Maules Creek Community Council Incorporated v Environment Protection Authority - [2024] NSWLEC 71 - NSWLEC 2024 case summary — Zoe

NSWNSWLEC

Maules Creek Community Council Incorporated v Environment Protection Authority

[2024] NSWLEC 71

Land and Environment Court (NSW)|2024-05-16|Before: Preston CJ

View original source

At a glance

Source facts

Court

Land and Environment Court (NSW)

Decision date

2024-05-16

Before

Preston CJ

Catchwords

Chapter 3
[2011] FCAFC 59 Bushfire Survivors for Climate Action Incorporated v Environment Protection Authority (2021) 250 LGERA 1
[2010] HCA 1 Lo v Chief Commissioner of State Revenue (2013) 85 NSWLR 86
[2013] NSWCA 180 Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24

Source

Original judgment source is linked above.

Catchwords

Chapter 3[2011] FCAFC 59 Bushfire Survivors for Climate Action Incorporated v Environment Protection Authority (2021) 250 LGERA 1[2010] HCA 1 Lo v Chief Commissioner of State Revenue (2013) 85 NSWLR 86[2013] NSWCA 180 Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24[1986] HCA 40 Minister for Immigration and Multicultural Affairs v Bhardwaj (2002) 209 CLR 597[2015] HCA 50 R v Hickmanex parte Fox and Clinton (1945) 70 CLR 598[1945] HCA 53 Seltsam Pty Ltd v McGuiness (2000) 49 NSWLR 262

Judgment (106 paragraphs)

[1]

81; [2000] NSWCA 88 Texts Cited: NSW EPA Climate Change Action Plan 2023-26 NSW EPA Climate Change Policy Category: Principal judgment Parties: Maules Creek Community Council Incorporated (INC9894709) (Applicant) Environment Protection Authority (First Respondent) Maules Creek Coal Pty Ltd (ACN 140 533 875) (Second Respondent) Attorney General for New South Wales (Intervenor) Representation: Counsel: R White, S Hoare and B Gallifuoco (Applicant) Z Heger (First Respondent) P Herzfeld SC and K Pham (Second Respondent) Z Heger (Intervener)

[3]

An environment protection licence is reviewed

Maules Creek Community Council Incorporated (the Community Council) is a community-based incorporated association concerned about developments in the Leard State Forest and surrounding farmlands, near Narrabri, including proposals for new and expanded open-cut coal mines. One of these developments is the Maules Creek Coal mine, which is an open-cut coal mine located in the Leard State Forest near the town of Maules Creek that is operated by Maules Creek Coal Pty Ltd (MCC).
The mine was granted project approval on 23 October 2012 under the then Part 3A of the Environmental Planning and Assessment Act 1979 (NSW) (EPA Act). On 2 May 2013, the Environment Protection Authority (EPA) granted MCC's application by issuing Environment Protection Licence No 20221 (EPL) under s 55(1) of the Protection of the Environment Operations Act 1997 (NSW) (POEO Act).
Environment protection licences are required to be reviewed by the appropriate regulatory authority every five years under s 78 of the POEO Act. Section 78 sets two procedural requirements for undertaking the review of a licence. Subsection (1) requires the review to be "at intervals not exceeding 5 years after the issue of the licence". Subsection (2) requires the appropriate regulatory authority to give public notice of the licences that are to be reviewed in the manner and with the content specified in subsection (2).
Section 78 specifies the action that must be taken if the requirements for review of a licence are not complied with. Subsection (3) applies where the appropriate regulatory authority is the EPA. If the EPA fails to comply with the requirements of s 78 to review a licence, it is required to report that failure to the Board of the EPA and in the EPA's annual report, together with a statement of reasons for the failure. Subsection (4) applies where the appropriate regulatory authority is an authority other than the EPA. Where the other regulatory authority fails to comply with the requirements of s 78 to review a licence, it is required to report that failure to the EPA.
Subsection (4A) sets a separate requirement, other than the requirement in s 78(1) to review each licence, to "audit, on an industry wide or regional basis, compliance with licence requirements under this Act and whether such requirements reflect best practice in relation to the matters regulated by the licences".
Finally, s 78 contains a privative clause. Subsection (5) precludes the bringing of proceedings under the POEO Act for a failure to comply with the requirements of the section.
Two other provisions of the POEO Act regulate how the appropriate regulatory authority is to exercise the functions under s 78 to review each licence (under s 78(1)) and to audit compliance with licence requirements (under s 78(4A)). These are s 45 and s 83 of the POEO Act.
Section 45 sets the matters the appropriate regulatory authority "is required to take into consideration" in exercising its functions under Chapter 3 of the POEO Act, which deals with environment protection licences. These functions include the functions of review of licences and audit of compliance with licence requirements in s 78. Three of the matters in s 45 are of relevance in this case: "(c) the pollution caused or likely to be caused by the carrying out of the activity or work concerned and the likely impact of that pollution on the environment, (d) the practical measures that could be taken - (i) to prevent, control, abate or mitigate that pollution, and (ii) to protect the environment from harm as a result of that pollution, … (f) whether the person concerned is a fit and proper person".
Consideration of the third matter of whether a person is a fit and proper person to hold a licence is assisted by s 83. As s 83(1) explains, s 83 has effect in determining whether a person is a fit and proper person as referred to in s 45(f), but does not limit the generality of that section. As at the date of the licence review in June 2023, s 83(2) listed 17 matters the appropriate regulatory authority "may take into consideration" in determining whether a person is a fit and proper person.
Where the person is a corporation, four of the matters in s 83(2), in paragraphs (a), (b), (c) and (d), concerned the person's (or a related body corporate's) record of compliance with environment protection legislation, including any contravention of the environment protection legislation. The term "environment protection legislation" is defined in the Dictionary to the POEO Act to have the same meaning as in the Protection of the Environment Administration Act 1991 (NSW), which in s 3(1) defines "environment protection legislation" to include not only the POEO Act but also other legislation concerned with protection of the environment. Two of the matters in paragraphs (f) and (g) concerned whether the person or related body corporate "is of good repute, having regard to character, honesty and integrity."
In this case, the review of the EPL for the Maules Creek Coal mine, required by s 78(1) of the POEO Act, was due to be conducted by 2 May 2023. The EPL was first issued on 2 May 2013, so that the first five-year review was undertaken by 2 May 2018 and the second five-year review was due by 2 May 2023.
In accordance with s 78(2) of the POEO Act, the EPA gave public notice, on its website, in January 2023 outlining all of the licences to be reviewed in the first half of 2023. One of those licences was the EPL for the Maules Creek Coal mine.
The review of the EPL was undertaken on 2 June 2023 by an officer of the EPA, Mr O'Connell, who completed a "Licence Review Record" for his review. Mr O'Connell's review was approved by another officer of the EPA, Ms Scrivener, on 5 June 2023. The licence review was recorded as having been completed in the EPA's computer record system, Permit and Licence Management System (PALMS), on 5 June 2023.

[4]

The EPA's licence review is challenged

The Community Council is concerned that the EPA's review of the EPL for Maules Creek Coal mine failed to comply with the requirements of the POEO Act for review of licences. To this end, the Community Council brought proceedings under s 252 of the POEO Act seeking a declaration that the EPA exercised its function to review the EPL in breach of s 45 of the POEO Act and an order that the EPA re-exercise that function to review the EPL having regard to the matters required by s 45 of the POEO Act to be considered.
The Community Council raised three grounds of challenge, which correspond to the three matters in s 45 of the POEO Act that it claimed the EPA failed to consider. Grounds 1 and 2 claimed the EPA breached s 45(f) of the POEO Act by failing to take into consideration whether MCC was a fit and proper person under s 45(f) and s 83(2) of the POEO Act (the fit and proper person grounds). Ground 1 focused on the EPA's failure to take into consideration s 45(f) directly, while ground 2 focused on the EPA's failure to take s 45(f) into consideration by having regard to the matters in s 83(2)(a), (b), (c), (d), (f) and (g). The Community Council contended that the inference would be drawn that the EPA failed to consider the matter in s 45(f) by the lack of reference to that matter, or the matters in s 83(2), in the Licence Review Record.
Ground 3 claimed the EPA breached s 45(c) and (d) of the POEO Act by failing to consider the pollution caused or likely to be caused by the carrying out of the activities licensed by the EPL, and the likely impact of that pollution on the environment (paragraph (c)), and the practical measures that could be taken to prevent, control, abate or mitigate that pollution and to protect the environment from harm as a result of that pollution (paragraph (d)) (the pollution ground).
The Community Council claimed that the scheduled activities carried out at the Maules Creek Coal mine, including mining for coal, result in the emission of a number of air pollutants, being PM2.5, ozone, metals and metalloids, carbon monoxide, nitrous oxide, sulphur dioxide and greenhouse gas (GHG) emissions, particularly carbon dioxide and methane. The conditions of the EPL do not expressly regulate the pollution caused by the emission of these air pollutants. The Community Council contended that the EPA, as evidenced by the Licence Review Record, did not consider whether the EPL should be varied to address the pollution caused by the emission of these air pollutants, and thereby failed to consider the matters required to be considered by s 45(c) and (d) of the POEO Act.

[5]

The EPA's licence review is defended

The EPA entered a submitting appearance, notwithstanding that the proceedings under s 252 of the POEO Act claim that the EPA has breached the POEO Act in the exercise of its functions under the POEO Act to review the EPL. MCC was left to defend the EPA's licence review.
At the outset, MCC submitted that the Community Council is precluded from bringing the proceedings to challenge the lawfulness of the licence review by s 78(5) of the POEO Act. MCC submitted that the proceedings are brought "under this Act" as they are brought under s 252 of the POEO Act seeking orders to remedy or restrain a breach of the Act. Although the Community Council claims the breach is of s 45 of the POEO Act, MCC submitted the proceedings are ultimately in respect of a failure to exercise the function in s 78 to review the EPL for the Maules Creek Coal mine. That is a failure to comply with the requirements of s 78. Hence, MCC submitted, s 78(5) precludes this failure to comply with s 78 from being the subject of proceedings under s 252 of the POEO Act.
As to the fit and proper person grounds, MCC drew attention to the distinction in language between s 45 and s 83(2) of the POEO Act. Under s 45, the EPA "is required to take into consideration" the matters in s 45 while under s 83(2), the EPA "may take into consideration" the matters in s 83(2). The consequence, MCC submitted, is that any failure by the EPA to consider a permissible but not mandatory matter in s 83(2) will not be a jurisdictional error. That disposes of ground 2.
MCC submitted that an inference cannot be drawn that the EPA did not consider the matter in s 45(f) of whether MCC is a fit and proper person, whether by reference to the matters in s 83(2) or otherwise, from the Licence Review Record alone. The Licence Review Record is not a statement of reasons and is an incomplete record of what the EPA may have taken into consideration in reviewing the EPL. There was other material available to the EPA of the compliance history of MCC and its related bodies corporate. The EPA had taken compliance enforcement action against MCC and related bodies corporate in the past. The EPA had also varied the EPL many times before the licence review was completed. The EPA would be aware of this regulatory and compliance action.
As to the pollution ground, MCC submitted that an inference cannot be drawn from the absence of discussion in the Licence Review Record of the air pollutants identified by the Community Council or the failure to recommend variation of the conditions of the EPL to regulate those pollutants, that the EPA failed to consider the matters in s 45(c) and (d) of the POEO Act. There was evidence available to the EPA on the pollution caused or likely to be caused by the scheduled activities carried out at the mine and the practical measures to mitigate pollution. There were a number of explanations why the EPA, having considered that pollution and those measures, may have reasonably decided not to recommend variation of any of the existing conditions of the EPL to regulate those pollutants.

[6]

Whether the proceedings are precluded by s 78(5) of the POEO Act

I will start with MCC's challenge that the proceedings are precluded by s 78(5) of the POEO Act.
The Community Council, in the Amended Summons, pleads that the proceedings are commenced under s 252 of the POEO Act. Section 252(1) provides: "Any person may bring proceedings in the Land and Environment Court for an order to remedy or restrain a breach of this Act or the regulations."
This Court has jurisdiction to hear and dispose of proceedings under Part 8.4 of the POEO Act, in which s 252(1) is located: see s 20(1)(ci) of the Land and Environment Court Act 1979 (NSW) (Court Act). Section 252 operates to confer, first, jurisdiction on the Court with respect to proceedings for an order to remedy and restrain a breach of the Act and, secondly, standing on any person to bring such proceedings in the Court.
Dealing with jurisdiction, the subject matter of proceedings under s 252 of the POEO Act concerns "a breach of this Act or the regulations". A "breach" includes a threatened or apprehended breach: see s 252(8) of the POEO Act. The proceedings are "for an order to remedy or restrain" a breach of the POEO Act or the regulations (s 252(1)).
The Court's adjudicative task is, first, to determine if a breach has been or will be committed and, secondly, if so, to "make such orders as it thinks fit to remedy or restrain the breach": see s 252(6) of the POEO Act. This provision affords the Court a wide discretion in formulating what order, if any, should be made to remedy or restrain any breach of the POEO Act. The orders the Court may make extend beyond "the mere determination of the rights and matters in dispute between the immediate parties": F Hannan Pty Ltd v Electricity Commission of NSW (No 3) (1985) 66 LGRA 306 at 313. But the touchstone for any order under s 252 of the POEO Act remains what will remedy or restrain the established breach of the POEO Act.
This necessity for the order to remedy or restrain a breach of the POEO Act can limit the orders the Court has power to make under s 252(1). Consider a declaratory order. The Court has power under s 252(1) of the POEO Act to declare that a decision made under the POEO Act is in breach of the POEO Act, but it might not have power under s 252(1) to declare a decision to be invalid or void: F Hannan Pty Ltd v Electricity Commission of NSW (No 3) at 327. The Court would, however, have power to declare a decision invalid or void under s 20(2)(c) of the Court Act, but this involves exercising the supervisory jurisdiction that the Supreme Court formerly had, but for s 20(2)(c) and s 71 of the Court Act which vested that jurisdiction exclusively in the Court, to judicially review a decision for jurisdictional error. The Court declares a decision involving jurisdictional error to be invalid or void as such a decision lacks legal foundation and is properly to be regarded, in law, as no decision at all: Minister for Immigration and Multicultural Affairs v Bhardwaj (2002) 209 CLR 597; [2002] HCA 11 at [51]; Hossain v Minister for Immigration and Border Protection (2018) 264 CLR 123; [2018] HCA 34 at [24].
Dealing with standing, s 252(1) allows "any person" to bring proceedings under s 252 for an order to remedy or restrain a breach of the POEO Act or the regulations. A statutory provision in the terms of s 252(1) has been described as conferring "open standing". As s 252(3) makes clear, proceedings under s 252(1) "may be brought whether or not any right of the person has been or may be infringed by or as a consequence of the breach". An open standing provision removes the restrictions on standing imposed by the common law: see Sydney City Council v Building Owners and Managers Association of Australia Ltd (1985) 2 NSWLR 383 at 387 commenting on the equivalent provision in the EPA Act (the former s 123, now s 9.45). That provision in the EPA Act has been described as granting "virtually unlimited status to any person to bring proceedings in the court for an order to restrain or remedy a breach of the Act": F Hannan Pty Ltd v Electricity Commission of New South Wales (No 3) at 310-311. Later in the same decision, Street CJ observed at 313: "Section 123 totally removes the conventional requirement that relief is normally only granted at the wish of a person having a sufficient interest in the matters sought to be litigated. It is open to any person to bring proceedings to remedy or restrain a breach of the Act. There could hardly be a clearer indication of the width of the adjudicative responsibility of the Court."
It is in this context of the jurisdiction and standing afforded by s 252 of the POEO Act that the privative clause in s 78(5) of the POEO Act needs to be construed. The phrase "proceedings under this Act" refers to proceedings brought under s 252(1) of the POEO Act. The matter that "cannot be the subject of proceedings under this Act" is limited to "any failure to comply with the requirements of this section." The phrase "any failure to comply with" is synonymous with "a breach of." Thus, subsection (5) precludes a breach of the requirements of s 78 being the subject of proceedings under s 252(1) of the POEO Act.
This brings me to the central issue in dispute between the parties - the ambit of the phrase "the requirements of this section" in s 78(5) of the POEO Act. The Community Council contended that this phrase only refers to the requirements expressly stated in each of the subsections of s 78 and not the requirements of other sections of the POEO Act, including s 45 and s 83, that might regulate how the functions under s 78 are to be exercised. MCC contended that insofar as s 45 regulates how the functions under s 78 are required to be exercised, that provision is a requirement of s 78. Hence, a failure to comply with s 45 is a failure to comply with the requirements of s 78.
I find that the phrase "the requirements of this section" in s 78(5) only refers to the requirements expressly stated in subsections (1) to (4A) of s 78. These are: 1. the requirement in subsection (1) to review each licence at intervals not exceeding 5 years after the issue of the licence; 2. the requirement in subsection (2) to give public notice of the licences that are to be reviewed in the manner and with the content specified in the subsection; 3. the requirement in subsection (3) to report any failure by the EPA to comply with the requirements of s 78 to review a licence (in s 78(1)) to the Board of the EPA and in the annual report, together with a statement of reasons for the failure; 4. the requirement in subsection (4) for a regulatory authority other than the EPA to report a failure to comply with the requirements of s 78 to review a licence (in s 78(1)) to the EPA; and 5. the requirement in subsection (4A) for the EPA to audit, on an industry wide or regional basis, compliance with licence requirements under the POEO Act and whether such requirements reflect best practice in relation to the matters regulated by the licences.
The phrase "the requirements of this section" in s 78(5) is wider than the phrase "the requirements of this section to review a licence" in s 78(3) and (4), as the former phrase is intended to catch all of the requirements in subsections (1) to (4A), while the latter phrase refers only to the requirement in subsection (1) to review a licence. The former phrase also refers to both the requirements in subsections (1) to (4) concerning review of licences as well as the requirements in subsection (4A) concerning audit of compliance with licence requirements.
The phrase "requirements of this section" in s 78(5) does not include the requirements of any other section of Chapter 3 of the POEO Act, including s 45. Section 45 does require the appropriate regulatory authority to take into consideration such of the matters as are of relevance in exercising its functions under Chapter 3. Two of the functions under Chapter 3 are the review of licences and the audit of compliance with licence requirements under s 78. But the source of the requirement to consider the matters in s 45 in the exercise of those functions under s 78 remains s 45, not the provisions of s 78 under which the functions are exercised. A failure to comply with the requirement in s 45 to consider the matters listed in s 45 in the exercise of functions under s 78 is a breach of s 45, not of the provisions under which the functions were exercised.
As a consequence, s 78(5) does not operate to preclude the bringing of proceedings under s 252 of the POEO Act for an order to remedy or restrain a breach of s 45 of the POEO Act; it only operates to preclude such proceedings for an order to remedy or restrain a breach of the requirements of s 78 itself.
This conclusion makes it unnecessary to decide the Community Council's alternative submissions that: first, the proceedings are brought pursuant to not only s 252 of the POEO Act to remedy or restrain a breach of the POEO Act but also s 20(2) of the Court Act to review the decision to review the licence for jurisdictional error, with the consequence that s 78(5) of the POEO Act does not operate to preclude the proceedings under s 20(2) of the Court Act to review for jurisdictional error; second, the privative clause in s 78(5) of the POEO Act is ineffective to prevent review for jurisdictional error, applying R v Hickman; ex parte Fox and Clinton (1945) 70 CLR 598; [1945] HCA 53; and third, the privative clause in s 78(5) of the POEO Act is to be read down to avoid constitutional invalidity, applying Kirk v Industrial Court (NSW) (2010) 239 CLR 531; [2010] HCA 1 (Kirk). As the third of these arguments arguably raised a constitutional issue, notices under s 78B of the Judiciary Act 1903 (Cth) were served. The Attorney General for New South Wales intervened in support of MCC's position that the principle in Kirk does not require s 78(5) of the POEO Act to be read down so as not to preclude the applicant from bringing the proceedings under s 252 of the POEO Act.
The conclusion that s 78(5) of the POEO Act does not operate to preclude the Community Council bringing proceedings under s 252 of the POEO Act for an order to remedy or restrain a breach of s 45 of the POEO Act makes it unnecessary to decide these alternative ways in which the Community Council contended the Court has jurisdiction to determine the proceedings.

