that the Defendant forthwith do all such things, and perform all such acts, as are necessary to abate the nuisance to the Plaintiff's Land caused by the discharge of water from the Penrith STP, including by repairing, making good and rectifying by appropriate works the damage to the Plaintiff's Land caused by the said discharge."
In closing submissions, Williams refined the remedial orders it sought in both proceedings to be: "1. Intercept and convey Penrith Sewage Treatment Plant (STP) flows in a stable and safe manner through the portion of Boundary Creek between Castlereagh Road and the Nepean River, including provision of a stable outlet structure that does not cause erosion. 2. Undertake the necessary works to realign Boundary Creek and restore parts of the land within the JKW Land that have been lost. 3. Undertake the necessary works to restore the vegetation of Boundary Creek with suitable endemic species to maintain and improve bank stability while requiring minimal ongoing maintenance. 4. Undertake any works necessary or incidental to the implementation of the works described above, including the clearing of vegetation, the construction of gabions and works to enable the temporary diversion of flows from the STP. 5. Within 6 months of the date of the Court's orders, prepare all necessary environmental and planning investigations/reports which would be required to obtain statutory approvals for the carrying [out] of the works. 6. Take steps to obtain all necessary statutory approvals for the carrying [out] of the works. 7. The works described above must be carried out and completed within 24 months of the date of the Court's orders."

[31]

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: 18 March 2021

J.K. Williams Staff Pty Limited v Sydney Water Corporation

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