Environment Protection Act 1970, ss 1A, 4, 27A, 41, 62C and 66B; Interpretation of Legislation Act 1984; s 35.

Kirk v Industrial Court (NSW) (2010) 239 CLR 531; DPP v Hazelwood Pacific Pty Ltd & Ors (Ruling No 2) [2019] VSC 871; DPP v Hazelwood Pacific Pty Ltd & Ors (Ruling No 4) [2019] VSC 873; Federal Commissioner of Taxation v Lutovi Investments Pty Ltd [1978] HCA 55; (1978) 22 ALR 519 referred to.

1. This is a judgment in relation to two interlocutory appeals. Both appeals concern pre-trial rulings in relation to the prosecution of a company and a director of that company under the Environment Protection Act 1970 ('the EPA'). Unless otherwise indicated, all section references below are to the EPA.
2. XYZ Pty Ltd ('XYZ')[2] is charged with a total of five offences, namely three charges under s 41 and one each under ss 27A and 59E. Henry Lowe,[3] the sole director of XYZ, is charged with the same five offences pursuant to s 66B(1).
3. The first ruling, which is appealed by Mr Lowe, concerns the meaning of the term 'environmental hazard' which is defined in s 4 and appears in both ss 27A and 59E.[4] For the reasons given below, I would dismiss Mr Lowe's appeal. The second ruling,[5] which is appealed by the DPP, concerns the meaning or, more precisely, the interplay of ss 41, 62C and 66B. For the reasons given below, I would uphold the DPP's appeal.

1. It is the DPP's case that XYZ operated a business which processed recyclable materials including paper, cardboard and plastics. On 13 July 2017, a heap of these materials covering 25,000 square metres of the business premises caught fire. It took firefighters approximately 48 hours to bring the fire under control. It was only after 10 days that the fire was fully extinguished. A great deal of smoke was released into the atmosphere as a result of the fire.
2. The amended summary of prosecution opening dated 8 August 2022 includes the following:
   1. [The] rubbish heap [on the premises occupied by XYZ] abutted a heap of crushed granulated glass containing decomposing organic food matter because the amount of recycled waste that had accumulated at the premises had overflowed into the holding yard of a neighbouring factory ...

...

1. The MFB investigated the fire but could not determine a cause. The following causes 'remained unresolved':
   • a. Machinery;
   • b. Spot fire from rubbish burn at [another location];
   • c. Juvenile activity;
   • d. Deliberate ignition;
   • e. Smoking;
   • f. Spontaneous combustion.
2. In relation to spontaneous combustion, the report notes:
   • Exothermic chemical reactions can occur at ambient or even low temperatures, resulting in physical and chemical changes in the materials involved. There is a gradual increase of the temperature of the combustible material when the heat or temperature comes from within that material and not from an outside heat source. The increase in temperature can result in fire from the ignition of any adjacent combustible material.
   • Spontaneous heating does occur in organic products (such as the glass heap which contained organic food waste) due to the exothermic, biological and/or chemical process, and this risk in temperate can heat combustibles to the required auto ignition temperature[.] [I]n the area of origin, there is a large section of processed granulated glass containing decomposing organic material (food waste) in direct contact with recycled waste.
   • Temperature readings taken on 18 August 2017 in conjunction with Environment Protection Authority (EPA) were as high as 69.9 degrees C. The material was off-gassing a decomposing manure type of smell when tested on 18 July 2017.

...

1. The act or omission of [XYZ] - and by extension, [Lowe] - alleged by the prosecution that gives rises to the charges is the way XYZ handled and stored recycled (sic) materials on the premises[6], specifically:
   1. XYZ allowed a vast quantity of recyclable materials to accumulate at the premises;
   2. a proportion of the recyclable materials were unsorted and contained remnants of organic material;
   3. the recyclable materials were flammable and/or toxic and this was known to XYZ;
   4. substantial pales and/or piles of recycled (sic) materials were stored in close proximity to one another; and
   5. XYZ allowed pales and/or piles of recycled (sic) materials to abut a large heap of processed glass produced by [the occupier of a neighbouring property].

1. Relevant sections of the EPA[7] are as follows (underlining added):

1A Purpose of Act

(1) The purpose of this Act is to create a legislative framework for the protection of the environment in Victoria having regard to the principles of environment protection.

(2) The principles of environment protection are set out in sections 1B to 1L.

