Coffey LPM Pty Ltd v The Contaminated Sites Committee [No 2]
[2013] WASC 98
•22 MARCH 2013
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CIVIL
CITATION: COFFEY LPM PTY LTD -v- THE CONTAMINATED SITES COMMITTEE [No 2] [2013] WASC 98
CORAM: HALL J
HEARD: 13 NOVEMBER 2012
DELIVERED : 22 MARCH 2013
FILE NO/S: CIV 1979 of 2012
BETWEEN: COFFEY LPM PTY LTD
Applicant
AND
THE CONTAMINATED SITES COMMITTEE
First RespondentWESFARMERS KLEENHEAT GAS PTY LTD
Second RespondentWA SEAFOOD EXPORTERS PTY LTD
Third RespondentMINISTER FOR THE ENVIRONMENT & HERITAGE
First-named IntervenorATTORNEY GENERAL FOR THE STATE OF WESTERN AUSTRALIA
Second-named Intervenor
Catchwords:
Prerogative writs - Judicial review - Contaminated Sites Act 2003 (WA) - Notice of provisional findings - Whether procedural fairness requirements met - Whether oral hearing required - Whether notice deficient in informing of the case to be met - Whether the notice should have contained statement of reasons - Whether the notice should have dealt with arguments raised by applicant and resolved conflicting evidence - Whether reasonable suspicion of contraventions could be held without excluding statutory defences
Legislation:
Contaminated Sites Act 2003 (WA), s 37, s 38
Result:
Order nisi discharged
Limited declaration made
Category: B
Representation:
Counsel:
Applicant: Dr J T Schoombee & Ms S C Errey
First Respondent : No appearance
Second Respondent : No appearance
Third Respondent : No appearance
First-named Intervenor : Mr R M Mitchell SC & Mr F Sunderland
Second-named Intervenor : Mr R M Mitchell SC & Mr F Sunderland
Solicitors:
Applicant: SRB Legal
First Respondent : No appearance
Second Respondent : No appearance
Third Respondent : No appearance
First-named Intervenor : State Solicitor for Western Australia
Second-named Intervenor : State Solicitor for Western Australia
Case(s) referred to in judgment(s):
Alphacell Ltd v Woodward [1972] AC 824; [1972] 2 All ER 475
Apache Northwest Pty Ltd v Agostini [No 2] [2009] WASCA 231
BP Australia Pty Ltd v Contaminated Sites Committee [2012] WASC 221
BP Australia v Contaminated Sites Committee [2012] WASC 211
DeKuyper v Crafter [1942] SASR 238
Environmental Agency (formerly National Rivers Authority) v Empress Car Co (Abertillery) Ltd [1998] 1 All ER 481; [1999] 2 AC 22
George v Rockett [1990] HCA 26; (1990) 170 CLR 104
Grays Haulage Co v Arnold [1966] 1 All ER 896
Gribbles Pathology v Cassidy [2002] FCR 856; (2002) 122 FCR 78
Heatley v The Tasmanian Racing and Gaming Commission [1977] HCA 39; (1977) 137 CLR 487
Hot Holdings Pty Ltd v Creasy [1996] HCA 44; (1996) 185 CLR 149
Kingham v Cole [2002] FCA 45; (2002) 118 FCR 289
Majury v Sunbeam Co Ltd [1974] 1 NSWLR 659
Masha Nominees Pty Ltd v Mobil Oil Australia Pty Ltd [2006] VSC 15; (2008) Aust Contract R 90‑237
MH6 v Mental Health Review Board [2009] VSCA 184; (2009) 25 VR 382
NAHF v The Minister for Immigration (2003) 128 FCR 351
NCSC v News Corp [1984] HCA 29; (1984) 156 CLR 296
Pallos Verdes Estates Pty Ltd v Carbon (1991) 6 WAR 223
Plaintiff M61/2010E v The Commonwealth (The Offshore Processing Case) [2010] HCA 41; (2010) 243 CLR 319
Plaintiff S10/2011 v Minister for Immigration [2012] HCA 31; (2012) 86 ALJR 1019
Price v Cromack [1975] 2 All ER 113
Re Carey; Ex parte Exclude Holdings Pty Ltd [2006] WASCA 219; (2006) 32 WAR 501
Re Contaminated Sites Committee; Ex parte Coffey LPM Pty Ltd [2012] WASC 242
Re Refugee Tribunal; Ex parte Aala [2000] HCA 57; (2000) 204 CLR 82
Ruddock v Taylor [2005] HCA 48
Salemi v McKellar (No 2) [1977] HCA 26; (1977) 137 CLR 396
Singh v The Minister for Immigration and Ethnic Affairs (1987) 15 FCR 4
South Australia v O'Shea [1987] HCA 39; (1987) 163 CLR 378
SPCC v Kristin Nominees Pty Ltd (1991) 72 LGRA 337
The Queen v McKellar; Ex parte Ratu [1977] HCA 35; (1977) 137 CLR 461
Traill v McRae (2002) FCR 349
Wiechmann v Lovering (1992) 59 SASR 203
HALL J:
Introduction
