Jeffman Pty Ltd and Lawrence Dry Cleaners Pty Ltd v Environment Protection Authority of NSW, Sydney Water Corporation and Douglas and Hilary Hutchinson

The EPA declares an investigation area 6On 28 February 2003, Jeffman notified the Environment Protection Authority of NSW ("EPA") by letter that the Source Site may present a significant risk of harm in accordance with s 60 of the Contaminated Land Management Act 1997 ("the CLM Act"). On 31 October 2003, the EPA declared the Source Site to be an investigation area under the then s 15 of the CLM Act ("Investigation Declaration"). The declaration identified the nature of the substances causing the contamination to be elevated levels of chlorinated hydrocarbons, including tetrachloroethene ("PCE"), trichloroethene ("TCE"), dichloroethene ("DCE") and vinyl chloride ("VC"), (together called "the Significant Contaminants"). The declaration noted that groundwater beneath the site is contaminated with volatile chlorinated compounds (including PCE, TCE, DCE and VC) but the extent of the on-site plume was not known and required further investigation. The declaration also noted that contaminated groundwater may have migrated from the southwestern (down-gradient) boundary of the site and impacted on the adjoining site, identified as the Central Workshops Site. The declaration noted the contaminated groundwater plume may continue to spread and that the extent of the off-site plume was not known and required further investigation.

The applicants' voluntary investigation of the contamination 7The declaration of an investigation area empowered the EPA to issue an investigation order under the then s 19 of the CLM Act. However, the declaration of an investigation area did not prevent the carrying out of a voluntary investigation of the site. This was initially the course pursued. On 4 May 2004, Jeffman entered into a Voluntary Investigation Agreement with the EPA. 8Following the Investigation Declaration, Jeffman engaged environmental consultant HLA Envirosciences Pty Ltd (which later changed its name to HLA ENSR, then to ENSR Australia Pty Ltd and now to AECOM Australia Pty Ltd ("AECOM")) to advise and undertake investigations on the Source Site to delineate the extent of any significant contamination. 9On or about 30 July 2004, Jeffman appointed an accredited Site Auditor, Mr Chris Jewell ("the Site Auditor"), to independently review any remediation work proposed to be or carried out on the land by AECOM. 10On or about 30 September 2004, AECOM published a report entitled, Detailed Site Investigation, Lawrence Dry Cleaners 887 - 893 Bourke Street Waterloo, NSW recording the results of their investigations ("the DSI Report"). 11On or about 30 September 2004, Jeffman provided the EPA with the DSI Report. The DSI Report assessed the source and extent of the contamination on both the Source Site and the adjacent properties. 12Between 14 October 2004 and 2 November 2005, Jeffman, Lawrence Dry Cleaners, Sydney Water and the EPA corresponded and had discussions regarding how the land should be regulated and remediated. 13By letter dated 14 October 2004, Sydney Water expressed concern to the EPA regarding the DSI Report. 14Sydney Water requested Jeffman, by letter dated 25 October 2004, that it be consulted in relation to the Site Auditor's draft summary site audit report and site audit statement in respect of the Voluntary Investigation Agreement. Sydney Water also requested by letter dated 1 November 2004 that Jeffman carry out further investigations. 15On 3 November 2004, the Site Auditor published a report. In that report, the Site Auditor stated that he had reviewed the DSI Report and that the investigations were carried out to an appropriate standard and in accordance with guidelines endorsed by the EPA. The Site Auditor recommended that further investigations and interpretation were necessary to identify areas on and off the Source Site that may require remediation of soil and groundwater. 16On or about 29 April 2005, AECOM published a report entitled, Work Plan: Remedial Investigation and RAP Development, Lawrence Dry Cleaners 887 - 893 Bourke Street, Waterloo ("Work Plan"). The Work Plan detailed proposed remediation methodologies for the Source Site and provided for the development of a remediation action plan. 17On 27 May 2005 and 11 July 2005, the EPA wrote to Jeffman regarding the Work Plan.

The EPA declares the land significantly contaminated 18The investigations undertaken were sufficient to confirm that the lands were significantly contaminated and to cause the EPA, on 2 November 2005, to declare under the then s 21 of the CLM Act, the lands to be a remediation site. The lands comprised the whole of the Source Site, Lewis Site and Hutchinson Site and parts of the Young Street Site and Central Workshops Site. The nature of the substances causing the contamination were again stated to be elevated levels of chlorinated hydrocarbons, including PCE, TCE, DCE and VC. 19The declaration noted that the groundwater beneath the Source Site was contaminated by volatile chlorinated compounds (including PCE, TCE, DCE and VC) and that contaminated groundwater had migrated from the southwestern (down-gradient) boundary of the Source Site and impacted on adjoining sites. The declaration again noted that the contaminated groundwater plume may continue to spread and that the extent of the off-site plume was still not known and required further investigation. 20The declaration of a remediation site empowered the EPA to make a remediation order under the then s 26 of the CLM Act. However, the declaration of a remediation site did not prevent the carrying out of a voluntary remediation of the site. Again, this was the course initially pursued by the applicants. 21On or around 23 December 2005, AECOM produced a draft Remediation Strategy, Lawrence Dry Cleaners 887 - 893 Bourke Street, Waterloo, NSW ("Draft Remediation Strategy"). 22Correspondence and discussions ensued between the applicants, Sydney Water and the EPA, regarding the Draft Remediation Strategy. 23The EPA notified the applicants on or about 10 January 2006 that it was not in a position to agree to the Draft Remediation Strategy. 24On 31 May 2006, the applicants provided the EPA with a remedial action plan detailing a proposal to remediate the land ("the First RAP"). 25GeoSyntec Consultants were engaged by or on behalf of the applicants to evaluate the feasibility of using Enhanced In Situ Bioremediation ("EISB") to treat the contaminated groundwater at the Source Site and develop conceptual designs for full-scale EISB implementation. Geosyntec prepared a report in December 2006, which recommended a phased approach to EISB, with Phase I being a small scale pilot trial and Phase II being full-scale implementation on the land. 26On 8 December 2006, the applicants provided the EPA with a Voluntary Remediation Proposal ("the First VRP") for its approval. 27AECOM subsequently prepared a revised version of the First RAP dated 1 February 2008 ("Revised RAP"). 28On or about 3 April 2007, AECOM prepared a report entitled Off-Site Human Health Risk Assessment for the applicants. 29On or about 3 July 2007, Geosyntec prepared a draft report entitled Phase I Bioremediation Design and Workplan Report for the applicants. 30On or about 15 October 2007, the EPA agreed the EISB remediation strategy identified in the First RAP and the First VRP were generally suitable, subject to various amendments. 31On 4 February 2008, the applicants submitted to the EPA and the Site Auditor the Revised RAP (1 February 2008) and a revised version of the VRP reflecting the EPA's required amendments ("Revised VRP"). 32On 11 February 2008, the applicants provided Sydney Water with copies of the Revised RAP and Revised VRP. 33On or about 18 February 2008, AECOM prepared a further report entitled Off-Site Human Health Risk Assessment for the applicants. 34On 29 July 2008, Sydney Water sent a letter enclosing a report authored by JBS Environmental Pty Ltd dated 28 July 2008 ("JBS Report") to the EPA. That letter and the JBS Report contained a review of the Revised VRP and opposed the Revised VRP on various grounds. 35On 22 August 2008, the applicants provided the EPA, the Site Auditor and Sydney Water with a response to Sydney Water's submissions. 36On 3 September 2008, the Site Auditor provided a report to the applicants and the EPA, outlining his opinion of the Revised RAP. 37On 18 November 2008, a Voluntary Remediation Proposal was agreed between the applicants and the EPA ("the Agreed VRP"). On 19 November 2008, the EPA agreed that it would not issue an order during compliance with the Agreed VRP. The Agreed VRP was restricted to the Phase I works involved in the pilot trial of EISB. 38On or around 11 March 2009, in accordance with the Agreed VRP, the pilot EISB system began to operate on the Source Site. 39On or about 3 April 2009, Sydney Water wrote to the applicants requesting them to immediately take steps to cease and abate the continued migration of contamination from the Source Site onto the Central Workshops Site, which Sydney Water contended was causing a continuing nuisance to it. 40On 6 May 2009, Sydney Water commenced, by way of Statement of Claim, proceedings in the Supreme Court of NSW alleging that the applicants were committing a nuisance in relation to the migration of contamination from the Source Site onto the Central Workshops Site. Sydney Water served the Statement of Claim upon the applicants on 4 November 2009. These proceedings have since been transferred to this Court and allocated LEC Proceedings No. 40266 of 2010. 41On or about 30 October 2009, Sydney Water's consultant, E3 Consulting Australia Pty Ltd, prepared a report entitled Detailed Investigation, SWC Site, Bourke St Waterloo ("E3 Report"). 42On 3 November 2009, Sydney Water filed further proceedings in this Court (Proceedings No. 40820 of 2009) seeking declarations that the applicants had and were breaching sections of the Protection of the Environment Operations Act 1997 ("POEO Act"), in relation to the contamination present on, and migrating off, the Source Site and claiming damages from the applicants in relation to the alleged breaches of the POEO Act. 43On or about 13 November 2009, AECOM prepared a report entitled Phase I EISB Performance and Sampling Report , which contained the results of the applicants' EISB trial. 44On or about 3 December 2009, Sydney Water wrote to the EPA (copying the applicants and other stakeholders) attaching reports from its expert, Professor Kueper, dated 29 and 30 November 2009. 45On or about 4 December 2009, the Site Auditor prepared a report entitled Observations of AECOM Groundwater Sampling Event and Collection Samples of E3, SWC Site, Waterloo, NSW reviewing the results of the performance of the Phase I EISB trial. 46On 21 January 2010, Sydney Water provided submissions to the EPA (copying in the applicants and other stakeholders) in respect of its concerns surrounding the EISB trial and requesting the EPA to consider alternative remediation strategies for the land. 47On 22 January 2010, Sydney Water provided submissions to the EPA (copying in the applicants and other stakeholders) in respect of the Site Auditor's review of the EISB trial results. These submissions contained Professor Kueper's review of the Site Auditor's report dated 4 December 2009. 48After over 4 years of the applicants endeavouring to carry out voluntary remediation of the contaminated groundwater, the EPA considered that it should issue a remediation order (now termed a management order). 49On 17 February 2010, the EPA sent the applicants a document entitled "Draft Management Order" dated 12 February 2010 ("the Draft Management Order") for their comment. 50On 8 March 2010, Geosyntec, the applicants' consultant, issued a report on its findings in respect of the Phase I EISB trial conducted on the Source Site. 51On 10 March 2010, the applicants, AECOM, the applicants' environmental consultant (Dr Hans Stroo), the EPA, Sydney Water and Sydney Water's consultant (Professor Kueper) met to discuss the Draft Management Order and remediation technologies that exist to remediate the land in the timeframes specified in the Draft Management Order. 52On 11 March 2010, the applicants wrote to Sydney Water stating that they admit that groundwater contaminated with the Significant Contaminants has migrated from the Source Site to those parts of the Central Workshops Site, the subject of the Management Order. 53In addition, on 25 June 2010, when making orders in respect of the stay of proceedings nos. 40820 of 2009 and 40266 of 2010 pending the determination of the present proceedings, the Court formally noted this admission that: "In LEC Proceedings No. 40820 of 2009 and 40266 of 2010, the Respondents [Jeffman Pty Limited and Lawrence Dry Cleaners Pty Limited] admit that groundwater contaminated with tetrachloroethene (PCE), trichloroethene (TC), dichloroethene (DCE) and vinyl chloride (VC) has migrated from the land at 887-893 Bourke Street, Waterloo (owned by Jeffman Pty Limited and occupied by Lawrence Dry Cleaners Pty Limited) to land occupied or owned by the Applicants [Sydney Water Corporation, Douglas and Hilary Hutchinson and Peter David Porter Lewis]." 54On 11 March 2010, the applicants provided the EPA with a submission on the Draft Management Order. A copy of this submission was provided to Sydney Water on 31 March 2010 at its request. 55On 12 March 2010, Sydney Water provided the EPA with a submission on the Draft Management Order. A copy of this submission was provided to the applicants. 56On 17 May 2010, Geosyntec, the applicants' consultant, issued a report summarising its recommendations in relation to Phase I EISB system at the Source Site. 57On 18 March 2010, the Site Auditor provided the EPA with his comments on Sydney Water's submission on the Draft Management Order.