(3) It is the intention of Parliament that in the administration of this Act regard should be given to the principles of environment protection.

4 Definitions

(1) In this Act unless inconsistent with the context or subject-matter -

contravene includes breach, fail, neglect or refuse to comply with;

element in relation to the environment means any of the principal constituent parts of the environment including waters, atmosphere, land, vegetation, climate, sound, odour, aesthetics, fish and wildlife;

environment means the physical factors of the surroundings of human beings including the land, waters, atmosphere, climate, sound, odours, tastes, the biological factors of animals and plants and the social factor of aesthetics;

environmental hazard means a state of danger to human beings or the environment whether imminent or otherwise resulting from the location, storage or handling of any substance having toxic, corrosive, flammable, explosive, infectious or otherwise dangerous characteristics;

occupier in relation to any premises includes a person who is in occupation or control of the premises whether or not that person is the owner of the premises and in relation to premises different parts of which are occupied by different persons means the respective persons in occupation or control of each part;

pollute includes causing or permitting pollution;

polluted means the condition of the environment described and referred to in section 39(1), 41(1) or 45(1) as the case may be;

premises includes messuages, buildings, lands, and hereditaments of every tenure and any machinery, plant, appliance, or vehicle used in connexion with any trade carried on at any premises and includes a ship;

segment in relation to the environment means any portion or portions of the environment expressed in terms of volume, space, area, quantity, quality, or time or any combination thereof;

27A Offences relating to industrial waste

(1) A person who -

(a) contravenes any rules or requirements relating to industrial waste specified in a waste management policy; or

(b) contravenes any regulations relating to industrial waste; or

(c) causes or permits an environmental hazard[8] -

is guilty of an indictable offence.

Penalty: 2400 penalty units plus, in the case of a continuing offence, a daily penalty of 1200 penalty units for each day the offence continues after conviction or after service by the Authority on the accused of notice of contravention of this subsection (whichever is the earlier).

41 Pollution of atmosphere

(1) A person shall not pollute the atmosphere so that the condition of the atmosphere is so changed as to make or be reasonably expected to make the atmosphere -

(a) noxious or poisonous or offensive to the senses of human beings;[9]

(b) harmful or potentially harmful to the health, welfare, safety or property of human beings;[10]

(c) poisonous, harmful or potentially harmful to animals, birds or wildlife;

(d) poisonous, harmful or potentially harmful to plants or other vegetation; or

(e) detrimental to any beneficial use made of the atmosphere.[11]

43 Penalty

Any person who contravenes any of the preceding provisions of this Part shall be guilty of an indictable offence against this Act and liable to a penalty of not more than 2400 penalty units and in the case of a continuing offence to a daily penalty of not more than 1200 penalty units for each day the offence continues after conviction or after service by the Authority on the accused of notice of contravention of the preceding provisions of this Part (whichever is the earlier).

59E Offence of aggravated pollution

A person who intentionally, recklessly or negligently pollutes the environment or intentionally, recklessly or negligently causes or permits an environmental hazard which results in -

(a) serious damage to the environment; or

(b) a serious threat to public health; or

(c) a substantial risk of serious damage to the environment; or

(d) a substantial risk of a serious threat to public health[12] -

is guilty of an indictable offence.

Penalty: In the case of an individual, a fine of 2500 penalty units or 7 years imprisonment or both. In the case of a body corporate, a fine of 10 000 penalty units.

62C Presumption that occupier caused discharge etc.

If any segment or element of the environment is polluted as a result of a discharge, emission or deposit of any substance from or on any premises on which there is conducted any commercial or industrial undertaking, the occupier of the premises is deemed to have polluted that segment or element of the environment unless the occupier proves that the discharge, emission or deposit was unrelated to the commercial or industrial undertaking.

66B Offences by corporations and partnerships etc.

(1) If a corporation contravenes, whether by act or omission, any provision of this Act or a notice or a licence or permit under this Act, each person who is a director or is concerned in the management of the corporation is also guilty of the offence which relates to the contravention and liable to the penalty for that offence.

(1A) It is a defence to a charge brought under subsection (1) against a person who is a director or is concerned in the management of a corporation if that person proves that -

* * * * *

(b) the person was not in a position to influence the conduct of the corporation in relation to the contravention;

(c) the person, being in such a position, used all due diligence to prevent the contravention by the corporation; or

(d) the corporation would not have been found guilty of the offence by reason of its being able to establish a defence available to it under this Act.

