Bailey v Director General, Department of Natural Resources (formerly known as Department of Land and Water Conservation)
[2014] NSWSC 1012
•25 July 2014
Supreme Court
New South Wales
- Amendment notes
Medium Neutral Citation: Bailey v Director General, Department of Natural Resources (formerly known as Department of Land and Water Conservation) [2014] NSWSC 1012 Hearing dates: 15 July - 9 August 2013 Decision date: 25 July 2014 Before: Fullerton J Decision: On the plaintiffs' case judgment for the first, second and third defendants.
Catchwords: MALICIOUS PROSECUTION - whether institution and maintenance of criminal proceedings for illegal clearing of native vegetation in the Land and Environment Court and by a case stated to the Court of Criminal Appeal was malicious and without reasonable and probable cause - misfeasance in public office - negligent misrepresentation - interference in trade or business - principle in Jones v Dunkel - claim of client legal privilege - whether plaintiffs exempt from the need to obtain development consent prior to clearing native vegetation - whether clearing part of "designated development" under s 12(f) Native Vegetation Conservation Act 1997 - whether plaintiffs entitled to rely on "rural structures" or "farm dam exemption" - whether any valid or conforming application under Part 8 of the Water Act 1912 Legislation Cited: Civil Liability Act 2002 (NSW)
Criminal Appeal Act 1912 (NSW)
Environmental Planning and Assessment Act 1979 (NSW)
Environmental Planning and Assessment Regulation 1994 (NSW)
Evidence Act 1995 (NSW)
Interpretation Act 1987 (NSW)
Limitation Act 1969 (NSW)
Native Vegetation Act 2003 (NSW)
Native Vegetation Conservation Act 1997 (NSW)
State Environmental Planning Policy No 46 - Protection and Management of Native Vegetation
Uniform Civil Procedure Rules 2005 (NSW)
Water Act 1912 (NSW)
Water Administration Act 1986 (NSW)
Water Amendment (Flood Control Works) Act 1999 (NSW)
Water Management Act 2000 (NSW)Cases Cited: A v State of New South Wales [2007] HCA 10; 230 CLR 500
Ampolex Ltd v Perpetual Trustee Co (Canberra) Ltd (1995) 37 NSWLR 405 at 411
ASIC v Hellicar [2012] HCA 17; 247 CLR 345
Bailey v Department of Land and Water Conservation (Supreme Court (NSW), James J, 22 May 2008, unrep)
Bailey v Department of Land and Water Conservation [2009] NSWCA 100; 74 NSWLR 333
Bailey v Director-General, Department of Natural Resources [2013] NSWSC 515
Cooper v Hobbs [2013] NSWCA 70
Bailey v Director General, Department of Natural Resources (Supreme Court (NSW), Fullerton J, 21 April 2013 unrep)
Birch v Allen [1942] HCA 17, 65 CLR 621
Director-General of the Department of Land and Water Conservation v Bailey [2003] NSWLEC 160
Director General Department of Land and Water Conservation v Bailey [2003] NSWCCA 361
Director-General Department of Land and Water Conservation v Jackson and Ors [2003] NSWLEC 81
Film Financial Consultants Ltd v Becker Group Ltd & Anor [2006] NSWSC 319
Grant v Roads and Traffic Authority of NSW [2014] NSWSC 379
Hope v Bathurst City Council [1980] HCA 16; 144 CLR 1
Kable v State of New South Wales [2012] NSWCA 243
Jones v Dunkel (1959) 101 CLR 298
Northern Territory v Mengel (1995) 185 CLR 307
Pinkstone v R [2004] HCA 23; 219 CLR 444
Polar Aviation Pty Ltd v Civil Aviation Safety Authority (No 4) [2011] FCA 1126
Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; 194 CLR 355
R v Adams [1935] HCA 62; 53 CLR 563
RPS v R [2000] HCA 3; 199 CLR 620
Sanders v Snell (l995) 196 CLR 329
Smith v Corrective Services Commn (NSW) [1980] HCA 39, 147 CLR 134
Standard Chartered Bank of Australia Ltd v Antico (1993) 36 NSWLR 87
Varawa v Howard Smith Co Ltd (1911) 13 CLR 35
Wentworth v Lloyd (1864) 10 HL Cas 589
Williams v The Queen [1986] HCA 88, 161 CLR 278Category: Principal judgment Parties: Bruce Clyde Bailey (1st Plaintiff)
Janet Beatrice Shafik-Bailey (2nd Plaintiff)
Director General, Department of Natural Resources (formerly known as Department of Land and Water Conservation) (1st Defendant)
Water Administration Ministerial Corporation (2nd Defendant)
State of NSW (3rd Defendant)Representation: Counsel:
PE King/FA Sinclair (Plaintiffs)
NJ Williams SC/IL Harvey/JL Roy (Defendants)
Solicitors:
Hicksons Lawyers (Plaintiffs)
Crown Solicitor's Office (Defendants)
File Number(s): 2006/267230
Judgment
The background facts and the issues to which they give rise in the pleadings
The plaintiffs, Mr Bruce Bailey and his sister Ms Janet Shafik-Bailey, are the registered proprietors of a rural property known as Hazeldene situated at Boomi in northern New South Wales. Hazeldene is located within a designated floodplain known as the Lower Macintyre, Whalan Creek and Boomi River Flood Plain. The Macintyre River, which borders Hazeldene to the north, is part of a regulated river system in the Border Rivers region of New South Wales and Queensland from which river waters are extracted under licence for irrigation farming in both States.
Hazeldene is operated primarily as an irrigated farming enterprise for the production of cotton under the business name "BC and JBS Bailey". Mr Bailey is also the registered proprietor of another rural property at Boggabilla, 60 kilometres east of Hazeldene, known as Rosewood West where cotton is also grown as part of the plaintiffs' business. Mr Bailey made all management and operational decisions for the business. His sister, the second plaintiff, did not give evidence in the proceedings.
The plaintiffs purchased Hazeldene in 1996 from their siblings following the death of their father in 1994. The purchase was funded by the sale of nine water licences which had been granted to their late father in the early 1980's under Part 2 of the Water Act1912 (NSW). The licences authorise the extraction of water from the Macintyre River for irrigation purposes. The rights in the remaining six water licences were transferred to the plaintiffs in 1996. In 1998, 2003 and 2008, the plaintiffs applied for and were granted a renewal of the six water licences under s 20C of the Water Act for a further period of five years. Collectively, the six water licences authorise the extraction of 5880 megalitres annually from the Macintyre River for the specified purposes of irrigating no more than 972 hectares on Hazeldene. The licences also provide that two axial flow pumps ("the Macintyre River pumps") are the authorised means by which the river water is extracted. As a condition of the licence the plaintiffs are required to meter and record all water diverted from the Macintyre River by means of the authorised works. A below ground system of irrigation channels, forming part of the irrigation infrastructure on Hazeldene, carries the allocated water to the areas under cotton cultivation in the north and south of the property.