The EPA issues the Management Order 58The EPA subsequently, on 3 June 2010, issued a management order to the applicants under s 14 of the CLM Act. The Management Order identified the substances causing the contamination as chlorinated hydrocarbons including PCE, TCE, DCE and VC (again referred to as "Significant Contaminants"). The Management Order required the applicants to take specified action, including to prevent migration of groundwater containing the Significant Contaminants from the Source Site to any adjoining land and to reduce the combined maximum concentration of the Significant Contaminants in groundwater, other than at the Source Site, to specified levels by specified dates.

The Management Order is appealed 59The applicants were dissatisfied with the terms of the Management Order issued by the EPA. On 16 June 2010, the applicants appealed under s 61 of the CLM Act to the Land and Environment Court of NSW. In determining such an appeal, the Court may, among other orders, revoke the Management Order and make any other order that the EPA might have made (CLM Act, s 62(2)). The applicants sought for the Court to make a Management Order in different terms to the order made by the EPA. 60Two of the adjoining landowners, Sydney Water and the Hutchinsons, whose land has, is being, and will continue to be contaminated by the contaminants in the groundwater migrating from the Source Site, applied to be and were joined by the Court as parties to the applicants' appeal. The adjoining landowners sought for the Court to make a Management Order in terms yet different again from the Management Order sought by the applicants. Finally, the EPA, by the conclusion of the hearing of the appeal, also sought for the Court to make a Management Order in terms different to the Management Order it had made on 3 June 2010. 61The parties are in agreement, therefore, that the EPA's Management Order should be revoked and the Court should instead make a new Management Order to address the contamination of the groundwater beneath the Source Site and adjoining lands. The parties disagree, however, as to the terms of the new Management Order that should be made by the Court. 62After the conclusion of the hearing, the second applicant, Lawrence Dry Cleaners, entered into voluntary administration. Lawrence Dry Cleaners applied for, and was granted, leave to reopen its case to lead evidence of the voluntary appointment of an administrator and to make submissions arising from these changed circumstances. At the re-opened hearing, Lawrence Dry Cleaners did not press its written submission that no management order should be made against it and instead maintained its earlier position, common with the first applicant, that a management order in different terms should be made against both applicants. Jeffman, after considering its position in light of the changed circumstances of Lawrence Dry Cleaners, also informed the Court that it continued to rely on the final submissions it had made at the hearing. The EPA, Sydney Water and the Hutchinsons each indicated they also maintained their respective positions put at the hearing. 63In hearing the proceedings, in accordance with s 37(1) of the Land and Environment Court Act 1979, I have been assisted by Acting Commissioner Johnson.

The points of disagreement about the Management Order 64The points of disagreement between the parties concerning the terms of the new Management Order may be grouped in six categories.

Remediation technology to be used 65The applicants have been trialling and wish to continue to use the remediation technology of EISB to treat the contamination of the groundwater. This remediation technology seeks to enhance a natural process of biodegradation of the contaminants by naturally occurring bacteria that live in the groundwater and soil beneath the Source Site and adjoining lands. However, bioremediation takes time. The applicants' primary submission is that, although the terms of the Management Order do not need expressly to mandate use of EISB, the Management Order should not expressly exclude use of EISB or impliedly exclude use of EISB by mandating use of remediation technologies other than EISB or setting a timetable under the Management Order for undertaking remediation, which is too short to permit EISB to be used. The applicants' alternative submission is that EISB could be expressly required by the Management Order if the Court considered that this remediation technology was clearly preferable. 66The EPA supports the applicants' primary submission, but not the applicants' alternative submission. The EPA submits that the Management Order should specify the environmental goals to be achieved by remediation but leave the choice of remediation technology to achieve the specified goals to the applicants. 67Sydney Water takes a contrary view. Sydney Water submits that the pilot testing of EISB undertaken on the site has not established that EISB has worked on the site to date or is likely to work in the future in any reasonable timeframe. Accordingly, Sydney Water submits that EISB should be eliminated from the range of remediation technologies available to be used by the applicants by, first, specifying other remediation technologies that should be used for remediation of the Source Site (such as thermal treatment technology) and the groundwater plume (such as excavation and associated pump and treat technology) and, secondly, by specifying a timetable for remediation that is sufficiently short that EISB cannot realistically be used for remediation. Sydney Water also submits that the contamination of the groundwater and soil of the Central Workshops Site constitutes a continuing nuisance which is causing loss and damage to Sydney Water and which should be abated as soon as is practicable by utilisation of remediation technologies other than EISB. 68The Hutchinsons generally adopt Sydney Water's position including that the Management Order should specify the remediation technology to be used for containment and treatment of contaminants on the Source Site. However, the Hutchinsons are content for the Management Order not to specify the remediation technology for remediation of the groundwater plume. Nevertheless, the Hutchinsons do adopt, as the preferred date by which the specified environmental goals for remediation of the groundwater plume are to be achieved, the same date as Sydney Water's date. This date realistically would preclude use of EISB as a remediation technique.

Timing of remediation 69The timing of remediation of the Source Site and the groundwater plume is dependent on the remediation technique chosen. EISB will take much longer than the other remediation techniques of excavation and associated pump and treat technology and/or thermal treatment technology. Hence, resolution of the issue concerning the remediation technology to be used in large part will resolve the timing issue. 70However, there is a further issue of timing between the EPA and the applicants. The applicants seek to extend the time taken to treat the groundwater plume to the final environmental goal by an additional 7 months and the time taken to demonstrate that contamination is not continuing on the Source Site by an additional 4 months from the dates proposed by the EPA.