(1B) A person who is a director of a corporation or who is concerned in the management of a corporation may, by virtue of subsection (1), be proceeded against and be convicted of an offence in respect of a contravention referred to in that subsection, whether or not the corporation has been proceeded against or been convicted in respect of the contravention.

(2) When in any proceedings under this Act it is necessary to establish the intention of a corporation, it is sufficient to show that a servant or agent of the corporation had that intention.

(3) In respect of any proceedings for an offence by a corporation against this Act any statement made by an officer of the corporation is admissible as evidence against the corporation.

(4) If a person who is a partner in a partnership contravenes, whether by act or omission, any provision of this Act or a notice or a licence or permit under this Act in the course of the activities of the partnership, each other person who is a partner in the partnership is also guilty of the offence which relates to the contravention and liable to the penalty for that offence.

(4A) If a person who is concerned in the management of an unincorporated association contravenes whether by act or omission, any provision of this Act or a notice or a licence or permit under this Act in the course of the activities of the unincorporated association, each other person who is at the time of the contravention concerned in the management of the unincorporated association is also guilty of the offence which relates to the contravention and liable to the penalty for that offence.

(4B) It is a defence to a charge brought under subsection (4) or (4A) if the person charged proves that -

* * * * *

(b) the person was not in a position to influence the conduct of the person who committed the contravention; or

(c) the person, being in such a position, used all due diligence to prevent the contravention; or

(d) the person who committed the contravention would not have been found guilty of the offence by reason of a defence available under this Act.

(5) In this section - officer -

(a) in relation to a corporation within the meaning of the Corporations Act, has the same meaning as it has in the Corporations Act;

(b) in relation to a corporation which is not a corporation within the meaning of the Corporations Act, means any person, by whatever name called, who is concerned or takes part in the management of the corporation; and

(c) includes any employee of the corporation who gives to an authorized officer any information relating to any part of the operations of the corporation over which that employee exercises any superintendence or control.

[1] This is an application for [a] ruling on the interpretation of 'environmental hazard' as defined in s 4(1) of the Environment Protection Act 1970.

1. The central issue for the trial judge was whether the word 'flammable' in the definition of environmental hazard should be understood as meaning 'dangerously flammable' with the consequence that it would not cover substances such as paper, cardboard and plastic. In the penultimate paragraph of his ruling, his Honour said this:

[42] I therefore rule that the adjective flammable in s 4 of the EP Act does not mean dangerously flammable. I find that the adjective flammable is to be given its ordinary meaning and when given its ordinary meaning it encompasses materials such as paper, cardboard and plastic.

1. His Honour gave four reasons for so ruling.
2. First, his Honour relied upon the ordinary meaning of the word 'flammable'. He referred to the definitions of flammable in the Macquarie Dictionary ('easily set on fire') and the Oxford English Dictionary ('inflammable; capable of being inflamed or set on fire; susceptible to combustion').
3. Second, his Honour thought that giving the word 'flammable' its ordinary meaning in the statutory definition of environmental hazard promoted the fundamental purpose of the EPA, namely, protecting the environment.[13] His Honour remarked:

[40] I find that the definition of 'environmental hazard' is an intentionally broad one designed to encompass a non-exhaustive variety of substances which have the potential to pollute the environment when not stored, handled or located safely.

1. Third, his Honour thought that if Parliament had intended 'flammable' to have a narrower, technical meaning, Parliament could and would have said so expressly.
2. Fourth, his Honour thought that the fact that 'flammable' may have a narrower, technical meaning in other legislation and materials dealing with dangerous goods (eg, the Dangerous Goods Act 1985, the Australian Dangerous Goods Code, the Australian/New Zealand Standard for the storage and handling of mixed classes of dangerous goods in packages and intermediate bulk containers and the Memorandum of Understanding between Worksafe and the Environment Protection Authority) did not require it to be given that narrow meaning in the EPA. His Honour remarked at [38] 'I have derived little assistance from the materials provided to the court during oral argument due to the qualifications to their use prescribed by the authorities'.

This is an application for [a] ruling on the interpretation of sections 62C, 66B, and 41 of the Environment Protection Act 1970 ('the EP Act').