Between 1985 and 1991, when it appears Hazeldene was being developed for cotton farming, Mr Bailey arranged for the construction of two water storage units. The first unit was built in 1985 with a surface area of 65 hectares. The second was built in 1991 with a surface area of 75 hectares. The water storage units were filled from the irrigation channels utilising lift pumps which had been installed on Hazeldene for that purpose. The two water storage units had a combined capacity of 4600 megalitres of water.
In addition to the allocated or regulated water pumped under licence from the Macintyre River into the below ground system of irrigation channels, Mr Bailey gave evidence that when the Macintyre River broke its banks and river water flowed across the floodplain, he turned off the Macintyre River pumps and, using the existing lift pumps, pumped floodwaters directly into the two water storage units either from Tarpaulin Creek (as to which see below) or floodwaters which flowed into the below ground channels.
This process of water collection and extraction either from Tarpaulin Creek or the Macintyre River floodplain is "floodplain harvesting" as defined in the "Water Sharing Plan - NSW Border Rivers Regulated Water Source" and adopted as the working definition in a joint agronomists' report tendered in the proceedings. The water thereby collected or extracted is similarly defined as "floodplain harvest water".
In May 2000 the plaintiffs purchased a parcel of land, known as "the Strip", bordering Hazeldene to the east. The Strip was also on the designated Lower Macintyre, Whalan Creek and Boomi River Floodplain. The Strip was purchased by the plaintiffs with the intention of clearing it of native vegetation and constructing a third water storage unit with a surface area of 84 hectares and a carrying capacity of 3000 megalitres of water. The clearing of native vegetation on private land was at that time subject to the provisions of Part 2 of the Native Vegetation Conservation Act 1997 (NSW) (since repealed).
The third water storage unit was also to be used in the cotton farming operations at both Hazeldene and Rosewood West. It was constructed with the intention that it would store water harvested from the floodplain during a flood event in the same way that Mr Bailey had harvested and stored floodwater in the past. According to a survey prepared for the purposes of the proceedings and tendered by the plaintiffs, the water harvested for this purpose was to be lifted by means of an additional lift pump to be installed proximate to the proposed third water storage unit near a below ground channel.
Between February 2000 and 21 July 2000, 64 hectares of native vegetation on the Strip was cleared by contractors retained by Mr Bailey in what I have referred to as "the first clearing event". In April 2002 an additional 20.4 hectares was cleared, including the island of native vegetation retained in the centre of the area cleared in June 2000, in "the second clearing event".
It was common ground that the plaintiffs did not obtain development consent under Part 2 of the Native Vegetation Conservation Act before clearing the native vegetation on the Strip in either the first or second clearing events.
The proposed third storage unit was to be constructed with levees extending 1.4 kilometres along its eastern side and 1.8 kilometres along the western side. The design of the unit allowed for a borrow pit to be dug leaving an island of vegetation in the centre of the pit and a 100 metre corridor on the western side adjacent to a dedicated travelling stock route.
Given that the design envisaged levee banks being constructed "on land that ... is within a floodplain" the construction of the unit was within the definition of "controlled work" in s 165A within Part 8 of the Water Act 1912 (NSW) and, that being the case, it was subject to approval being granted under Part 8 of the Water Act.
It was also common ground that the plaintiffs had not lodged an application for approval to build the water storage unit under Part 8 of the Water Act at the time of the first clearing event. The question whether they had lodged an application before the second clearing event was in dispute. It was their case that an application was lodged with the second defendant for processing on 19 July 2000, and that the refusal of Departmental officers to process the application at that time (or any time prior to January 2004) was tortious. The defendants submitted that there was no valid or complying application lodged by the plaintiffs until January 2004 and, even if there were, the Department was entitled to defer further consideration of it while the legality of the first and second clearing events was investigated.
It was a matter of considerable dispute in the proceedings as to whether, even with approval to construct the third water storage unit, the plaintiffs had a legal right to harvest floodplain water to fill it.
On 18 July 2002 the Director General of the Department of Land and Water Conservation (the first defendant in these proceedings) commenced proceedings against Mr Bailey by the issue of two summonses in the criminal jurisdiction of the Land and Environment Court for what were alleged to be two offences of clearing of native vegetation, being the first and second clearing events, without development consent in contravention of s 21(2)(a) of the Native Vegetation Conservation Act.
During the investigation into the illegal clearing which preceded the issue of the summonses, and in defence of the criminal proceedings in the Land and Environment Court, Mr Bailey relied upon legal advice he obtained in April 2000 from Allen Allen & Hemsley Lawyers ("the Allens' advice") to the effect that he was exempt from the need to obtain development consent under Part 2 of the Native Vegetation Conservation Act before clearing the Strip of native vegetation because the clearing was for the purpose of constructing a "rural structure", namely a "farm dam". The Allens' advice did not refer to the legislative source of the "rural structures exemption" being within Schedule 3 to the State Environmental Planning Policy No 46 - Protection and Management of Native Vegetation ("SEPP 46") and did not directly address the question whether an irrigation storage unit of the size Mr Bailey proposed building could properly be described as a "farm dam" to attract the exemption. Rather, the advice assumes that the size of the "farm dam" is not a material consideration so long as the clearing is to the minimum extent necessary for its construction.
Despite the repeal of SEPP 46 by s 70 of the Native Vegetation Conservation Act, the clearing of native vegetation for a purpose described in Schedule 3 to SEPP 46 continued to be exempt from any requirement for development consent under Part 2 of the Act. Although Mr Bailey informed Departmental officers of the tenor of the Allens' advice and provided them with a copy of the advice, the advice was not considered by the Department to be persuasive. They took the view that the "farm dam exemption" in SEPP 46 did not extend to the construction of an irrigation storage unit of the size and capacity of the third water storage unit Mr Bailey intended constructing on the Strip.
In the Land and Environment Court Mr Bailey also relied upon the exemption under s 12(f) of the Native Vegetation Conservation Act from the need to obtain development consent as an additional defence to the charges of illegal clearing. This was not referred to in the Allens' advice and was raised only obliquely in correspondence between the parties after the summonses issued. It was, however, relied upon expressly at the hearing of the summonses where it was argued on Mr Bailey's behalf that the construction of the third water storage unit was an "artificial water body" as provided for in Schedule 3 of the Environmental Planning and Assessment Regulation 1994, and therefore a designated development within the meaning of the Environmental Planning and Assessment Act 1979 (NSW). On that additional basis, it was submitted by senior counsel then appearing that Mr Bailey was not obliged to obtain development consent before clearing the Strip in either the first or second clearing events the subject of the criminal proceedings.