Scope of investigation 71There are two points of disagreement between the parties concerning the scope of investigation of contaminants. 72First, the EPA and the applicants confine the contaminants that need to be investigated and treated under the Management Order to the Significant Contaminants that were the subject of the EPA's declaration on 2 November 2005 and the EPA's Management Order dated 3 June 2010. These are the specified chlorinated hydrocarbons of PCE, TCE, DCE and VC. These are all classified as Dense Non-Aqueous Phase Liquids ("DNAPL"). Sydney Water and the Hutchinsons seek to expand the range of contaminants dealt with by the Management Order to include Light Non-Aqueous Phase Liquids ("LNAPL"). The applicants and EPA oppose the inclusion of LNAPL. 73Secondly, the EPA, Sydney Water and the Hutchinsons submit that the applicants should investigate the nature and extent of the deeper groundwater contamination beneath the Source Site and adjoining lands to determine whether any significant risk is posed to human health or the environment. The applicants do not wish to undertake this deeper groundwater investigation.

Area of containment 74The EPA and the applicants submit that the land on which contaminants in groundwater should be contained should be the land on which the dry cleaning business has been and is being conducted, namely the Source Site. 75Sydney Water submits that the Young Street Site should also be included as this land has been contaminated by groundwater migrating from the Source Site which is owned by Jeffman. Sydney Water submits that contaminants already in the groundwater and the soil of the Young Street Site should be contained and prevented from migrating to the Central Workshops Site and other land adjoining the Young Street Site. The Hutchinsons adopt Sydney Water's position.

Process for approval of remediation action plan 76The parties agree that implementation of the Management Order involves preparation of a remediation action plan. The parties differ, however, as to the process for approval of the remediation action plan. 77The EPA, Sydney Water and the Hutchinsons submit that, in the circumstances of this case, the process should involve: the applicants preparing a draft remediation action plan; the applicants lodging the draft remediation action plan with and obtaining the written review and recommendations of an expert panel of remediation experts approved by the EPA and affected landowners; the applicants revising the remediation action plan to implement any recommendations of the expert panel; the applicants lodging the revised remediation action plan together with the expert panel's written review and recommendations with the EPA; the EPA approving the remediation action plan; and the applicants implementing the approved remediation action plan. 78The applicants, however, propose a different process. The applicants submit that the Management Order should appoint a site auditor who would approve the remediation action plan prepared by the applicants. The applicants propose that the applicants would prepare and submit a draft remediation action plan to the EPA for its comment but not approval; the applicants would revise and then submit the revised remediation action plan to a site auditor accredited under the CLM Act; the site auditor would, in effect, approve the remediation action plan by issuing a site audit statement demonstrating that the remediation action plan, in essence, implements the Management Order; and the applicants would submit the site audit statement to the EPA.

Wording of certain conditions 79The parties differ as to the wording of certain conditions of the Management Order. As a general rule, Sydney Water and the Hutchinsons suggest wording to tighten the obligations of the applicants and shorten the timing of steps to be undertaken under the Management Order while the applicants seek to retain flexibility in both these respects.