1. The central issue for his Honour was whether the prosecution could rely on s 66B to sheet home accessorial criminal responsibility to Mr Lowe, the sole director of XYZ, in circumstances where the prosecution had not in the charges identified a relevant act or omission by XYZ. That is, the prosecution had not particularised any act or omission by XYZ that had caused the fire which caused the smoke which caused the pollution. Rather, the prosecution relied on s 62C to deem XYZ as having polluted the atmosphere contrary to s 41(1)(a), (b) and (e).
2. His Honour ruled that to enliven the operation of s 66B, it was necessary for the prosecution to identify an act or omission by XYZ which polluted the atmosphere in the ways described in s 41.
3. His Honour gave four reasons for reaching that conclusion.
4. First, his Honour thought that the wording of s 66B implies that there must be an identified act or omission by the contravening corporation: in his Honour's view, that is the import of the words 'act or omission' and 'conduct' in s 66B.
5. Second, his Honour thought that, had the identification of an act or omission by the company not been necessary to enliven s 66B, Parliament could have simply removed the reference to act or omission in s 66B.
6. Third, his Honour considered that his conclusion was supported by the High Court's reasoning in Kirk v Industrial Court (NSW).[14] In that case, which concerned the prosecution of a company and a director under ss 15, 16 and 50 of the Occupational Health and Safety Act 1983 (NSW), the High Court found it was necessary for the prosecution to identify with some particularity an act or omission by the company constituting the alleged offences, otherwise the accused company and director would have to obviate every risk[15] to make good the statutory defences available to them under ss 50 and 53 of that Act. Applying the High Court's reasoning in Kirk, it was his Honour's view in the present case that without the identification of an act or omission constituting the alleged offence, the statutory defences available to an accused under s 66B of the EPA would be rendered 'either impossible or all but [impossible]'.
7. Fourth, his Honour thought that attaching liability to an occupier (whether a natural person or corporation) pursuant to s 62C is one thing but using s 62C in combination with s 66B to attach accessorial liability to a director, who may be a non-occupying director, is another. In his Honour's view, the second reading speeches and extraneous materials did not indicate that Parliament intended to go that far.
8. His Honour further ruled that the discharge or emission of smoke from the premises occupied by XYZ, which triggered the application of s 62C vis a vis XYZ, was not an identified act by XYZ, as asserted by the prosecution: rather, it was the result or consequence of an unidentified act or omission. Consequently, it did not trigger the application of s 66B.

1. In relation to the trial judge's first ruling, Mr Lowe submitted that the EPA, the Dangerous Goods Act 1985 and the Occupational Health and Safety Act 2004 are meant to complement one another. This intended complementarity was confirmed in the second reading speech for the Bill which introduced the definition of 'environmental hazard' into the EPA.[16] The relevant Minister said:

The Bill is an important part of the comprehensive Government program of control over chemicals. The Occupational Health and Safety Act 1985 provides for protection of people in the workplace, while the Dangerous Goods Act 1985 provides for the protection of the general public. This Bill complements these Acts and provides for proper management of discarded industrial wastes. It will ensure that facilities are properly operated and maintained, that contamination of the environment is prevented, and that an adequate information base for waste disposal planning is created. It is therefore an important step towards bringing hazardous chemicals under control and giving the necessary assurances that community welfare is being safeguarded.[17]

1. Mr Lowe also placed particular emphasis on what the relevant Minister said in the course of the Parliamentary debates about the 1985 Bill:

Honourable Members will be aware that the House passed the Dangerous Goods Act and the Occupation Health and Safety Act and this is the third piece of legislation which is complementary to the other two Acts ... [B]oth the Environment Protection Act and the Dangerous Goods Act will rely on the same national standards and codes relative to hazardous materials.[18]