On 1 July 2003 Talbot J held that Mr Bailey was entitled to be acquitted of both offences having discharged the burden of establishing, on the balance of probabilities, that the clearing was for the purpose of the construction of a "farm dam" as provided for in Schedule 3 to SEPP 46 (Director-General of the Department of Land and Water Conservation v Bailey [2003] NSWLEC 160). Talbot J also considered whether the exemption in s 12(f) of the Native Vegetation Conservation Act was an additional basis upon which Mr Bailey was entitled to be acquitted. His Honour followed the decision of Bignold J in Director-General Department of Land and Water Conservation v Jackson And Ors [2003] NSWLEC 81 and held that without a development consent issuing under the Environmental Planning and Assessment Act, the exemption under s 12(f) of the Native Vegetation Conservation Act was not available.
Rather than formally dismissing both summonses, Talbot J acceded to a request that two questions of law be stated for the opinion of the Court of Criminal Appeal pursuant to s 5BA of the Criminal Appeal Act 1912 (NSW). The first question was advanced by the Department. It concerned whether the farm dam exemption under Schedule 3 to SEPP 46 applied where what was proposed to be constructed was a water storage unit of the size and scale of the third water storage unit Mr Bailey proposed building. The second question proposed by Mr Bailey related to whether the decision in Jackson as to the operation of s 12(f) of the Native Vegetation Conservation Act was correct in law.
On 5 December 2003, the Court of Criminal Appeal answered both questions in Mr Bailey's favour. It confirmed that the interpretation given to the "farm dam exemption" by Talbot J was available and held that the decision in Jackson as to the construction of s 12(f) was wrong in law and that Mr Bailey was also entitled to rely on the exemption in s 12(f) in defence of the allegation of illegal clearing.
On 17 December 2003, Talbot J dismissed both summonses.
Approval to build the third water storage unit under Part 8 of the Water Act was granted to the plaintiffs in December 2005 (but not issued until March 2006) after an application lodged by them in January 2004 was processed. The approval expressly noted that the clearing was approved by the Land and Environment Court. At that time Mr Bailey resolved not to construct the irrigation unit as market and seasonal conditions had changed and construction costs had increased.
The parties and the pleadings
The claim brought by both plaintiffs for damages under various causes of action
By an amended statement of claim dated 27 April 2007, the plaintiffs claim damages for the interruption to their farming business and the consequential diminishment of returns from cotton yields on both Hazeldene and Rosewood West over successive growing seasons between 2000 and 2006, by reason of what they claim was the tortious conduct of the defendants in preventing them from constructing the proposed third water storage unit on the Strip in 2000. The plaintiffs claim that but for the tortious conduct of the defendants, they would have harvested water from the floodplain between 2000 and 2006 (or accessed water otherwise legally entering the irrigation system on Hazeldene) and stored it in the proposed third storage unit to irrigate unexploited or underexploited areas of Hazeldene and Rosewood West and to improve cotton yields on the existing areas under irrigation on both properties.
Separate actions for the intentional interference in the plaintiffs' business by the unlawful acts of Departmental officers (or some of them); the negligent misrepresentations by other Departmental officers alleged to have induced the plaintiffs to act to their detriment; and the conduct of named officers said to constitute misfeasance in public office were pleaded in the alternate.
A Minister of the Crown in the State of New South Wales was at all relevant times responsible for administering the Water Act, utilising the resources of relevant departments established as divisions of the New South Wales public service. The Department of Land and Water Conservation ("the Department") was the administering department between 1995 and 2 April 2003. It was abolished as a department of the public service on 2 April 2003. The administering department was thereafter known as the Department of Natural Resources ("DNR") until it was abolished in April 2007.
The Department was also the administering department for the Native Vegetation Conservation Act whilst that Act remained in force. That Act was repealed on the commencement of s 52 of the Native Vegetation Act 2003 (NSW) on 1 December 2005. (These proceedings relate only to the operation of the Native Vegetation Conservation Act.)
The Director General of the Department, and the Director General of its successor, the DNR, (the first defendant in the proceedings), was responsible to the appropriate minister for the general conduct and management of the operations and functions of the Department. For the purposes of these proceedings, that included taking such steps as were necessary to consider, and if accepted to act upon the recommendation from the Legal and Compliance Branch of the Department that Mr Bailey be prosecuted for breaches of the Native Vegetation Conservation Act by the clearing of native vegetation in the first and second clearing events. In that capacity, the first defendant was a servant or agent of the third defendant (the State of New South Wales) for the purposes of performing such administrative or statutory functions or duties assigned to him.
The second defendant, the Water Administration Ministerial Corporation ("WAMC"), is the body responsible for receiving and considering applications under Part 8 of the Water Act for the construction of controlled works on a floodplain (the construction of the proposed third water storage unit being a controlled work as defined, and the Strip being part of a floodplain as defined). The WAMC is constituted under s 371 of the Water Management Act 2000 (NSW). That section provides:
(1) There is constituted by this Act a corporation with the corporate name "Water Administration Ministerial Corporation".
(2) The affairs of the Ministerial Corporation are to be managed by the Minister.
(3) Any act, matter or thing done in the name of, or on behalf of, the Ministerial Corporation by the Minister, or with the authority of the Minister, is taken to have been done by the Ministerial Corporation.
(4) The Ministerial Corporation is, for the purposes of any Act, a statutory body representing the Crown.
The functions of the WAMC are provided for in s 372. Relevantly, ss 372(3) and (4) provide:
(3) The Ministerial Corporation may exercise any of its functions, and may otherwise act, in the name of the Department.
(4) It is the duty of the Ministerial Corporation to exercise its functions consistently with the principles of ecologically sustainable development.
Mr Bailey's dealings with a number of authorised officers of the second defendant concerning an application for approval under Part 8 of the Water Act to construct the proposed third water storage unit (water compliance officers) and officers of the Department responsible for the operation of relevant provisions of the Native Vegetation Conservation Act, in particular the investigation into the legality of clearing the Strip of native vegetation in the first and second clearing events (vegetation compliance officers), were relied upon by the plaintiffs in establishing the liability of the third defendant as their employer.
Four agronomists gave evidence concurrently. In the course of their evidence it was agreed that on the assumption that the proposed third storage unit was constructed on or before the cotton growing season of 2001/2002 (that is, no later than December 2000), and on the further assumption that the plaintiffs were legally entitled to harvest floodplain water to store in the proposed third storage unit for irrigation purposes, the loss of income from that loss of opportunity between 2000 and 2006 was estimated at $3.3 million.
The plaintiffs also made a claim for exemplary damages for what they contend was the defendants' "insolence" in preventing them from constructing the third water storage unit and the "arrogance" with which they were treated by various of the water compliance officers as servants and agents of the third defendant.
The defences to the claims for damages brought by both plaintiffs (other than the defence of illegality)
The defendants submitted there was no evidentiary foundation for a finding of either actionable misconduct, unlawful conduct or mala fides by any of the defendants (or their servants or agents) in their dealings with Mr Bailey between 2000 and 2004 over the construction of the proposed third water storage unit or the clearing of the land to facilitate its construction. In addition, it was submitted that to the extent that any claim is founded on any advice furnished, or anything done or omitted to be done by the second or third defendants (or their servants or agents) under the Water Act, s 182 of that Act precludes any liability in damages if those persons otherwise acted in good faith. Here, it was submitted they acted in accordance with all proper practices and procedures consistently with the proper administration of Part 8 of the Water Act.