[7]

The Community Council's arguments on the fit and proper person grounds

Grounds 1 and 2 contended that the EPA breached s 45 of the POEO Act by failing to take into consideration whether MCC was a fit and proper person as required by s 45(f) of the POEO Act. Ground 1 was that the EPA failed to take into consideration the matter in s 45(f) at all, while ground 2 was that the EPA failed to take s 45(f) into consideration by having regard to the matters in s 83(2) of the POEO Act.
Although the Community Council contended in argument at the hearing that the EPA was obliged to take into consideration the matters of relevance in s 83(2) of the POEO Act, notwithstanding the use of the word "may" in s 83(2), this argument strayed from the terms of ground 2. The breach of the POEO Act that ground 2 pleaded was of s 45, not s 83(2). Indeed, the Community Council did not plead in any ground that the EPA breached s 83(2) of the EPA Act. The Community Council's reliance on s 83(2) was merely a means to an end, not an end in itself. The Community Council sought to establish that the EPA failed to consider the matter in s 45(f) of the POEO Act by the EPA not having regard to the matters in s 83(2) of the POEO Act which assist in determining whether MCC is a fit and proper person.
The Community Council's argument on grounds 1 and 2 was that the Court should draw the inference that the EPA did not consider whether MCC was a fit and proper person from the lack of reference to and discussion of that matter in the Licence Review Record, by reference to s 45(f) and s 83(2) of the POEO Act. The reviewing officer, Mr O'Connell, completed the Licence Review Record form when he undertook the review of the EPL on 2 June 2023. Part 1 of the form, in the first column entitled "Question", asked nine questions, the ninth of which (question I) concerned s 45 of the POEO Act. The form raised the question "Has section 45 of the POEO Act been considered, as appropriate?" In the middle column next to that question, entitled "Action required", the form instructed the reviewing officer to "Take into account the considerations listed in section 45 of the POEO Act when conducting the licence review…." Each of the matters in (a) to (f1) inclusive of s 45 were then stated, including "(f) whether the person is a fit and proper person (section 83)." In the third column entitled "Findings/comments", the reviewing officer, Mr O'Connell, entered the following comment: "Yes. Conditions on the license [sic] address Section 45 considerations."
The only other entry of Mr O'Connell in the Licence Review Record, which the Community Council said might be relevant to whether MCC is a fit and proper person, is the comment in answer to question H, "Have submissions and any issues outstanding from other EPA actions been considered?" The "Action required" with respect to this question was printed on the form as: "Check CM9 for any public/licensee submissions and review. Annex, as an appendix to this document, any further reasoning or consideration of such submissions where necessary. Check whether outstanding matters from previous reviews, Compliance Audit, prosecutions, penalty notices or complaints should be actioned."
In response to this question and action required, Mr O'Connell entered the following comment: "Blast fume incident currently before the Land and Environment Court." That was a reference to a prosecution the EPA had brought against MCC in this Court.
The Community Council submitted that neither comment in answer to questions H or I revealed that Mr O'Connell took into consideration the matter in s 45(f) of whether MCC is a fit and proper person or the matters in s 83(2) in determining whether MCC is a fit and proper person.
The answer to question I that "Conditions on the license address Section 45 considerations" does not reveal consideration of s 45(f) of whether MCC is a fit and proper person as there are no conditions of the EPL of relevance to the matter in s 45(f). Indeed, the Community Council submitted, that matter could not be the subject of a condition of the licence because it goes to whether MCC is a fit and proper person to hold the licence in the first place.
The answer to question H selects only one incident of non-compliance with the environment protection legislation, the "Blast fume incident currently before the Land and Environment Court", highlighting Mr O'Connell's lack of consideration of the large number of other incidents of MCC's or related bodies corporate's non-compliance with the environment protection legislation, which are of relevance to answering the fit and proper person question. The Community Council referenced the other incidents of MCC's non-compliance with the environment protection legislation set out in paragraphs 33-47 of the Statement of Agreed Facts and the incidents of non-compliance with the environment protection legislation by related bodies corporate (both holding companies and subsidiary companies) set out in paragraphs 48-68 of the Statement of Agreed Facts.
The incidents of MCC's non-compliance include prosecutions for environmental offences, penalty notices, prevention notices, clean-up notices, official cautions and enforceable undertakings. The incidents of non-compliance by related bodies corporate include prosecutions for environmental offences, penalty notices, clean-up notices and a pollution reduction program.
The Community Council submitted that none of these incidents of non-compliance by MCC or related bodies corporate were recorded by Mr O'Connell in the Licence Review Record. The Community Council submitted that each of these incidents constituted a "salient fact" for the purposes of the fit and proper person test in s 45(f) of the POEO Act. The Community Council cited Brennan J's statement in Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24 at 61; [1986] HCA 40, referenced by the Full Federal Court in Bat Advocacy NSW Inc v Minister for Environment Protection, Heritage and the Arts (2011) 180 LGERA 99; [2011] FCAFC 59 at [45], that: "The facts to be brought to mind are the salient facts which give shape and substance to the matter: the facts of such importance that, if they are not considered, it could not be said that the matter has been properly considered."
The Community Council submitted that there is no evidence that Mr O'Connell considered these salient facts of the incidents of MCC's and related bodies corporate's non-compliance with the environment protection legislation for the purpose of addressing the fit and proper person test. Indeed, Mr O'Connell's lack of reference to these incidents in the Licence Review Record justifies the Court drawing the inference that Mr O'Connell did not consider the incidents, citing IOF Custodian Pty Limited atf the 105 Miller Street North Sydney Trust v Special Minister of State [2022] NSWLEC 86 at [70] and see also Parramatta City Council v Hale (1982) 47 LGRA 319 at 345 and Bat Advocacy NSW Inc v Minister for Environment Protection, Heritage and the Arts at [44], [46], [47].

[8]