The Contaminated Sites Committee is charged with making decisions as to who is responsible for remediation of contaminated sites. Before making a decision the committee is obliged to give written notice to any person who may be held responsible: s 37 Contaminated Sites Act 2003 (WA) (the Act). The notice is required to set out the nature of the contamination and the extent to which the committee reasonably believes the person caused or contributed to it.
A person who receives a notice is afforded an opportunity to make written submissions as to anything in the notice that is disputed, and to provide information in support of their position. Any submission or information provided must be taken into account by the committee in making a decision as to responsibility for the remediation.
In this case, the applicant received a notice under s 37 in respect of land in Osborne Park. The land in question is the site of a petrol filling station. It is not disputed that the land has been contaminated by hydrocarbons. In 2004 a company engaged in environmental consultancy had conducted investigations at the site. That company was subsequently taken over by the applicant.
The notice stated that the committee reasonably suspected that an underground petrol fill pipe had been damaged in the course of the work conducted by the environment consultancy company and that this damage had resulted in all significant contamination now present at the site. The notice stated that the committee was proposing to decide that the applicant bore 70% of the responsibility for remediation of the site.
The applicant took the position that it could not respond to the notice because, in its view, there had been a denial of procedural fairness. The applicant then commenced proceedings for a writ of certiorari to quash the notice, a writ of prohibition to stop the committee from relying on the notice and proceeding to a final decision and a writ of mandamus requiring the committee to conduct further investigations and an oral hearing. Other orders were also sought including a stay of any decision‑making by the committee pending determination of the proceedings.
On 13 June 2012 an order nisi, or show cause order, was made by E M Heenan J: Re Contaminated Sites Committee; Ex parte Coffey LPM Pty Ltd [2012] WASC 242. An order was also made at that time staying proceedings before the committee until final determination.
The grounds of review contained in the order nisi are very lengthy. The issues raised by those grounds can be summarised as follows:
1.Was there a denial of procedural fairness because:
(a)the committee did not hold a hearing before issuing the s 37 notice?; and
(b)the committee did not conduct a site investigation in the presence of all parties prior to issuing the notice?;
2.is the notice defective because it does not inform the applicant of the case it has to meet?;
3.is the notice defective because it fails to include the reasons of the committee for issuing it?;
4.is the notice defective because it fails to deal with all factual and legal matters relevant to the question of whether the applicant can be held responsible for remediation under the Act?
The applicant's case is that the committee has failed to render it procedural fairness. This complaint is made before any final decision has been made. The s 37 notice is merely a preliminary step in the decision‑making process. It is not a step that adversely affects the applicant's rights and the process is far from complete. To allege that an incomplete process is deficient is an exercise in futility.
For the reasons that follow none of the grounds for review can succeed. In any event, prerogative writs are a discretionary remedy and this is not a case in which that discretion should be exercised in favour of the applicant. There will, however, be a declaration in respect of one aspect of the notice. This relates to references in the notice to the contamination being to the Osborne Park site 'and any affected sites'. It was accepted at the hearing that no other sites had been identified and there was no information contained in the notice that could justify a remediation decision in respect of other sites.