Further, to the extent that any of the causes of action are based on the failure of the defendants to exercise, or to consider exercising, any function under the Water Act, the defendants rely upon ss 44 and 46 of the Civil Liability Act 2002 (NSW). Section 43A of Civil Liability Act is also relied upon as not giving rise to any liability for any act or omission involving an exercise, or failure to exercise power under Part 8 of the Water Act, the powers under that Part being the exercise of a special statutory power within the meaning of that section, which was not an unreasonable exercise of that power in the circumstances.
Finally, it was submitted that to the extent that anything said or done by the defendants (or their servants or agents) in their dealings with Mr Bailey concerning the construction of the proposed third water storage unit prior to 6 November 2000 is capable of being described as a misrepresentation, or to the extent that any act of the defendants on or before that date is susceptible to being viewed as an unauthorised or unlawful act giving rise to a cause of action in tort (including breach of any statutory duty), no cause of action is maintainable by reason of s 14 of the Limitation Act1969 (NSW).
The plaintiffs advanced no submission to meet the limitations defence. It was not referred to in the Amended Reply.
The claim for damages by Mr Bailey for malicious prosecution
Mr Bailey brings a separate action for malicious prosecution against the first defendant and/or the third defendant for what is alleged to be the institution and maintenance of the criminal proceedings against him in the Land and Environment Court maliciously and without reasonable and probable cause. He also contends that the proceedings were maintained maliciously without reasonable and probable cause by way of the case stated to the Court of Criminal Appeal.
Particulars of malice were pleaded to include a number of purposes ulterior to the imposition of criminal sanctions provided for under the Native Vegetation Conservation Act, namely to prevent or delay the construction of the proposed third water storage unit, to deliberately cause Mr Bailey economic harm, and/or out of pique or spite. Other motivations, also said to evidence malice, were identified by his counsel in final submissions.
Mr Bailey's case is that he was prosecuted without reasonable and probable cause because, on a proper reading of the Native Vegetation Conservation Act and related legislation, the prosecution for illegal clearing was doomed to fail. This is said to follow from Mr Bailey being entitled to rely upon both the "rural structures/farm dam exemption" and the exemption from the need to obtain development consent in s 12(f) of the Native Vegetation Conservation Act, such that neither the first defendant as the named prosecutor in the proceedings and other "prosecutors" for whom the third defendant is vicariously liable, could have had any genuine belief in his guilt and, if they did, it was based on legally insufficient grounds. It was his further contention that the first defendant knew or must have known the prosecution could not succeed at the time the proceedings were commenced on 18 July 2002 because the Allens' advice obtained in April 2000, a copy of which he provided to the Department in July 2000 in the course of the investigation into the legality of the clearing, and of which the first defendant was aware when he initiated the proceedings, advised that the "rural structures/farm dam exemption" applied and that this was a complete defence to the allegation of illegal clearing.
The Allens' advice was also considered by Ms Lindsey Paget-Cooke, the legal officer within the Legal and Compliance Branch of the Department, who recommended that Mr Bailey be prosecuted in a prosecution memorandum considered by the first defendant before he approved the prosecution on 1 July 2002. It was submitted that Ms Paget-Cooke's deliberate failure to afford the Allens' advice the weight it deserved or ignoring it completely, and the first defendant's determination to treat it in the same way in order to preserve the Department's preferred policy position in its dealings with large scale irrigation farmers in the Barwon Region, and Mr Bailey in particular, was eloquent evidence of malice.
In addition to a claim for special damages for malicious prosecution assessed referable to what was said to be the loss of opportunity to harvest and store water in the proposed third water storage unit, Mr Bailey also claims damages representing the difference between the costs he incurred in defending himself in the Land and Environment Court and the costs of the proceedings brought by the Director General by way of a stated case in the Court of Criminal Appeal, and the costs he recovered. In the event that Mr Bailey succeeds in his action for malicious prosecution, the quantum of that head of his damages claim is not in contest. He also seeks an award of exemplary damages for what he contends was the "conscious disregard of his rights as a citizen and his right to be free from unwarranted prosecution". He makes an ambit claim for damage to his reputation.
In summary, the first and third defendants submitted that the prosecution of Mr Bailey for illegal clearing commenced by the filing of the summons in the Land and Environment Court on 18 July 2002 and maintained thereafter, including the appeal by way of a case stated to the Court of Criminal Appeal, has not been established by the evidence to be malicious, that is for the ulterior or improper purpose of causing "economic harm" to Mr Bailey or out of "spite and/or pique" (as pleaded), or for any other ulterior or improper purpose relied upon in counsel's closing submissions and, for that reason alone, the action must fail. They also submitted that the evidence fails to establish that the prosecution was instituted or maintained without reasonable or probable cause. The defendants submitted that the first defendant and Ms Paget-Cooke had reasonable grounds for believing that there were real prospects of Mr Bailey being successfully prosecuted (or a genuine belief in Mr Bailey's guilt) and, further, that when viewed objectively, it has not been proved that the proceedings were instituted or maintained without sufficient evidence to support each of the essential elements of the offence of illegal clearing in accordance with the information available at that time, including an available view of the relevant law.
The evidence relied upon by Mr Bailey to support his action for malicious prosecution, and what were relied upon as the inferences of fact said to arise from that evidence to establish the constituent elements of that claim, dominated the proceedings.
The defence of illegality
Were there any finding of liability in the defendants, or any of them, under any of the causes of action relied upon by both plaintiffs, or any finding of liability in the first defendant or third defendant for malicious prosecution, the defendants submitted that the plaintiffs (and Mr Bailey on his own behalf) have not proved that they have suffered any compensable economic loss. That is said to follow from the fact that what is relied upon as the lost opportunity to fill the proposed third storage unit with water (and thereafter the lost opportunity to extend and improve the irrigation farming business on Hazeldene over the period 2000-2006) would have been an opportunity illegally obtained in circumstances where neither Mr Bailey nor his sister had any right, licence, authority or approval under the Water Act to extract river water to fill the third water storage unit for irrigation purposes, or to harvest the overflow of river water from the floodplain for the same purposes (or at all).
The plaintiffs submitted that the defence of illegality proceeds upon a misunderstanding of the facts and a misreading of the statutory water rights regime in operation as at July 2000 and that, in any event, the defence of illegality is neither properly pleaded nor available in this case as a matter of law.
The interpretation and the application of particular provisions of the Water Act, in particular Parts 2 and 8 of the Act, and to a lesser extent the operation of the Water Administration Act 1986 (NSW) and the Water Management Act, are central to the plaintiffs' case on both liability and damages and to the defence of illegality relied upon by the defendants.