1. Mr Lowe submitted that complementarity is served by consistent use of terminology. The Dangerous Goods Act 1985 picks up definitions in the Australian Dangerous Goods Code (ADG Code)[19] which deals with dangerous goods that are toxic (Chapter 2.6), corrosive (Chapter 2.8), flammable (Chapters 2.3 and 2.4), explosive (Chapter 2.1) and infectious (Chapter 2.6). These are the same adjective or descriptors that appear in the definition of 'environmental hazard' in the EPA. All these terms are narrowly defined. 'Flammable' in the Dangerous Goods Act 1985 and the ADG Code refers to substances with a flashpoint of less than 60 degrees Celsius whereas paper and cardboard ignite at no less than 250 degrees Celsius and plastics ignite at between 350 and 580 degrees Celsius. Various Australian Standards and 'industry material' regarding the handling and storing of dangerous goods also use 'flammable' in a narrow sense. The Memorandum of Understanding between Worksafe and the Environment Protection Authority dated 29 March 2017 also evidences a narrower interpretation of 'dangerous goods'.
2. Mr Lowe further submitted there are other provisions of the EPA which adequately criminalise inappropriate storage or handling of materials such as paper, cardboard and plastics.
3. The prosecution submitted that the trial judge's interpretation of flammable in the definition of environmental hazard was correct. The prosecution submitted that Mr Lowe's interpretation distorts the syntax of the definition, ignores the purposes of the EPA and derives no support from narrower definitions of flammable in different contexts. As regards syntax, the adjectives (including 'flammable' and 'otherwise dangerous') in the definition of 'environmental hazard' qualify the noun ('characteristics'). As regards the purposes of the EPA, if voluminous flammable material ignites, the smoke can cause significant pollution of the environment, which the EPA seeks to prevent. As regards the meaning of flammable in other contexts, that does not require the narrower use of the word in the context of the EPA. Further, it would have been easy for Parliament to incorporate the narrower meaning of 'flammable' if that had been its intention - eg by the EPA, like the Dangerous Goods Act 1985, referencing the ADG Code.

1. In relation to the trial judge's second ruling, the prosecution submitted that requiring it to identify an act or omission causative of the discharge or omission was inconsistent with the structure and purposes of the EPA, the fact that s 41 offences are strict liability offences and the reverse onus defences in s 66B.
2. The prosecution submitted that in many cases it is impossible for the prosecution to identify an act or emission that led to the polluting discharge or emission. The consequence of the impugned ruling, if allowed to stand, is that directors who have the capacity to influence the conduct of corporations but who fail to exercise due diligence could escape responsibility. This would be inconsistent with the purposes of the EPA.
3. As regards the wording of s 66B, the prosecution submitted that because the word contravention suggests a positive act, the words 'whether by act or omission' were inserted simply to counter that suggestion.
4. The prosecution submitted that had Parliament intended that the prosecution must identify an act or omission by the contravening company for s 66B to be engaged, one would have expected it to say so clearly.
5. The prosecution submitted that the actus reus of the offence is the discharge and emission of pollutants. The prosecution relied on what Keogh J said in DPP v Hazelwood Pacific Pty Ltd & Ors (Ruling No 4),[20] namely, 'the actus reus of the offence against s 41(1) of the EP Act is to pollute the atmosphere so that it is changed as described'.[21] The trial judge was wrong to categorise the discharge or emission of the pollutants as the result of some unidentified act or omission. The prosecution submitted that the pollution of the atmosphere to the extent described by s 41 is the result.
6. The prosecution submitted that Kirk was distinguishable in a number of respects. It was a case about particulars in the context of OHS legislation which did not have any equivalent to s 62C. Whilst the OHS legislation had an equivalent to s 66B, the prosecution submitted that it was not the subject of any analysis. Kirk concerned OHS legislation which is risk based and preventative whereas the EPA is result based. The offences considered in Kirk were not strict liability offences.
7. In relation to the trial judge's second ruling, Mr Lowe submitted that the trial judge was correct to find that the references in s 66B to 'act or omission' and 'conduct' required the prosecution to identify a causative act or omission by XYZ for s 66B to be engaged.
8. Mr Lowe submitted that the trial judge was correct to rely on Kirk.[22] That case highlighted the difficulty of an accused utilizing statutory defences if an alleged causative act or omission is not identified by the prosecution. If the prosecution were allowed to double-deem using ss 62C and 66B, Mr Lowe would be put in the same position as Mr Kirk was, having to prove that every possible risk was obviated.
9. Mr Lowe submitted that deeming more people guilty of the crime did not necessarily serve Parliament's purpose in enacting the relevant provisions. Neither the objects of the Act or the extrinsic material indicates Parliament intended that s 66B would apply in the absence of an identified causative act or omission by the corporation. If Parliament intended the deeming provision to have such a draconian outcome, it needed to say so in clear and unambiguous terms. Deeming provisions should be construed strictly.
10. Mr Lowe submitted that Keogh's J analysis of the elements of the relevant s 41 offences in DPP v Hazelwood Pacific Pty Ltd & Ors (Ruling 2)[23] and DPP v Hazelwood Pacific Pty Ltd & Ors (Ruling No 4)[24] was correct and, contrary to the prosecution's submissions, it provides no support for the view the discharge of smoke from the premises occupied by XYZ may be treated as the causative act for the purposes of s 66B. Rather, as the trial judge in the present case indicated, the discharge of smoke was a consequence or result of an unidentified act or omission.

