Solicitors:
Department of Planning and Environment (Prosecutor)
Mills Oakley (Defendant)
File Number(s): 2017/186631, 2017/186632, 2017/186634
[2]
The Defendant Seeks to Withdraw Admissions
The defendant in Class 5 proceedings in this Court, Leda Manorstead Pty Ltd ("Leda"), seeks by way of objection to paragraph [344] of the affidavit of Mr Stewart McLachlan, sworn on 19 May 2017, to, in effect, withdraw earlier statements that it made that constitute admissions under the Evidence Act 1995.
There can be no serious argument that the statements do not constitute "admissions" as that term is defined in the Dictionary to the Act:
admission means a previous representation that is:
(a) made by a person who is or becomes a party to a proceeding (including a defendant in a criminal proceeding), and
(b) adverse to the person's interest in the outcome of the proceeding.
The admissions were contained in a letter dated 19 April 2017 from the solicitors for Leda, Mills Oakley, to the Department of Planning and Environment ("the Department"), and were made prior to criminal proceedings being commenced in this Court against Leda ("the letter"). The salient parts of the letter are as follows:
As you would recall we act for Leda Manorstead Pty Ltd (our client).
We refer to our letter of 19 October 2016. We also refer to the subsequent meeting we (and the directors of our client) had with Mr Marcus Ray, Deputy Secretary (of the Department), on 8 December 2016.
At the meeting on 8 December 2016 we informed Mr Ray that after:
• the retrieval and compiling of documents to comply with the 'section 119J' notice issued by the Department;
• a review by our client of those documents; and
• a consideration by our client of the possible adverse environmental impacts of relevant actions,
our client may be in a position to admit to certain matters.
We explained - on behalf of our client - that we expected an early and frank admission by our client would reduce or eliminate the need for the Department to divert resources in what might otherwise be a costly and complex investigation.
On 30 March 2016 you informed us (by email) that this submission must be provided to you by 13 April 2017.
Exposed bulk earthworks (condition 21A(b))
Our client admits for part of the period between January 2014 and September 2016 works that were regulated by project approval 08_0200 were not carried out in strict compliance with condition 21A(b).
That is, in carrying out bulk earthworks under the project approval, the maximum exposed disturbed area relating such works (that had not been permanently revegetated) exceeded the maximum of five hectares set by condition 21A(b).
Our client was the beneficiary of the work that was carried out and is liable for this breach under section 75D of the former Part 3A provisions of the Environmental Planning and Assessment Act 1979 (the Act).
In considering what action the Department will now take, we ask the Department to bear in mind that there was no material adverse environmental impact from the breach.
Condition 21A(b) was inserted as a result of 'Mod 1'. It arose from submissions made by the Tweed Shire Council (the Council). The submissions were made specifically (and only) in relation to the control of dust. Whilst this motive is not explicit in the Director-General's assessment report for Mod 1, it is explicit in section 5.4 of the report for 'Mod 2':
[T]he 5ha limit is a requirement to reduce the impact of dust emissions on nearby residents.
We are instructed that an analysis of the records (kept by the successive environmental officers, the Council and the certifier) shows that, over the four-year period from August 2012 to the present:
• Five people made a total of eight complaints about dust in the approximately three-month period between 11 October 2013 and 4 December 2013. Five of these complaints were from three people about dust on the three days of 7, 8 and 12 November 2013.
These events occurred when earthworks were active in Cobaki's precincts 1 and 3 - immediately adjacent to the Currumbin Waters residential area. The complainants were apparently located predominantly in Sawtell Drive, but also at Ajax Court. We enclose a map showing these addresses.
• There were no dust complaints between December 2013 and February 2016. On 25 February 2017 a complaint was made concerning dust nuisance on the prior weekend. Acknowledgement was made by the complainant that there were trespassers (four-wheel drive vehicles and off-road bikers) on the property and that they were the cause of the dust problem.
Our client has observed that the problem is not caused by trespassers riding on the site's gravel roads or open earthworks areas. The problem arises from trespassers' activity over sloping areas that have never been the subject of earthworks. Their activity creates tracks - resulting from the frequency of this use - from which topsoil dust plumes result.
We are instructed that:
• None of the above dust complaints were caused by exposed bulk earthworks areas exceeding the limits of approval.
• None of the complaints were made by residents in locations near to, or that might conceivably have been affected by, earthworks in areas of the site (other than in precincts 1 and 2).
…
Apology
Our client acknowledges that breaching conditions of the project approval and the development consent is not acceptable. Even if there is no adverse impact from a breach, our client acknowledges that conditions must still be obeyed.
Our client particularly recognises that there was a minor, transitory adverse environmental impact from the use of the stockpile area. However, it is unlikely that - had our client complied with condition 49 - that this environmental impact would have been avoided. An environmental impact of this kind was within the scope of the terms of the development consent, as granted, in 1995.
Our client deeply regrets and apologises for the two breaches outlined above. There was clearly a failure on our client's internal systems. Our client acknowledges that such failures cannot be tolerated and it must ensure that such failures do not re-occur.