MCC's arguments on the fit and proper person grounds

MCC contested that the Court should draw the inference that the EPA failed to consider the matter in s 45(f) of whether MCC is a fit and proper person, for three reasons.
First, MCC submitted this is not a case where the administrative decision-maker was required to, and did, give reasons for the decision made. In such a case, if a decision-maker who gives reasons for a decision makes no reference to a relevant matter the decision-maker was required to consider, an inference may be drawn that the decision-maker did not consider the matter: see Bat Advocacy NSW Inc v Minister for Environment Protection, Heritage and the Arts at [47]; Lo v Chief Commissioner of State Revenue (2013) 85 NSWLR 86; [2013] NSWCA 180 at [10] and IOF Custodian Pty Limited atf the 105 Miller Street North Sydney Trust v Special Minister of State at [70].
Rather, this is a case where the administrative decision-maker was not statutorily required to, and did not purport to, give a statement of reasons for the decision that was made. In such a case, as noted in Plaintiff M64/2015 v Minister for Immigration and Border Protection (2015) 258 CLR 173; [2015] HCA 50 at [25]: "It is well settled that in the context of administrative decision-making, the court is not astute to discern error in a statement by an administrative officer which was not, and was not intended to be, a statement of reasons for a decision that is a broad administrative evaluation rather than a judicial decision. It is possible that error of law on the part of the Delegate might be demonstrated by inference from what the Delegate said by way of explanation of his decision; but it must be borne in mind that the Delegate was not duty-bound to give reasons for his decision, and so it is difficult to draw an inference that the decision has been attended by an error of law from what has not been said by the Delegate."
In the present case, the Licence Review Record was not statutorily required to be, and did not purport to be, a statement of reasons of the reviewing officer for his review of the EPL. Section 78 of the POEO Act does not require the EPA or other regulatory authority to give reasons for any review of a licence it undertakes. This stands in contrast to the statutory requirement to give reasons for the grant or refusal of a licence application: see s 55(2)(b) and s 61 of the POEO Act.
Indeed, the Licence Review Record has no statutory basis, not being required by s 78 or any other section of the POEO Act. Instead, the Licence Review Record is completed as part of a regulatory procedure that the EPA has adopted to guide reviewing officers undertaking licence reviews. The Licence Review Record is a form created by the EPA Regulatory Procedure: Undertaking Licence Reviews (excluding Waste Transport Licences) (RP-04) (the Regulatory Procedure). The Regulatory Procedure states that it is to be read in conjunction with the 'Licence Review Record', which is available to be downloaded (paragraph 6.2). The Regulatory Procedure instructs the reviewing officer to "save a copy of the 'Licence Review Record' and use it to record the relevant findings of the licence review." The footer to the Licence Review Record form describes it as a "Checklist": "Regulatory Procedure RP-04 | Undertaking Licence Reviews - Checklist."
Parts 1 to 3, which contain sections A to M, of the Licence Review Record align with the same parts and sections in the Regulatory Procedure (note to s 6.2). Of relevance to consideration of the matter in s 45(f) of the POEO Act are Part 1 - Licence Review, including sections H and I, and Part 2 - Outcomes, including section J, in both the Licence Review Record and the Regulatory Procedure.
Section H in Part 1 concerns "submissions, information and recent EPA actions". Paragraph 6.26 in section H of the Regulatory Procedure states: "Consider how any recent EPA compliance action informs the licence review by checking information from any compliance audit, prosecution, penalty notice, or other compliance action. Check also that there are no outstanding actions from the previous licence review, if a review has previously occurred."
Section H in the Licence Review Record asks the question: "Have submissions and any issues outstanding from other EPA actions been considered?" Amongst other action required, section H instructs the reviewing officer to "Check whether outstanding matters from previous reviews, Compliance Audit, prosecutions, penalty notices or complaints should be actioned."
Section I in Part 1 concerns the s 45 considerations. Paragraph 6.27 of the Regulatory Procedure states: "When undertaking licensing functions such as a licence review, the EPA must take into consideration the matters provided in section 45 of the POEO Act. To satisfy this requirement, complete section "I" of the 'Licence Review Record', which lists the section 45 considerations relevant to a licence review."
Section 1 of the Licence Review Record asks the question "Has section 45 of the POEO Act been considered, as appropriate?" The action required is to "Take into account the considerations listed in section 45 of the POEO Act when conducting the licence review", including "(f) whether the person is a fit and proper person (section 83)."
Part 2 concerns the outcomes of the licence review. Section J Licence Review provides three boxes of recommendations for the reviewer to check: first, "Variation to licence required"; second, "Variation to licence not required"; and third, "Other". An open text field is provided in the third column for "comments".
This integral relationship between the Regulatory Procedure and the Licence Review Record is confirmed in the instructions in the Licence Review Record of how to use the form: "1. This form must be completed for all licence reviews except licences for the transportation of trackable waste to summarise your licence review findings and related decision-making. 2. Read regulatory procedure 'RP04 Undertaking Licence Reviews' for details on how to conduct a licence review."
The instructions in the Licence Review Record further required (in paragraph 3) the reviewing officer to "complete all parts of this form as follows", one of which was "Part 1 - Licence Review: answer all questions (A-I)". As previously noted, the table in Part 1 with questions H and I have a third column entitled "Findings/comments". This is the part of the form in which the reviewing officer answers the questions.
The result is, MCC submitted, that the reviewing officer's comments in the third column of the Licence Review Record form are simply answers to the questions which the form asked. They are not reasons for the decision the reviewing officer made.
The comment in section H, referring to the "Blast fume incident currently before the Land and Environment Court", is responsive to both the question and the action required regarding issues outstanding from other EPA actions, including prosecutions. The reviewing officer was recording that the blast fume incident was an outstanding matter. That comment did not reveal that the reviewing officer only considered that incident of non-compliance with the environment protection legislation; rather, the comment was that of the "previous reviews, Compliance Audit, prosecutions, penalty notices or complaints", this was the only matter outstanding.
The comment in section I, "Yes. Conditions on the license address Section 45 considerations", is similarly responsive to both the question and the action required. The first statement "Yes" is responsive to the question, "Has section 45 of the POEO Act been considered, as appropriate?". The second statement that licence conditions address the s 45 considerations, not only is responsive to that question, noting that the consideration is to be "as appropriate", but also explains one way in which the s 45 considerations were taken into account in accordance with the action required. That is to say, one way in which the reviewing officer took into account the s 45 considerations was by assessing whether the licence conditions address the s 45 considerations as appropriate. The reviewing officer's statement that the licence conditions did address the s 45 considerations was not a statement of reasons recording the reviewing officer's full consideration of the s 45 considerations in reviewing the licence, only a comment that the reviewing officer assessed the licence conditions as addressing the s 45 considerations as appropriate.
The comment in section J, in Part 2 - Outcomes, that "No variation required" was responsive to the reviewing officer checking the recommendation box that "Variation to licence not required".
In these circumstances, MCC submitted the Court would not draw the inference that the EPA failed to consider the mandatory matter in s 45(f) of the POEO Act, or the permissible matters in s 83(2) of the POEO Act, from the answers given and the comments made by the reviewing officer in the Licence Review Record.
Secondly, MCC submitted the Court, in drawing any inference regarding the EPA's consideration of the matter in s 45(f) of the POEO Act, would look to all of the material available to the EPA in undertaking the review of the EPL.
The material before the reviewing officer clearly included the Regulatory Procedure. The Licence Review Record, which the reviewing officer downloaded and completed, instructed the reviewing officer to read the Regulatory Procedure. Section 1 of the Regulatory Procedure, which articulates its purpose, instructs the reviewing officer on "how to undertake a licence review effectively and lawfully", including the instruction that: "When conducting a licence review, the EPA is required to take into consideration the matters prescribed under section 45 of the POEO Act that are relevant to that licence."
Section 6 of the Regulatory Procedure instructs the reviewing officer how to conduct the licence review required by Part 1. Listed under the headings of "essential information" and "licence review requirements under the POEO Act" are s 78 and s 45 of the POEO Act, both of which are hyperlinked to the legislative provision. The reference to s 45 states that the section "sets out matters to be taken into consideration in licensing functions."
In paragraph 6.3, within section 6 directing the procedures to be followed in conducting the licence review in Part 1, the reviewing officer is instructed to familiarise themselves with the licence being reviewed. Paragraph 6.3 states: "You must ensure that you are familiar with the licence which is the subject of that review. Use the information and records in CM9, PALMS (including the licence information form and communications tab), and CIRAM/EPIC to familiarise yourself with the licence details and history and scheduled activities. Note: If the EPA has not attended the Licensed Premises for more than 6 months and a licence review is due, an inspection is strongly recommended."
The acronyms are defined in section 4 Definitions of the Regulatory Procedure. "CM9" is the "Content Manager 9: CM9 is the EPA's record keeping system". "PALMS" is the "Permit and Licence Management System". "CIRAM/EPIC" are separately defined. "CIRAM" is "Compliance, Incident Reporting and Management: CIRAM was the EPA's case management system prior to the introduction of EPIC in March 2021." "EPIC" is "Environment Protection Incidents and Cases: EPIC is the EPA's end-to-end case management system. It replaced CIRAM (the previous case management system) in March 2021."
MCC submitted that all of the incidents of non-compliance with the environment protection legislation by MCC and its related bodies corporate that are identified in the Statement of Agreed Facts, and relied upon by the Community Council, were recorded in these record keeping and case management systems. MCC referred to the printout of EPA's Public Register for MCC's EPL, which was in evidence. That licence summary listed all of the enforcement notices the EPA had issued, including penalty notices, clean up notices and prevention notices; the mandatory environmental audit; and the pollution studies and reduction programs. MCC submitted that the Court would infer that the EPA's internal record keeping and case management systems would contain the same information as that on the EPA's Public Register. This information coincides with the incidents of non-compliance with the environmental protection legislation by MCC identified in the Statement of Agreed Facts. The Community Council did not contest this submission.
The note to paragraph 6.3 recommends the reviewing officer inspect the licensed premises if the EPA has not attended the premises for more than six months and a licence review is due. Mr O'Connell, the reviewing officer undertaking the review of the EPL, followed this recommendation and undertook an inspection of MCC's premises on 17 May 2023. Mr O'Connell recorded his inspection in the comments in the third column in sections B and E of the Licence Review Record.
Section H of the Regulatory Procedure instructs the reviewing officer to consider EPA compliance action. Paragraph 6.26 directs the reviewing officer to check "information from any compliance audit, prosecution, penalty notice, or other compliance action." MCC submitted that this is done by checking the record keeping and case management systems earlier referred to (CM9, PALMS and CIRAM/EPIC).
Section I of the Regulatory Procedure instructs the reviewing officer, when undertaking the licence review, to take into consideration the matters in s 45 of the POEO Act (paragraph 6.27).
Part 2 of the Regulatory Procedure concerns the outcomes of the licence review. Section J instructs the reviewing officer to make a recommendation. The three options are printed on the Licence Review Record form as boxes to check: recommend whether or not a licence variation is required or make some other recommendation. The reviewing officer is directed to check one of these three boxes.
MCC submitted that in the case of the matter in s 45(f) of the POEO Act, if the reviewing officer found the holder of the licence not to be a fit and proper person, no variation of the conditions of the licence would be appropriate, but instead revocation of the licence under Part 3.7 of the POEO Act would be appropriate. In that event, the reviewing officer would check the "Other" box and add a comment that revocation of the licence was recommended. MCC submitted that the fact that Mr O'Connell, the reviewing officer for the EPL, did not check the "Other" box, but instead checked the "Variation to licence not required" box, evidences that he did not consider revocation of the EPL was appropriate.
MCC submitted that the material available to the reviewing officer in reviewing the EPL also included two documents concerning the EPA's risk-based licensing system. The first document, published on the EPA's website, concerns the EPA's risk assessment process. The document explains that: "Risk assessments are undertaken by EPA officers in consultation with licensees. A risk assessment tool developed by the EPA is used to evaluate the impacts associated with a licensed premises and the likelihood of environmental harm occurring. The risk assessment process is an opportunity for licence holders and EPA officers to discuss the environmental performance of individual premises and how improvements to operations can be put in place if needed. The process considers the following components 1. the day-to-day operations at the site, including the type (air - including odour, water and noise emissions) and nature of emissions from the premises 2. the risk of a pollution incident, by examining the pollution-control measures in place at the premises, and its proximity to sensitive environments and receptors (as well as their level of sensitivity) 3. the environmental management performance of the licensee".
The document explains the third component, the environmental management category: "The third component of the assessment examines the environmental management performance of a licensee at the licensed premises and results in the allocation of an environmental management category, which takes into account a licensee's compliance history and regulatory actions undertaken by the EPA in response to any incidents and non-compliances the management systems and practices a licensee has in place to control and mitigate environmental risks environment improvement programs initiated by the licensee."
These three components of the risk assessments are used to determine the overall environmental risk associated with the licensed activity, from Level 1 to Level 3, with Level 3 being the highest risk level. The environmental risk level for each licence is made available on the EPA's Public Register. The licence summary for MCC's EPL on the EPA's Public Register states the current environmental risk level to be Level 3, the highest risk level.
The risk assessment process document explains how the EPA uses the environmental risk level: "The risk assessments assist the EPA to focus its regulatory activities on high risk licensees. Licensees with a higher risk level receive an increased level of regulatory and compliance oversight, whereas licensees with a lower risk level benefit from reduced red tape and a reduced regulatory burden. A higher risk level may result in more intensive monitoring and reporting obligations on the licence."
MCC submitted that as its licensed scheduled activities have been determined to be Level 3, it is subject to an increased level of regulatory and compliance oversight at all times, and not just at the time of the review of its licence under s 78 of the POEO Act.
The second document is the EPA's Risk-based Licensing Regulatory actions guideline (the Regulatory actions guideline). The guideline explains its purpose: "This guideline has been developed to assist the general public and licensees to understand the factors that the EPA considers when undertaking licensing functions under the Protection of the Environment Operations Act 1997 (POEO Act). In particular, this guideline outlines general considerations in response to environmental issues or non-compliance with licence conditions at licensed premises."
MCC submitted that the Regulatory actions guideline may have guided the EPA in deciding on the most appropriate regulatory action in response to the various environmental issues and non-compliances with licence conditions that have occurred at the Maules Creek Coal mine in the past. The EPA has taken enforcement action against MCC and varied the EPL on a number of occasions.
The Regulatory actions guideline states that EPA officers should consider "a range of factors when deciding the most appropriate regulatory action in response to an environmental issue at a licensed premises." First, EPA officers should consider relevant provisions in the POEO Act and regulations and EPA policy and guidelines as relevant to the environmental issue. These include "Chapter 3 of the POEO Act, in particular section 45 - matters to be taken into account when exercising licensing functions." Second, EPA officers should consider "the potential or actual environmental harm caused by the environmental issue or non-compliance." Third, EPA officers should consider the licensee's compliance history: "In exercising licensing functions under the POEO Act the EPA must consider a number of matters as set out in section 45 of the POEO Act. These include considering whether a licensee is a 'fit and proper person', as referred to in section 83 of the POEO Act. The factors the EPA may consider include: ● the licensee's record of compliance with environmental legislation ● the licensee's record of compliance with their licence conditions ● the licensee's cooperation with the EPA and willingness to commit to appropriate remedial actions ● any voluntary actions undertaken to address the environmental issue."
Fourth, EPA officers should consider "a range of factors regarding the best practicable measures available to reduce the environmental impact posed by the activity." Fifth, EPA officers, in deciding what regulatory action should be taken, should consider the most appropriate alternative or complementary actions. The list of regulatory actions includes prosecutions, penalty notices, clean-up notices and prevention notices, all being actions the EPA has taken against MCC, as well as suspension of a licence.
MCC submitted that the Court would infer that the reviewing officer, in undertaking the review of the EPL, would have considered, first, the EPA's risk assessment process document and the EPA's determination that the overall environmental risk associated with MCC's licensed activities is Level 3 and, secondly, the Regulatory actions guideline in determining what regulatory action, if any, should be taken as a result of the licence review. Consideration of these documents would have involved the reviewing officer considering MCC's record of compliance with the licence and environment protection legislation, as both documents require that consideration. This consideration would have informed the reviewing officer's consideration of whether MCC is a fit and proper person as referred to in s 45(f) and s 83(2) of the POEO Act.
Thirdly, MCC submitted the Court, in determining what inference should be drawn concerning the EPA's consideration of the matter in s 45(f) of whether MCC is a fit and proper person, would have regard to the degree of regulatory and compliance oversight the EPA has exercised over MCC and its licensed activities, and all of the occasions on which the EPA has had the opportunity to consider MCC's record of compliance with the licence and the environment protection legislation and the appropriateness of the licence conditions in light of that record.
As earlier noted, the EPA has taken enforcement action for MCC's compliance with the licence on many occasions. The EPA issued two penalty notices on 8 February 2017 and 22 May 2017; two clean up notices on 21 February 2020 and 9 April 2020 and a variation of clean up notice on 22 May 2020; and one prevention notice on 23 November 2021, nine variations of the prevention notice on 8 December 2021, 22 December 2021, 1 April 2022, 19 April 2022, 9 May 2022, 2 June 2022, 16 August 2022, 19 August 2022 and 25 October 2022, and one revocation of the prevention notice on 20 December 2022. The EPA issued MCC with an official caution concerning burial of waste tyres at the mine site.
The EPA and other regulatory authorities have also taken enforcement action against MCC for non-compliance with the environment protection legislation. MCC was prosecuted and convicted for three offences against s 120(1) of the POEO Act and an offence against s 60A(2) of the Water Management Act 2000 (NSW); issued with two penalty notices for offences of failing to comply with the development consent granted under the EPA Act; and entered into enforceable undertakings in relation to an alleged contravention of the Water Management Act and the Work Health and Safety Act 2011 (NSW).
The reviewing officer was directed by the Regulatory Procedure, in undertaking the licence review, to have regard to this history of enforcement action against MCC that is maintained in the EPA's record-keeping and case management systems.
MCC submitted that the EPA has reviewed on many occasions the appropriateness of the licence conditions in light of MCC's record of non-compliance, resulting in the EPA varying the EPL under s 58(1) of the POEO Act. The EPA may vary a licence on application by the holder of the licence or its own initiative (s 58(3)) at any time during the currency of the licence (s 58(4)). In the period between the licence review under s 78 that was due on 2 May 2018 and the licence review under s 78 that was completed on 5 June 2023, which is the subject of challenge, the EPA had made six variations of the licence (on 27 November 2019, 2 March 2022, 30 March 2022, 2 August 2022, 13 February 2023 and 2 June 2023). Five of these six variations were within a year and a half of the licence review in 2023. The licence variation on 2 June 2023 was contemporaneous with the reviewing officer's review of the EPL on 2 June 2023. The reviewing officer, in familiarising himself with the licence as required by Regulatory Procedure, would have had knowledge of these licence variations.
The reviewing officer, Mr O'Connell, undertook an inspection of MCC's licensed premises on 17 May 2023 as part of the review of the EPL, as recommended by the Regulatory Procedure. Mr O'Connell's inspection of the Maules Creek Coal mine lasted 3.5 hours. He inspected the three scheduled activities carried out on the premises. Mr O'Connell's inspection report is 7 pages and includes photographs. The inspection informed Mr O'Connell's answers and comments in sections A to I in Part 1 of the Licence Review Record. The matters discussed by Mr O'Connell with MCC's representatives at the inspection and in the inspection report he completed included MCC's compliance with licence conditions. The inspection report concluded with Mr O'Connell's recommendation of the "follow up and further action required."
In these circumstances, MCC submitted that the EPA's licence review under s 78 of the POEO Act should not be viewed as having been undertaken in a vacuum; rather, it took place in the context of a high degree of regulatory and compliance oversight and licence variation before the licence review was completed. MCC submitted that the Court should infer that the reviewing officer was aware of the enforcement action the EPA had taken and the variations of the licence, as the Regulatory Procedure, risk assessment process document and Regulatory actions guideline required the reviewing officer to be familiar with the licence which is the subject of the review and the licensee's compliance history.

[9]

Fit and proper person grounds not established

I find that the Community Council has not established that the EPA failed to take into consideration the matter in s 45(f) of the POEO Act of whether MCC is a fit and proper person in exercising its function under s 78(1) to review the EPL for the Maules Creek Coal mine. To establish that an administrative decision-maker has failed to consider a matter the decision-maker was obliged to consider is to establish a negative fact - that the decision-maker did not do something. In the absence of an admission by the decision-maker that the matter was not considered, establishing a negative fact requires drawing an inference from other positive proven facts: Caswell v Powell Duffryn Associated Collieries Ltd [1940] AC 152 at 169-170; Seltsam Pty Ltd v McGuiness (2000) 49 NSWLR 262; [2000] NSWCA 29 at [84]-[91]. The Community Council's argument for drawing the inference that the matter in s 45(f) was not considered was founded on the few facts stated by the reviewing officer in the Licence Review Record. But those facts are insufficient to draw that inference, for the three reasons MCC advanced.
First, the inference that the EPA failed to consider whether MCC is a fit and proper person is not the only reasonable inference that can be drawn from what is and is not stated in the Licence Review Record. The Licence Review Record was neither intended nor required to be a statement of reasons. The Licence Review Record form was a checklist to guide the reviewing officer's review of the licence. The form had printed questions and action required, which the reviewing officer would consider in undertaking the licence review. To the extent that the form asked for comments, they were to be responsive to the questions or action required in the form; the inclusion of any comments did not involve the provision of a statement of reasons. Accordingly, an inference about the reviewing officer's consideration of any particular matter in s 45 cannot necessarily be drawn from what the reviewing officer did or did not say in the succinct comments entered on the form.
Secondly, any inference to be drawn as to the EPA's consideration of whether MCC is a fit and proper person must have regard to all of the material before the reviewing officer. There was some debate about what material was before the EPA. The Community Council's solicitor had issued a notice to produce to the EPA seeking production of a wide category of documents "that informed or discussed the review" of the EPL. This notice was challenged by the EPA but, as a compromise, the EPA agreed to produce documents in a more limited category of documents "that were before the decision-maker(s) for the purposes of the review" of the EPL. The Community Council's solicitor agreed to this limitation and issued a second notice to produce in those terms. The EPA produced three documents in response: the inspection report concerning the inspection undertaken on 17 May 2023; the EPL, licence version dated 2 June 2023; and the Licence Review Record.
Notwithstanding this limited production of documents by the EPA, it is reasonable to infer that the EPA had regard, in undertaking the review of the EPL, to many other documents and information. As MCC has submitted, it is reasonable to infer that the reviewing officer, in undertaking the review of the EPL, had regard, as he was required to do, to the Regulatory Procedure, the risk assessment process document, the Regulatory actions guideline, the EPA's record-keeping and case management systems, which include MCC's compliance history and the EPA's enforcement action against MCC, and the licence itself and its many variations. Consideration of all of that material necessarily involved consideration of the matter in s 45(f) and the matters of relevance in s 83(2) of the POEO Act of whether MCC is a fit and proper person.
Thirdly, the EPA's review of the EPL under s 78 of the POEO Act was undertaken in the context of the EPA's heightened regulatory and compliance oversight of MCC and its licensed activities. The EPA has continued to take enforcement action against MCC, including issuing penalty notices, clean up notices and prevention notices, for MCC's non-compliance with the licence and the environment protection legislation. The appropriateness of the conditions of the licence has been reviewed by the EPA on many occasions, leading to variations of the licence, including five variations in the year and a half before the licence review was completed, one of which was contemporaneous with the licence review. The reviewing officer undertook an inspection of the licensed premises as part of his licence review. It is reasonable to infer that the reviewing officer was aware of, and had regard to, this regulatory and compliance oversight and enforcement action in undertaking the licence review.
Collectively, consideration of the Regulatory Procedure, risk assessment process document, Regulatory actions guideline, EPA's record-keeping and case management systems, containing EPA's enforcement action and MCC's compliance history, and the licence variations, and the inspection of the mine informed the reviewing officer's consideration of the matter in s 45(f) of whether MCC is a fit and proper person. In these circumstances, it is not reasonable to infer that the EPA failed to consider either the matter in s 45(f) of whether MCC is a fit and proper person, or the matters in s 83(2) of the POEO Act that may be considered in determining whether MCC is a fit and proper person.
I reject grounds 1 and 2.