Background
The site which is the subject of the notice is located on the corner of Hutton and Howe Streets in Osborne Park. It is more fully described as Lot 152 on Plan 2849 comprising Certificate of Title Volume 1805 Folio 993 and is known as 7 Hutton Street, Osborne Park. At all relevant times the site has been owned by WA Seafood Exporters Pty Ltd (WASE), the third respondent.
From at least 1999 a petrol service station and motor vehicle workshop operated on the site. This service station was leased by Caltex Australia Petroleum Pty Ltd until late 1999 and by Wesfarmers Kleenheat Gas Pty Ltd (WKG), the second respondent, from 1999 to about 2004 and from 2004.
WKG and WASE were also named in the notice as having partial responsibility for remediation of the site. On this basis they were served with papers in these proceedings but have not sought to participate. The committee, which is the first defendant, has filed a notice that it intends to abide by the decision of the court. In these circumstances, there would have been no contradictor. However, the Minister for the Environment and the Attorney General were granted leave to intervene for that purpose and appeared by counsel.
In August 2004 an associated company of the applicant was engaged by WKG to carry out drilling in order to determine whether or not the site was contaminated. This involved taking soil samples by drilling at various locations at the site. One of the drill holes produced a sample which indicated the existence of petroleum contamination in the subsoil. The drill hole in question was given the identification code of SB11.
Further investigations were conducted in 2005. These included excavation of the site around drill hole SB11. This revealed that an underground fuel pipeline showed signs of damage. The damage was such that fuel was continuing to leak from the pipe. The pipe was then repaired on 8 April 2005.
In or about September 2008 WASE, as owner of the site, reported to the CEO of the Department for the Environment that the site was contaminated. That led to the site being classified by the CEO under s 13 of the Act as 'contamination - remediation required'. It is not disputed that the site is contaminated and that the classification was correctly made.
The responsibility for the remediation of sites classified as 'contaminated - remediation required' is provided for in pt 3 of the Act. Those responsible can include, relevantly, the owner of the site and any person who has caused or contributed to the contamination of the site. More than one person may be responsible for remediation and the extent of responsibility is determined in accordance with the Act: s 22. I will return to the relevant provisions later in these reasons.
The Contaminated Sites Committee (the committee) has responsibility for making decisions as to who is responsible for remediation of a site and the extent to which a person is, or persons are, responsible for such remediation. On 14 July 2008 WASE filed an application with the committee requesting it to make a decision as to responsibility for remediation under s 36(2) of the Act.
The committee then commenced investigations and enquiries. These enquiries continued over several years and involved extensive correspondence between the committee and the applicant, amongst others. The information provided by WASE to the committee included a report that it had commissioned from Hydrocarbon Remedial Services Pty Ltd (HRS). This report refers to the exploratory drilling undertaken in August 2004 and concludes that the drilling was the cause of the damage to the underground fuel line and that that damage, in turn, resulted in the contamination. The applicant was advised by the committee that this allegation had been made against it and the applicant made written submissions in response, including a detailed critique of the HRS report.
The applicant disputes that the drilling undertaken by its associated company caused the damage to the pipe. It contends that the hand auger used to make the drill holes could not have caused damage of the type alleged. Furthermore, it is said that drilling was done in accordance with a site map provided by WKG and on which the applicant relied. That site map is said to be inaccurate and thus any damage to the pipe caused by the drilling was unintended.
Relevant provisions of the Contaminated Sites Act
Division 1 of pt 3 contains a series of inter‑related rules for determining responsibility for remediation of a site. Some of those rules operate independently of any decision of the committee. Others require such a decision. Provisions of the latter type include s 25(3) and s 27(1). Those subsections impose liability to the extent that a person caused or contributed to contamination or to the extent that a subsequent owner knows or suspects that a site is contaminated when the owner acquired it. The necessity to determine the extent of liability requires a qualitative assessment by the committee.
As owner of the site, WASE is responsible for remediation of the site except to the extent that some other person caused or contributed to that contamination. Where contamination is said to have been caused by another person prior to the commencement of the Act that other person is only liable if that contamination was caused by an act done 'without lawful authority'.
The jurisdiction of the committee was enlivened by the application by WASE pursuant to s 36. That section provides as follows:
Committee to make decisions as to responsibility for remediation
(1)The committee is to make decisions as to -
(a)who is responsible for remediation of a site;
(b)the extent to which a person is, or persons are, responsible for remediation of a site.