…
Next steps
In response, our client submits the following:
• Under the Department's Compliance Policy - in circumstances where there has been no or only low environmental harm - a penalty notice would not normally be issued. The only identified exception is when there is a need to deter further breaches because (for example) the offender submitted false and misleading information about the breach. No false or misleading information has been provided. Our client has co-operated fully with your compliance officers. This letter represents a further sep in our client's co-operation with you.
• The breach of condition 21A(b) offence is at the lower end of the scale of seriousness, as there has either been no material environmental harm as a result of this breach.
• The creation of the stockpile did involve some minor transitory environmental impact. However, this impact would not have been avoided if the correct procedure had been followed (ie obtaining the written consent of the SWAC). Accordingly, this breach is still at the lower end of the scale of seriousness. It also reflects a procedural failure in 2007 and 2008. Considerable time has elapsed since this procedural failure occurred.
• Given our client's co-operation and its apology (set out above), these breaches should be assessed as only having low significance.
• An appropriate response in the circumstances would be to issue a warning or advisory letter (ie an official caution) in relation to both breaches.
Attached to the letter was an aerial photograph of the subject area and a report from JWA Pty Ltd Ecological Consultants, entitled Impact Assessment of the Stockpiling of Soil on Part of the Cobaki Parkway Alignment Cobaki Estate dated April 2017.
There are several things to note from the outset about the letter. First, it is from Leda's solicitors, that is to say, the admissions were made pursuant to legal advice. Second, they are in respect of condition 21A(b) of the project approval referred to therein, alleged breach of which has given rise to two of the three charges against Leda being heard in these proceedings. Third, as is evident from the letter, they were made voluntarily in the hope of obtaining a dispensation from the Department.
Proceedings for two breaches of condition 21A(b) were commenced on 22 June 2017.
It was not until 15 November 2018 that Leda, by way of letter to the Department from Mills Oakley, sought to withdraw the admissions:
The Affidavit of Stewart McLachlan dated 19 May 2017
Paragraph [344] of the Affidavit of Stewart McLachlan dated 19 May 2017 (the Affidavit) and Tab 60 of Exhibit SM1 to the Affidavit relate to a letter issued by Mills Oakley to the Prosecutor dated 19 April 2017 (the Mills Oakley Letter).
The following statement contained on pages 1-2 of the Mills Oakley Letter provides, under the heading 'Exposed bulk earthworks (condition 21A(b))':
Our client admits that for the period between January 2014 and September 2016 works that were regulated by project approval 08_0200 were not carried out in strict compliance with condition 21A(b).
That is, in carrying out bulk earthworks under the project approval, the maximum exposed disturbed area relating such works (that has not been permanently revegetated) exceed the maximum of five hectares set by condition 21A(b). …
In short, the breach of condition 21A(b) has had not material adverse environmental or community impact.
(the Admissions)
The Defendant formally withdraws the Admissions contained within the Mills Oakley Letter.
The Defendant denies exceeding the limit of 5 hectares set by condition 21A(b), consistent with its plea of not guilty to Summons 1 and 2.
In the event that the Prosecutor seeks to press the admissibility of the Admissions in the above proceedings, the Defendant will object to the Admissions in accordance with ss 135 and 137 of the Evidence Act 1995 (NSW). The Defendant considers that the Admissions must be excluded as the probative value is outweighed by the danger of unfair prejudice to the Defendant, in light of the following matters:
The Admissions were made during the course of representations made by the Defendant to the Secretary of the Department of Planning and Environment on the basis that "early and frank admissions by [the Defendant] would reduce or eliminate the Department to divert resources in what might otherwise be a costly and complex investigation".
The context and contents of the Mills Oakley Letter are indicative of the letter being sent on a 'without prejudice' basis.
The Mills Oakley letter was sent six months prior to Summons 1 and 2 being filed and served on the Defendant. The Admissions were made prior to knowledge by the Defendant of the precise nature of the charges.
This attempt was rebuffed by the Department in writing on the same day.
In response, on 22 November 2018, Mills Oakley said as follows:
We refer to the above proceedings, and our letter of 15 November 2018 (and your subsequent response) regarding the letter issued by Mills Oakley to the Prosecutor dated 19 April 2017 (the Mills Oakley letter) referred to at paragraph [344] of the Affidavit of Stewart McLachlan dated 19 May 2017 (the Affidavit) and Tab 60 of Exhibit SM1 to the Affidavit.
In addition to the matters raised in our letter of 15 November 2018, the Defendant also considers that the Court should refuse to admit the Mills Oakley letter in accordance with s 90 of the Evidence Act 1995 as, having regard to the circumstances in which the admission was made, it would be unfair to the Defendant to use the evidence. We have previously detailed the relevant circumstances in which the admission was made in our letter of 15 November 2018.
Accordingly, please note that the subject matter of the Mills Oakley letter will be objected to pursuant to s 90 of the Evidence Act 1995.
[3]
Bases for Withdrawal of the Admission
The bases for withdrawing the admissions are set out in the correspondence referred to above and are not repeated.
In summary, Leda relies on ss 90, 135 and 137 of the Evidence Act.