1. Regarding the trial judge's first ruling, the ordinary meaning of flammable is 'easily set on fire'. It seems unsurprising that substances which can be easily set on fire should be included in the definition of 'environmental hazard' in the EPA, bearing in mind that there is a further requirement for the definition to apply, namely, that by reason of the location, storage or handling of the substance, it constitutes a danger to human beings or the environment. It is self-evident that the inappropriate location, storage or handling of a substance which is easily set on fire, represents a real danger to persons and the environment, especially if the amount of the substance is voluminous. The same may be said for substances which are toxic, corrosive, explosive, infectious or otherwise dangerous, giving those adjectives their ordinary meaning.
2. The incident which is the subject of these proceedings graphically illustrates the danger to the environment of a very large heap of flammable materials such as paper, cardboard and plastics. The fire burned for 10 days, generating an enormous amount of smoke. To suggest that such a large heap of flammable material does not constitute an environmental hazard is inconsistent with the promotion of the fundamental purpose of the EPA, namely, the protection of the environment. In short, the text of the definition of environmental hazard in s 4 of the EPA and the purpose of the EPA provide strong support for the view that flammable, and the other adjectives in that provision, should be given their ordinary meaning.
3. Dealing with context, it is true that in other legislation and materials dealing with the regulation of dangerous goods, the word 'flammable', and the other adjectives included in the definition of 'environmental hazard', are given a narrower, technical meaning. It is also true that the Dangerous Goods Act 1985, Occupational Health and Safety Act 2004 and the EPA are complementary pieces of legislation. But complementarity does not mean uniformity. Where giving the terminology used in a piece of legislation its ordinary meaning better serves the fundamental purpose of that legislation, and does so without undermining the complementarity of a suite of legislation, the ordinary meaning should be taken to have been Parliament's intention. That is the situation with the word 'flammable' in the definition of 'environmental hazard' in the EPA. In my view, his Honour's ruling was correct.
4. Accordingly, I would grant Mr Lowe leave to appeal from his Honour's first ruling but dismiss the appeal.