The legislative scheme - water
The licensing scheme under the Water Act 1912
Under s 12 of the Water Administration Act, the right to the control, use and flow of all water in rivers, lakes and aquifers, including all water occurring naturally on or below the surface of the ground, vested in the second defendant. These rights prevailed over any authority conferred by or under another Act (including a later Act). With the passage of the Water Management Act, effective from 1 January 2001, s 392 of that Act provides that these various rights (called "State's water rights") are now vested in the Crown, except to the extent to which they are divested from the Crown by that Act, or any other Act. Although the Water Management Act also repealed the Water Act, the operation of particular provisions of that Act, including provisions relating to "harvestable rights", only came into effect under progressive proclamations after the date of proclamation, they have no direct bearing on the issues in dispute in the proceedings.
The licensing scheme for the regulation of the use of river water is governed by Part 2 of the Water Act while Part 8, so far as is relevant to these proceedings, is concerned with regulating the construction of flood control works on a floodplain. Neither Part 2 nor Part 8 of the Water Act was affected by the passage of the Water Management Act.
So far as these proceedings are concerned, Part 2 and Part 8 of the Water Act were in force and remained in force between 2000 and 2006 (the closed period upon which the plaintiffs' case for damages is based) subject only to the passage of the Water Amendment (Flood Control Works) Act 1999 (NSW) ("the Amending Act") which came into force on 7 July 2000. The impact of the amendments to Part 8 under the Act are significant. Mr Williams SC, senior counsel for the defendants, submitted they were either ignored or overlooked in the way the plaintiffs have sought to make out their case.
Even assuming that a Part 8 application was lodged by Mr Bailey for processing on 19 July 2000 through Mr Gardner (a matter very much in dispute), on that date the Amending Act governed the granting of approval for the construction of the proposed third water storage unit on the Strip. Importantly, the Amending Act made further provision with respect to the approval of works that may affect or prevent the movement of floodwaters by requiring the second defendant to give consideration to the impact on the environment in determining whether approval for the construction of those works should be granted. In addition, other provisions within Part 8 of the Water Act were revised and new provisions introduced to deal with the approval of the construction of controlled works on a floodplain as defined in s 165A. It will be necessary to return and consider the operation of Part 8 under the Amending Act in detail.
Part 2 of the Water Act
At all relevant times so far as these proceedings are concerned, the plaintiffs were authorised under licence granted pursuant to Division 3A of Part 2 of the Water Act to extract a certain (volumetric) quantity of water from the Macintyre River utilising nominated authorised works ("the Macintyre River pumps") for the express purpose of servicing an irrigated area of no more than 972 hectares on Hazeldene. That authority, identified in the proceedings as 90SA011547 and renewed under s 20C of the Water Act, was subject to specified terms, limitations and conditions, one of which required the plaintiffs to meter and record the measurement of all water diverted or taken from the Macintyre River by means of the authorised works. In 2009 the water licences were converted to Access Licences under the Water Management Act and are now known as Regulated River (general security A) - 90AL812209 and Regulated River (general security B) - 90AL812210. These may be ignored for present purposes.
The defendants submitted that the authority 90SA011547 current throughout the closed period 2000 to 2006 upon which the plaintiffs' claim for damages is based, was to operate a joint water supply scheme as provided for in Div 4 of Part 2 of the Water Act.
A "joint water supply scheme" is defined in Division 1 of Part 2 of the Water Act to include any work which:
(a) is used or proposed to be used for the purposes of supplying water to the lands of two or more occupiers who are jointly utilising the work or who propose to utilise the work jointly (whether any of those occupiers has occupation of the site of the work or not),
(b) ...
(c) ...
A "work" to which Part 2 extends is defined to mean a work:
(a) which is connected with, or which affects the quantity or use of water in, a river or lake,
(a1) ...
(b) which affects the quantity of water flowing in, to or from, or contained in, any such river or lake, or
(c) in or through which flows, or is contained or used, water taken from any such river or lake,
being a work which is used, or is to be used:
(d) for water conservation, irrigation, water supply or drainage,
...
(g) a work declared under subsection (3) to be a work for urban drainage, or
(h) a work (or class of work) declared by the Ministerial Corporation by order published in the Gazette as being a work to which this Part does not extend.
"River" is defined to include:
(a) a stream of water, whether perennial or intermittent, flowing in a natural channel, or in a natural channel artificially improved, or in an artificial channel which has changed the course of the stream,
(b) an affluent, confluent, branch or other stream of water into or from which a stream referred to in paragraph (a) flows, and
(c) anything declared by the Ministerial Corporation by order published in the Gazette to be a river ...
...
The defendants submitted that the joint water supply scheme operated by the plaintiffs and the licensed works associated with it under the authority 90SA011547, including the Macintyre River pumps which were used to supply water to both Hazeldene and Rosewood West for irrigation farming, did not confer any right to take river water except through the licensed works and subject to the limitations and conditions of the licence.
Section 19 in Part 2 of the Water Act provides that:
No water shall be taken from any river or lake for the purposes of any joint water supply scheme except under authority granted in pursuance of the provisions of this Division.
Section 21B, also in Part 2, provides:
(1) Any person who:
(a) constructs, erects or uses a work to which this Part extends otherwise than pursuant to a right conferred on the person by this Part or Part 10 or by a licence, group licence, irrigation corporation licence, authority or permit,
...
is guilty of an offence...
The defence of illegality, pleaded by the defendants in answer to the entirety of the plaintiffs' claim for damages, proceeds upon the construction of the operating provisions of Part 2 of the Water Act as set out above to the extent that those provisions govern Mr Bailey's entitlement to extract river water (as defined) to fill the proposed third water storage unit. The competing submissions as to the construction of those provisions will be considered later in these reasons.
Part 8 of the Water Act
Guidelines for the Macintyre River and Whalan Creek Floodplain Development - Boggabilla to Mungindi were developed and released in 1981. The guidelines describe a system of floodways which were intended should remain unobstructed by earthworks, subject to designated areas where levee banks and other floodplain structures are able to be constructed with minimal impact on the flow of floodwater. The Macintyre River and Whalan Creek Floodplain covered by the published guidelines includes Hazeldene and the Strip.
On 3 July 1985 the lower Macintyre River, Whalan Creek, and Boomi River floodplain was declared as a "floodplain" pursuant to s 166(1) of the Water Act. It was not in issue that Hazeldene and the Strip are located within the floodplain as declared. The construction of flood control works on a floodplain is subject to the operation of Part 8 of the Water Act. The construction of the proposed third water storage unit is a "controlled work", as defined in Part 8, for which approval was required.
The capture of floodplain water flows for irrigation purposes is known as "floodplain harvesting". It was common ground that during a flood event floodwaters progressively extend across the lower Macintyre River, Whalan Creek, and Boomi River floodplain from the Macintyre River towards and ultimately along a watercourse or waterway known as Tarpaulin Creek which traverses Hazeldene generally from north-west to south-east. The expert agronomists agreed that most of the water that enters the Tarpaulin Creek watercourse at these times originates from the Macintyre River as floodwater and flows east into Boomi Creek and back into the Macintyre River, in effect merging at that point with the river water.