Remediation technology to be used 80The applicants and the EPA propose that the Management Order should leave to the applicants the choice of remediation technology or technologies to be used to achieve the remediation goals and other performance outcomes required by the Management Order. Sydney Water and the Hutchinsons submit that the remediation technology of EISB has been tried by the applicants, but has not proven successful, and should be removed from the options of remediation technologies available to be used by the applicants in implementing the Management Order. They submit that the Management Order should specify other remediation technologies. 81In exercising functions under the CLM Act, including making a management order, the EPA (and the Court on an appeal where the Court re-exercises the functions of the EPA) is to have regard to the principles of ecologically sustainable development: s 9(1) of the CLM Act. These principles include the precautionary principle, inter-generational equity, conservation of biological diversity and improved valuation, pricing and incentive mechanisms: s 9(3)(a)-(d) of the CLM Act. The last mentioned principle includes the polluter pays principle, the user pays principle and the subsidiarity principle. The subsidiarity principle involves devolution of responsibility for taking relevant action to the level of persons who are best placed to achieve specified environmental goals. As s 9(d)(iii) of the CLM Act states, "environmental goals, having been established, should be pursued in the most cost effective way, by establishing incentive structures, including market mechanisms, that enable those best placed to maximise benefits or minimise costs to develop their own solutions and responses to environmental problems". 82A management order under the CLM Act is a means of implementing the polluter pays principle; by means of the management order, persons who generate pollution and waste should bear the costs of containment, avoidance and/or abatement. 83A management order under the CLM Act imposes duties and/or responsibilities on appropriate persons (see s 13) to take specified actions. These actions may be either process or outcome oriented. Illustrations of process-oriented actions are specified in s 16 of the CLM Act and include various investigations of the contamination, the harm caused and the means for undertaking remediation of the land and monitoring of the effectiveness of remediation (see s 16(a), (b), (c) and (e)). A duty to undertake such actions is discharged when the action is performed, whatever might be the outcome. Illustrations of outcome-orientation actions are also specified in s 16 and include carrying out remediation of the land; erecting barriers; and treating, storing or containing on land, or removing from the land and treating and disposing of solid or liquid materials that might be or contain contaminants (see s 16(d), (f) and (g)). A responsibility to undertake such actions is discharged only when the prescribed outcome or end is achieved. 84The Management Order proposed in this case involves both process and outcome orientated outcomes. The Management Order will require the applicants to undertake various investigations and monitoring and reporting on the results thereof. Importantly, however, the Management Order will prescribe remediation standards that must be achieved, and the times by which those standards must be achieved, in containing contaminants on the Source Site and remediating the Source Site and the groundwater plume. The applicants will be required to achieve those standards in those timeframes. 85Application of the principle of subsidiarity to a management order ordinarily would leave to the person subject to the order the choice of actions, including remediation technologies, which might best achieve the mandated outcomes (the remediation standards and timeframes). This is because the person subject to the order is "best placed to maximise benefits and minimise costs to develop their own solutions and responses" to environmental problems. 86The EPA and the applicants (and the Hutchinsons in respect of remediation of the groundwater plumes but not the Source Site) adopt this approach for the Management Order in this case. They suggest that the Management Order should prescribe interim and final remediation standards and timeframes to achieve these standards but leave open the remediation technology or technologies the applicants may use to achieve these standards and timeframes. Adaptive environmental management would be required to be employed so that if monitoring reveals that the standards and timeframes prescribed in the Management Order will not be complied with then complementary and more aggressive remediation technologies can be used to ensure that the mandated standards and timeframes are met. 87Sydney Water, whilst not necessarily disagreeing with this approach in principle, submits that in the circumstances of this case the applicants' choice of remediation technologies should be circumscribed. 88Sydney Water notes that the applicants originally wanted to use EISB as the sole means through which they will comply with their obligations under the Management Order and sought at least five years to do so. Sydney Water submits on the evidence, however, that the capacity of EISB to achieve remediation of the contamination is speculative and uncertain. Although the applicants have had many years to implement a remediation strategy, the applicants have not finalised a detailed strategy involving EISB and have only supplied conceptual layouts for full-scale bioremediation (tendered as Exhibits J2 and J3). These conceptual layouts need to be developed into a remediation action plan capable of being implemented. Sydney Water submits that there is no certainty that full-scale bioremediation will achieve the remediation standards at all or in the timeframes required. The applicants have not developed a "Plan B" using alternative remediation technologies if EISB does not work. 89Sydney Water submits that it has been deprived of the use of its land for 7 years so far by reason of the contamination of the groundwater beneath its land and will continue to be deprived of the use of the land for howsoever long the applicants take to achieve the remediation standards. Sydney Water submits that the delay has been and will continue to be too long. The applicants are polluters who have contaminated Sydney Water's land and they should be required to clean it up within a reasonable period of time. 90Sydney Water proposes that the applicants should be required by the Management Order to use particular proven remediation technologies: containment of contaminants on the Source Site by a barrier system including hydraulic containment utilising pump and treat technology to remove groundwater as required; treatment of contaminants on the Source Site by thermal treatment technology; and excavation (and associated pump and treat technology) or thermal treatment technology to reduce and maintain the level of contaminants on the affected landholders' lands. Sydney Water submits these technologies will achieve the remediation standards within a two year timeframe. This would bring to an end, Sydney Water submits, the era of uncertainty and stagnation that has beset the Central Workshops Site "as a result of the applicants' delay in cleaning up their pollution of the Remediation Site." 91There is a good deal of force in many of Sydney Water's submissions about the applicants' approach to remediation in the past and the pilot testing of EISB. There has been delay by the applicants in taking real and effective action to remediate the Source Site and the groundwater plume as opposed to many years of studying, discussing and testing remediation concepts; there has been and still is no definite remediation action plan, only a conceptual layout for remediation; the evidence from the pilot testing of EISB is inconclusive and insufficient to be able to draw robust conclusions that full-scale EISB will meet the remediation standards within the timeframes to be imposed by the Management Order; there was until the court hearing no proposal to treat, as opposed to contain, the contamination on the Source Site; there was until the court hearing no proposal for adaptive management, including setting interim targets which if not met will trigger a change in remediation approach so as to utilise remediation technologies other than EISB; there was until the court hearing no proposal for review by independent experts or review and approval by the appropriate regulatory authority, the EPA, of the remediation action plan but rather a reliance on the Site Auditor appointed by the applicants to perform these functions; there was until the court hearing inadequate accountability and transparency, including a lack of reporting by the applicants on investigations, monitoring and performance in implementing the Management Order; and there was until the court hearing inadequate participation by, consultation with and access to information for the affected landholders. The result was that the remediation proposal of the applicants to use EISB, initially agreed to by the EPA, was unsatisfactory and unsuitable to be permitted under the Management Order as originally made by the EPA. 92However, over the course of the hearing, the evidence, the proposal for remediation of the Source Site and groundwater plume and the terms of the Management Order evolved considerably. In my assessment, on the evidence adduced at the hearing, and if the terms of the Management Order are amended so as to change the process for design and implementation of the remediation approach, there is justification to afford the applicants one further and final opportunity to utilise EISB as an option to remediate the groundwater plume. 93The temporally open-ended and best endeavours approach that has been characteristic of the applicants' conduct over the past 7 years, and that the applicants had indicated they wish to continue in the future (as manifested in the applicants' grounds for appeal against the EPA's management order), will not be available under the Management Order proposed by the Court. 94The Management Order will set clear remediation standards, and timeframes for achieving those standards, which must be met by the applicants. The Management Order will require the applicants to prepare and have approved by the EPA a remediation action plan which will need to specify timelines, interim triggers and thresholds which, if not met, will trigger a change in remediation approach so as to ensure the remediation standards set by the Management Order are achieved by the times specified. 95For example, the Management Order will set an interim remediation standard for treatment of the groundwater plume, other than at the Source Site, of a combined maximum concentration of the Significant Contaminants of 5 mg/L. This interim standard must be achieved within two years of the date of the Management Order. The applicants indicate their preference is to use EISB as the remediation technology to achieve not only this interim standard but also the other remediation standards in the Management Order. The Management Order will require the applicants to prepare and have approved a remediation action plan which specifies a timeline, interim triggers and thresholds by which progress towards achieving the remediation standards, including the interim standard, using their preferred technique of EISB can be measured and the alternative remediation techniques (which may include pump and treat, excavation and thermal treatment) for reaching the remediation standards, including the interim standard, which are to be applied if the applicants have not demonstrated that EISB will achieve the standards. Hence, the applicants will need to demonstrate, on the data collected from the investigations, monitoring, sampling and analyses required by the Management Order, by 22 months from the date of the Management Order, that EISB will achieve the interim remediation standard of 5 mg/L by the prescribed time of 2 years (24 months) from the date of the Management Order. If this is not demonstrated, the applicants will need to change the remediation approach. 96The same approach of fixing timelines, interim triggers and thresholds, monitoring and adaptive management will be required in relation to the final remediation standard for treatment for the groundwater plume of a combined maximum concentration of the Significant Contaminants of 0.5 mg/L and the standards for containment and treatment of the contamination of the Source Site. 97Through these mechanisms of fixing standards and timeframes, monitoring and adaptive management, certainty and finality of outcome can be achieved. The applicants will be required to achieve the prescribed outcomes by the times specified. Consistent with the principle of subsidiarity, the applicants would be afforded some latitude in choice of remediation technologies to achieve these outcomes but this will be subject to checks that the remediation technology chosen is working so as to ensure that the prescribed outcomes will be achieved. If not, the applicants must change to a different remediation technology or technologies so as to ensure the outcomes will be achieved. 98Affording the applicants this latitude of choice of remediation technology will result in a longer timeframe than Sydney Water and the Hutchinsons would prefer. The remediation technology of EISB will take longer to achieve remediation to the remediation standards that will be set than other technologies such as excavation or thermal treatment. The applicants' expert, Dr Konzuk, estimates that 5 years will be needed to achieve remediation of the groundwater plume to the final standard of 0.5 mg/L. Sydney Water and the Hutchinsons sought remediation to this standard in 2 years. They do not point to any particular harm or prejudice that will be caused by a further delay of 3 years, other than Sydney Water's legitimate concern that until remediation to the final remediation standard is achieved it is prevented from full use and enjoyment of its land, including developing it for its highest and best purpose. 99I consider that this additional time should be permitted in order to retain EISB in the range of remediation technologies able to be used by the applicants. Consistent with the subsidiarity principle, the applicants are best placed to develop cost effective solutions to the environmental problem. 100The evolution of the parties' respective cases, the proposal for remediation of the Source Site and groundwater and the terms of the Management Order throughout the court hearing also makes it unnecessary to set out, and to make findings from, much of the expert evidence adduced at the hearing. 101The parties reached agreement as to many matters, including: the source of contamination being the applicants' land (the Source Site); the contamination having spread onto the Young Street site, the Lewis site, the Hutchinsons' site and the Central Workshops Site; the need to remediate not only the groundwater plume but also the Source Site; and the remediation standards, both interim and final, to which remediation should be achieved. 102There also was not material disagreement that the remediation technologies of excavation, with associated pumping and treatment of groundwater, could be effective to remove the contamination on accessible land, principally the Central Workshops Site. The parties' experts agreed that excavation: (a) would permanently remove virtually all accessible and identified contamination provided that recontamination from inflowing groundwater does not occur; and (b) is a relatively rapid form of treatment that facilitates site reuse (Exhibit J26, [3.1]). 103There was some disagreement about the cost of excavation and associated pump and treat. The applicants relied on the likely high cost of excavation and associated pump and treat technology to support their argument that it should not be pursued before EISB has been given an adequate opportunity to achieve the remediation standards. As indicated, I consider that the applicants should be given an opportunity in the next two years to establish that EISB can achieve the remediation standards. However, if the applicants are unsuccessful in demonstrating that their preferred technique of EISB can achieve compliance with all standards, in the specified time under the remediation action plan, they will be required to implement other remediation technologies which may include excavation and pump and treat technologies. These alternative remediation measures will need to be implemented irrespective of whether their cost is greater than EISB. The applicants will have an obligation under the Management Order to achieve the remediation standards and the high costs of doing so will not be a reason for non compliance. 104There was also agreement between the parties' experts that thermal treatment technologies could remediate the Source Site and groundwater plume. The experts agreed: (a) thermal technologies can result in rapid treatment of contaminated sites (typically 18-24 months from initial decision to completion) (Exhibit J26, [5.1]); (b) when properly designed and implemented, thermal technologies are capable of removing a large fraction of the contaminant mass (typically up to or exceeding 99% within the target treatment zone) (Exhibit J26, [5.1]); (c) thermal technologies can be applied to both DNAPL source zones and plumes, although historically the technologies have been applied primarily to DNAPL source zones and high concentration areas (Exhibit J26, [5.2]); and (d) thermal technologies are not as affected by soil heterogeneity as fluid injection technologies (Exhibit J26, [5.3]). 105Again, the disagreement was mainly about the cost of using thermal treatment technology. The applicants' relied on the cost to support their argument that EISB is preferable. As I have stated in relation to excavation, I am prepared for other reasons for the Management Order to retain the option for the applicants to use EISB but if the applicants have not demonstrated that EISB will meet all remediation standards by the specified times, they may need to employ other remediation measures including thermal treatment. Indeed, for the Source Site which is built upon, thermal technologies may be the only workable and realistic alternative remediation measure to treat the contaminant source zones. The cost of using thermal technology in this event will not be a reason not to undertake it. The applicants will be obliged to achieve the remediation standard within the time frame specified regardless of the cost of doing so. 106In relation to EISB, the change in the parties' positions, partly as a response to the expert evidence at the hearing and partly as a response to the change in the approach which would be required by the terms of the proposed Management Order, has meant that many of the disagreements in the expert evidence need not be resolved. 107The applicants' position was originally that EISB would be the sole means through which they would comply with their obligations under the Management Order. They opposed setting, as the remediation standards to be achieved, any prescribed level of the combined maximum concentration of the Significant Contaminants. They proposed vesting the Site Auditor (which they had appointed) with the responsibility for certifying that: the remediation has reduced the volume weighted average concentration of Significant Contaminants to a level that would not preclude the Site Auditor certifying that the Source Site and adjoining lands were suitable for use as residential with minimal opportunity for soil access, including units; that there are no unacceptable ecological risks or risks to human health; and that the works in the remediation action plan are appropriate for the purposes of achieving the directions under the Management Order. The applicants' position in these respects was founded on EISB having been proven by the pilot testing to have had success in remediating partly the groundwater plume. 108Sydney Water's response to the applicants' original position was to challenge the foundation for the applicants' position. Sydney Water adduced evidence to show that the pilot testing had not established that EISB had worked in the past or was likely to work within the 5 year timeframe proposed by the Management Order. Hence, Sydney Water said, there was a real risk that in 5 years time, the neighbouring lands would continue to be blighted with the downstream plume from the applicants' contamination. 109I will not set out all of the competing evidence concerning the pilot testing of EISB, the results of that testing or the inferences that could be drawn as to the success or otherwise of the pilot testing. It is sufficient for me to state that I found the evidence of Professor Kueper, the expert called by Sydney Water, to be more persuasive than that of Dr Konzuk, Mr Clay and Dr Stroo, the experts called by the applicants, in identifying the weaknesses in the pilot testing undertaken and in the data collected from the testing and, hence, the difficulty of drawing any robust inference from the testing alone as to whether EISB had been successful in achieving some degree of remediation of the groundwater plume. 110But I do not consider it necessarily follows from this inability of the pilot testing to prove the success of EISB in remediating the groundwater plume that the applicants should be precluded by the terms of the Management Order from using EISB as a remediation technique in the future. 111The parties' experts did agree that EISB can be effective in remediation of contamination in both DNAPL source zones and the groundwater plume. The experts agreed: (a) when properly designed and implemented, and provided that site conditions are conducive, EISB can result in the in situ destruction of the contaminant mass to innocuous end products and corresponding reductions in groundwater concentrations (Exhibit J26, [8.1]); (b) Significant Contaminant concentrations in groundwater are unlikely to increase (rebound) after appropriately applied active EISB if untreated contaminants remain sorbed to soil provided DNAPL is no longer present (Exhibit J26, [8.3]); (c) EISB can be applied in both the DNAPL source zones and the contaminant plume. Within a DNAPL source zone, the length of time required for EISB to meet a concentration based clean up goal is dependent, in part, on (i) the amount of DNAPL present, (ii) the amount of mass sorbed to grain surfaces or diffused into low permeability layers, (iii) properties of the DNAPL (eg. solubility, surface area: volume ratios etc); and (iv) the rate of biodegradation and associated level of enhancement of DNAPL dissolution and desorption into the groundwater (Exhibit J26, [8.4]); (d) the length of time required for EISB to reach a concentration based clean up goal within a contaminant plume is governed by (i) the amount of mass sorbed to organic matter or diffused into low permeability layers within the aquifer; and (ii) the rate of biodegration and associated level of enhancement of desorption/ diffusion from the soil (Exhibit J26, [8.5]); and (e) the pilot test demonstrated that the rate and extent of biodegration could be enhanced by additions of lactate and also demonstrated that dissolution of DNAPL and/or desorption from soil could be enhanced (Exhibit J26, [8.6]). 112The position, therefore, is that EISB has the potential to work, but has not yet been proven by the pilot testing on the site to work, to remediate the contamination in both the source zone and the groundwater plume. The applicants' experts, particularly Dr Konzuk who had more applied experience with EISB than Mr Clay, considered that with proper design and implementation, full-scale EISB could achieve the agreed remediation standards in the timeframes proposed. On the other hand, having regard to the evidence from the pilot testing, Dr Kueper considered there was "tremendous uncertainty" whether full-scale EISB could meet the standards within the timeframes proposed. 113Although I accept there is uncertainty, I still consider the applicants should be given one more opportunity to demonstrate that EISB can achieve the remediation standards in the timeframes required. However, any such opportunity must be subject to checks and safeguards, firstly, to improve the prospects of EISB achieving the remediation standards and timeframes, secondly, if it is not proven to be able to do so, to require a change in the remediation approach before too much time elapses by employing alternative remediation measures so as to ensure the remediation standards are achieved within the timeframes prescribed and, thirdly, to improve transparency, accountability and enforceability. 114I deal with some of these checks and safeguards in other sections of this judgment. The Management Order will incorporate measures intended to improve the prospects of EISB being successful, including: requiring the draft remediation action plan (which will propose the full-scale EISB) to be peer reviewed by independent experts and to incorporate their recommendations; providing the draft remediation action plan to the affected landholders for their comment (which enables their experts to comment); and requiring the remediation action plan to be approved by the EPA. Through these measures of improving the design of EISB and the remediation approach, the prospects of full-scale EISB achieving the remediation standards within the timeframes are likely to be maximised. 115Secondly, the Management Order will incorporate requirements for monitoring and adaptive management. The Management Order will set interim and final remediation standards that will need to be achieved at prescribed times. The remediation action plan will set timelines, interim triggers and thresholds so that progress towards meeting these interim and final remediation standards can be monitored. If the monitoring data fails to demonstrate substantial progress towards achieving compliance with the remediation standards, the applicants will be required to change remediation approach and employ other remediation measures so as to ensure that the remediation standards are achieved by the times prescribed. 116Thirdly, the Management Order will incorporate measures for disclosing, reporting, communicating and providing access to information, including on the results of the investigations, monitoring, sampling and analyses required by the Management Order. These measures will improve transparency, accountability and enforceability of the Management Order and the likelihood of the applicants complying with the Management Order including achieving the remediation standards by the times prescribed. 117Collectively, these checks and safeguards should reduce the uncertainty concerning both the efficacy of EISB and the applicants' achievement of the remediation standards in the timeframes required. By following this approach, the risk that another 5 years might elapse with no result in achieving remediation of the contaminated groundwater plume, which Sydney Water and the Hutchinsons fear, should be mitigated. The applicants will not be permitted to continue experimenting with EISB as a remediation technique with no endpoint in terms of remediation outcome or time. To the contrary, the applicants will be required to achieve the remediation standards by the times prescribed.