[10]

The Community Council's arguments on the pollution ground

Ground 3 contended that the EPA failed to consider two other matters in s 45(c) and (d) of the POEO Act. These concern the pollution the Maules Creek Coal mine is causing or is likely to cause and the likely impact of that pollution and the practical measures to mitigate that pollution and to protect the environment from harm as a result of that pollution.
The Community Council identified seven categories of air pollutants that are emitted by the carrying out of the scheduled activities authorised by the EPL, being coal works; crushing, grinding or separating; and mining for coal. The third scheduled activity includes not only the extraction of coal but also the transportation of coal product at the mine by non-road diesel trucks. The categories of air pollutants are PM2.5, ozone, metal and metalloids, carbon monoxide, nitrous oxide, sulphur dioxide, and GHG emissions, particularly carbon dioxide and methane. The Community Council contended that the pollution caused by the emission of these air pollutants is likely to cause harm to human health and the environment. In particular, PM2.5, being fine particulate matter with a diameter of 2.5 micrometres or less, is harmful to human health, including contributing to respiratory and cardiovascular illnesses, and GHG emissions to the atmosphere contribute to climate change. These harmful effects of PM2.5 and GHG emissions were not contested by MCC.
The Community Council submitted that the existing conditions of the EPL do not address the pollution caused by these air pollutants and in particular do not require MCC to take practical measures to mitigate that pollution and to protect the environment from harm as a result of that pollution. In particular, the conditions of the EPL do not regulate PM2.5 or GHG emissions.
The Community Council contended that the EPA, in its review of the EPL, did not consider the pollution caused by these air pollutants, the likely impact of these pollutants on human health and the environment, or the practical measures to mitigate that pollution and to protect the environment from harm as a result of that pollution. The Community Council submitted that the EPA thereby failed to consider the matters in s 45(c) and (d) of the POEO Act.
The Community Council submitted the Court would draw the inference that the EPA failed to consider these matters from, first, what the reviewing officer did and did not say in the Licence Review Record and, second, the EPA not recommending the conditions of the EPL be varied to regulate emissions of these air pollutants or require MCC to take practical measures to mitigate that pollution or to protect the environment from harm as result of that pollution.
The Community Council submitted that what is said in the Licence Review Record supports drawing the inference that the reviewing officer considered only the pollution expressly identified in the conditions of the EPL. Condition P1.1 of the EPL identifies monitoring points for ambient air monitoring. Condition O3 requires all operations and activities to be carried out in a manner that will minimise the emission of dust from the premises. Condition O5.1 requires offensive blast fume not to be emitted from the premises. Condition M2.1 requires monitoring of the concentration of each of the pollutants specified in the table in condition M2.2, which are discharged from the premises. The air pollutants specified in the table in condition M2.2 are PM10 and particulates -deposited matter. While the units of measure for monitoring of these pollutants are stated, no limits are specified. The limit conditions in section 3 of the licence do not apply to air pollution.
As a consequence, sections E and F in the Licence Review Record, directing the reviewing officer's attention to whether the types and locations of monitoring points and the limits/monitoring tables in the licence are correct, did not demand the reviewing officer consider air pollutants other than the two pollutants specified in the licence of PM10 and particulates - deposited matter.
Section G of the Licence Review Record, directing the reviewing officer's attention to the existing conditions of the licence, did not demand the reviewing officer consider whether those conditions should be varied or new conditions added to regulate pollution caused by the emission of air pollutants other than the two pollutants specified in the licence.
Section I of the Licence Review Record directs the reviewing officer to take into account the considerations in s 45 of the POEO Act. The reviewing officer answered "Yes", that he had considered s 45 of the POEO Act, and added that "Conditions on the license address Section 45 considerations". The Community Council submitted that both the answer and comment were incorrect, as the licence conditions did not address the pollution caused by the seven categories of air pollutants that are emitted from the premises by the carrying out of the licensed activities or the likely impacts of that pollution or require the taking of practical measures to mitigate that pollution and to protect the environment from harm from that pollution.
The Community Council also relied on what was not said in the Licence Review Record. Nowhere does the reviewing officer identify in the Licence Review Record that the scheduled activities at the Maules Creek Coal mine cause pollution by the emission of the seven categories of air pollutants and hence assess the likely impact of that pollution on human health or the environment. The reviewing officer did not recommend any variation to the licence to require the taking of practical measures to mitigate that pollution or to protect the environment from harm as a result of that pollution. That would have required the reviewing officer to have checked either the box for "Variation to licence required" or the "Other" box and added a comment that amended or new conditions were required to regulate these air pollutants.
The Community Council submitted that proper consideration of the matters in s 45(c) and (d) of the POEO Act required the reviewing officer to be aware not only of the impact of the pollution caused by the emission of these air pollutants and the likely harm to the environment, but also of the practical measures to mitigate that pollution and to protect the environment from harm as a result of that pollution. As Giles JA observed in Weal v Bathurst City Council (2000) 111 LGERA 181; [2000] NSWCA 88 at [80]: "Taking relevant matters into consideration called for more than simply adverting to them. There had to be an understanding of the matters and the significance of the decision to be made about them, and a process of evaluation, sufficient to warrant the description of the matters being taken into consideration…."
The Community Council submitted that taking the matters in s 45(c) and (d) of the POEO Act into consideration required the EPA to have an understanding of what pollution is being caused by the scheduled activities at the Maules Creek Coal mine, which requires identification of the seven categories of air pollutants emitted from the premises and the likely impact of that pollution on the environment, and a process of evaluation of that pollution and its likely impact on the environment sufficient to establish those matters being taken into consideration.
Consideration of the matters in s 45(c) and (d) of the POEO Act involves consideration not only of the impact and likely harm as a result of the pollution, but also of the practical measures that can be taken to mitigate that impact and protect the environment from that harm. Again, as Giles JA said in Weal v Bathurst City Council at [80]: "…it had to be aware not only of the impact and the likely harm but also of available protective or mitigating means: so the conditions to be included in the consent were an integral part of the consideration…"
The Community Council submitted that, in undertaking the licence review, any conditions that might be imposed on the licence to mitigate the pollution caused by the emission of the air pollutants and to protect the environment from harm as a result of that pollution, needed to be an integral part of the EPA's consideration of the matters in s 45(c) and (d) of the POEO Act. The Community Council submitted that the EPA's review of MCC's EPL was an obvious opportunity to recommend variation of the licence to impose conditions requiring MCC to take practical measures to mitigate the pollution caused by the emission of the air pollutants, especially GHG emissions and PM2.5, and to protect the environment from harm as a result of that pollution. The failure to do so supports an inference that the matters were not taken into consideration: Parramatta City Council v Hale at 340, 344, 391.
The Community Council submitted the types of conditions the EPA ought to have recommended the EPL be varied to impose include conditions implementing the EPA's recommended actions in its Climate Change Action Plan 2023-26. One of the recommendations was to require "all new large non-road diesel machinery at all NSW coal mines to meet US EPA Tier 4 emissions standards or better". Diesel emissions contain short-lived climate pollutants and are known to adversely affect health. The Community Council submitted that the inference should be drawn that the EPA did not consider the impact of diesel emissions on human health and the environment from the failure of the EPA to recommend MCC's EPL be varied to impose a condition implementing this recommendation.
The Community Council submitted that the need to recommend the licence be varied to impose a condition mitigating PM2.5 emissions was more pressing at the time of this licence review in 2023 than it was at the time of the previous licence review in 2018 or when the EPL was originally issued in 2013. In the period between the licence reviews in 2018 and 2023, the World Health Organisation (WHO) issued, on 22 September 2021, the WHO Global Air Quality Guidelines, which set out health-based guidelines for PM2.5 and other pollutants. The WHO Guidelines recommended an annual average PM2.5 air quality guideline level of 5 micrometers per cubic meter. The Community Council submitted that the failure of the EPA to recommend the EPL be varied to impose a condition requiring MCC to mitigate PM2.5 emissions, such as achieving this WHO annual average PM2.5 air quality guideline level, supports drawing the inference that the EPA failed to consider the impact of pollution by PM2.5 emissions.

[11]

MCC's arguments on the pollution ground

MCC contested that the Court would draw the inference that the EPA failed to consider the matters in s 45(c) and (d) of the POEO Act in undertaking the licence review. MCC advanced six reasons. The first three reasons are the same three reasons that MCC advanced in defence of the fit and proper person grounds, with appropriate adaptation. First, as the Licence Review Record was not a statement of reasons, an inference of failure to consider the matters in s 45(c) and (d) cannot reasonably be drawn merely from what was said or not said in the Licence Review Record. Secondly, regard must be had to all of the material before the reviewing officer in drawing an inference as to the EPA's consideration of these matters. Thirdly, regard must also be had to the context in which the licence review was undertaken, including the EPA's earlier enforcement action and variations of the licence and the inspection of the mine the reviewing officer undertook as part of the licence review.
In addition, MCC advanced three further reasons why the Court would not draw the inference that the EPA failed to consider the matters in s 45(c) and (d) of the POEO Act in undertaking the licence review: the EPL is only one of the statutory mechanisms for regulating air pollution from the Maules Creek Coal mine; a review of an individual licence may not be the most appropriate way to implement industry-wide measures to regulate particular air pollutants, such as GHG emissions and PM2.5; and the EPA was contemporaneously considering industry-wide measures to regulate GHG emissions in its recently adopted climate change policies when reviewing the EPL. These further reasons need explanation.
The fourth reason was that it was reasonable to infer that the EPA, in deciding the appropriateness of the EPL's conditions in regulating air pollution as a result of the carrying out of the licensed activities, would have considered whether and to what extent such air pollution is regulated by the POEO Act and the development consent for the Maules Creek Coal mine granted under the EPA Act.
The POEO Act regulates pollution, by prescribing numerous environment protection offences in Chapter 5, including air pollution offences in Part 5.4 of the POEO Act. The issuing of a licence authorising scheduled activities is not necessarily a defence to all of the air pollution offences in Part 5.4 that might result from the carrying out of the licensed activities. In these circumstances, the causing of air pollution in one of the ways proscribed by the air pollution offences does not need to be regulated by a condition of a licence because the statute already regulates that air pollution.
The carrying out of the scheduled activities licensed by the EPL also involves the carrying out of development under the EPA Act, which required development consent under that Act. A consolidated Project Approval for the Maules Creek Coal Project was issued under the then Part 3A of the EPA Act on 23 October 2012. That Project Approval was subject to the conditions in schedules 2 to 5.
Schedule 2 condition 1 imposed an overarching obligation to "implement all reasonable and feasible measures to prevent and/or minimise any material harm to the environment that may result from the construction, operation, or rehabilitation of the development." Condition 2 required MCC to carry out the project generally in accordance with the Environmental Assessment (EA), the statement of commitments and the conditions of approval. The statement of commitments is in Appendix 5 to the approval. Amongst the commitments in the statement of commitments are ones concerning air quality, including:

commitment 4 that MCC will develop a staged Environmental Management System (EMS) in consultation with relevant regulators (which includes the EPA) to the approval of the then Department of Planning and Infrastructure, which must include, amongst other documents, an Air Quality Management Plan;
commitment 6 that MCC will "utilise leading practice technologies and initiatives as required to seek to achieve the air quality outcomes described in this EA";
commitment 7 that MCC "will undertake regular monitoring of greenhouse gas emissions and energy efficiency initiatives to ensure that Scope 1 greenhouse gas emissions per tonne of product coal are kept to the minimum practicable level";
commitment 8 that MCC "will install a real time air quality monitoring network in consultation with OEH [Office of Environment and Heritage]. Consultation will also occur with Boggabri and Tarrawonga Coal Mines in an attempt to develop an holistic network for the region";
commitment 9 that MCC "will install a real time meteorological monitoring system with predictive air quality modelling software capabilities at locations selected in consultation with OEH. Consultation will also occur with Boggabri and Tarrawonga Coal Mines in an attempt to develop an holistic network for the region. The monitoring component of this system will include a PM2.5 monitor at a location representative of the receivers located within the Maules Creek Community"; and
commitment 36 that MCC "will prepare an Annual Review (which summarises monitoring results and reviews performance) and distribute it to the relevant regulatory authorities and the Maules Creek CCC [Community Consultative Committee]."

Schedule 3 of the Project Approval contains environmental performance conditions. Conditions 26 to 35 regulate air quality and GHG emissions. Condition 27 requires MCC to "implement all reasonable and feasible measures to minimise the release of greenhouse gas emissions from the site to the satisfaction of the Planning Secretary."
Condition 29 sets the general air quality criteria. MCC is required to "ensure that all reasonable and feasible avoidance and mitigation measures are employed so that particulate matter emissions generated by the project do not cause exceedances of the criteria listed in Table 9, Table 10 and Table 11 at any residence on privately-owned land or on more than 25 percent of any privately-owned land." Table 9 sets long-term criteria for total suspended particulate matter and particulate with a diameter less than 10 micrometres (PM10). Table 10 sets short-term criteria for PM10. Table 11 sets long-term criteria for deposited dust.
Condition 30 sets mine-specific air quality criteria. MCC is required to ensure that "particulate matter emissions generated by the project do not exceed the criteria listed in Table 12 at any residence on privately-owned land or on more than 25 percent of any privately-owned land." Table 12 sets the short-term criteria for PM10.
Conditions 28 and 32 require MCC to implement additional air quality mitigation upon request of a landowner of affected privately-owned land or acquire affected privately-owned land upon request of the landowner, if the air quality impacts of the project exceed specified criteria.
Condition 33 is an operating condition requiring MCC to: "(a) implement best management practice to minimise the off-site odour, fume and dust emissions of the project, including best practice coal loading and profiling and other measures to minimise dust emissions from coal transportation by rail; (b) operate a comprehensive air quality management system on site that uses a combination of predictive meteorological forecasting, predictive and real time air dispersion modelling and real-time air quality monitoring data to guide the day to day planning of mining operations and implementation of both proactive and reactive air quality mitigation measures (such as relocate, modify and/or suspend operations) to ensure compliance with the relevant conditions of this approval; (c) manage PM2.5 levels in accordance with any requirements of an EPL; (d) minimise the air quality impacts of the project during adverse meteorological conditions and extraordinary events (see note d in condition 29); (e) minimise any visible off-site air pollution; (f) minimise the surface disturbance of the site generated by the project; and (g) co-ordinate the air quality management on site with the air quality management at other mines within the Leard Forest Mining Precinct to minimise the cumulative air quality impacts of the mines, to the satisfaction of the Planning Secretary."
Condition 34 requires MCC to "prepare and implement an Air Quality and Greenhouse Gas Management Plan for the project to the satisfaction of the Planning Secretary." The plan must: "(a) be prepared in consultation with the EPA, and be submitted to the Planning Secretary for approval prior to the commencement of construction; (b) describe the measures that would be implemented to ensure: ● best management practice is being employed; ● the air quality impacts of the project are minimised during adverse meteorological conditions and extraordinary events; and ● compliance with the relevant conditions of this consent. (c) describe the proposed air quality management system; (d) include a risk/response matrix to codify mine operational responses to varying levels of risk resulting from weather conditions and specific mining activities; (e) include commitments to provide summary reports and specific briefings at CCC meetings on issues arising from air quality monitoring; (f) include an air quality monitoring program that: ● uses a combination of real-time monitors and supplementary monitors to evaluate the performance of the project; ● adequately supports the proactive and reactive air quality management system; ● includes PM2.5 monitoring; ● includes a trigger response/reactive management protocol to be used in combination with the real time PM10 monitoring sites and the site meteorological weather station; ● includes monitoring of occupied project-related residences and residences on air quality-affected land listed in Table 1 and Table 8, subject to the agreement of the tenant and/or landowner; ● evaluates and reports on the effectiveness of the air quality management system; ● includes sufficient random audit of operational response to the real time air quality management system to determine the ongoing effectiveness of these responses in maintaining the project within the relevant criteria in this Schedule and the requirements of conditions 29 and 30 above; and ● includes a protocol for determining any exceedances of the relevant conditions in this approval; and (g) include a Leard Forest Mining Precinct Air Quality Management Strategy that has been prepared in consultation with other coal mines in the Precinct to minimise the cumulative air quality impacts of all mines within the Precinct, that includes: ● systems and processes to ensure that all mines are managed to achieve their air quality criteria; ● a shared environmental monitoring network and data sharing protocol; ● control monitoring site(s) to provide real time data on background air quality levels (ie not influenced by mining from the Leard Forest Mining Precinct and representative of regional air quality); ● a shared predictive and real time air dispersion model covering the Leard Forest Mining Precinct to be used for assessment of cumulative impacts, optimising location of the shared real time monitoring network, validation of air predictions and optimising mitigation measures; and ● procedures for identifying and apportioning the source/s and contribution/s to cumulative air impacts for both mines and other sources, using the air quality and meteorological monitoring network and appropriate investigative tools such as modelling of post incident plume dispersion, dual synchronised monitors and chemical methods of source apportionment (where possible)."

[12]

Source: Climate Change Action Plan 2023-26, Figure 2 2. The action plan sets out the actions for each of the three key pillars. For Pillar 2: Mitigate, the action plan summarises six existing actions (Actions 10 to 15) the EPA will continue and strengthen, one of which is to "Regulate short-lived climate pollutants from our licensees" (Action 14), and four new actions (Actions 16 to 19) the EPA will take over the next three years. These four actions are: "Action 16 Develop a series of greenhouse gas emission reduction targets and related pathways for key industry sectors we license, to help guide our regulatory effort Action 17 Prepare or adopt climate change mitigation guidance for key industry sectors we license, including the performance outcomes we seek Action 18 Progressively place greenhouse gas emission limits and other requirements on licences for key industry sectors Action 19 Encourage and support our regulated community to innovate".

