Minister for Planning v Coalpac Pty Limited

Minister for Planning v Coalpac Pty Limited - [2008] NSWLEC 271 - NSWLEC 2008 case summary — Zoe

[9]

(a) produce up to 350,000 tonnes of saleable coal a year from the project. 7 For the purposes of these proceedings, the annual production of coal permitted by condition 6(a) of schedule 2 of the approval is measured during the period between 7 September 2006 and 6 September 2007 (approval year). 8 The amount of saleable coal produced by the defendant in the approval year was 635,277 tonnes. This was reported to the Department of Planning in accordance with condition 4 in schedule 5 of the approval in the defendant's Annual Environmental Management Report. 9 The total daily deliveries from the project for the approval year were 597,129.9 tonnes as reported in the verified statement of total daily amounts dated 5 June 2008 by the defendant. A further 39,773.6 tonnes was purchased by the defendant for delivery during the approval year, whereby total deliveries on behalf of the defendant during the approval year were 636,903.5 tonnes. 10 On or around 4 April 2007, an application for modification dated 21 March 2007 was lodged with the prosecutor by the defendant (modification 1). Modification 1 was to allow the processing (washing) of coal recovered from the project at the on-site coal preparation plant. On 4 June 2007, the application for modification was approved by the prosecutor. 11 On or around 11 April 2007, an application for modification dated 4 April 2007 was lodged with the prosecutor by the defendant (modification 2). Modification 2 was to allow the introduction of auger mining techniques to improve coal recoveries and an increase in approved coal production from 350,000 to 500,000 tonnes a year from the project. On 6 December 2007, this application for modification was approved by the prosecutor. Additional conditions relating to community enhancement contributions, noise mitigation measures, a pollution reduction program, transport route restrictions, and land acquisition requirements were inserted into the approval. 12 On or around 6 September 2007, a major project application for the Invincible open cut coal mine - extension (the proposed project) dated 17 August 2007 was lodged with the prosecutor by the defendant. The proposed project was to allow an increase in annual coal production from 500,000 to 900,000 tonnes a year over a maximum period of eight years, expanding open cut and auger mining activities, crushing and processing coal on site, and trucking coal to Mount Piper. The proposed project has not been determined by the prosecutor. 13 It is not alleged that the defendant is in breach of any conditions in schedules 2 to 5 of the approval other than condition 6(a) in schedule 2. 14 The adverse environmental impact generated by the circumstances identified in the prosecutor's summons and charge was the lost opportunity for prior environmental assessment before the activity was carried out. The environmental assessment carried out for the project approval application, particularly in relation to impacts associated with traffic, dust and noise, was based upon the proposed rate of extraction. 15 The defendant has co-operated to the fullest extent with the enquiries made by the prosecutor in relation to the offence. 16 There is no record of any prior environmental offence by the defendant. 17 The defendant's profit and loss statement for the approval year is in evidence and I consider it below. Mr Follington's evidence 18 The following evidence was given by Mr Ian Follington, who has been the managing director of the defendant since November 2006 when a new major shareholder of the defendant came upon the scene. I accept his evidence. 19 In November 2006, the defendant prepared a document called "Overview of Existing Planned Developments for 2006 to 2012" which it lodged with the Department of Planning to initiate discussion regarding increased production. A presentation was made to officers of the Department prior to lodgement. The document contemplated production at the rate of one million tonnes per annum. There was dialogue between the defendant and the Department thereafter. One of the issues canvassed was the option of seeking to increase production by modifying the existing Part 3A project approval.

[21]

