Morrison v Peacock and Roslyndale Shipping Company Pty Ltd [2003] NSWLEC 68 | Case summary

1 In these proceedings, the defendants, Harold Anthony Peacock and Roslyndale Shipping Company Pty Ltd, have each been charged with an offence against the Marine Pollution Act 1987. The charges respectively allege that on 1 December 1996, in the lagoon at Lord Howe Island, a discharge of oil occurred from the ship Sitka II into waters in contravention of s 8(1) of that Act. The defendant, Captain Peacock, was the master of the ship and the other defendant, Roslyndale Shipping Company Pty Ltd, was the owner of the ship. 2 In relation to those two charges the defendants have now pleaded guilty and, therefore, the only matters for consideration of the Court at this time is the question of penalty and the question of costs. 3 The defendants have each made an application under s 10 of the Crimes (Sentencing Procedure) Act 1999. They have also submitted that no order should be made as to costs of the proceedings in this Court. Both those submissions are resisted by the prosecution. 4 The case has an unusual history and it is relevant that I briefly summarise it. 5 The summonses respectively charging each of the defendants with the offences issued out of this Court on 23 January 1998. The hearing took place over three days in December 1998 and three days in May 1999. On 6 August 1999 I delivered the judgment of this Court (Morrison v Peacock and Roslyndale Shipping Company Pty Ltd [1999] NSWLEC 182). The defendants had relied on a statutory defence, that is, the defence that was, as the Marine Pollution Act then stood, set out in s 8(2)(b). It provided that s 8(1) (under which they were charged) does not apply to the discharge of oil or of an oily mixture from a ship: 8(2)(b) if the oil or oily mixture, as the case may be, escaped from the ship in consequence of damage, other than intentional damage, to the ship or its equipment, and all reasonable precautions were taken after the occurrence of the damage or the discovery of the discharge for the purpose of preventing or minimising the escape of oil or oily mixture, as the case may be. 6 One of the issues that was raised in the case became a crucial, very important and public issue. That was: Does the word "damage" in s 8(2)(b) include fair wear and tear. It was the prosecution's case that damage does not include wear and tear and, accordingly, the defence could not be made out. 7 I decided, by reference to some cases in this Court, that the word "damage" included fair wear and tear and, on that basis, I held that the defendants had made out their defence. 8 The prosecutor then asked me to state a case to the Court of Criminal Appeal. On 1 March 2000, I granted the application to state a case. The Court of Criminal Appeal delivered its judgment on 30 October 2000 (Morrison v Peacock and Roslyndale Shipping Company Pty Ltd (2000) 50 NSWLR 178) in which it answered the questions raised in the stated case by upholding my decision and by, in particular, adopting, as the proper construction of the word "damage", the construction that I had sought to put on it. 9 The prosecutor made an application on 10 August 2001 for special leave to appeal to the High Court. Special leave was granted and the matter came for hearing before the High Court on 9 April 2002. The judgment of the High Court was delivered on 9 October 2002 (Morrison v Peacock [2002] HCA 44). The High Court answered the question differently to the way that I had found and that the Court of Criminal Appeal had answered and held that: In that section "damage" means a sudden change in the condition of the ship or its equipment that was the instantaneous consequence of some event where the event was external or internal to the ship or its equipment. 10 On 25 October 2002 the defendants withdrew their defence and each entered pleas of guilty. 11 It is not necessary for me to traverse the facts in detail. They have been traversed seriatim as the hearings have progressed. It is only necessary for me to say this about the facts. On 1 December 1996 the Sitka II was tied up to the jetty at Lord Howe Island. It was unloading a cargo of road base bags and, for that purpose, it was utilising a crane that was situated on the ship. The crane was standing on a plinth and a hydraulic hose fitted to the crane ruptured causing hydraulic oil to discharge under pressure. An amount of 15 litres of oil escaped. Most of that discharged onto the deck of the ship but about five litres of oil escaped over the ship's side into the water. The first mate shut down the hydraulic pump, and the authorities were notified. A clean-up operation, under the auspices of the Marine administration Board at Lord Howe Island, was carried out and the five litres of spill was cleaned up in approximately two hours. 12 It was necessary for me to determine in the proceedings how the damage occurred. In par 26 of my judgment I made the following finding. 26 Mr Williamson's opinion was that the hose failed because of abrasion and chafing at the base of the steel sleeve in the crane column near the point where the crane sat at the top of the plinth. In the course of his investigation (which took place some time after the incident) Mr Williamson was able to observe the crane in a dismantled state. He noted that the base of the steel sleeve was very heavily corroded and that the radius was very rough. At the base of the sleeve, according to Mr Williamson, the column of hoses was able to turn in excess of 400 degrees, which resulted in a sawing motion of all the hoses at the point where the sleeve was corroded and rough. The abrasion and chafing could be seen on the eight hoses at that point when they were inspected after having been removed from the crane casing.