Each of these four new actions is explained in the action plan. For Action 16, the action plan emphasises that GHG emission reduction targets and related pathways will be developed by industry sector, to help the EPA "focus our regulatory effort where we can achieve the greatest gains." The targets themselves will not be enforceable, as they will apply to the industry sector as a whole, and not to an individual licensee by way of conditions of the licence. Nevertheless, the targets "will provide tailored and transparent signals for the industry sectors in question, as we work with them to influence and require greenhouse gas emission reductions." Action 17 likewise involves the EPA preparing "climate change mitigation guides that meet our environmental protection licensees' needs and make clear the outcomes we're seeking".
It is not until the stage of Action 18 that these targets are implemented as requirements of the licences for the key industry sectors. The action plan explains: "The EPA will progressively place feasible, evidence-based greenhouse gas emission limits and other requirements on new and existing environment protection licences, for key industry sectors that we regulate. In addition to emissions limits, other licence conditions could include: • monitoring and/or emission estimation conditions • other performance requirements (e.g. see Box 5 Better management of non-road diesel emissions at coal mines below) • reporting conditions • pollution reduction studies and programs. We'll develop these emission limits and other licence requirements to help NSW meet its net zero targets. Our requirements will also be informed by any sector emission reduction targets we have developed for the industries we license (see Action 16)."
The action plan emphasises that this action of setting emission limits on licences will be implemented progressively: "Emission limits and other requirements will be placed on licences progressively, on a sector-wide basis, as: • we develop or identify climate change mitigation guidance relevant to key industry sectors we license (see Action 17) • our licensees develop their climate change mitigation and adaptation plans (see Action 5(b)). We'll prioritise consistency across each licensed industry sector, while still ensuring our requirements are fit for purpose at the site level."
Box 4 in the action plan explains that the GHG emission limits could be emission intensity limits or load limits. One of the early steps the action plan identifies is to regulate "all new large non-road diesel equipment to meet US EPA Tier 4 emission standards (or better) (see Box 5 below)." Box 5 explains this action: "Diesel emissions are known to adversely affect health. They also contain short-lived climate pollutants. … Coal mining is the largest contributor of non-road diesel combustion emissions in NSW. We want to bring emissions standards for non-road diesel equipment into line with global best practice and encourage the uptake of cost-effective low emission technologies in NSW. We'll be requiring all new large non-road diesel machinery at all NSW coal mines to meet US EPA Tier 4 emission standards (or better - for example, zero emissions), via a licence variation. (The Tier 4 standard reduces emissions of nitrogen oxides (NOx) and PM2.5, which are harmful to human health and contribute short-lived climate pollutants). Tier 4 machines have the same or lower greenhouse gas emissions as other standard equipment. Many recently approved coal mines are already meeting the Tier 4 emissions standard, as it is a requirement of their development consent. We will be working with the coal mining sector to begin implementing this requirement in 2023, ensuring the requirement represents cost-effective abatement. We will also work with the sector to ensure appropriate transitional arrangements are in place, and that any regulatory barriers to implementing the better-performing equipment are removed. The requirement will not apply to existing or ordered machinery. Licensees will be given a reasonable grace period (to be determined) to enable them to prepare for the change. They will need to upgrade their surface non-road diesel fleet to meet this standard (as a minimum) over time as they replace their equipment. This action will have significant benefits for local air quality and co-benefits for climate because it will cut greenhouse gas emissions, including short-lived climate pollutants."
The action plan records that the EPA will provide updates on where it placed the limits and requirements on licences in the EPA's Annual Report.
MCC submitted that, in the context of the EPA's Climate Change Policy and Climate Change Action Plan, no inference would be drawn from the lack of reference to, or recommendation to impose a condition regulating, GHG emissions and PM2.5 in the Licence Review Record, that the EPA failed to consider the pollution caused by these air pollutants, the harm caused by that pollution, or the practical measures that could be taken to mitigate that pollution and to protect the environment from harm as a result of that pollution. That is not the only inference that can be drawn; another, more likely inference is that the EPA considered that action to mitigate emissions of GHG and PM2.5 from the scheduled activities licensed by the EPL is best taken on an industry-sector basis in accordance with the EPA's Climate Change Policy and Climate Change Action Plan.
For these six reasons, MCC submitted that the Court would not draw the inference that the EPA failed to consider the matters in s 45(c) and (d) of the POEO Act from either the lack of reference to those matters in the Licence Review Record or the absence of a recommendation to vary the licence to impose conditions requiring MCC to mitigate emissions of the seven categories of air pollutants identified by the Community Council, especially GHG emissions and PM2.5. That is not the only inference reasonably available to be drawn from the lack of reference to or recommendation to vary the licence to impose licence conditions concerning those pollutants. There are other explanations, given in the six reasons, for this lack of reference and recommendation.

[13]

The pollution ground is not established

I find that the Community Council has not established that the EPA, in undertaking the review of the EPL, failed to take into consideration the matters in s 45(c) and (d) of the POEO Act, for the six reasons advanced by MCC.
It may be accepted that the answers and comments in the Licence Review Record do not in terms refer to the seven categories of air pollutants identified by the Community Council, or discuss the likely harm caused by pollution from those air pollutants or the practical measures that could be taken to mitigate that pollution or protect the environment from harm as a result of that pollution. The Licence Review Record also does not recommend that the licence be varied to impose conditions requiring MCC to take practical measures to mitigate that pollution and to protect the environment from harm as a result of that pollution. Nevertheless, the inference that the EPA failed to consider these matters in undertaking the licence review is not the only reasonable inference that can be drawn from this lack of reference or recommendation.
First, the Licence Review Record form was a checklist to guide the reviewing officer's review of the licence. The reviewing officer answered the questions and commented on the action required by the form. One of those questions and actions required, in Section I, involved consideration of the matters in s 45, including the matters in (c) and (d) which were printed on the form. The reviewing officer answered "Yes" that he had considered the matters in s 45 and commented that "conditions on the licence address Section 45 considerations." That answer and comment did not constitute a statement of reasons, but nevertheless is some evidence that the reviewing officer did consider the matters in s 45(c) and (d). The converse, however, is not established: the lack of specific reference to the seven categories of air pollutants, including GHG emissions and PM2.5, does not necessarily establish that the reviewing officer did not consider those air pollutants.
Secondly, in drawing an inference as to the EPA's consideration of the matters in s 45(c) and (d), regard needs to be had to all of the material before the reviewing officer. As I explained when dealing with the fit and proper person grounds, it is reasonable to infer that the reviewing officer, in undertaking the review of the EPL, had regard to the Regulatory Procedure, the risk assessment process document, the Regulatory actions guideline, the EPA's record-keeping and case management systems, which include MCC's compliance history and the EPA's enforcement action against MCC, and the licence and its many variations. That material required or enabled consideration of the matters in s 45(c) and (d) of the POEO Act. Consideration of that material thus involved consideration of the matters in s 45(c) and (d).
Thirdly, the EPA's review of the EPL under s 78 was undertaken in the context of the EPA's regulatory and compliance oversight of MCC and its licensed activities. The EPA had determined the overall environmental risk associated with MCC's licensed activities to be Level 3, the highest risk level. That risk assessment involved consideration of the day-to-day operations at the premises, including the type and nature of emissions from the premises, including air pollution, and the pollution-control measures in place at the premises. MCC, as a licensee with the highest risk level, has received an increased level of regulatory and compliance oversight by the EPA. That is evidenced by the record of enforcement action against MCC and numerous variations of the licence. The reviewing officer was instructed by the Regulatory Procedure to have regard to this record of regulatory and compliance oversight. The reviewing officer also undertook an inspection of the premises as part of the licence review, allowing personal observation of the licensed activities and the type and nature of emissions from the premises.
Fourthly, it is reasonable to infer that the EPA's consideration of the matters in s 45(c) and (d) of the POEO Act when undertaking the licence review was informed by the EPA's knowledge that those matters are also regulated by the POEO Act itself and the development consent for the Maules Creek Coal mine granted under the EPA Act. Part 5.4 of the POEO Act generally regulates air pollution from carrying out scheduled activities on premises, while conditions of the development consent for the mine particularly regulate emissions of air pollutants from the premises, including GHG emissions and PM2.5. Whilst the Community Council submitted that these conditions of the development consent did not go far enough to mitigate the pollution caused by the emission of the seven categories of air pollutants, especially GHG emissions and PM2.5, nevertheless it was reasonably open to the reviewing officer to find that the conditions adequately address the matters in s 45(c) and (d) of the POEO Act, so that it was not appropriate to recommend the EPL be varied to impose the same or similar conditions. This provides an alternative explanation for the reviewing officer not recommending that the licence be varied to impose conditions regulating pollution by the seven categories of air pollutants, including GHG emissions and PM2.5, rather than drawing the inference that the reviewing officer failed to consider the matters in s 45(c) and (d) of the POEO Act.
Fifthly, another explanation for the reviewing officer not referring to, or recommending a variation of the licence to impose conditions concerning, the air pollutants of GHG emissions and PM2.5 is that the reviewing officer considered that regulation of such air pollutants is best achieved through an audit under s 78(4A) of the POEO Act on an industry-wide or regional basis, and not by a licence-by-licence review under s 78(1) of the POEO Act. Both forms of review are appropriate regulatory approaches. The fact that the reviewing officer might not have used the regulatory approach of individual licence review under s 78(1) to regulate emissions of GHGs and PM2.5 from MCC's scheduled activities does not demand drawing the inference that the reviewing officer failed to consider the pollution caused by those emissions or the practical measures that could be taken to mitigate that pollution and to protect the environment from harm as a result of that pollution.
Sixthly, this explanation for the reviewing officer not expressly referring to emissions of GHGs and PM2.5 in the Licence Review Record - that the appropriate regulatory approach is an industry-wide approach - is corroborated by the EPA's development of the Climate Change Policy and the Climate Change Action Plan. The Climate Change Policy and the Climate Change Action Plan provide for a staged regulatory approach to set targets for emissions of GHGs and PM2.5 for relevant industry sectors and, in a number of years, to vary licences in the industry sectors to require licensees to implement practical measures to achieve those targets. The Climate Change Policy and the Climate Change Action Plan did not instruct EPA officers to review and vary licences in the industry sectors immediately to require licensees to take practical measures to mitigate the emissions of GHGs and PM2.5 from their licensed activities.
The EPA developed the Climate Change Policy and the Climate Change Action Plan in response to this Court's order in the Bushfire Survivors case and published them only five months before the EPA reviewed the EPL. It is reasonable to infer the reviewing officer was aware of the policy and the action plan and the industry-wide, staged, regulatory approach recommended in them.
In these circumstances, it is not reasonable to draw the inference of a failure to consider the emission of GHGs and PM2.5 from the scheduled activities at the Maules Creek Coal mine from the lack of reference to, or recommendation to vary the EPL to impose conditions requiring the mitigation of, those emissions in the Licence Review Record.
For these six reasons, the Community Council has not established that the EPA failed to consider the matters in s 45(c) and (d) of the POEO Act in undertaking the licence review of the EPL for the Maules Creek Coal mine. Ground 3 is rejected.

[14]

Conclusion and orders

The Community Council has not established any of its three grounds of breach of s 45 of the POEO Act. The proceedings under s 252 of the POEO Act should be dismissed.
Both parties requested the Court to defer determining the question of costs of the proceedings until after the Court determined the outcome of the proceedings. The Community Council indicated that if it were to be unsuccessful in establishing that the EPA breached s 45 of the POEO Act, it would seek that the Court make no order as to costs pursuant to r 4.2(1) of the Land and Environment Court Rules 2007 (NSW) as the proceedings have been brought in the public interest. MCC indicated it would like to consider whether it wished to apply for an order that the Community Council pay MCC's costs of the proceedings. The EPA entered a submitting appearance except as to costs.
Of relevance to the question of what costs order, if any, should be made is that the person alleged to have breached the POEO Act is the regulator, the EPA, not the regulated, MCC, and that the subject matter of the proceedings is the regulator's exercise of its function under s 78 of the POEO Act to review licences issued under the POEO Act. EPA entered a submitting appearance and hence did not actively defend its exercise of the functions under the POEO Act. MCC was left to do that, notwithstanding that there was no allegation that MCC in any way contributed to the claimed breach of the POEO Act by the EPA or that the claimed relief that the EPA re-exercise the function under s 78 would interfere with MCC's EPL or any other right of MCC.
In these circumstances, I will direct that if either MCC or the Community Council seek an order for costs against any other party, they should apply within 14 days of the date of this judgment. If an application is made, the matter will be listed for directions and fixed for hearing.
The Court orders: 1. The proceedings are dismissed. 2. If any party seeks an order for costs, the party is to apply to the Court within 14 days of the date of this judgment. 3. If an application is made under order 2, the matter is to be listed for directions and the fixing of a hearing of the application for a costs order. 4. If an application is not made under order 2, there is to be no order as to costs with the intention that each party bear their own costs of the proceedings.

[20]

Maules Creek Community Council Incorporated (the Community Council) is a community-based incorporated association concerned about developments in the Leard State Forest and surrounding farmlands, near Narrabri, including proposals for new and expanded open-cut coal mines. One of these developments is the Maules Creek Coal mine, which is an open-cut coal mine located in the Leard State Forest near the town of Maules Creek that is operated by Maules Creek Coal Pty Ltd (MCC).
The mine was granted project approval on 23 October 2012 under the then Part 3A of the Environmental Planning and Assessment Act 1979 (NSW) (EPA Act). On 2 May 2013, the Environment Protection Authority (EPA) granted MCC's application by issuing Environment Protection Licence No 20221 (EPL) under s 55(1) of the Protection of the Environment Operations Act 1997 (NSW) (POEO Act).
Environment protection licences are required to be reviewed by the appropriate regulatory authority every five years under s 78 of the POEO Act. Section 78 sets two procedural requirements for undertaking the review of a licence. Subsection (1) requires the review to be "at intervals not exceeding 5 years after the issue of the licence". Subsection (2) requires the appropriate regulatory authority to give public notice of the licences that are to be reviewed in the manner and with the content specified in subsection (2).
Section 78 specifies the action that must be taken if the requirements for review of a licence are not complied with. Subsection (3) applies where the appropriate regulatory authority is the EPA. If the EPA fails to comply with the requirements of s 78 to review a licence, it is required to report that failure to the Board of the EPA and in the EPA's annual report, together with a statement of reasons for the failure. Subsection (4) applies where the appropriate regulatory authority is an authority other than the EPA. Where the other regulatory authority fails to comply with the requirements of s 78 to review a licence, it is required to report that failure to the EPA.
Subsection (4A) sets a separate requirement, other than the requirement in s 78(1) to review each licence, to "audit, on an industry wide or regional basis, compliance with licence requirements under this Act and whether such requirements reflect best practice in relation to the matters regulated by the licences".
Finally, s 78 contains a privative clause. Subsection (5) precludes the bringing of proceedings under the POEO Act for a failure to comply with the requirements of the section.
Two other provisions of the POEO Act regulate how the appropriate regulatory authority is to exercise the functions under s 78 to review each licence (under s 78(1)) and to audit compliance with licence requirements (under s 78(4A)). These are s 45 and s 83 of the POEO Act.
Section 45 sets the matters the appropriate regulatory authority "is required to take into consideration" in exercising its functions under Chapter 3 of the POEO Act, which deals with environment protection licences. These functions include the functions of review of licences and audit of compliance with licence requirements in s 78. Three of the matters in s 45 are of relevance in this case:

[24]

Consideration of the third matter of whether a person is a fit and proper person to hold a licence is assisted by s 83. As s 83(1) explains, s 83 has effect in determining whether a person is a fit and proper person as referred to in s 45(f), but does not limit the generality of that section. As at the date of the licence review in June 2023, s 83(2) listed 17 matters the appropriate regulatory authority "may take into consideration" in determining whether a person is a fit and proper person.
Where the person is a corporation, four of the matters in s 83(2), in paragraphs (a), (b), (c) and (d), concerned the person's (or a related body corporate's) record of compliance with environment protection legislation, including any contravention of the environment protection legislation. The term "environment protection legislation" is defined in the Dictionary to the POEO Act to have the same meaning as in the Protection of the Environment Administration Act 1991 (NSW), which in s 3(1) defines "environment protection legislation" to include not only the POEO Act but also other legislation concerned with protection of the environment. Two of the matters in paragraphs (f) and (g) concerned whether the person or related body corporate "is of good repute, having regard to character, honesty and integrity."
In this case, the review of the EPL for the Maules Creek Coal mine, required by s 78(1) of the POEO Act, was due to be conducted by 2 May 2023. The EPL was first issued on 2 May 2013, so that the first five-year review was undertaken by 2 May 2018 and the second five-year review was due by 2 May 2023.
In accordance with s 78(2) of the POEO Act, the EPA gave public notice, on its website, in January 2023 outlining all of the licences to be reviewed in the first half of 2023. One of those licences was the EPL for the Maules Creek Coal mine.
The review of the EPL was undertaken on 2 June 2023 by an officer of the EPA, Mr O'Connell, who completed a "Licence Review Record" for his review. Mr O'Connell's review was approved by another officer of the EPA, Ms Scrivener, on 5 June 2023. The licence review was recorded as having been completed in the EPA's computer record system, Permit and Licence Management System (PALMS), on 5 June 2023.