Timing of remediation 118The determination that the Management Order should not expressly or impliedly exclude EISB as a remediation technique means that a longer time frame needs to be provided for undertaking remediation of the Source Site and groundwater plume. The EPA propose a timetable of progressive remediation involving, in order:

1. Containment of contaminants on the Source Site: Reduce and thereafter maintain the combined maximum concentration of the Significant Contaminants in groundwater migrating from the Source Site to any adjoining land to 0.5 mg/L or less by a date 13 months after the Management Order commences.
2. Interim treatment of contaminants in groundwater plume: Reduce the combined maximum concentration of Significant Contaminants in groundwater, other than at the Source Site, to less than 5 mg/L by a date 2 years after the Management Order commences.
3. Final treatment of contaminants in groundwater plume: Reduce the combined maximum concentration of Significant Contaminants in groundwater, other than at the Source Site, to less than 0.5 mg/L by a date 5 years after the Management Order commences.
4. Treatment of contaminants on Source Site: Implement one or more remediation technologies to treat to the maximum extent practicable the DNAPL source zones and/or high concentrations of sorbed phase Significant Contaminants, on the Source Site, by a date 10 years after the Management Order commences. 119The applicants agree with EPA's dates for containment (13 months) and treatment (10 years) of contaminants on the Source Site and for interim treatment of contaminants in the groundwater plume (2 years). The applicants seek a longer period, however, to achieve final treatment of contaminants in the groundwater plume (5 years and 7 months rather than 5 years). The applicants submit that: "The time required to undertake a detailed design, have that design incorporated into a RAP (remediation action plan), have that RAP approved by the site auditor and EPA, obtain the necessary equipment and install the EISB system, test and commission the system, implement it for 2.1 years and to have a buffer for contingencies justifies the time sought in the order." 120The applicants referred to the evidence of Dr Konzuk, an expert in design and use of EISB amongst other remediation techniques. 121I find that the time period should be the 5 years proposed by the EPA. First, Dr Konzuk's evidence supports that period being sufficient to achieve final treatment. Dr Konzuk estimated the following steps and timings: detailed design phase for EISB (4 months); EPA approval time (varies but in this case the EPA's proposal is for the applicants to submit the RAP for the EPA's approval within 6 months of the Management Order commencing and it is reasonable to assume the EPA will make a determination within 2 months); procure and install equipment and "plumb it up" (2 months); start up testing and "shakedown" (1 month); and active injection of electron donor to enhance the natural biodegradation process (2.1 years to achieve final treatment goal of 0.5 mg/L). This means that it should take around 11 months before active injection of electron donor can start then 2.1 years of active electron donor injunction to achieve the final treatment goal, a total time of 3 years. The EPA's time period of 5 years, therefore, already contains a considerable buffer for contingencies. 122Secondly, the applicants agree to the EPA's date for achieving the interim treatment goal of 5 mg/L, being 2 years after the Management Order commences. To achieve this goal, the design, approval, installation and start up testing steps would have to be achieved in the time period Dr Konzuk explained. Ensuring compliance with the interim target should ensure compliance with the final target. 123Thirdly, the applicants have had considerable latitude in time since the contamination was first notified to the EPA, in February 2003. The applicants have voluntarily investigated and proposed RAPs from 2003 to 2010 but with little result in terms of actually remediating either the Source Site or the groundwater plume. The lack of action prompted the EPA to issue, on 3 June 2010, the Management Order to compel the applicants to take action to remediate the groundwater plume. Even by the time of hearing of the appeal against the Management Order, the applicants still only had a concept plan, and no detailed design, for the remediation of the groundwater plume. Having regard to this long lead time and slow tempo of action to date, there is little justification for affording the applicants further latitude in the time to be taken to achieve final treatment of the groundwater plume.