I have looked at those matters as follows. 15 First, the trivial nature of the offence. I do not consider that the offence of discharging polluting material into water is of a trivial nature. But I take into account, in the circumstances of the application of s 10 in these proceedings, that this offence was minor. The amount of oil which discharged into the water was five litres and, although it is important to consider that in its context, as Mr Hill, appearing for the prosecutor, urged, that amount is, by any standard, small. I take into account in this connection that the discharge was readily mopped up, although it took some two hours to do so, and I take into account in this connection that there was no evidence of any environmental harm of any sort. 16 Secondly, I have considered whether there were any extenuating circumstances. I think there were. 17 In pars 21 to 24 of my judgment I made findings in some detail as to how the crane came to be on the deck of the ship. In par 34 I summarised those findings firstly as follows: 34 … Roslyndale engaged experts in Australia to carry out work on the crane, experts in Auckland to assemble and fit it, and an expert from Bureau Veritas to test its operation, and Captain Peacock knew it had done so. It was reasonable in those circumstances for both the defendants to believe that the crane and its components would operate without mishap 18 Secondly, I noted that the crane was installed only six months prior to the incident, that it had been used during that period without damage and that there was evidence to show that it had been used for a period of approximately 60.5 hours without mishap. 19 Furthermore, as I found, visual inspection of the hoses at the point where the hose ruptured was physically possible by using a torch and by peering up into the plinth. But I accepted Mr Williamson's opinion that it was not certain to reveal the abrasion and chafing of the one hose which led to the actual rupture because eight hoses were located in that position. 20 In those circumstances I made, as Mr Gee QC, appearing for the defendants, correctly pointed out, a positive finding of fact that the defendants not only had no actual knowledge that the hose would probably rupture when the crane was being used, but they each had reason to believe that no such thing would occur. It seems to me that those circumstances amount to a case where there was, unlike many of the cases that are decided in this Court, no matters to indicate that the events which actually happened were likely to occur. 21 I do not ignore Mr Hill's submission that there was a warning sign. I found, in par 27 of my judgment, that there was another point at which abrasion and chafing could be seen. That was the point where the hoses entered the plinth through the forward access hole. That was not the place where the hose ruptured. Mr Hill strenuously urged the Court to find that that was a warning sign and that the defendants should have been under notice of abrasion and chafing and should have examined and taken steps to check the rest of the crane mechanism. 22 That matter was also raised at the hearing and I made findings about it in par 29 of my judgment as follows: 29 The first matter raised by Mr Burge was that the access hole in the plinth through which the hoses passed was rough and uneven, and was likely to cause abrasion and chafing, which Mr Williamson found did in fact occur at that point. Hence, in Mr Burge's opinion, the fact that a hose failed was foreseeable and preventable. This evidence does not coincide with Mr Williamson's opinion that the hose ruptured at the point where the hoses entered the steel sleeve of the crane casing, and, since I accept Mr Williamson's version, it does not displace a conclusion that there was no "intentional damage" . 23 I take the same view in connection with the s 10 applications that are made today. That was not a warning sign of the event which actually occurred. 24 Mr Hill also submitted that the offence under s 8(1) of the Marine Pollution Act is an offence of strict liability and in such a case the master, Captain Peacock, and the owner bear a responsibility. The legislative intention is that there shall be no environmental damage as a consequence of discharge into water which is why this offence is one of strict liability. Mr Hill drew my attention to a passage from the decision of the Court of Criminal Appeal in Valle v Morrison (Gleeson CJ, Allen and Sully JJ, NSWCCA, 22 November 1995, unreported). Allen J, with whom the other members of the Court agreed, said as follows: The submissions put to us by Mr Sexton in his able argument carried with them a suggestion that it would be inappropriate to impose a penalty upon a master in any case where it was not some personal want of care or skill on his part which caused the spillage. That submission, understandable though it is in human terms, is clearly contrary to the purpose of s 8 of the Act. It is a matter of notoriety that all too often it is not possible to sheet home to any individual responsibility for a spillage in the sense of establishing that it was his act or omission which caused it. The purpose of s 8 in imposing strict liability upon the owner and upon the master, as well as upon any individual found to be responsible, is to deal with this potential disaster of oil spillage by making the owner and the master responsible without personal fault. 