[25]

The Community Council is concerned that the EPA's review of the EPL for Maules Creek Coal mine failed to comply with the requirements of the POEO Act for review of licences. To this end, the Community Council brought proceedings under s 252 of the POEO Act seeking a declaration that the EPA exercised its function to review the EPL in breach of s 45 of the POEO Act and an order that the EPA re-exercise that function to review the EPL having regard to the matters required by s 45 of the POEO Act to be considered.
The Community Council raised three grounds of challenge, which correspond to the three matters in s 45 of the POEO Act that it claimed the EPA failed to consider. Grounds 1 and 2 claimed the EPA breached s 45(f) of the POEO Act by failing to take into consideration whether MCC was a fit and proper person under s 45(f) and s 83(2) of the POEO Act (the fit and proper person grounds). Ground 1 focused on the EPA's failure to take into consideration s 45(f) directly, while ground 2 focused on the EPA's failure to take s 45(f) into consideration by having regard to the matters in s 83(2)(a), (b), (c), (d), (f) and (g). The Community Council contended that the inference would be drawn that the EPA failed to consider the matter in s 45(f) by the lack of reference to that matter, or the matters in s 83(2), in the Licence Review Record.
Ground 3 claimed the EPA breached s 45(c) and (d) of the POEO Act by failing to consider the pollution caused or likely to be caused by the carrying out of the activities licensed by the EPL, and the likely impact of that pollution on the environment (paragraph (c)), and the practical measures that could be taken to prevent, control, abate or mitigate that pollution and to protect the environment from harm as a result of that pollution (paragraph (d)) (the pollution ground).
The Community Council claimed that the scheduled activities carried out at the Maules Creek Coal mine, including mining for coal, result in the emission of a number of air pollutants, being PM2.5, ozone, metals and metalloids, carbon monoxide, nitrous oxide, sulphur dioxide and greenhouse gas (GHG) emissions, particularly carbon dioxide and methane. The conditions of the EPL do not expressly regulate the pollution caused by the emission of these air pollutants. The Community Council contended that the EPA, as evidenced by the Licence Review Record, did not consider whether the EPL should be varied to address the pollution caused by the emission of these air pollutants, and thereby failed to consider the matters required to be considered by s 45(c) and (d) of the POEO Act.

[26]

The EPA entered a submitting appearance, notwithstanding that the proceedings under s 252 of the POEO Act claim that the EPA has breached the POEO Act in the exercise of its functions under the POEO Act to review the EPL. MCC was left to defend the EPA's licence review.
At the outset, MCC submitted that the Community Council is precluded from bringing the proceedings to challenge the lawfulness of the licence review by s 78(5) of the POEO Act. MCC submitted that the proceedings are brought "under this Act" as they are brought under s 252 of the POEO Act seeking orders to remedy or restrain a breach of the Act. Although the Community Council claims the breach is of s 45 of the POEO Act, MCC submitted the proceedings are ultimately in respect of a failure to exercise the function in s 78 to review the EPL for the Maules Creek Coal mine. That is a failure to comply with the requirements of s 78. Hence, MCC submitted, s 78(5) precludes this failure to comply with s 78 from being the subject of proceedings under s 252 of the POEO Act.
As to the fit and proper person grounds, MCC drew attention to the distinction in language between s 45 and s 83(2) of the POEO Act. Under s 45, the EPA "is required to take into consideration" the matters in s 45 while under s 83(2), the EPA "may take into consideration" the matters in s 83(2). The consequence, MCC submitted, is that any failure by the EPA to consider a permissible but not mandatory matter in s 83(2) will not be a jurisdictional error. That disposes of ground 2.
MCC submitted that an inference cannot be drawn that the EPA did not consider the matter in s 45(f) of whether MCC is a fit and proper person, whether by reference to the matters in s 83(2) or otherwise, from the Licence Review Record alone. The Licence Review Record is not a statement of reasons and is an incomplete record of what the EPA may have taken into consideration in reviewing the EPL. There was other material available to the EPA of the compliance history of MCC and its related bodies corporate. The EPA had taken compliance enforcement action against MCC and related bodies corporate in the past. The EPA had also varied the EPL many times before the licence review was completed. The EPA would be aware of this regulatory and compliance action.
As to the pollution ground, MCC submitted that an inference cannot be drawn from the absence of discussion in the Licence Review Record of the air pollutants identified by the Community Council or the failure to recommend variation of the conditions of the EPL to regulate those pollutants, that the EPA failed to consider the matters in s 45(c) and (d) of the POEO Act. There was evidence available to the EPA on the pollution caused or likely to be caused by the scheduled activities carried out at the mine and the practical measures to mitigate pollution. There were a number of explanations why the EPA, having considered that pollution and those measures, may have reasonably decided not to recommend variation of any of the existing conditions of the EPL to regulate those pollutants.

[30]

This Court has jurisdiction to hear and dispose of proceedings under Part 8.4 of the POEO Act, in which s 252(1) is located: see s 20(1)(ci) of the Land and Environment Court Act 1979 (NSW) (Court Act). Section 252 operates to confer, first, jurisdiction on the Court with respect to proceedings for an order to remedy and restrain a breach of the Act and, secondly, standing on any person to bring such proceedings in the Court.
Dealing with jurisdiction, the subject matter of proceedings under s 252 of the POEO Act concerns "a breach of this Act or the regulations". A "breach" includes a threatened or apprehended breach: see s 252(8) of the POEO Act. The proceedings are "for an order to remedy or restrain" a breach of the POEO Act or the regulations (s 252(1)).
The Court's adjudicative task is, first, to determine if a breach has been or will be committed and, secondly, if so, to "make such orders as it thinks fit to remedy or restrain the breach": see s 252(6) of the POEO Act. This provision affords the Court a wide discretion in formulating what order, if any, should be made to remedy or restrain any breach of the POEO Act. The orders the Court may make extend beyond "the mere determination of the rights and matters in dispute between the immediate parties": F Hannan Pty Ltd v Electricity Commission of NSW (No 3) (1985) 66 LGRA 306 at 313. But the touchstone for any order under s 252 of the POEO Act remains what will remedy or restrain the established breach of the POEO Act.
This necessity for the order to remedy or restrain a breach of the POEO Act can limit the orders the Court has power to make under s 252(1). Consider a declaratory order. The Court has power under s 252(1) of the POEO Act to declare that a decision made under the POEO Act is in breach of the POEO Act, but it might not have power under s 252(1) to declare a decision to be invalid or void: F Hannan Pty Ltd v Electricity Commission of NSW (No 3) at 327. The Court would, however, have power to declare a decision invalid or void under s 20(2)(c) of the Court Act, but this involves exercising the supervisory jurisdiction that the Supreme Court formerly had, but for s 20(2)(c) and s 71 of the Court Act which vested that jurisdiction exclusively in the Court, to judicially review a decision for jurisdictional error. The Court declares a decision involving jurisdictional error to be invalid or void as such a decision lacks legal foundation and is properly to be regarded, in law, as no decision at all: Minister for Immigration and Multicultural Affairs v Bhardwaj (2002) 209 CLR 597; [2002] HCA 11 at [51]; Hossain v Minister for Immigration and Border Protection (2018) 264 CLR 123; [2018] HCA 34 at [24].
Dealing with standing, s 252(1) allows "any person" to bring proceedings under s 252 for an order to remedy or restrain a breach of the POEO Act or the regulations. A statutory provision in the terms of s 252(1) has been described as conferring "open standing". As s 252(3) makes clear, proceedings under

[35]

The phrase "the requirements of this section" in s 78(5) is wider than the phrase "the requirements of this section to review a licence" in s 78(3) and (4), as the former phrase is intended to catch all of the requirements in subsections (1) to (4A), while the latter phrase refers only to the requirement in subsection (1) to review a licence. The former phrase also refers to both the requirements in subsections (1) to (4) concerning review of licences as well as the requirements in subsection (4A) concerning audit of compliance with licence requirements.
The phrase "requirements of this section" in s 78(5) does not include the requirements of any other section of Chapter 3 of the POEO Act, including s 45. Section 45 does require the appropriate regulatory authority to take into consideration such of the matters as are of relevance in exercising its functions under Chapter 3. Two of the functions under Chapter 3 are the review of licences and the audit of compliance with licence requirements under s 78. But the source of the requirement to consider the matters in s 45 in the exercise of those functions under s 78 remains s 45, not the provisions of s 78 under which the functions are exercised. A failure to comply with the requirement in s 45 to consider the matters listed in s 45 in the exercise of functions under s 78 is a breach of s 45, not of the provisions under which the functions were exercised.
As a consequence, s 78(5) does not operate to preclude the bringing of proceedings under s 252 of the POEO Act for an order to remedy or restrain a breach of s 45 of the POEO Act; it only operates to preclude such proceedings for an order to remedy or restrain a breach of the requirements of s 78 itself.
This conclusion makes it unnecessary to decide the Community Council's alternative submissions that: first, the proceedings are brought pursuant to not only s 252 of the POEO Act to remedy or restrain a breach of the POEO Act but also s 20(2) of the Court Act to review the decision to review the licence for jurisdictional error, with the consequence that s 78(5) of the POEO Act does not operate to preclude the proceedings under s 20(2) of the Court Act to review for jurisdictional error; second, the privative clause in s 78(5) of the POEO Act is ineffective to prevent review for jurisdictional error, applying R v Hickman; ex parte Fox and Clinton (1945) 70 CLR 598; [1945] HCA 53; and third, the privative clause in s 78(5) of the POEO Act is to be read down to avoid constitutional invalidity, applying Kirk v Industrial Court (NSW) (2010) 239 CLR 531; [2010] HCA 1 (Kirk). As the third of these arguments arguably raised a constitutional issue, notices under s 78B of the Judiciary Act 1903 (Cth) were served. The Attorney General for New South Wales intervened in support of MCC's position that the principle in Kirk does not require s 78(5) of the POEO Act to be read down so as not to preclude the applicant from bringing the proceedings under s 252 of the POEO Act.
The conclusion that s 78(5) of the POEO Act does not operate to preclude the Community Council bringing proceedings under s 252 of the POEO Act for an order to remedy or restrain a breach of s 45 of the POEO Act makes it unnecessary to decide these alternative ways in which the Community Council contended the Court has jurisdiction to determine the proceedings.

[37]

Grounds 1 and 2 contended that the EPA breached s 45 of the POEO Act by failing to take into consideration whether MCC was a fit and proper person as required by s 45(f) of the POEO Act. Ground 1 was that the EPA failed to take into consideration the matter in s 45(f) at all, while ground 2 was that the EPA failed to take s 45(f) into consideration by having regard to the matters in s 83(2) of the POEO Act.
Although the Community Council contended in argument at the hearing that the EPA was obliged to take into consideration the matters of relevance in s 83(2) of the POEO Act, notwithstanding the use of the word "may" in s 83(2), this argument strayed from the terms of ground 2. The breach of the POEO Act that ground 2 pleaded was of s 45, not s 83(2). Indeed, the Community Council did not plead in any ground that the EPA breached s 83(2) of the EPA Act. The Community Council's reliance on s 83(2) was merely a means to an end, not an end in itself. The Community Council sought to establish that the EPA failed to consider the matter in s 45(f) of the POEO Act by the EPA not having regard to the matters in s 83(2) of the POEO Act which assist in determining whether MCC is a fit and proper person.
The Community Council's argument on grounds 1 and 2 was that the Court should draw the inference that the EPA did not consider whether MCC was a fit and proper person from the lack of reference to and discussion of that matter in the Licence Review Record, by reference to s 45(f) and s 83(2) of the POEO Act. The reviewing officer, Mr O'Connell, completed the Licence Review Record form when he undertook the review of the EPL on 2 June 2023. Part 1 of the form, in the first column entitled "Question", asked nine questions, the ninth of which (question I) concerned s 45 of the POEO Act. The form raised the question "Has section 45 of the POEO Act been considered, as appropriate?" In the middle column next to that question, entitled "Action required", the form instructed the reviewing officer to "Take into account the considerations listed in section 45 of the POEO Act when conducting the licence review...." Each of the matters in (a) to (f1) inclusive of s 45 were then stated, including "(f) whether the person is a fit and proper person (section 83)." In the third column entitled "Findings/comments", the reviewing officer, Mr O'Connell, entered the following comment: "Yes. Conditions on the license [sic] address Section 45 considerations."
The only other entry of Mr O'Connell in the Licence Review Record, which the Community Council said might be relevant to whether MCC is a fit and proper person, is the comment in answer to question H, "Have submissions and any issues outstanding from other EPA actions been considered?" The "Action required" with respect to this question was printed on the form as:

[39]

In response to this question and action required, Mr O'Connell entered the following comment: "Blast fume incident currently before the Land and Environment Court." That was a reference to a prosecution the EPA had brought against MCC in this Court.
The Community Council submitted that neither comment in answer to questions H or I revealed that Mr O'Connell took into consideration the matter in s 45(f) of whether MCC is a fit and proper person or the matters in s 83(2) in determining whether MCC is a fit and proper person.
The answer to question I that "Conditions on the license address Section 45 considerations" does not reveal consideration of s 45(f) of whether MCC is a fit and proper person as there are no conditions of the EPL of relevance to the matter in s 45(f). Indeed, the Community Council submitted, that matter could not be the subject of a condition of the licence because it goes to whether MCC is a fit and proper person to hold the licence in the first place.
The answer to question H selects only one incident of non-compliance with the environment protection legislation, the "Blast fume incident currently before the Land and Environment Court", highlighting Mr O'Connell's lack of consideration of the large number of other incidents of MCC's or related bodies corporate's non-compliance with the environment protection legislation, which are of relevance to answering the fit and proper person question. The Community Council referenced the other incidents of MCC's non-compliance with the environment protection legislation set out in paragraphs 33-47 of the Statement of Agreed Facts and the incidents of non-compliance with the environment protection legislation by related bodies corporate (both holding companies and subsidiary companies) set out in paragraphs 48-68 of the Statement of Agreed Facts.
The incidents of MCC's non-compliance include prosecutions for environmental offences, penalty notices, prevention notices, clean-up notices, official cautions and enforceable undertakings. The incidents of non-compliance by related bodies corporate include prosecutions for environmental offences, penalty notices, clean-up notices and a pollution reduction program.
The Community Council submitted that none of these incidents of non-compliance by MCC or related bodies corporate were recorded by Mr O'Connell in the Licence Review Record. The Community Council submitted that each of these incidents constituted a "salient fact" for the purposes of the fit and proper person test in s 45(f) of the POEO Act. The Community Council cited Brennan J's statement in Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24 at 61; [1986] HCA 40, referenced by the Full Federal Court in Bat Advocacy NSW Inc v Minister for Environment Protection, Heritage and the Arts (2011) 180 LGERA 99; [2011] FCAFC 59 at [45], that:

[51]

The instructions in the Licence Review Record further required (in paragraph 3) the reviewing officer to "complete all parts of this form as follows", one of which was "Part 1 - Licence Review: answer all questions (A-I)". As previously noted, the table in Part 1 with questions H and I have a third column entitled "Findings/comments". This is the part of the form in which the reviewing officer answers the questions.
The result is, MCC submitted, that the reviewing officer's comments in the third column of the Licence Review Record form are simply answers to the questions which the form asked. They are not reasons for the decision the reviewing officer made.
The comment in section H, referring to the "Blast fume incident currently before the Land and Environment Court", is responsive to both the question and the action required regarding issues outstanding from other EPA actions, including prosecutions. The reviewing officer was recording that the blast fume incident was an outstanding matter. That comment did not reveal that the reviewing officer only considered that incident of non-compliance with the environment protection legislation; rather, the comment was that of the "previous reviews, Compliance Audit, prosecutions, penalty notices or complaints", this was the only matter outstanding.
The comment in section I, "Yes. Conditions on the license address Section 45 considerations", is similarly responsive to both the question and the action required. The first statement "Yes" is responsive to the question, "Has section 45 of the POEO Act been considered, as appropriate?". The second statement that licence conditions address the s 45 considerations, not only is responsive to that question, noting that the consideration is to be "as appropriate", but also explains one way in which the s 45 considerations were taken into account in accordance with the action required. That is to say, one way in which the reviewing officer took into account the s 45 considerations was by assessing whether the licence conditions address the s 45 considerations as appropriate. The reviewing officer's statement that the licence conditions did address the

[56]