Scope of investigation 124There were two areas of disagreement between the parties concerning the scope of investigation: the substances to be investigated and the depth of investigation. 125Notwithstanding 8 years of investigation since the first applicant notified the EPA of the contamination of the Source Site, the boundaries of the source areas of contamination have still not been precisely delineated. The parties are agreed that the applicants should be required by the Management Order to investigate the existence, nature and extent of the source of contamination. The EPA and applicants submit this investigation should focus on contaminants that are DNAPL. Sydney Water and the Hutchinsons submit the investigation should also include LNAPL. The thought to include LNAPL arose during the hearing when the applicants' consultants, AECOM, produced a draft Soil Assessment Report which showed high levels of contamination at bore hole 105/monitoring well 89 on the Hutchison Site. The experts could not state definitively whether the data revealed the existence of DNAPL (consistent with the presence of Significant Contaminants in DNAPL form) or LNAPL (consistent with the presence of turpentine). Sydney Water and the Hutchinsons submit that this uncertainly in whether the contaminants on the Hutchinson Site are DNAPL or LNAPL needs to be resolved by further investigation; hence, the inclusion of LNAPL along with DNAPL in the Management Order. 126Whilst Sydney Water and the Hutchinsons' position is understandable, I do not consider that this Management Order should now include LNAPL. This Management Order is the culmination of a process under the CLM Act that has only addressed DNAPL contamination. The declaration of investigation area on 31 October 2003, the declaration of remediation site on 2 November 2005 and the Management Order on 3 June 2010 each identified the substances causing the contamination to be chlorinated hydrocarbons, including PCE, TCE, DCE and VC. These are the substances specified to be the Significant Contaminants. These substances do not include LNAPL. The Management Order made by the Court on appeal should not now specify the different substance of LNAPL to be a contaminant that needs to be addressed by the Management Order. 127If further investigation and management of contamination by LNAPL is required, the EPA can again follow the process under the CLM Act by issuing a new preliminary investigation order under s 10 to investigate whether lands are contaminated by LNAPL; a new declaration under s 11 that lands are significantly contaminated by LNAPL, after having considered the matters under s 12 with respect to LNAPL; and a new Management Order under s 14 directing action be taken in relation to the significant contamination by LNAPL. The Court should not bypass this process by including LNAPL in the current Management Order which is directed to DNAPL. 128Furthermore, the evidence before the Court does not establish that the LNAPL which may have been detected on the Hutchinson Site is due to the activities of the applicants. The LNAPL detected is consistent with turpentine. As the applicants submitted, turpentine is commonly used in paints and varnishes, paint thinning, paint stripping and cleaning of painting brushes and equipment, uses and activities consistent with the business operations conducted on both the Lewis Site and the Hutchinson Site. 129The second area of dispute about the scope of the investigation is whether the applicants should undertake deep groundwater investigation. The applicants submit that a separate order requiring investigation of deep groundwater contamination to determine whether any significant risk is posed to human health or the environment is not necessary, as the nature and extent of the risks will be assessed and mitigated by other orders of the Management Order. The EPA, Sydney Water and the Hutchinsons disagree, submitting that the other orders do not address deep groundwater investigation. 130I agree with the latter parties' submissions. The evidence establishes that groundwater has been contaminated at depth, but the nature and extent of the deeper groundwater contamination and the risk any such contamination might pose to human health (by use of groundwater) and the environment remains unclear. This uncertainty needs to be reduced by investigation and report. 131The other orders in the Management Order requiring investigation will not duplicate an order for deep groundwater investigation. The other orders will require investigation of the DNAPL source and demonstrating that on-going contamination from the continued operation of the dry cleaning business is not occurring as well as investigation as to the potential effects of remedial works on the Hutchinsons' building. These are different to deep groundwater investigation.

Area of containment 132The parties disagree as to whether containment of contaminants in migrating groundwater should be restricted to the Source Site or also extend to the Young Street Site. Sydney Water submits that as the first applicant owns the Young Street Site it is in a position to contain the contaminants that have migrated from the Source Site on to the Young Street Site and to prevent further migration to the Central Workshops Site and other adjoining land. 133Although there is some force in Sydney Water's argument, I consider that the Young Street Site should not be included as a site on which contaminants should be contained, although it should be included with other adjoining sites for treatment of the groundwater plume beneath the sites. 134One reason is that the source of the contamination is the Source Site. Although the precise boundaries of the DNAPL source zones have not yet been delineated (and that will be one of the tasks that the applicant will be required to undertake under the Management Order), the current information does not suggest the DNAPL source zone extends on to the Young Street Site. Rather, the contamination of the Young Street Site has occurred by contaminants in groundwater migrating from the Source Site to the Young Street Site and other adjoining sites. The appropriate remediation strategy, therefore, is to treat the groundwater plume beneath the Young Street Site, rather than containing but not treating contaminants on the Young Street Site. 135Another reason is that containment of contaminants on the Young Street Site would necessitate a complete revision of the concept for remediation of the groundwater plume. The bioremediation proposed involves a cyclical groundwater flow with active electron donor injection up gradient and extraction, down gradient and then re-injection. The natural groundwater flow from the Source Site is to the west. Hence the applicants propose a dual set of injection and extraction wells running roughly north-south, to intercept and augment the westerly flow of groundwater. These dual sets of injection and extraction wells traverse the boundary between the Young Street Site and Central Workshops Site. This concept is not compatible with containment of contaminants on the Young Street Site. Containment would involve creating a barrier along the southern boundary of the Young Street Site preventing any migration of contaminants in groundwater to the Central Workshops Site. Furthermore, Sydney Water's proposal is for containment only on the Young Street Site and not treatment. The groundwater plume would therefore only be treated partially. This may affect the efficacy of the remediation.

Process for approval of remediation action plan 136Implementation of the Management Order involves preparation and approval of a remediation action plan. The parties disagree as to the process for approval of and the person or body who should approve the remediation action plan. The applicants wish to continue using the Site Auditor (who Jeffman appointed back in 2004) to issue a site audit statement certifying that the remediation action plan will ensure the Management Order is complied with. The EPA, Sydney Water and the Hutchinsons submit that the EPA and not the Site Auditor should be responsible for approving the remediation action plan. 137I find, in the circumstances of this case, the process for approval and identity of the approval body should be as submitted by the EPA, Sydney Water and the Hutchinsons. First, the current Site Auditor has not been appointed to undertake a statutory site audit under Pt 4 of the CLM Act. The Site Auditor's role to date has been non-statutory and advisory to the applicants. A management order may require a person to have specified actions audited by a site auditor under Part 4 of the CLM Act: s 16(m). Any such site audit would be a statutory site audit as it would be a requirement under the CLM Act: s 47. 138However, a management order does not need to require such a statutory site audit. Hence, I do not accept the applicants' submission that the scheme of the CLM Act requires that the Site Auditor be responsible for approving the RAP to implement the Management Order. 139Secondly, the intimate involvement of the Site Auditor with the applicants to date in evaluating and providing advice on the remediation proposal is likely to pose difficulties, including potential conflicts of interest, if the Site Auditor were to exercise the different role of a statutory site auditor. These potential difficulties can be avoided by placing the responsibility under the Management Order for approval of the remediation action plan with the EPA. 140Thirdly, the proposal of the EPA, Sydney Water and the Hutchinsons for peer review of the draft remediation action plan by an expert panel of independent remediation experts, rather than review by the Site Auditor presently engaged by the applicants, is more likely to critically evaluate and, through recommendations, improve the quality and efficacy of the remediation action plan and its implementation of the Management Order.

Wording of certain conditions 141There are a number of differences in wording between the draft conditions preferred by the parties. In many instances, the differences are of form not substance. I have selected or revised the form that I consider best achieves the purpose of the condition. The matters of substance are fourfold. 142First, the EPA, Sydney Water and the Hutchinsons propose that the applicants should be accountable by providing written reports on the investigations and the monitoring, sampling and analysis required by the Management Order. The applicants have not suggested reporting. I consider regular reporting by the applicants on their performance in implementing the Management Order to be important in ensuring transparency and accountability, compliance with and enforceability of the Management Order. 143Sydney Water and the Hutchinsons further submit that the reports should be provided not only to the EPA but also the affected landholders. I agree. The surrounding landholders are affected by contamination of the groundwater and have a real interest in being kept informed about the progress and results of implementing the Management Order. 144Secondly, there was some variation between the parties concerning timing for undertaking actions and reporting under the Management Order. Mostly I have accepted the EPA's suggested timing, adjusted to take account of the date the Management Order will be made. Where the order requiring action or reporting was silent as to the timing, I have inserted a time or adopted Sydney Water's recommended time phrase of "as soon as reasonably practicable." 145Thirdly, the parties disagreed as to the need for soil vapour and sub-slab monitoring of vapour levels within building footprints. The applicants proposed only undertaking soil vapour and sub-slab monitoring if the results from the pre-sampling surveys and the monitoring of vapour levels in buildings on the remediation site indicate it is necessary. The EPA, Sydney Water, and the Hutchinsons submit that it should be done in any event. I agree with the latter parties that concurrent soil vapour and sub-slab monitoring within the building footprints should be undertaken to understand the contribution to indoor air from sub-surface vapours as opposed to ambient air sources. Such monitoring should not be contingent on receipt of unacceptable results from pre-sampling surveys and monitoring of vapour levels in the buildings. 146Fourthly, the parties disagreed as to the terms on which the applicants could access the land of affected landholders to carry out actions required by the Management Order. All parties agreed that the applicants need to consult with the affected landholders to seek consent to enter onto and carry out actions required by the Management Order on the land that they own and consider their reasonable requests in relation to access. The EPA, Sydney Water and the Hutchinsons proposed adding particulars of the types of matters which the affected landholders might request in relation to access, including a reasonable request for indemnification by the applicants for any loss or damage that may be suffered by the affected landholders, including for economic loss caused by interference with the business activities carried out by the affected landholders, and making good the land of the affected landholders, on conclusion of the implementation of the actions required by the Management Order. The applicants did not wish to add these particulars. I consider the matters particularised by the EPA, Sydney Water and the Hutchinsons will be the matters that the affected landholders will request in relation to access and it is preferable to specify them in the Management Order rather than keep silent.