(2)The committee -
(a)is to make a decision as to responsibility for remediation if it is requested to do so by an interested person; and
(b)may make a decision as to responsibility for remediation on its own initiative.
(3)In this section -
interested person means a person who is prescribed as being an interested person for the purposes of this section.
If the committee makes a determination that a person is responsible for remediation one of the consequences is that the CEO of the Department of Environment and Conservation (DEC) may issue various kinds of notices under pt 4 of the Act. These notices may require the investigation, cleanup or abatement of hazards arising from the contamination of a site: s 41 and s 49 to s 51. The Act provides that where a site is classified as 'contaminated - remediation required' a notice may be given to 'a person responsible for remediation of the site': s 42(1)(a). Where more than one person is responsible notice may be given to any or all of the persons responsible for remediation. A notice may also be given to an owner or occupier of the land: s 42(1)(c).
Such notices are binding on the person to whom they are given: s 47A(a). In some circumstances a notice may also be binding on subsequent owners: s 48; or on an owner of other land: s 54. A person on whom a notice is binding must ensure that the requirements of the notice are complied with within such time as is specified in the notice: s 43. Failure to comply with a notice is an offence and may also result in the CEO taking action to ensure that the requirements of the notice are complied with: s 43(2) and s 53(1)(a). The CEO may also recover the costs of taking action to ensure compliance from the person on whom the notice is binding: s 55(1).
Where a person carries out investigation or remediation in respect of a site (whether or not pursuant to a notice issued by the CEO) the person may, to the extent that the person is not a person responsible for the remediation of the site, recover certain costs from the person responsible for that remediation: s 56. The costs recoverable are the reasonable costs of carrying out the investigation or remediation and of complying with a notice issued by the CEO which is binding on the person incurring the cost. Such costs are recoverable by action in a court of competent jurisdiction.
It can be seen from this that there are two significant consequences that flow from a decision as to responsibility for remediation of a site classified as 'contamination - remediation required'. First, it makes the person or persons responsible liable to be served with a notice by the CEO which they are under a legal obligation to comply with. Secondly, it makes responsible persons liable to an action for recovery of costs associated with investigation and remediation of the site.
Once a decision has been made by the committee as to responsibility notice of it must be given to each person who the committee has decided is responsible for remediation: s 39(1). The notice of a decision has effect according to its tenor: s 39(3). A notice issued under s 39 determines the persons who are responsible for remediation of a site classified as 'contamination - remediation required' and the extent of their responsibility for the purposes of s 42(1)(a) and s 56 of the Act.
The decision does not operate to determine responsibility for remediation other than for the purposes of the Act. Nothing in the Act affects any right a person has at law to obtain damages: s 9(4). Neither the Act nor the decision of the committee affects any liability which might arise in contract or tort in respect of contamination of the land.
Section 33 of the Act provides that the committee is to consist of between three and five persons selected by the relevant Minister from a panel of names. The panel of names must contain the names of at least one legal practitioner and one auditor. There is nothing to suggest that, in choosing people from the panel to constitute the committee, the Minister is under any obligation to include a legal practitioner.
Section 34 provides for the procedure of the committee. It states as follows:
Procedure of committee
In making a decision under this Act the committee -
(a)is to consult the CEO and may consult any other person it considers necessary to consult; and
(b)is to act according to equity, good conscience and the substantial merits of the case, without regard to technicalities or legal forms, is not bound by the rules of evidence and is to conduct its inquiries in any manner it considers appropriate.
There is no provision in the Act which gives the committee coercive power to obtain information or to compel an exchange of information between persons who are contesting their respective responsibilities. However, reg 25 of the Contaminated Sites Regulations 2006 (WA) does confer power on the committee to require an applicant, a person who might be responsible for remediation of a site or a person who may have access to relevant information, to 'provide further information to the committee'. That regulation provides that any requirement issued by the committee must be in writing and must specify the information to be provided by that person and the period within which the person is to provide the information. Such a period may not be less than 14 days. Neither reg 25, nor any provision in the Act, authorise the committee to compel a witness to attend and submit to cross‑examination. There is no reference to the administration of oaths or to the conduct of hearings in the course of the committee's enquiries.