The acronyms are defined in section 4 Definitions of the Regulatory Procedure. "CM9" is the "Content Manager 9: CM9 is the EPA's record keeping system". "PALMS" is the "Permit and Licence Management System". "CIRAM/EPIC" are separately defined. "CIRAM" is "Compliance, Incident Reporting and Management: CIRAM was the EPA's case management system prior to the introduction of EPIC in March 2021." "EPIC" is "Environment Protection Incidents and Cases: EPIC is the EPA's end-to-end case management system. It replaced CIRAM (the previous case management system) in March 2021."
MCC submitted that all of the incidents of non-compliance with the environment protection legislation by MCC and its related bodies corporate that are identified in the Statement of Agreed Facts, and relied upon by the Community Council, were recorded in these record keeping and case management systems. MCC referred to the printout of EPA's Public Register for MCC's EPL, which was in evidence. That licence summary listed all of the enforcement notices the EPA had issued, including penalty notices, clean up notices and prevention notices; the mandatory environmental audit; and the pollution studies and reduction programs. MCC submitted that the Court would infer that the EPA's internal record keeping and case management systems would contain the same information as that on the EPA's Public Register. This information coincides with the incidents of non-compliance with the environmental protection legislation by MCC identified in the Statement of Agreed Facts. The Community Council did not contest this submission.
The note to paragraph 6.3 recommends the reviewing officer inspect the licensed premises if the EPA has not attended the premises for more than six months and a licence review is due. Mr O'Connell, the reviewing officer undertaking the review of the EPL, followed this recommendation and undertook an inspection of MCC's premises on 17 May 2023. Mr O'Connell recorded his inspection in the comments in the third column in sections B and E of the Licence Review Record.
Section H of the Regulatory Procedure instructs the reviewing officer to consider EPA compliance action. Paragraph 6.26 directs the reviewing officer to check "information from any compliance audit, prosecution, penalty notice, or other compliance action." MCC submitted that this is done by checking the record keeping and case management systems earlier referred to (CM9, PALMS and CIRAM/EPIC).
Section I of the Regulatory Procedure instructs the reviewing officer, when undertaking the licence review, to take into consideration the matters in s 45 of the POEO Act (paragraph 6.27).
Part 2 of the Regulatory Procedure concerns the outcomes of the licence review. Section J instructs the reviewing officer to make a recommendation. The three options are printed on the Licence Review Record form as boxes to check: recommend whether or not a licence variation is required or make some other recommendation. The reviewing officer is directed to check one of these three boxes.
MCC submitted that in the case of the matter in s 45(f) of the POEO Act, if the reviewing officer found the holder of the licence not to be a fit and proper person, no variation of the conditions of the licence would be appropriate, but instead revocation of the licence under Part 3.7 of the POEO Act would be appropriate. In that event, the reviewing officer would check the "Other" box and add a comment that revocation of the licence was recommended. MCC submitted that the fact that Mr O'Connell, the reviewing officer for the EPL, did not check the "Other" box, but instead checked the "Variation to licence not required" box, evidences that he did not consider revocation of the EPL was appropriate.
MCC submitted that the material available to the reviewing officer in reviewing the EPL also included two documents concerning the EPA's risk-based licensing system. The first document, published on the EPA's website, concerns the EPA's risk assessment process. The document explains that:

[67]

Fourth, EPA officers should consider "a range of factors regarding the best practicable measures available to reduce the environmental impact posed by the activity." Fifth, EPA officers, in deciding what regulatory action should be taken, should consider the most appropriate alternative or complementary actions. The list of regulatory actions includes prosecutions, penalty notices, clean-up notices and prevention notices, all being actions the EPA has taken against MCC, as well as suspension of a licence.
MCC submitted that the Court would infer that the reviewing officer, in undertaking the review of the EPL, would have considered, first, the EPA's risk assessment process document and the EPA's determination that the overall environmental risk associated with MCC's licensed activities is Level 3 and, secondly, the Regulatory actions guideline in determining what regulatory action, if any, should be taken as a result of the licence review. Consideration of these documents would have involved the reviewing officer considering MCC's record of compliance with the licence and environment protection legislation, as both documents require that consideration. This consideration would have informed the reviewing officer's consideration of whether MCC is a fit and proper person as referred to in s 45(f) and s 83(2) of the POEO Act.
Thirdly, MCC submitted the Court, in determining what inference should be drawn concerning the EPA's consideration of the matter in s 45(f) of whether MCC is a fit and proper person, would have regard to the degree of regulatory and compliance oversight the EPA has exercised over MCC and its licensed activities, and all of the occasions on which the EPA has had the opportunity to consider MCC's record of compliance with the licence and the environment protection legislation and the appropriateness of the licence conditions in light of that record.
As earlier noted, the EPA has taken enforcement action for MCC's compliance with the licence on many occasions. The EPA issued two penalty notices on 8 February 2017 and 22 May 2017; two clean up notices on 21 February 2020 and 9 April 2020 and a variation of clean up notice on 22 May 2020; and one prevention notice on 23 November 2021, nine variations of the prevention notice on 8 December 2021, 22 December 2021, 1 April 2022, 19 April 2022, 9 May 2022, 2 June 2022, 16 August 2022, 19 August 2022 and 25 October 2022, and one revocation of the prevention notice on 20 December 2022. The EPA issued MCC with an official caution concerning burial of waste tyres at the mine site.
The EPA and other regulatory authorities have also taken enforcement action against MCC for non-compliance with the environment protection legislation. MCC was prosecuted and convicted for three offences against s 120(1) of the POEO Act and an offence against s 60A(2) of the Water Management Act 2000 (NSW); issued with two penalty notices for offences of failing to comply with the development consent granted under the EPA Act; and entered into enforceable undertakings in relation to an alleged contravention of the Water Management Act and the Work Health and Safety Act 2011 (NSW).
The reviewing officer was directed by the Regulatory Procedure, in undertaking the licence review, to have regard to this history of enforcement action against MCC that is maintained in the EPA's record-keeping and case management systems.
MCC submitted that the EPA has reviewed on many occasions the appropriateness of the licence conditions in light of MCC's record of non-compliance, resulting in the EPA varying the EPL under s 58(1) of the POEO Act. The EPA may vary a licence on application by the holder of the licence or its own initiative (s 58(3)) at any time during the currency of the licence (s 58(4)). In the period between the licence review under s 78 that was due on 2 May 2018 and the licence review under s 78 that was completed on 5 June 2023, which is the subject of challenge, the EPA had made six variations of the licence (on 27 November 2019, 2 March 2022, 30 March 2022, 2 August 2022, 13 February 2023 and 2 June 2023). Five of these six variations were within a year and a half of the licence review in 2023. The licence variation on 2 June 2023 was contemporaneous with the reviewing officer's review of the EPL on 2 June 2023. The reviewing officer, in familiarising himself with the licence as required by Regulatory Procedure, would have had knowledge of these licence variations.
The reviewing officer, Mr O'Connell, undertook an inspection of MCC's licensed premises on 17 May 2023 as part of the review of the EPL, as recommended by the Regulatory Procedure. Mr O'Connell's inspection of the Maules Creek Coal mine lasted 3.5 hours. He inspected the three scheduled activities carried out on the premises. Mr O'Connell's inspection report is 7 pages and includes photographs. The inspection informed Mr O'Connell's answers and comments in sections A to I in Part 1 of the Licence Review Record. The matters discussed by Mr O'Connell with MCC's representatives at the inspection and in the inspection report he completed included MCC's compliance with licence conditions. The inspection report concluded with Mr O'Connell's recommendation of the "follow up and further action required."
In these circumstances, MCC submitted that the EPA's licence review under s 78 of the POEO Act should not be viewed as having been undertaken in a vacuum; rather, it took place in the context of a high degree of regulatory and compliance oversight and licence variation before the licence review was completed. MCC submitted that the Court should infer that the reviewing officer was aware of the enforcement action the EPA had taken and the variations of the licence, as the Regulatory Procedure, risk assessment process document and Regulatory actions guideline required the reviewing officer to be familiar with the licence which is the subject of the review and the licensee's compliance history.

[68]

I find that the Community Council has not established that the EPA failed to take into consideration the matter in s 45(f) of the POEO Act of whether MCC is a fit and proper person in exercising its function under s 78(1) to review the EPL for the Maules Creek Coal mine. To establish that an administrative decision-maker has failed to consider a matter the decision-maker was obliged to consider is to establish a negative fact - that the decision-maker did not do something. In the absence of an admission by the decision-maker that the matter was not considered, establishing a negative fact requires drawing an inference from other positive proven facts: Caswell v Powell Duffryn Associated Collieries Ltd [1940] AC 152 at 169-170; Seltsam Pty Ltd v McGuiness (2000) 49 NSWLR 262; [2000] NSWCA 29 at [84]- [91]. The Community Council's argument for drawing the inference that the matter in s 45(f) was not considered was founded on the few facts stated by the reviewing officer in the Licence Review Record. But those facts are insufficient to draw that inference, for the three reasons MCC advanced.
First, the inference that the EPA failed to consider whether MCC is a fit and proper person is not the only reasonable inference that can be drawn from what is and is not stated in the Licence Review Record. The Licence Review Record was neither intended nor required to be a statement of reasons. The Licence Review Record form was a checklist to guide the reviewing officer's review of the licence. The form had printed questions and action required, which the reviewing officer would consider in undertaking the licence review. To the extent that the form asked for comments, they were to be responsive to the questions or action required in the form; the inclusion of any comments did not involve the provision of a statement of reasons. Accordingly, an inference about the reviewing officer's consideration of any particular matter in s 45 cannot necessarily be drawn from what the reviewing officer did or did not say in the succinct comments entered on the form.
Secondly, any inference to be drawn as to the EPA's consideration of whether MCC is a fit and proper person must have regard to all of the material before the reviewing officer. There was some debate about what material was before the EPA. The Community Council's solicitor had issued a notice to produce to the EPA seeking production of a wide category of documents "that informed or discussed the review" of the EPL. This notice was challenged by the EPA but, as a compromise, the EPA agreed to produce documents in a more limited category of documents "that were before the decision-maker(s) for the purposes of the review" of the EPL. The Community Council's solicitor agreed to this limitation and issued a second notice to produce in those terms. The EPA produced three documents in response: the inspection report concerning the inspection undertaken on 17 May 2023; the EPL, licence version dated 2 June 2023; and the Licence Review Record.
Notwithstanding this limited production of documents by the EPA, it is reasonable to infer that the EPA had regard, in undertaking the review of the EPL, to many other documents and information. As MCC has submitted, it is reasonable to infer that the reviewing officer, in undertaking the review of the EPL, had regard, as he was required to do, to the Regulatory Procedure, the risk assessment process document, the Regulatory actions guideline, the EPA's record-keeping and case management systems, which include MCC's compliance history and the EPA's enforcement action against MCC, and the licence itself and its many variations. Consideration of all of that material necessarily involved consideration of the matter in s 45(f) and the matters of relevance in s 83(2) of the POEO Act of whether MCC is a fit and proper person.
Thirdly, the EPA's review of the EPL under s 78 of the POEO Act was undertaken in the context of the EPA's heightened regulatory and compliance oversight of MCC and its licensed activities. The EPA has continued to take enforcement action against MCC, including issuing penalty notices, clean up notices and prevention notices, for MCC's non-compliance with the licence and the environment protection legislation. The appropriateness of the conditions of the licence has been reviewed by the EPA on many occasions, leading to variations of the licence, including five variations in the year and a half before the licence review was completed, one of which was contemporaneous with the licence review. The reviewing officer undertook an inspection of the licensed premises as part of his licence review. It is reasonable to infer that the reviewing officer was aware of, and had regard to, this regulatory and compliance oversight and enforcement action in undertaking the licence review.
Collectively, consideration of the Regulatory Procedure, risk assessment process document, Regulatory actions guideline, EPA's record-keeping and case management systems, containing EPA's enforcement action and MCC's compliance history, and the licence variations, and the inspection of the mine informed the reviewing officer's consideration of the matter in s 45(f) of whether MCC is a fit and proper person. In these circumstances, it is not reasonable to infer that the EPA failed to consider either the matter in s 45(f) of whether MCC is a fit and proper person, or the matters in s 83(2) of the POEO Act that may be considered in determining whether MCC is a fit and proper person.
I reject grounds 1 and 2.

[70]

Ground 3 contended that the EPA failed to consider two other matters in s 45(c) and (d) of the POEO Act. These concern the pollution the Maules Creek Coal mine is causing or is likely to cause and the likely impact of that pollution and the practical measures to mitigate that pollution and to protect the environment from harm as a result of that pollution.
The Community Council identified seven categories of air pollutants that are emitted by the carrying out of the scheduled activities authorised by the EPL, being coal works; crushing, grinding or separating; and mining for coal. The third scheduled activity includes not only the extraction of coal but also the transportation of coal product at the mine by non-road diesel trucks. The categories of air pollutants are PM2.5, ozone, metal and metalloids, carbon monoxide, nitrous oxide, sulphur dioxide, and GHG emissions, particularly carbon dioxide and methane. The Community Council contended that the pollution caused by the emission of these air pollutants is likely to cause harm to human health and the environment. In particular, PM2.5, being fine particulate matter with a diameter of 2.5 micrometres or less, is harmful to human health, including contributing to respiratory and cardiovascular illnesses, and GHG emissions to the atmosphere contribute to climate change. These harmful effects of PM2.5 and GHG emissions were not contested by MCC.
The Community Council submitted that the existing conditions of the EPL do not address the pollution caused by these air pollutants and in particular do not require MCC to take practical measures to mitigate that pollution and to protect the environment from harm as a result of that pollution. In particular, the conditions of the EPL do not regulate PM2.5 or GHG emissions.
The Community Council contended that the EPA, in its review of the EPL, did not consider the pollution caused by these air pollutants, the likely impact of these pollutants on human health and the environment, or the practical measures to mitigate that pollution and to protect the environment from harm as a result of that pollution. The Community Council submitted that the EPA thereby failed to consider the matters in s 45(c) and (d) of the POEO Act.
The Community Council submitted the Court would draw the inference that the EPA failed to consider these matters from, first, what the reviewing officer did and did not say in the Licence Review Record and, second, the EPA not recommending the conditions of the EPL be varied to regulate emissions of these air pollutants or require MCC to take practical measures to mitigate that pollution or to protect the environment from harm as result of that pollution.
The Community Council submitted that what is said in the Licence Review Record supports drawing the inference that the reviewing officer considered only the pollution expressly identified in the conditions of the EPL. Condition P1.1 of the EPL identifies monitoring points for ambient air monitoring. Condition O3 requires all operations and activities to be carried out in a manner that will minimise the emission of dust from the premises. Condition O5.1 requires offensive blast fume not to be emitted from the premises. Condition M2.1 requires monitoring of the concentration of each of the pollutants specified in the table in condition M2.2, which are discharged from the premises. The air pollutants specified in the table in condition M2.2 are PM10 and particulates -deposited matter. While the units of measure for monitoring of these pollutants are stated, no limits are specified. The limit conditions in section 3 of the licence do not apply to air pollution.
As a consequence, sections E and F in the Licence Review Record, directing the reviewing officer's attention to whether the types and locations of monitoring points and the limits/monitoring tables in the licence are correct, did not demand the reviewing officer consider air pollutants other than the two pollutants specified in the licence of PM10 and particulates - deposited matter.
Section G of the Licence Review Record, directing the reviewing officer's attention to the existing conditions of the licence, did not demand the reviewing officer consider whether those conditions should be varied or new conditions added to regulate pollution caused by the emission of air pollutants other than the two pollutants specified in the licence.
Section I of the Licence Review Record directs the reviewing officer to take into account the considerations in s 45 of the POEO Act. The reviewing officer answered "Yes", that he had considered s 45 of the POEO Act, and added that "Conditions on the license address Section 45 considerations". The Community Council submitted that both the answer and comment were incorrect, as the licence conditions did not address the pollution caused by the seven categories of air pollutants that are emitted from the premises by the carrying out of the licensed activities or the likely impacts of that pollution or require the taking of practical measures to mitigate that pollution and to protect the environment from harm from that pollution.
The Community Council also relied on what was not said in the Licence Review Record. Nowhere does the reviewing officer identify in the Licence Review Record that the scheduled activities at the Maules Creek Coal mine cause pollution by the emission of the seven categories of air pollutants and hence assess the likely impact of that pollution on human health or the environment. The reviewing officer did not recommend any variation to the licence to require the taking of practical measures to mitigate that pollution or to protect the environment from harm as a result of that pollution. That would have required the reviewing officer to have checked either the box for "Variation to licence required" or the "Other" box and added a comment that amended or new conditions were required to regulate these air pollutants.
The Community Council submitted that proper consideration of the matters in s 45(c) and (d) of the POEO Act required the reviewing officer to be aware not only of the impact of the pollution caused by the emission of these air pollutants and the likely harm to the environment, but also of the practical measures to mitigate that pollution and to protect the environment from harm as a result of that pollution. As Giles JA observed in Weal v Bathurst City Council (2000) 111 LGERA 181; [2000] NSWCA 88 at [80]:

[74]

The Community Council submitted that, in undertaking the licence review, any conditions that might be imposed on the licence to mitigate the pollution caused by the emission of the air pollutants and to protect the environment from harm as a result of that pollution, needed to be an integral part of the EPA's consideration of the matters in s 45(c) and (d) of the POEO Act. The Community Council submitted that the EPA's review of MCC's EPL was an obvious opportunity to recommend variation of the licence to impose conditions requiring MCC to take practical measures to mitigate the pollution caused by the emission of the air pollutants, especially GHG emissions and PM2.5, and to protect the environment from harm as a result of that pollution. The failure to do so supports an inference that the matters were not taken into consideration: Parramatta City Council v Hale at 340, 344, 391.
The Community Council submitted the types of conditions the EPA ought to have recommended the EPL be varied to impose include conditions implementing the EPA's recommended actions in its Climate Change Action Plan 2023-26. One of the recommendations was to require "all new large non-road diesel machinery at all NSW coal mines to meet US EPA Tier 4 emissions standards or better". Diesel emissions contain short-lived climate pollutants and are known to adversely affect health. The Community Council submitted that the inference should be drawn that the EPA did not consider the impact of diesel emissions on human health and the environment from the failure of the EPA to recommend MCC's EPL be varied to impose a condition implementing this recommendation.
The Community Council submitted that the need to recommend the licence be varied to impose a condition mitigating PM2.5 emissions was more pressing at the time of this licence review in 2023 than it was at the time of the previous licence review in 2018 or when the EPL was originally issued in 2013. In the period between the licence reviews in 2018 and 2023, the World Health Organisation (WHO) issued, on 22 September 2021, the WHO Global Air Quality Guidelines, which set out health-based guidelines for PM2.5 and other pollutants. The WHO Guidelines recommended an annual average PM2.5 air quality guideline level of 5 micrometers per cubic meter. The Community Council submitted that the failure of the EPA to recommend the EPL be varied to impose a condition requiring MCC to mitigate PM2.5 emissions, such as achieving this WHO annual average PM2.5 air quality guideline level, supports drawing the inference that the EPA failed to consider the impact of pollution by PM2.5 emissions.