25 That is correct, in my respectful opinion, but that does not mean that there can never be an appropriate application of s 10 in cases of strict liability. 26 As Mr Gee pointed out, s 10 is not qualified. It applies to any circumstances in which a court finds a person guilty of an offence. The offences under s 8 of the Marine Pollution Act is an offence to which s 10 applies. I note in this connection a passage from the judgment of Spigelman CJ in Thornloe v Filipowski (2001) 52 NSWLR 60 at 76 as follows: It is, in my opinion, relevant to the exercise of the discretion under s 10 of the Sentencing Act, in the context of a strict liability offence, to consider what the applicant for the benefit of s 10 could have done to avert the event that has occurred. 27 In this case I take the view that neither of the defendants could have done anything to avert the event that occurred. That event was the rupture of the hose at the base where the steel casing entered the plinth. This was not a case of want of precaution or other omissions on the part of either the master or the owner. They did what had to be done in relation to the installation and operation of the crane. They could not have been under any notion that it would not operate as it was expected to do. 28 Thirdly, in considering s 10 I have taken into account Captain Peacock's antecedents. He was at sea from 1978 to 1992. He spent four years managing a stevedoring operation offshore and in 1996 became the master of the Sitka II. He has no prior convictions for any marine pollution offences. Nor indeed does the other defendant, the owner of the ship. 29 I have taken into account a reference that has been tendered from Mr Ian Kiernan AO, the chairman of Clean Up Australia Ltd. I place perhaps some lesser weight on that reference than I would have done had Mr Kiernan made it quite clear that he was aware, when he wrote it, that the defendants had both been charged with an offence under the Marine Pollution Act. However, he does say that in his opinion the owners and the crew are responsible citizens and committed to the environment and some weight must be placed on that. 30 For all those reasons I think it is appropriate, as I have said, to apply s 10 in relation to both defendants. 31 I turn now to the question of costs. 32 When the High Court granted special leave to the prosecution to appeal, it did so on the condition that the prosecutor would pay the costs of the defendants in the Court of Criminal Appeal and in the High Court. That was not a surprising condition, considering that the reason that the High Court granted special leave depended upon the broad public interest in the question of law that was at stake. It was a broad and important public question and not at all confined to the particular circumstances of both defendants. However, what that means is that I should consider, as Mr Hill urged me to do, the costs of the proceedings in this Court somewhat in isolation because it is in respect of them that the defence asks me to make no order. (It was pointed out that there is extant an order awarding costs in favour of the prosecution against the defendants in relation to an interlocutory matter in the proceedings and I put that aside for this purpose.) 33 Mr Hill's submission was that the case on which the hearing in this Court depended was fairly simple on its facts. The defendants vigorously defended it. They did so in the ultimate without success. Moreover, he submitted, the question on which the whole issue turned could have been raised as a preliminary point and dealt with in some other less costly way instead of a hearing which went for six days. I reject that submission. 34 Firstly, there was a contest as to the facts underlying the defence. Evidence was adduced by Mr Burge (in reply, it is true) as to opinions and facts upon which the Court was urged not to find the defence made out. 35 Secondly, the defendants were entitled to defend their case. This is a criminal offence. The defendants are entitled to come to the Court and raise whatever defence may seem appropriate to them. 36 Thirdly, it was not appropriate to raise the question of the meaning of "damage" in s 8(2)(b) as a preliminary point in the proceedings. I agree with Mr Gee's submission that, had that been sought, the Court would have rejected it. It is not a question that can be decided in a vacuum. Indeed, the High Court was careful to point out in par 3 of its judgment as follows: 3. … The true issue was not whether wear and tear that results in the escape of oil is "damage" under s 8 … It was whether, upon the facts of the case, the expression "damage ... to the ship or its equipment" in s 8 covered the rupture of the ship's hose that was brought about by the abrading and chafing of the hose over a period of time.

Morrison v Peacock and Roslyndale Shipping Company Pty Ltd

At a glance

Court

Decision date

Before

Source

Judgment (15 paragraphs)

Parties

Cases Cited (4)

Cited By (7)