Conclusion and orders 147For these reasons, I consider the Court should, under s 62(2) of the CLM Act, revoke the Management Order made by the EPA on 3 June 2010 and instead make a new Management Order which reflects the findings in this judgment. The new Management Order is attached to the judgment. It is an order that the EPA might make under Part 3 of the CLM Act (as required by s 62(2) of the CLM Act). 148The Court:

1. upholds the appeal;
2. revokes the Management Order No. 20101404 dated 3 June 2010 made by the Environment Protection Authority of NSW;
3. makes the Management Order annexed; and
4. reserves the question of costs of the proceedings.

Section 14 of the Contaminated Land Management Act 1997 Date of this order: 26 May 2011

PERSONS SUBJECT TO THIS ORDER Jeffman Pty Ltd (ACN 000 121 291) Lawrence Dry Cleaners Pty Ltd (ACN 002 408 040)

LAND TO WHICH THIS ORDER APPLIES This order applies to the significantly contaminated land in declaration number 21084 made on 2 November 2005 by the Environment Protection Authority of NSW ("EPA"), comprising: Description Address Lots A and B in DP 438772 and Lot 1 in DP 89250 887-893 Bourke Street, Waterloo Lot 1 in DP 88482 895-899 Bourke Street, Waterloo Lot B in DP 88095 901 Bourke Street, Waterloo Parts of Lot 3 in DP 775039 Parts of 207-229 Young Street, Waterloo Parts of Lot 2 in DP 800705 Parts on 903-921 Bourke Street, Waterloo

NATURE OF CONTAMINATION AND RISK OF HARM AFFECTING THE LAND The substances causing the contamination (the "Significant Contaminants") are: Chlorinated hydrocarbons, including tetrachloroethene (PCE), trichloroethene (TCE), dichloroethene (DCE), and vinyl chloride (VC). The Significant Contaminants are Dense Non-Aqueous Phase Liquids ("DNAPL"). The Significant Contaminants are classified as:

1. VC is classified by the International Agency for Research on Cancer (IARC) as a Group 1 human carcinogen (known human carcinogen);
2. TCE and PCE are classified by IARC as Group 2A (probably human carcinogen); and
3. DCE is classified by IARC as Group 3 (not classifiable as to its carcinogenicity to humans). The EPA believes that the land is contaminated and that the contamination is significant enough to warrant regulation, for the following reasons:
4. Groundwater beneath the land is contaminated with the Significant Contaminants at concentrations substantially exceeding relevant levels in the ANZECC Guidelines for Fresh and Marine Water Quality. VC concentrations substantially exceed the Drinking Water Guideline value.
5. Contaminated groundwater has migrated from the southwestern (down-gradient) boundary of the site at 887-893 Bourke Street, Waterloo, and impacted on the adjoining sites. The contaminated groundwater plume may continue to spread.
6. The offsite migration of contaminated groundwater may put potential future users of groundwater at risk. No current users of groundwater have been identified. NB. The contaminant plume is within an area of restricted groundwater use (see www.dnr.nsw.gov.au/water/pdf/zone2.pdf).

DEFINITIONS "Affected Landholders" means the registered owners of Lot 2 in DP 800705 located at 903-921 Bourke Street, Waterloo, Lot B in DP 88095 at 901 Bourke Street, Waterloo, Lot 3 in DP 775039 at 207-229 Young Street, Waterloo and Lot 1 in DP 88482 at 895-899 Bourke Street, Waterloo. "Management Order" is this Management Order. "Remediation Site" means the properties as shown on the attached map comprising Lots A and B in DP 438772, Lot 1 in DP 89250, parts of Lot 3 in DP 775039, Lot 2 in DP 800705, Lot 1 in DP 88482 and Lot B in DP 88095. "Source Site" means Lots A and B in DP 438772, Lot 1 in DP 89250.

ACTION REQUIRED BY THIS ORDER The persons subject to this order must take the actions specified by the times specified in the orders below.

A. INVESTIGATIONS

1. Investigate source of contamination (a) Investigate and determine the existence, nature, location and extent of the Significant Contaminants, including the DNAPL source. (b) Provide a written report to the EPA and Affected Landholders within 4 months of the date of the Management Order, setting out the results of that investigation.
2. Investigate whether any ongoing contamination (a) Investigate whether Significant Contaminants are still being released, spilled or otherwise being allowed to escape into the soil and groundwater from the continued operation of the dry cleaning business on the Source Site. (b) Provide a written report to the EPA and Affected Landholders within 4 months of the date of the Management Order, setting out the results of the investigation and describing in detail the measures to be taken to prevent any ongoing release, spill or escape of the Significant Contaminants into the soil and groundwater. (c) Implement the preventative measures proposed in the report as soon as practicable after completion of the investigation required by this order.
3. Investigate deep groundwater contamination (a) Investigate the nature and extent of the deeper groundwater contamination beneath the Source Site, parts of Lot 3 in DP 775039 and Lot 2 in DP 800705, Lot 1 in DP 88482 and Lot B in 88095 to determine whether any significant risk is posed to human health or the environment. (b) Provide a written report to the EPA and Affected Landholders within 6 months of the date of the Management Order setting out the results of the investigation.
4. Investigate possible contamination of backfill next to Shea's Creek culvert (a) Install a minimum of five groundwater monitoring wells in the backfill next to Shea's Creek culvert down to the base level of the culvert, take samples from the wells, and analyse the samples to assess the possibility of the migration of the Significant Contaminants in groundwater through the backfill along the side of the culvert. (b) Provide a written report to the EPA and the Affected Landholders within 1 month of the date of the Management Order confirming completion of the installation and sampling and reporting on the results of the sampling and analysis.
5. Investigate potential effects of remedial works on buildings (a) If and when any remediation design works propose excavation works or the utilisation of thermal treatment technology or demolition or the drilling of holes through any concrete slab on, under or adjacent to the building located on Lot B in DP 88095 ("Proposed Works"), promptly engage a suitably qualified and experienced structural engineer to assess the potential for the Proposed Works to affect the structural integrity of the building and provide a report to the EPA and all Affected Landholders of that assessment. The report is to include the recommendations of the structural engineer as to what measures, if any, should be implemented to ensure that the carrying out of the Proposed Works does not compromise the structural integrity of the building. (b) Implement the recommendations of the structural engineer prior to carrying out any of the Proposed Works, but first obtain the consent of each Affected Landholder on whose land it is proposed that any measures recommended by the structural engineer are to be implemented.