1. If the environment has been polluted by a discharge from commercial or industrial premises, there are two paths for a successful prosecution of the occupier of those premises (whether a natural person or a corporation) for polluting the atmosphere contrary to s 41 of the EPA. The first path is to identify some act or omission of the occupier which caused the pollution. The second path is to utilize the s 62C deeming provision. It is clear that the deeming provision was introduced because of the difficulty that may be encountered by the prosecution in identifying the acts or omissions which caused pollution.
2. Directors of corporate occupiers, who exercise due diligence, will often be in a position to influence the conduct of the company and so prevent discharges or emission from premises occupied by the company. Attaching liability to directors through the joint operation of ss 62C and 66B ('double deeming') promotes the fundamental objective of the EPA which is to protect the environment whilst also affording directors appropriate reverse onus defences.
3. It does not follow from the impossibility of identifying the company's relevant act or omission that it is impossible or all but impossible for a director to avail himself of the defences that are set out in s 66B. Take the current incident. One critical factor in the pollution of the environment as a result of the discharge from the premises was the build-up of the heap of paper, cardboard and plastic on the premises. That accumulation of flammable materials did not happen overnight. It was conduct on the part of the corporation in relation to the alleged contravention of s 41. Even though there is uncertainty as to how the materials were ignited (arson, accident, exothermic reaction), it would not be impossible or all but impossible for Mr Lowe to show that as sole director, he took all reasonable steps to get the company to prevent or reduce the build-up of flammable materials in the first place. Nor would it be impossible or all but impossible for him to show that he exercised due diligence in guarding against ignition of these flammable materials (eg by directing the company to engage proper security for the premises, enforce a no-smoking policy on site and reduce, if not eliminate, the presence of biological matter amongst the recyclable materials). Furthermore, it would not be impossible or all but impossible for Mr Lowe to show that he had directed the company to install sprinkler systems in case the measures undertaken to prevent ignition failed. Requiring Mr Lowe to demonstrate his due diligence with regard to such matters is not oppressive.
4. The defence's reliance on Kirk is misconceived. That case was concerned with risk based OHS legislation, not result based environmental protection legislation. The fact that the EPA is result based means that an accused director does not have to obviate every risk to health and safety. Most importantly, there was no equivalent to s 62C in the OHS legislation that was under consideration in Kirk. There was only one path to a successful prosecution and that involved the prosecution identifying some act or omission by the employer company which was causative of the proscribed risk to health and safety of employees and others who attended the employer's premises. This point was amplified by the references to acts and omissions in the sections creating the relevant offences, namely ss 15 and 16 of the Occupational Health and Safety Act 1983 (NSW). In those circumstances, it was hardly surprising that the High Court found that that prosecution's particulars - as against the employer company (Kirk Group Holdings P/L) and its director Mr Kirk - were deficient.
5. Finally, the use of the words 'act or omission' and 'conduct' in s 66B are not inconsistent with double deeming. Most importantly, s 66B does not say it applies, or only applies, where the contravention of a corporation is 'by act or omission'. The defence ignores the use of the word 'whether'.
6. The words, 'whether by act or omission', in s 66B are not words of limitation. If anything, on their face, and particularly having regard to the use of the word 'whether', they are words of extension. They do not imply that the contravention must be one occasioned by some specific and identified act or omission, thereby excluding a deemed contravention. That conclusion is reinforced by the reasoning of the High Court in Federal Commissioner of Taxation v Lutovi Investments Pty Ltd (Lutovi).[25]
7. In Lutovi, the High Court was required to consider s 44(2D) of the Income Tax Assessment Act 1936-1972, which relevantly provided that a share issued by a company was a redeemable share if:

the share was issued in pursuance of, or as part of, an agreement or arrangement, whether oral or in writing and whether entered into before or after the commencement of this sub-section, that had [a relevant purpose].[26]

1. Gibbs and Mason JJ (with whom Murphy J agreed) held that the words, 'whether oral or in writing', were 'words of extension, not of limitation'. Their Honours said:

The words 'whether oral or in writing' do not imply that an agreement or arrangement must be wholly oral or wholly written, thereby excluding an agreement or arrangement which is partly oral and partly written. No rational purpose would be served by such an exclusion. But what of an arrangement which is implied or inferred from the circumstances or the conduct of the parties? Is it excluded? We do not think so. Counsel for the respondent conceded that one can infer an agreement or arrangement so long as it is oral or written. We would go further and say that the words are words of extension, not of limitation. They were so regarded in Newton v Federal Commissioner of Taxation (1958) 98 CLR, at p 8; (1958) AC, at p 465.[27]

1. In his dissenting judgment, Stephen J did not deal with the issue of whether these words were words of extension or limitation. In his dissenting judgment, Aickin J said that the words appeared to him to be otiose. His Honour said:

I do not, however, consider that in this context those words either limit or extend the meaning or operation of the preceding words. If the words were 'an oral or written agreement or arrangement' they would in the absence of some additional context have a limiting operation, but, when used in this context and in the phrase 'whether oral or in writing', I do not regard them as more than a pointless reminder that there is more than one way in which an agreement may be entered into. If the words are to be dignified as having been inserted for more abundant caution they fail dismally in their allotted task.[28]

1. By like reasoning to that contained in Lutovi, I would conclude that the words, 'whether by act or omission' in s 66B(1) of the Act are, if anything, words of extension, not limitation. Thus, Mr Lowe's submission that s 66B has no application in respect of deemed contraventions must be rejected. Alternatively, if the relevant words in s 66B are, to use the words of Aickin J, no more than a 'pointless reminder' that contraventions can be occasioned by both acts and omissions, Mr Lowe's contention is again without substance.
2. Construing s 66B(1) in its context, and with the legislative purposes of the Act in mind, it is plain that s 66B(1) imposes a liability on directors for all of the contraventions of their corporations - subject to the defences set out in s 66B(1A). To hold otherwise would serve no legitimate legislative purpose.
3. As regards the reference to 'conduct' in s 66B, it has work to do not only where the prosecution relies on an identified act or omission by the corporation but also where the prosecution relies on s 62C. It will be recalled that s 62C deems the corporation to have polluted the environment. In other words, it deems the corporation to have performed the conduct which constitutes the actus reus of the offence. Having regard to the text, context and purpose of s 66B, there is no reason to exclude such deemed conduct from the scope of the word 'conduct' in that section. And there is no reason to suppose that a director could not avail himself or herself in a meaningful way of the defences afforded by s 66B where s 62C is invoked by the prosecution vis a vis the director as well as the corporation. Ordinarily one would expect the director to do that by showing that he exercised due diligence in his role as a director to prevent the pollution of the environment. That is not an unreasonable, let alone an oppressive expectation.
4. Accordingly, I would grant leave to appeal to the DPP, uphold her appeal and set aside the trial judge's second ruling.