An issue in the concurrent evidence session and in the evidence of Mr Cowell (an expert who gave evidence in the concurrent session and who was also called by the plaintiffs as a lay witness) was whether it was appropriate to characterise Tarpaulin Creek as a "watercourse" or "waterway" when it only ran in flood events. As the defendants ultimately submitted, little turns on the resolution of that question, or for that matter the precise topographical location of Tarpaulin Creek, also the subject of contention in the proceedings. That is because the floodwaters which are disgorged from the Macintyre River and which pass over and across the floodplain upon which Hazeldene is located (inclusive of their passage along Tarpaulin Creek), flow progressively east into Boomi Creek and back into the Macintyre River and, accordingly, access to those (river) waters (as defined) are necessarily subject to the water licensing system provided for in Part 2 of the Water Act. As noted above, the defendants submitted that Mr Bailey had no licensed right to access that water. Mr King, counsel for the plaintiffs, submitted to the contrary.
Mr Bailey gave evidence that when the Macintyre River breaks its banks and floodwater either enters the below ground supply channel on Hazeldene, or when it collects and then flows along Tarpaulin Creek and into the supply channel where the channel intersects the creek, he turns off the authorised pumps at the Macintyre River and, using lift pumps installed on Hazeldene, he "harvests" the floodwater by pumping it into the two existing water storage units built in 1985 and 1991. On the defendants' case, the lift pumps were not authorised works under the Water Act. In addition, the licence (90SA011547) authorising the plaintiffs to extract water from the Macintyre River by use of the Macintyre river pumps does not, in its terms, permit or authorise the use of the supply channel on Hazeldene, or the use of lift pumps to harvest or store harvested floodwaters in the existing water storage units on Hazeldene. The only licensed works under the authority are the Macintyre River pumps. Mr Bailey also gave evidence that the proposed third water storage unit was to be utilised in the same way.
The relationship between the harvesting of floodplain waters and the authorised or licensed extraction of river waters under Part 2 the Water Act, remained a matter of considerable contention in the proceedings.
As noted in [50], the Amending Act was passed effective from 7 July 2000 and amended Part 8 in significant respects. The following provisions are material.
Division 1 of Part 8 provides for the definition of relevant terms, including:
165 Definitions
(1) In this Part, except in so far as the context or subject-matter otherwise indicates or requires:
approval means an approval under this Part.
complying controlled work means a controlled work that is assessed as a complying controlled work under section 168B.
controlled work-see section 165A.
...
floodplain means any land which is so designated by an order in force under section 166 (1).
...
floodplain management plan means a floodplain management plan adopted by the Ministerial Corporation under section 166A. [None has been made to date and none current at the time.]
lake includes a lagoon, swamp or other collection of still water, whether permanent or temporary, not being water contained in an artificial work.
...
river includes:
(a) a stream of water, whether perennial or intermittent, flowing in a natural channel, or in a natural channel artificially improved, or in an artificial channel which has changed the course of the stream,
(b) an affluent, confluent, branch or other stream of water into or from which a stream referred to in paragraph (a) flows, and
(c) anything prescribed as being a river,
but does not include anything prescribed as not being a river.
...
165A Controlled work-meaning
(1) In this Part, a controlled work means:
(a) an earthwork, embankment or levee that is situated, or proposed to be constructed, on land that:
(i) is, or forms part of, the bank of a river or lake, or
(ii) is within a floodplain, or
(b) any work that is situated, or proposed to be constructed, on land that:
(i) is, or forms part of, the bank of a river or lake, or
(ii) is within a floodplain,
and that is declared by order of the Ministerial Corporation published in the Gazette to be a controlled work, ...
Division 2 provides:
166 Designation of floodplains
(1) The Ministerial Corporation may, by order published in:
(a) the Gazette, and
(b) at least one newspaper published and circulating generally in the locality of the land to which the order relates,
designate any land specified in the order as a floodplain.
(2) An order under subsection (1) takes effect:
(a) on the date of its first publication in the Gazette and a newspaper pursuant to subsection (1) or, where it is first published in the Gazette and a newspaper on different dates, the later of those dates, or
(b) a date specified in the order in that regard,
whichever is the later.
(3) While an order under subsection (1) is in force, the Ministerial Corporation shall cause a map depicting the floodplain to which the order relates to be made available for public inspection at each of its offices, free of charge, during the ordinary office hours of the Ministerial Corporation.
Division 3 provides:
166C Matters for general consideration
(1) The Ministerial Corporation, in exercising its functions under this Division with respect to approvals, must have regard to the following matters, and any other matters that it considers relevant:
(a) the contents of any relevant floodplain management plan or any other relevant Government policy,
(b) the need to maintain the natural flood regimes in wetlands and related ecosystems and the preservation of any habitat, animals (including fish) or plants that benefit from periodic flooding,
(c) the effect or likely effect on water flows in downstream river sections,
(d) any geographical features, or other matters, of Aboriginal interest that may be affected by a controlled work,
(e) the effect or likely effect of a controlled work on the passage, flow and distribution of any flood waters,
(f) the effect or likely effect of a controlled work on existing dominant flood ways or exits from flood ways, rates of flow, flood water levels and the duration of inundation,
(g) the protection of the environment,
(h) any other matter relating to the desirability or otherwise of a controlled work.
(2) The Ministerial Corporation is to ensure that the notice of its determination to grant or refuse to grant an approval, renew or refuse to renew an approval, impose conditions on an approval or vary or revoke the conditions of an approval includes a statement of the reasons for the determination and of the extent to which the Ministerial Corporation took into account the matters set out in subsection (1) in making that determination.
It was the passage of the Amending Act that saw the inclusion of the matters in s 166C which the Ministerial Corporation is obliged to take into account when exercising its approval functions. The defendants placed emphasis upon the mandatory consideration, being "protection of the environment" in s 166C(1)(g) and the residual matter in s 166C(1), "any other matters that the Ministerial Corporation considers relevant". It was submitted that an application for approval for the construction of a controlled work on a floodplain (the construction of the proposed third water storage unit on the Strip being a controlled work) without an assessment of the impact on the environment and, in particular, in this case, without completion of an investigation into the impact on the environment of the clearing of vast tracts of native vegetation on the Strip and an assessment of the environmental value of what remained at least before the second clearing event which effectively denuded the Strip of native vegetation, would preclude consideration of the environmental impact. For that reason, so it was submitted, water compliance officers of the Department (those concerned with applications for approval under Part 8 of the Water Act) were entitled to take a robust view of the plaintiff's apparent determination in both clearing events to clear the Strip of native vegetation prior to a Part 8 approval being granted to construct the water storage unit, independent of the different but related concerns of the vegetation compliance officers that a vast tract of native vegetation had been cleared which in 2000 they believed to have been cleared without consent under the Native Vegetation Conservation Act.