[75]

MCC contested that the Court would draw the inference that the EPA failed to consider the matters in s 45(c) and (d) of the POEO Act in undertaking the licence review. MCC advanced six reasons. The first three reasons are the same three reasons that MCC advanced in defence of the fit and proper person grounds, with appropriate adaptation. First, as the Licence Review Record was not a statement of reasons, an inference of failure to consider the matters in s 45(c) and (d) cannot reasonably be drawn merely from what was said or not said in the Licence Review Record. Secondly, regard must be had to all of the material before the reviewing officer in drawing an inference as to the EPA's consideration of these matters. Thirdly, regard must also be had to the context in which the licence review was undertaken, including the EPA's earlier enforcement action and variations of the licence and the inspection of the mine the reviewing officer undertook as part of the licence review.
In addition, MCC advanced three further reasons why the Court would not draw the inference that the EPA failed to consider the matters in s 45(c) and (d) of the POEO Act in undertaking the licence review: the EPL is only one of the statutory mechanisms for regulating air pollution from the Maules Creek Coal mine; a review of an individual licence may not be the most appropriate way to implement industry-wide measures to regulate particular air pollutants, such as GHG emissions and PM2.5; and the EPA was contemporaneously considering industry-wide measures to regulate GHG emissions in its recently adopted climate change policies when reviewing the EPL. These further reasons need explanation.
The fourth reason was that it was reasonable to infer that the EPA, in deciding the appropriateness of the EPL's conditions in regulating air pollution as a result of the carrying out of the licensed activities, would have considered whether and to what extent such air pollution is regulated by the POEO Act and the development consent for the Maules Creek Coal mine granted under the EPA Act.
The POEO Act regulates pollution, by prescribing numerous environment protection offences in Chapter 5, including air pollution offences in Part 5.4 of the POEO Act. The issuing of a licence authorising scheduled activities is not necessarily a defence to all of the air pollution offences in Part 5.4 that might result from the carrying out of the licensed activities. In these circumstances, the causing of air pollution in one of the ways proscribed by the air pollution offences does not need to be regulated by a condition of a licence because the statute already regulates that air pollution.
The carrying out of the scheduled activities licensed by the EPL also involves the carrying out of development under the EPA Act, which required development consent under that Act. A consolidated Project Approval for the Maules Creek Coal Project was issued under the then Part 3A of the EPA Act on 23 October 2012. That Project Approval was subject to the conditions in schedules 2 to 5.
Schedule 2 condition 1 imposed an overarching obligation to "implement all reasonable and feasible measures to prevent and/or minimise any material harm to the environment that may result from the construction, operation, or rehabilitation of the development." Condition 2 required MCC to carry out the project generally in accordance with the Environmental Assessment (EA), the statement of commitments and the conditions of approval. The statement of commitments is in Appendix 5 to the approval. Amongst the commitments in the statement of commitments are ones concerning air quality, including:
- commitment 4 that MCC will develop a staged Environmental Management System (EMS) in consultation with relevant regulators (which includes the EPA) to the approval of the then Department of Planning and Infrastructure, which must include, amongst other documents, an Air Quality Management Plan;
- commitment 6 that MCC will "utilise leading practice technologies and initiatives as required to seek to achieve the air quality outcomes described in this EA";
- commitment 7 that MCC "will undertake regular monitoring of greenhouse gas emissions and energy efficiency initiatives to ensure that Scope 1 greenhouse gas emissions per tonne of product coal are kept to the minimum practicable level";
- commitment 8 that MCC "will install a real time air quality monitoring network in consultation with OEH [Office of Environment and Heritage]. Consultation will also occur with Boggabri and Tarrawonga Coal Mines in an attempt to develop an holistic network for the region";
- commitment 9 that MCC "will install a real time meteorological monitoring system with predictive air quality modelling software capabilities at locations selected in consultation with OEH. Consultation will also occur with Boggabri and Tarrawonga Coal Mines in an attempt to develop an holistic network for the region. The monitoring component of this system will include a PM2.5 monitor at a location representative of the receivers located within the Maules Creek Community"; and
- commitment 36 that MCC "will prepare an Annual Review (which summarises monitoring results and reviews performance) and distribute it to the relevant regulatory authorities and the Maules Creek CCC [Community Consultative Committee]."
Schedule 3 of the Project Approval contains environmental performance conditions. Conditions 26 to 35 regulate air quality and GHG emissions. Condition 27 requires MCC to "implement all reasonable and feasible measures to minimise the release of greenhouse gas emissions from the site to the satisfaction of the Planning Secretary."
Condition 29 sets the general air quality criteria. MCC is required to "ensure that all reasonable and feasible avoidance and mitigation measures are employed so that particulate matter emissions generated by the project do not cause exceedances of the criteria listed in Table 9, Table 10 and Table 11 at any residence on privately-owned land or on more than 25 percent of any privately-owned land." Table 9 sets long-term criteria for total suspended particulate matter and particulate with a diameter less than 10 micrometres (PM10). Table 10 sets short-term criteria for PM10. Table 11 sets long-term criteria for deposited dust.
Condition 30 sets mine-specific air quality criteria. MCC is required to ensure that "particulate matter emissions generated by the project do not exceed the criteria listed in Table 12 at any residence on privately-owned land or on more than 25 percent of any privately-owned land." Table 12 sets the short-term criteria for PM10.
Conditions 28 and 32 require MCC to implement additional air quality mitigation upon request of a landowner of affected privately-owned land or acquire affected privately-owned land upon request of the landowner, if the air quality impacts of the project exceed specified criteria.
Condition 33 is an operating condition requiring MCC to:

[88]

Spontaneous combustion events are identified as having the potential to give rise to odour impacts. Blasting is identified as generating oxides of nitrogen (NOx) together with other gases as by-products of ammonium nitrate-based explosives. Vehicle exhaust emissions from equipment operated on site, such as mine dump trucks, are identified as including PM2.5, NOx, carbon monoxide, sulphur dioxide and organic compounds.
The Air Quality and Greenhouse Gas Management Plan addresses how these air pollutants are to be managed in accordance with the requirements of the POEO Act, and the conditions of the EPL and the Project Approval (section 2). Section 3 sets out the air quality management measures. Section 4 sets out the GHG management measures. Section 5 sets out the air quality monitoring program. Section 6 sets out the protocol for determining exceedances. Section 7 deals with complaints handling. Section 8 deals with reporting. Section 9 deals with revision of the management plan.
MCC submitted that the EPA, in undertaking the review of the EPL, would be aware that MCC is legally required to comply with all of these conditions of the Project Approval dealing with air pollution from the carrying out of the mine project. These conditions dealing with air pollution address the matters in s 45(c) and (d) of the POEO Act. In these circumstances, MCC submitted there would have been no need for the EPA, in the review of the EPL, to recommend a variation of the EPL to include conditions that duplicate the conditions of the Project Approval. MCC is already legally required by the Project Approval to take practical measures to mitigate the pollution caused by the emission of the air pollutants identified in the Project Approval and the Air Quality and Greenhouse Gas Management Plan, which overlap with the seven categories of air pollutants identified by the Community Council, and to protect the environment from harm as a result of that pollution. MCC submitted this provides an explanation for the reviewing officer not referring to, or recommending the imposition of conditions on the licence concerning, the pollution caused by the emission of these air pollutants or the practical measures that could be taken to mitigate that pollution and to protect the environment as a result of that pollution.
The fifth reason MCC advanced concerns the inappropriateness of implementing industry-wide measures to regulate certain types of air pollution by the review and variation of individual licences. Section 78 of the POEO Act requires the EPA to undertake two forms of review. The first is review of each licence, under s 78(1). That is the review that was undertaken by the EPA of MCC's EPL. The second is the industry-wide audit under s 78(4A). That subsection provides:

[90]

MCC submitted that these two forms of review serve different purposes, focus on different matters and achieve different results. The first review serves the particular purpose of checking the on-going appropriateness of an individual licence's requirements and the licensee's compliance with the licence, focuses on the matters regulated by the licence and particular to the licensee, and results in a recommendation to vary or not vary the licence or take other regulatory action particular to the licence or licensee. The second review serves the broader purpose of reviewing, on an industry wide or regional basis, licensing requirements under the POEO Act, not the requirements of individual licences, and evaluating whether these licensing requirements under the POEO Act reflect best practice in relation to the matters regulated by the licenses in that industry or region.
MCC submitted that regulation of the seven categories of air pollutants identified by the Community Council, especially PM2.5 and GHG emissions, is best achieved, on an industry wide or regional basis, by an audit under s 78(4A) and not by a licence review under s 78(1) of the POEO Act.
MCC noted its Maules Creek Coal mine is in the coal mining industry and is located in the region of the Leard Forest Mining Precinct. The regulation of PM2.5 and GHG emissions as result of a coal mining, for example, is best achieved by formulating licence requirements that can be implemented on an industry wide and regional basis by implementation on every licence for scheduled activities involving coal mining. That sets an industry wide, regulatory level playing field. All coal mines will be subject to the same licence requirements to mitigate PM2.5 and GHG emissions from their scheduled activities.
MCC submitted that in this circumstance, no inference would be drawn from the lack of reference to, or recommendation to impose a condition regulating, air pollutants such as PM2.5 and GHG emissions in the Licence Review Record, that the EPA failed to consider the pollution caused by these air pollutants, the harm caused by that pollution, or the practical measures that could be taken to mitigate that pollution and to protect the environment from harm as a result of that pollution. That is not the only inference that can be drawn; another, more likely inference is that the EPA considered that those matters are better dealt with on an industry wide and regional basis through the regulatory mechanism of an audit under s 78(4A) of the POEO Act.
The sixth reason MCC advanced is an extension of the fifth reason. Under

[103]

I find that the Community Council has not established that the EPA, in undertaking the review of the EPL, failed to take into consideration the matters in s 45(c) and (d) of the POEO Act, for the six reasons advanced by MCC.
It may be accepted that the answers and comments in the Licence Review Record do not in terms refer to the seven categories of air pollutants identified by the Community Council, or discuss the likely harm caused by pollution from those air pollutants or the practical measures that could be taken to mitigate that pollution or protect the environment from harm as a result of that pollution. The Licence Review Record also does not recommend that the licence be varied to impose conditions requiring MCC to take practical measures to mitigate that pollution and to protect the environment from harm as a result of that pollution. Nevertheless, the inference that the EPA failed to consider these matters in undertaking the licence review is not the only reasonable inference that can be drawn from this lack of reference or recommendation.
First, the Licence Review Record form was a checklist to guide the reviewing officer's review of the licence. The reviewing officer answered the questions and commented on the action required by the form. One of those questions and actions required, in Section I, involved consideration of the matters in s 45, including the matters in (c) and (d) which were printed on the form. The reviewing officer answered "Yes" that he had considered the matters in s 45 and commented that "conditions on the licence address Section 45 considerations." That answer and comment did not constitute a statement of reasons, but nevertheless is some evidence that the reviewing officer did consider the matters in s 45(c) and (d). The converse, however, is not established: the lack of specific reference to the seven categories of air pollutants, including GHG emissions and PM2.5, does not necessarily establish that the reviewing officer did not consider those air pollutants.
Secondly, in drawing an inference as to the EPA's consideration of the matters in s 45(c) and (d), regard needs to be had to all of the material before the reviewing officer. As I explained when dealing with the fit and proper person grounds, it is reasonable to infer that the reviewing officer, in undertaking the review of the EPL, had regard to the Regulatory Procedure, the risk assessment process document, the Regulatory actions guideline, the EPA's record-keeping and case management systems, which include MCC's compliance history and the EPA's enforcement action against MCC, and the licence and its many variations. That material required or enabled consideration of the matters in s 45(c) and (d) of the POEO Act. Consideration of that material thus involved consideration of the matters in s 45(c) and (d).
Thirdly, the EPA's review of the EPL under s 78 was undertaken in the context of the EPA's regulatory and compliance oversight of MCC and its licensed activities. The EPA had determined the overall environmental risk associated with MCC's licensed activities to be Level 3, the highest risk level. That risk assessment involved consideration of the day-to-day operations at the premises, including the type and nature of emissions from the premises, including air pollution, and the pollution-control measures in place at the premises. MCC, as a licensee with the highest risk level, has received an increased level of regulatory and compliance oversight by the EPA. That is evidenced by the record of enforcement action against MCC and numerous variations of the licence. The reviewing officer was instructed by the Regulatory Procedure to have regard to this record of regulatory and compliance oversight. The reviewing officer also undertook an inspection of the premises as part of the licence review, allowing personal observation of the licensed activities and the type and nature of emissions from the premises.
Fourthly, it is reasonable to infer that the EPA's consideration of the matters in s 45(c) and (d) of the POEO Act when undertaking the licence review was informed by the EPA's knowledge that those matters are also regulated by the POEO Act itself and the development consent for the Maules Creek Coal mine granted under the EPA Act. Part 5.4 of the POEO Act generally regulates air pollution from carrying out scheduled activities on premises, while conditions of the development consent for the mine particularly regulate emissions of air pollutants from the premises, including GHG emissions and PM2.5. Whilst the Community Council submitted that these conditions of the development consent did not go far enough to mitigate the pollution caused by the emission of the seven categories of air pollutants, especially GHG emissions and PM2.5, nevertheless it was reasonably open to the reviewing officer to find that the conditions adequately address the matters in s 45(c) and (d) of the POEO Act, so that it was not appropriate to recommend the EPL be varied to impose the same or similar conditions. This provides an alternative explanation for the reviewing officer not recommending that the licence be varied to impose conditions regulating pollution by the seven categories of air pollutants, including GHG emissions and PM2.5, rather than drawing the inference that the reviewing officer failed to consider the matters in s 45(c) and (d) of the POEO Act.
Fifthly, another explanation for the reviewing officer not referring to, or recommending a variation of the licence to impose conditions concerning, the air pollutants of GHG emissions and PM2.5 is that the reviewing officer considered that regulation of such air pollutants is best achieved through an audit under s 78(4A) of the POEO Act on an industry-wide or regional basis, and not by a licence-by-licence review under s 78(1) of the POEO Act. Both forms of review are appropriate regulatory approaches. The fact that the reviewing officer might not have used the regulatory approach of individual licence review under s 78(1) to regulate emissions of GHGs and PM2.5 from MCC's scheduled activities does not demand drawing the inference that the reviewing officer failed to consider the pollution caused by those emissions or the practical measures that could be taken to mitigate that pollution and to protect the environment from harm as a result of that pollution.
Sixthly, this explanation for the reviewing officer not expressly referring to emissions of GHGs and PM2.5 in the Licence Review Record - that the appropriate regulatory approach is an industry-wide approach - is corroborated by the EPA's development of the Climate Change Policy and the Climate Change Action Plan. The Climate Change Policy and the Climate Change Action Plan provide for a staged regulatory approach to set targets for emissions of GHGs and PM2.5 for relevant industry sectors and, in a number of years, to vary licences in the industry sectors to require licensees to implement practical measures to achieve those targets. The Climate Change Policy and the Climate Change Action Plan did not instruct EPA officers to review and vary licences in the industry sectors immediately to require licensees to take practical measures to mitigate the emissions of GHGs and PM2.5 from their licensed activities.
The EPA developed the Climate Change Policy and the Climate Change Action Plan in response to this Court's order in the Bushfire Survivors case and published them only five months before the EPA reviewed the EPL. It is reasonable to infer the reviewing officer was aware of the policy and the action plan and the industry-wide, staged, regulatory approach recommended in them.
In these circumstances, it is not reasonable to draw the inference of a failure to consider the emission of GHGs and PM2.5 from the scheduled activities at the Maules Creek Coal mine from the lack of reference to, or recommendation to vary the EPL to impose conditions requiring the mitigation of, those emissions in the Licence Review Record.
For these six reasons, the Community Council has not established that the EPA failed to consider the matters in s 45(c) and (d) of the POEO Act in undertaking the licence review of the EPL for the Maules Creek Coal mine. Ground 3 is rejected.

Maules Creek Community Council Incorporated v Environment Protection Authority

At a glance

Court

Decision date

Before

Catchwords

Source

Catchwords

Judgment (106 paragraphs)

Parties

Legislation Cited (15)

Cases Cited (24)

Cited By (1)