[1] Because this is an interlocutory proceeding, a pseudonym has been used in the place of the name of the applicant and the reasons have been prepared in a form which omits identifying details.

[2] A pseudonym. The company is in receivership and did not appear below or in this Court.

[4] The first ruling relates to Charges 4 and 5 on the two indictments.

[5] The second ruling relates to Charges 1 to 3 on the two indictments.

[6] Although these alleged acts or omissions by XYZ are included in the summary of prosecution opening, they are not particularised in any of the charges, although they could be. As illustrated by DPP v Hazelwood Pacific Pty Ltd & Ors (Ruling No 4) [2019] VSC 873, there is nothing to prevent the prosecution utilizing both bases of liability - that is, identifying an act or omission by XYZ that caused the pollution and, in the alternative, relying on s 62C to deem XYZ as having caused the pollution.

[7] The extracts from the EPA are from Authorised Version No 196, being the Authorised Version incorporating amendments as at 1 July 2017.

[13] Section 35 of the Interpretation of Legislation Act 1984 states:

In the interpretation of a provision of an Act or subordinate instrument -

(a) a construction that would promote the purpose or object underlying the Act or subordinate instrument (whether or not that purpose or object is expressly stated in the Act or subordinate instrument) shall be preferred to a construction that would not promote that purpose or object;

[15] The plurality in Kirk said at p 554 (underlining added, citations omitted):

[16] The scheme of this legislation stood apart from other legislation of this type in Australia. In other States the employer's obligation, to take measures for the health and safety of employees and others, was limited to the taking of such measures as were practicable. This Court has held that such a provision places the onus upon the prosecution to show that the means which should have been employed to remove or mitigate a risk were practicable. A feature of the legislation here in question is that where an employer is charged with an act or omission which is a contravention of s 15 or s 16, it will be necessary for the employer to establish one of the defences available under s 53 in order to avoid conviction. Where reliance is placed by the employer on s 53(a), it would be necessary for the employer to satisfy the Industrial Court, to the civil standard of proof, that it was not reasonably practicable to take the measure in question. Such a defence can only address particular measures identified as necessary to have been taken in the statement of offence.

[17] Section 53(a), in the context of proceedings for offences against ss 15 and 16, referred to the situation where it is not reasonably practicable for an employer to comply 'with the provision of this Act'. It is not to be understood as requiring an employer to negative the general provisions of ss 15 and 16 and to establish that every possible risk was obviated. It requires that regard be had to the breach of the provision which it is alleged constituted the offences. A breach or contravention of s 15 or s 16 is the measure not taken, the act or omission of the employer.

1. [16]The definition of 'environmental hazard' was inserted in the EPA by s 5 of the Environment Protection (Industrial Waste) Act 1985 (the 1985 Act). A minor amendment to that definition was made by s 4 of the Environment Protection (Amendment) Act 1988, substituting the word 'substance' for 'waste'.

[17] Victoria, Parliamentary Debates, Legislative Assembly, 31 October 1985, 1606 (Andrew McCutcheon).

[18] Victoria, Parliamentary Debates, Legislative Assembly, 26 November 1985, 2389.

[19] The full title of the ADG Code is 'Australian Code for the Transport of Dangerous Goods by Road and Rail'.

[20] [2019] VSC 873 ('Hazelwood (Ruling No 4)).

[22] (2010) 239 CLR 531, [15]-[18].

[23] [2019] VSC 871.

[24] [2019] VSC 873.

[25] [1978] HCA 55; (1978) 22 ALR 519 ('Lutovi').