Mr Williams submitted that the way the plaintiffs case has been advanced, in particular the repeated submission that the operation of the Water Act and the Native Vegetation Conservation Act are distinct, such that the water compliance officers had no legitimate interest in whether consent under the Native Vegetation Conservation Act had been obtained, and the vegetation officers had no interest in whether a Part 8 approval had been granted, overlooks the interrelationship between the legislative objects in the Native Vegetation Conservation Act (reflected in the prohibition on illegal clearing under Part 2 of the Act without consent) and the obligation on the second defendant to consider the protection of the environment under s 166 of the Water Act when executing the powers to approve construction of controlled works under Part 8.
Section 167 provides that an application for an approval for the construction of controlled works shall:
(a) be made, in or to the effect of the form approved by the Ministerial Corporation, by the occupier of the land, or the occupiers of the lands, upon which the controlled work the subject of the application is situated or proposed to be constructed,
(b) be accompanied by:
(i) the application fee approved by the Ministerial Corporation, and
(ii) an assessment of the likely impact of the controlled work, and
(iii) such other information as may be required by the application form, and
(c) be lodged with the Ministerial Corporation.
Section 80 of the Interpretation Act 1987 (NSW) (as in force in July 2000 and currently) provides as follows:
(1) If an Act or statutory rule prescribes a form, strict compliance with the form is not necessary but substantial compliance is sufficient.
(2) If a form prescribed by an Act or instrument requires the form to be completed in a specified manner, or requires specified information to be included in, attached to or furnished with the form, the form is not duly completed unless it is completed in that manner and unless it includes, or has attached to or furnished with it, that information.
Upon receiving an application for approval of the construction of a controlled work the Ministerial Corporation (the second defendant) could refuse to determine an application if, inter alia, in its opinion the application did not comply with s 167.
In addition to the operating provisions set out above, ss 168A to 170B of the Water Act provide for a staged process pursuant to which a duly lodged Part 8 application will be considered. Under s 171, the second defendant is to determine an application by either granting or refusing to grant an approval in respect of the works the subject of the application. Under s 176A, the second defendant could, without limiting the operation of s 166C, impose conditions on an approval including "conditions relating to the protection of the environment". Under s 180, a person must not construct a controlled work otherwise than in accordance with an approval that is in force in respect of the work. Under s 180B if the second defendant formed the opinion that a person was engaging in, or was about to engage in, an activity that contravened s 180 it was empowered to order the person to desist from engaging in that activity by service of a notice in writing served on the person.
The plaintiffs tendered an affidavit by Mr Cameron, served by the defendants for the purposes of the proceedings, at a time when he held the position of Licensing Manager on secondment to the second defendant. In the affidavit he deposed to the process under which an application under the amended Part 8 of the Water Act would be dealt with pending the determination of the application in accordance with s 171 of the Act. In the affidavit he also noted that the Department published a guide for applications for consent to construct a controlled work under Part 8 of the Water Act after the passage of the Amending Act. That document was separately tendered by the plaintiffs as Exhibit HA 4 as current at least as at February 2001. It states:
The purpose of this document is to set out the requirements for plans to accompany applications (under Section 167 of the Water Act, 1912) for the approval of irrigation developments. In many cases, the application will require the services of a Surveyor or other suitably qualified person to prepare the plan on their behalf.
INTRODUCTION
Over the years, the previous practice for obtaining approval for flood control works on the floodplain (Part 8 of the Water Act) drew a lot of complaints from the wider community. The complaints were generally related to the delays associated with obtaining a license approval and the appeals process that existed at that time. In response to those community concerns, DLWC developed a package of major changes to the method of obtaining approval for flood control works on the floodplain.
The package involved revision of internal practices, development and updating of floodplain management plans through a community process, along with the associated necessary changes to Part 8 of the Act. The 1999 changes were gazetted on 7th July 2000.
The changes to the Act were intended to:
● Expand the issues which should be considered in relation to applications for approvals;
● Streamline the procedures for dealing with applications; and
● Strengthen the DLWC's ability to take appropriate action in relation to unauthorised flood control works or proposed building of works and to achieve the timely removal or cessation of such activity.
The main reasons for the amendments were:
1. There were repeated community requests to make management of flood control works more effective.
2. Changes would enable timely and practical action by the DLWC on unauthorised works.
3. The change was necessary in order to eliminate time consuming, costly and highly resource based analyses of the impacts associated with flood control works.
It also set out s 166C in full.
Exhibit U (also tendered by the plaintiffs) is a letter forwarded to landholders in the Namoi Valley from Mr Cameron as licensing coordinator of the Healthy Floodplains Project. The letter is dated April 2013.
The stated objective of the project is to:
...bring floodplain harvesting within the licensing and approvals framework of the Water Management Act 2000 in order to protect the environment and provide equitable arrangements for sharing floodplain water.
"Floodplain harvesting" is defined in the letter as "the collection, extraction or impoundment of water flowing across floodplains" excluding where water is extracted under a water access licence that is not a floodplain harvesting access licence; taking of water under a landholder right, including the harvesting of rainwater runoff; taking of water under an applicable water access exemption under the Water Management Act; or runoff of irrigation water and stormwater which is subsequently captured in accordance with licence conditions. None of the exclusions apply for present purposes.
The project is concerned with assessing eligibility under three requirements:
1. The landowner is already floodplain harvesting;
2. The harvesting takes place on a designated floodplain; and
3. The works used for harvesting fall within the definition of "eligible works".
The definition of "eligible works" refers to existing works already constructed on floodplains in accordance with approval granted under Part 2 and Part 8 of the Water Act or the Water Management Act as of 3 July 2008. There are another series of definitions of eligibility in terms of existing works.
It would appear that Mr Bailey considered that he was eligible as he forwarded registration of interest forms by facsimile on 28 June 2013 - notably within a week of proceedings commencing in this Court.
In those forms he cited the irrigation storage unit by that time constructed on the Strip as having had "the works licensed/approved on 31 March 2006 referable to approval 90C W810925" - relevantly the date upon which the Part 8 approval lodged in January 2004 was granted.
In the registration of interest form Mr Bailey provided the following description of his floodplain harvesting activities and how the floodplain harvesting system works in respect of each of the three existing floodplain harvesting sites (again as he described them) on Hazeldene:
... overland flow will be taken by pipes and gates marked as site 3 on property map. This water will gravity feed through the tail water return channel shown in green hatching. It will be placed into storage 3 via lift pumps marked in blue.
Given the pendency of the commencement of the litigation at the time of forwarding the registration of interest, the information contained within it is not determinative of any issue arising in these proceedings.