(a) the subject offence has the same character as an offence of contravening a condition of development consent issued under Part 4 of the EPA Act ; (b) although Part 3A is reserved for major projects, the contravention of a condition of a Part 3A consent in terms of general characterisation is neither more nor less serious than contravention of a condition of a Part 4 development consent; (c) the same maximum penalty applies. The objective seriousness in any particular case, whether for contravention of a Part 3A approval or a Part 4 consent, will turn principally upon the nature and purpose of the condition contravened, and the consequences of the contravention. 32 I consider that the defendant's submissions are to be preferred subject to one significant qualification. Major projects under Part 3A certainly have the potential to generate huge revenues and profits. If substantial revenues and profits are generated as a result of an offence, or they are the motive for an offence, that may bear adversely upon the defendant in sentencing. Nature of the condition contravened 33 The condition contravened was one of exceeding authorised production. The condition imposed an annual production limit of 350,000 tonnes of saleable coal from the Invincible Colliery. It is common ground that there was a very substantial exceedence of this limit during the charge period in the order of eighty per cent. 34 The determination of objective seriousness warrants consideration of why that annual production limit was imposed. The environmental assessment which supported the original Part 3A application indicates that the proposal for that limit was market driven. That is to say, it was a limit nominated by the defendant on the basis of it being sufficient to enable it to fulfil the contracts it won or thought it would win for the ensuing three year period. The defendant submits, without contest, that it was not a limit which was set because of any identified environmental constraints. I accept the submission. 35 It appears also from the environmental assessment which accompanied the original Part 3A application that under previous operations and consents prior to the colliery temporarily ceasing production in 2001, the colliery had been permitted to transport, and therefore it seems must have been permitted to produce, two million tonnes of coal per annum.

[22]

36 It is common ground that if a higher production limit had been applied for in a timely way it would have been granted subject to environmental assessment, and there is little doubt that the environmental assessment would have been satisfactory. Objective considerations 37 The original development application for production of up to 350,000 tonnes per annum was such that the environmental assessments which were carried out in relation to dust, noise and traffic impacts to support it were based upon the premise that that would be the maximum extraction from the mine in a year. The prosecutor submits, and I accept, that it was for this reason that condition 6 of schedule 2, which contains the production limitation, was imposed. There was no environmental assessment carried out to assess the impacts of producing more than 350,000 tonnes in a given year. As it turns out, the only environmental impact caused by the commission of the offence is the lost opportunity for prior environmental assessment before the increased production was carried out. The commission of the offence did not cause nor was it likely to have caused any substantive harm to the environment. 38 In that regard it may be noted that in December 2007, the Minister approved the defendant's application to increase annual production to 500,000 tonnes per annum, and currently the Minister is considering a further application to increase production to 900,000 tonnes per annum. Although the Department of Planning has not completed its assessment, there has nevertheless been an extensive and detailed environmental assessment submitted in support of the application, which has concluded that the proposed increase would not have any unacceptable impacts on the environment nor any unacceptable amenity impacts. That also appears to have been the Department of Planning's assessment of the defendant's earlier proposal to increase production to 500,000 tonnes prior to the Minister's approval of that proposal. 39 There is no suggestion that anyone has complained about this offence. Rather, the prosecution has been brought as a consequence of the Department of Planning acting upon the exceedence as disclosed by the defendant as part of its annual reporting.

[23]

40 There are other objective features, as follows: (a) the maximum penalty for this offence prescribed by Parliament under the EPA Act ; (b) the need for general deterrence; (c) the need for specific deterrence; (d) the gravity of the offence that was committed. Maximum penalty 41 The maximum penalty for an offence under s 125 of the Act is provided for under s 126 and is a fine not exceeding $1,100,000. The prescribed maximum penalty "reflects the public expression of Parliament of the seriousness of the offence": Camilleri's Stock Feeds Pty Limited v Environment Protection Authority (1992) 32 NSWLR 683 at 698. In Director of Public Prosecutions (Commonwealth) v Said Khodor El Kahani (1990) 21 NSWLR 370 at 380, the Court of Criminal Appeal held: As in all matters of sentencing for offences provided by statute, it is essential first to determine the maximum sentence which may be law be imposed. Not only does this identify any alternatives provided by Parliament. It indicates to the Court, in a general way, the seriousness with which Parliament, representing the people, has viewed the offence. 42 The maximum penalty provided under s 126 was increased from 200 penalty units to 1,000 penalty units in 1992 and to 10,000 penalty units in 1999. An increase in the statutory maximum sentence is a significant matter to take into account when exercising the sentencing discretion. It represents a change in the community expectation as to the appropriate sentence. General deterrence 43 The prosecutor submits that there is a need to impose a penalty that will act to generally deter others from carrying out development otherwise than in accordance with development approvals granted under the EPA Act, and that is one of the main purposes why Parliament has created the offence. I accept the submission. In Bentley v BGP Properties Pty Ltd (2006) 145 LGERA 234 at [139] - [140] Preston CJ said: A sentence must serve the purpose of general or public deterrence. It is the duty of the court to see that the sentence which is imposed will operate as a powerful factor in preventing the commission of similar crimes by those who might otherwise be tempted by the prospect that only light punishment will be imposed.

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