B. MONITORING 6. Monitoring Shea's Creek (a) Monitor quarterly the concentrations of the Significant Contaminants in Shea's Creek culvert and ensure that contaminated water and vapours are not discharging into Shea's Creek at concentrations that could cause harm to human health or the environment. (b) Provide a written report to the EPA and Affected Landholders setting out the results of the quarterly monitoring on a quarterly basis beginning 3 months from the date of the Management Order. 7. Monitoring risk to human health in Shea's Creek culvert Undertake vapour monitoring of the airspace in the Shea's Creek culvert prior to any person having access to the culvert to ensure that there is no unacceptable risk to human health. 8. Monitoring at particular groundwater wells (a) Install groundwater wells at the western end of Lot 1 in DP 88482 and Lot B in DP 88095, take samples from the wells, and analyse the samples to assess the concentration of Significant Contaminants. (b) Provide a written report to the EPA and Affected Landholders within 1 month of the date of the Management Order confirming completion of the installation, sampling and analysis and reporting on the results of the sampling and analysis. 9. Monitoring the spread of the groundwater plume (a) Assess and monitor the potential spreading of the groundwater plume on and outside the Remediation Site onto as yet unaffected lands. (b) Provide a written report to the EPA and Affected Landholders on the monitoring results on a quarterly basis beginning 3 months from the date of the Management Order. 10. Monitoring the spread of vapour phase contaminants (a) Assess and monitor the potential spreading of the vapour phase contaminants on and outside the Remediation Site onto as yet unaffected lands. (b) Provide a written report to the EPA and Affected Landholders on the monitoring results on a quarterly basis beginning 3 months from the date of the Management Order. 11. Vapour monitoring in buildings in Remediation Site (a) (i) Monitor vapour levels of all Significant Contaminants in all buildings located on the Remediation Site every quarter using static and personal monitoring methods to ensure protection of human health in accordance with Environment Health Risk Assessment - Guidelines for Assessing Human Health Risks from Environmental Hazards: June 2004 (enHealth 2004) and evaluation against Australian air quality guidelines or, if unavailable, WHO air quality guidelines; (ii) undertake pre-sampling surveys prior to monitoring to ensure: confounding from other sources does not occur; worst case exposure conditions are evaluated; and (iii) undertake concurrent soil vapour and sub-slab monitoring within the building footprints to understand the contribution to indoor air from sub-surface vapours as opposed to ambient air sources. (b) Provide written reports to the EPA and Affected Landholders on the results of all such monitoring on a quarterly basis beginning 3 months from the date of the Management Order with a further copy being provided to the expert panel referred to in Order 18 below. 12. Management consequential upon vapour monitoring (a) If levels of Significant Contaminants are identified in buildings from the quarterly monitoring referred to in Order 11 exceeding target acceptable criteria developed in accordance with enHealth 2004 and WHO air quality guidelines, implement appropriate management measures as soon as reasonably practicable to ensure the health and safety of the occupants and any visitors. (b) If such management measures are required and implemented, notify the EPA in writing. 13. Monitor ecological and human health risks (a) Ensure that all ecological risks and risks to human health including risks from inhalation that may arise from exposure to DNAPLs and the Significant Contaminants are assessed using a site-specific risk-based approach consistent with Schedule B(5) - Guideline on Ecological Risk Assessment of the National Environment Protection (Assessment of Site Contamination) Measure 1999 (NEPM 1999), the Environmental Health Risk Assessment - Guidelines for Assessing Human Health Risks from Environmental Hazards: June 2004 (enHealth 2004), the National Environment Protection (Assessment of Site Contamination) Measure 1999 (NEPM 1999) and the Vapour Intrusion : Technical Practice Note , September 2010 (DECCW 2010), in each case as amended or replaced from time to time, that includes, as a minimum, a process of data consolidation, gap analysis, data acquisition (soil gas profiling, sub-slab analyses, and ambient and indoor air sampling), site-specific predictive modelling, analysis of variable sensitivity, pre-sampling surveys and above-ground concurrent air sampling and assessment against toxicity reference doses as approved by relevant Australian government agencies and, if appropriate, relevant international agencies. (b) Where an unacceptable risk has been identified to the environment or to human health, implement as soon as reasonably practicable measures to ensure any risk is prevented or minimised.

C. REMEDIATION ACTIONS 14. Containment on Source Site Reduce and maintain the combined maximum concentrations of the Significant Contaminants in groundwater migrating from the Source Site to any adjoining land to 0.5 mg/L or less within 14 months of the date of the Management Order. 15. Treatment of Significant Contaminants on Source Site Implement one or more remediation technologies to treat to the maximum extent practicable DNAPL source zones and/or high concentrations of sorbed phase Significant Contaminants, on the Source Site, within 10 years of the date of the Management Order. 16. Interim treatment of groundwater plume Implement one or more remediation technologies to reduce the combined maximum concentration of Significant Contaminants in groundwater, other than at the Source Site, to less than 5 mg/L within 2 years of the date of the Management Order. 17. Final treatment of groundwater plume Implement one or more remediation technologies to reduce the combined maximum concentration of the Significant Contaminants in the groundwater, other than at the Source Site, to 0.5 mg/L or less within 5 years of the date of the Management Order and thereafter to maintain the combined maximum concentration of Significant Contaminants at or below that level.

D. APPROVAL AND IMPLEMENTATION OF REMEDIATION ACTION PLAN 18. Review by independent expert panel of draft Remediation Action Plan (a) Within 6 weeks of the date of the Management Order, appoint an expert panel of at least 3 independent remediation experts approved by the EPA and Affected Landholders acting reasonably to review and certify that the detailed remediation design and programme is suitable and appropriate for the purpose of achieving Orders 1 - 17 above. (b) Within 10 weeks of the date of the Management Order, lodge a draft remediation action plan with the expert panel. (c) Within 12 weeks of the date of the Management Order, obtain the written review and recommendations of the expert panel. (d) Within 6 months of the date of the Management Order, implement any recommendations of the expert panel through revisions to the draft remediation action plan including to the detailed remediation design and programme. 19. Approval of Remediation Action Plan Prepare, and submit to the EPA within 6 months of the date of the Management Order, and provide to all Affected Landholders, a remediation action plan with a detailed outline of the works which you propose to implement, or have implemented, to achieve Orders 1 - 17 above. The plan must: (a) Specify the reports which will be developed and propose dates for submission of these reports to the EPA. (b) Contain a detailed design plan including supporting information such as numerical modelling results for the implementation of EISB (and other complementary "hot spot" treatment technologies, including pump and treat, excavation and thermal, as selected by the applicants) on the Remediation Site (having regard to Exhibit J2 and J3 in Land and Environment Court Proceedings 10446/10 attached to these Orders) to allow compliance with the above Orders 1 - 17. (c) Specify a timeline, interim triggers and thresholds by which progress towards achieving compliance with the targets and environmental goals in Orders 1 - 17 are measured by you and reported in writing to the EPA, on a regular basis for 20 months from the date of this Management Order. (d) Specify and describe workable, realistic and costed alternative remediation measures for the application of other remediation techniques (which may include pump and treat, excavation and thermal amongst other commercially available techniques) for reaching the targets and environmental goals in the Management Order, on and after two years from the date of the Management Order, which are to apply in the event that you have not demonstrated to the EPA's satisfaction, by 22 months after the date of the Management Order, that your preferred technique, EISB, has made substantial progress towards achieving compliance with all targets in Directions 1 - 17 above by 22 months after the date of the Management Order. (e) Adopt an adaptive management strategy to the achievement of Orders 1 - 17 which may include, for example, proposed methods for "hot spot" treatment in the context of ongoing EISB treatment that will allow the targets in Orders 1 - 17 to be achieved. (f) Be approved by and in accordance with the further recommendations of the independent expert panel referred to in Order 18 above. 20. Implement approved Remediation Action Plan Upon approval by the EPA of the remediation action plan, implement the approved remediation action plan. 21. Carry out orders consistent with EPA Guidelines Carry out the orders in the Management Order consistent with any relevant guidelines made or approved by the EPA under s 105 of the Contaminated Land Management Act 1997. In the event of any inconsistency between the guidelines and the Management Order, the Management Order shall prevail. 22. Obtaining consent of Affected Landholders to access their land Consult with the Affected Landholders to seek consent to enter onto, and carry out any actions required by the Management Order on the land they own and consider their reasonable requests in relation to access, including, without limitation, reasonable requests regarding: (a) indemnification for any loss or damage that may be suffered by the Affected Landholders, including for economic loss caused by interference with the business activities carried on by the Affected Landholders; and (b) making good the land of the Affected Landholders on conclusion of the implementation of the actions required by the Management Order.

E. ACCESS TO INFORMATION 23. Public access to information on remediation actions (a) Make available for inspection by any person, free of charge, any report on the action taken under the management order, and provide a copy of such a report to any person for a reasonable fee. (b) Make available for inspection by any person, free of charge: (i) all reports disclosing the results of the investigations required to be conducted pursuant to any of the Orders 1 - 17 above; (ii) all reports disclosing the results of monitoring under any of the Orders 1 - 17 above, at least once every three months; (iii) all documents disclosing the recommendations of the expert panel referred to in Order 18 above; (iv) documents disclosing the remediation action plan referred to in Order 19 above; and (c) provide a copy of any such report or document to any person for a reasonable fee. 24. Provide correspondence to Affected Landholders (a) Provide all the Affected Landholders with copies of any correspondence exchanged between you and the EPA (or any site auditor or expert panel) at any time and at least once every 3 months during implementation of the remediation action plan report to the EPA and the Affected Landholders in writing on: (i) the effectiveness of any remediation technologies in treating the Significant Contaminants; (ii) whether any barrier between the Source Site and the other affected properties is effective of should be replaced by more effective containment works; and (iii) the practicability of any medication or replacement. (b) Comply with all reasonable requests by any Affected Landholder for copies of documents or raw data obtained through the investigations required by the Management Order. 25. Invite Affected Landholders to meetings Invite all the Affected Landholders to participate in any meetings between you and the EPA or the site auditor or expert panel.

Amendments 07 June 2011 - Incorrect Word Used. Amended paragraphs: Paragraph 24 (ii) and (iii) of the Mangement Order 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 2011