The Native Vegetation Conservation Act
The Native Vegetation Conservation Act came into operation in 1998. It replaced existing legislative controls relating to the clearance of native vegetation and protected land with a consolidated legislative framework providing for a single regime for clearing native vegetation throughout New South Wales. The statutory objects in Part 1 of the Act are as follows:
(a) to provide for the conservation and management of native
vegetation on a regional basis, and
(b) to encourage and promote native vegetation management
in the social, economic and environmental interests of the
State, and
(c) to protect native vegetation of high conservation value, and
(d) to improve the condition of existing native vegetation, and
(e) to encourage the revegetation of land, and the rehabilitation of land, with appropriate native vegetation, and
(f) to prevent the inappropriate clearing of vegetation, and
(g) to promote the significance of native vegetation,
in accordance with the principles of ecologically sustainable
development.
The attainment of the statutory objects are provided for in successive Parts of the Act. In the Land and Environment Court and in these proceedings only Part 2 was of direct relevance.
Part 2 imposes controls on the clearing of native vegetation and creates criminal offences where native vegetation is cleared without consent. Penalties are imposed in accordance with s 126 of the Environmental Planning and Assessment Act.
Assessment of factors listed in the DPP prosecution Policy and Guidelines in relation to the proposed prosecution of Bruce Bailey for clearing native vegetation in contravention of Part 2 of the Native Vegetation Conservation Act 1997. (Prepared by Lindsey Paget-Cooke, 20 June 2002.)
1. The seriousness or triviality of the alleged offence, or that it is of a 'technical' nature only
The offence involved the clearing of 120 hectares of native vegetation, including vegetation possessing habitat values. The cleared area formed part of a local vegetation corridor linking the McIntyre River riperial zone to the Boronga nature Reserve in the south. The clearing could therefore not be considered to be trivial or of a technical nature.
2. Whether or not the action would be perceived as counter-productive by bringing the law into disrepute, for example, where consent for the clearing would have been given if an application had been made
Had an application been submitted, a Targeted Flora survey, a Fauna survey and Aboriginal sites survey would have been required. In view of the vegetation present it is almost certain that the application would ultimately have been refused. There do not appear to be any reasons why bringing this prosecution would result in the law being brought into disrepute.
3. Whether or not the alleged offence is of considerable public concern
No specific public concerns have been noted. However, there is indirect public interest in the matter, in that clearing would not have been permitted under the terms of the draft Moree Regional Vegetation Management Plan, which has been prepared by the Moree Regional Vegetation Committee, the members of which include local stakeholders. Furthermore, the interpretation of the exemptions under the NVC Act is of interest to landholders across the State.
4. The necessity to maintain public confidence in such basic institutions as the Parliament and the courts
There is a general obligation on the Department to use the legislation that Parliament has passed to achieve the objectives of that legislation. In this sense the prosecution of serious clearing offences will maintain the public confidence in these institutions.
5. The staleness of the alleged offence
The offence was committed some time ago - probably more than 2 years ago - although the Department only became aware of the offence on 31 July 2000. Some delays did occur during the course of the investigation, due to staff shortages and the need to prioritise some other prosecutions in the same region. However, the offence is significant, and the NVC Act specifically provides that proceedings can be brought within 2 years of the date of knowledge of the offence in question. Therefore it is not regarded as inappropriate to commence proceedings at this stage.
6. The prevalence of the alleged offence, and the need for deterrence, both personal and general
It is likely that many members of the farming community take the view that the Rural Structures exemption should allow the clearing of native vegetation for the building of water storages of any size. Certainly Mr Bailey told a Departmental officer that he had been advised by NSW farmers that clearing for his proposed storage would be permitted under the exemption. Whilst the prevalence of the abuse of this exemption is not known, there is a general need for clarification of its scope and in order to deter those who might be considering inappropriate reliance on it.
7. The availability and efficacy of the various options available to the Department to remedy the alleged breach
In view of the extent of the clearing and the level of environmental harm, this is considered to be a serious breach. It is intended that remediation should be achieved through the issue of a s47 remedial notice. However, it is considered that the offence is deserving of a punitive response as well.
8. The likely length and expense of any legal proceedings, including the investigation to obtain the evidence
The investigation is for the most part complete, and has only involved moderate Departmental resources in terms of staff time. As Mr Bailey has freely admitted, having authorised the clearing, the focus on the legal proceedings would be the legal interpretation of the Rural Structures and Regrowth exemptions. Therefore it is not expected that the final hearing would be particularly lengthy. It is therefore considered that the time and expense necessary to bring the proceedings will be worth it in terms of the clarification of the scope of the exemptions, and in terms of the future deterrence value assuming that the Department is successful.
9. Whether or not any resulting conviction would necessarily be regarded as unsafe and unsatisfactory, including the effect of any precedent which may be set
No reason to suppose that this will be the case.
10. The likely outcome in the event of a finding of guilt, having regard to the sentencing options available to the court, including the size of the penalty
It is possible that the court might be persuaded not to enter a conviction against Mr Bailey, on the basis that he relied on the advice he obtained from a reputable firm of solicitors. However, the Department would strongly argue against this, on the basis that -
● the advice should not have been read as allowing the extent of clearing which Mr Bailey carried out, and
● Mr Bailey had been advised by departmental officers that he would need to submit an application for consent to clear, because the proposed clearing was not permitted under the exemptions, and in view of this he should not just have relied on his solicitor's advice with out further consultation with the Department.
Assuming that a conviction was recorded, then the penalty would reflect the court's view of the seriousness of the offence, and the fact that Mr Bailey would by then have incurred the expense of erecting fencing as required by the s 47 notice. It is expected that the penalty would be modest, but it is nonetheless felt that even if that is the case it is worth bringing the proceedings.
11. Whether the consequences of any conviction or penalty would be unduly harsh or oppressive
The Department is not aware of Mr Bailey's financial circumstances, but these would be taken into account by the court in fixing the level of penalty.
12. The degree of culpability of the alleged offender in relation to the offence
The Department regards Mr Bailey's degree of culpability as high, bearing in mind that he had received advice on 3 separate occasions from Departmental officers, but chose to ignore it and to proceed with his plans regardless.
13. Any mitigating or aggravating circumstances, including any previous advice given to the alleged offender
The only mitigating factor, already referred to, is the advice Mr Bailey received from his solicitors.
14. Special circumstances that would prevent a fair trial from being conducted
Not applicable.
15. Whether or not the alleged offender is willing to co-operate in the investigation or actions taken against others, or the extent to which the alleged offender has already done so.
Mr Bailey has refused to be interviewed and/or to reveal the names of the contractors who undertook the clearing. However, this is not particularly significant, since the Department would not want to prosecute the contractors, who were clearly following Mr Bailey's instructions.
16. The action which is proposed to be taken against others arising out of the same incident
Not applicable - see above.
17. Whether the alleged offender has been dealt with previously in regard to alleged breaches of the NVC Act and how, including whether the alleged breach is a continuing or further offence
The Department has not had any previous actions against Mr Bailey.
Amendments
23 September 2014 - Typographical error
Amended paragraphs: Coversheet
Decision last updated: 23 September 2014
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