Those provisions state as follows:
90 Discretion to exclude admissions
In a criminal proceeding, the court may refuse to admit evidence of an admission, or refuse to admit the evidence to prove a particular fact, if:
(a) the evidence is adduced by the prosecution, and
(b) having regard to the circumstances in which the admission was made, it would be unfair to a defendant to use the evidence.
…
135 General discretion to exclude evidence
The court may refuse to admit evidence if its probative value is substantially outweighed by the danger that the evidence might:
(a) be unfairly prejudicial to a party, or
(b) be misleading or confusing, or
(c) cause or result in undue waste of time.
…
137 Exclusion of prejudicial evidence in criminal proceedings
In a criminal proceeding, the court must refuse to admit evidence adduced by the prosecutor if its probative value is outweighed by the danger of unfair prejudice to the defendant.
[4]
Section 90
In my view, when regard is had to authorities such as Em v The Queen [2007] HCA 46; (2007) 232 CLR 67, there is nothing that would warrant the Court exercising its discretion to exclude the material containing the admissions.
The statements were made voluntarily by Leda, absent any cogent evidence of any promise by the Department that Leda would not face criminal sanction, and, it may be presumed, upon the provision of legal advice.
To the extent that the letter dated 15 November 2018 suggests that representations were made that if admissions were forthcoming no action would be taken against Leda, little weight may be placed on any such assertion given that the maker of the representations is not identified, the correspondence in which these purported representations were made was not put before the Court, and/or alternatively, there was no affidavit evidence to support such a claim. On the contrary, the letter states that it was the lawyers who expected that "an early and frank admission" could result in leniency and it was this expectation that was put to Mr Marcus Ray at the meeting on 8 December 2016, and not the other way around. Furthermore, the letter indicates that the admissions arose as a result of a review of Leda's documents by Mills Oakley.
The fact that the statements were made by Leda prior to being charged is immaterial in my view. Admissions are frequently made by defendants prior to criminal proceedings being instituted.
I also do not accept that the letter was sent on a "without prejudice basis" by Mills Oakley. There was no express indication that this was intended (it must be recalled that the letter was drafted by lawyers) and it cannot be inferred by the contents of the letter. Merely because the letter contained admissions and an apology in the hope of avoiding criminal charges does not mean that, without more, it was sent on a "without prejudice basis".
Finally, I do not consider that the admissions were improperly obtained or that they are unreliable.
In summary, I do not find that the circumstances in which they were made means that it would be unfair to Leda for the Department to rely on the admissions. I therefore decline to exclude the evidence pursuant to s 90 of the Evidence Act.
[5]
Sections 135 and 137 of the Evidence Act
It is convenient to deal with the discretion to exclude evidence under ss 135 and 137 together, noting, however, that the test is less stringent in s 137, because it does not require the probative value of the evidence to be "substantially outweighed by the danger that the evidence might be (a) unfairly prejudicial to a party", as it does in s 135.
There was no dispute that the evidence was not of "probative value" (as that term is defined in the Dictionary to the Evidence Act). Rather, the parties disputed whether or not the evidence was, with respect to each provision, unfairly prejudicial to Leda (s 135(a) only, and s 137).
In my view, the evidence could not be characterised as unfairly prejudicial to Leda. First, for the reasons given above, there is nothing in the circumstances surrounding the making of the admissions, or inherent in the content of the admissions, that is unfair to Leda. They were made voluntarily, upon receipt of legal advice, and without sufficient evidence of a promise that Leda would not be charged. Second, and contrary to a submission made by Leda, they were made in respect of a breach of a condition of the project approval the subject of two of the three charges it presently faces (condition 21A(b)), and not some other charge that has since been discontinued by the Department (with respect to the failure to obtain a construction certificate) or to which Leda has pleaded guilty (with respect to erosion and sediment control). Third, Leda has pleaded not guilty to having breached condition 21A(b) of the project approval. That is, the Department must nevertheless prove beyond reasonable doubt the elements of the offences with which Leda has been charged. The admissions do not, of themselves, in any way diminish this burden. In this regard, it is noted, for example, that the letter states that "none of the above dust complaints were caused by exposed bulk earthworks areas exceeding the limits of approval". Ultimately, it will be a matter for the Court what weight is to be accorded to the admissions.
As concluded above, the admissions are not unreliable. Nor do they, if admitted, give rise to any procedural unfairness, such as an inability to cross-examine their maker.
Turning to the discretion to exclude the evidence under s 135 of the Evidence Act, I do not accept that the probative value of the evidence is "substantially" outweighed by the danger that the evidence might be unfairly prejudicial to Leda.
I also do not accept that, for the purposes of s 137 of that Act, the probative value of the evidence is outweighed by the danger of prejudice to Leda.
For the reasons given above, I therefore decline to exercise my discretion to exclude evidence of the admissions under either provision.
[6]
Conclusion
It follows therefore that paragraph [344] of Mr McLachlan's affidavit is allowed into evidence.
The exhibits on the voir dire are to be returned.
[7]
DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.
Decision last updated: 29 November 2018