The committee's decision‑making process requires the issuing of a preliminary notice under s 37. It is such a notice which is of critical importance in this case. Section 37 provides for the necessary contents of the notice. The purpose of such a notice is to inform a person that there is a possibility that the committee could make a decision that they are responsible for remediation of a contaminated site and to give that person an opportunity to make submissions as to why such a decision should not be made. Where submissions are made, the committee is required to take them into consideration in making a decision: s 38. Once a decision has been made notice of it is required to be given pursuant to s 39. A person who has been given notice and is a party aggrieved by the decision has a right of appeal to this court on a question of law: s 40 and s 77.
Sections 37 to s 40 provide as follows:
37. Notice to be given before decision made
Before making a decision as to responsibility for remediation in respect of a person, the committee is to give written notice to that person -
(a)if the decision is proposed to be made in accordance with section 25, specifying -
(i)the nature of the contamination that the committee reasonably suspects that the person caused, or contributed to; and
(ii)the extent of the contamination that the committee reasonably suspects that the person caused, or contributed to;
(b)if the decision is proposed to be made in accordance with section 25(3), specifying the act that the committee reasonably suspects the person carried out without lawful authority and giving details of -
(i)the conviction of the person for the offence that was constituted by the act; or
(ii)any contravention described in paragraph (b) of the definition of “an act that was done without lawful authority” in section 25(5);
(c)if the decision is proposed to be made in accordance with section 26, specifying the change of use, or proposed change of use, to which the relevant land is, or is to be, put;
(d)setting out any other matters regarding responsibility for remediation that are relevant;
(e)informing the person that if the person wishes to disagree with any statements made in the notice the person may, within the time specified in the notice, make a written submission to the committee -
(i)specifying any statement that the person disagrees with;
(ii)giving reasons as to why the person disagrees with the statement; and
(iii)providing any information or documents supporting the reasons given;
and
(f)briefly and accurately summarising the effect of section 38.
38. Matters to be taken into account in making a decision as to responsibility for remediation
(1)A decision as to responsibility for remediation is to be made in accordance with Division 1 and the section which empowers the decision to be made.
(2)In making a decision as to responsibility for remediation the committee is to take into consideration -
(a)the contents of any notice given by the committee under section 37; and
(b)any submission made to the committee referred to in section 37(e) and any information or documents provided in support of the reasons given in that submission,
and may take into consideration any other matters the committee considers relevant.
39. Notice of decision to be given
(1)The committee is to ensure that notice of a decision as to responsibility for remediation is given in writing to -
(a)each person who the committee has decided is responsible for remediation;
(b)each person in respect of whom the committee has decided there is to be a change in the extent of the person’s responsibility for remediation;
(c)in the case of a decision under section 28, the insolvent body corporate;
(d)in the case of a request under section 36(2)(a) any person who made the request;
(e)in the case of a decision under section 54(1)(c), the first person within the meaning of that section; and
(f)each interested person, within the meaning of section 36(3).
(2)A notice given under subsection (1) is to -
(a)specify who is responsible for remediation and the extent of the responsibility;
(b)specify the section of the Act under which the decision is made;
(c)specify the reasons for the decision;
(d)contain details of the appeal available in respect of the decision under section 77; and
(e)contain any other details prescribed.
(3)A notice given under subsection (1) has effect according to its tenor.
40. Appeal from decision as to responsibility for remediation
A person who has been given a notice of a decision under section 39(1) may appeal against a decision of the committee in accordance with section 77.
Should prerogative relief be refused on discretionary grounds?
The intervenors submitted that the court should refuse to grant prerogative relief in this case on discretionary grounds because the applicant has an available alternative remedy, namely a right of appeal to this court on questions of law, if and when the committee determines the applicant to be responsible for remediation of the site.
The committee has not yet made a decision as to responsibility for remediation. Until such a decision is made and a notice is issued under s 39 the applicant cannot be the subject of notices under pt 4 or be held liable for the cost of investigation or remediation work undertaken for non‑compliance with such notices. The issue of a notice under s 37 does not affect the rights, duties or liabilities of the applicant in respect to the remediation of the site. It is clear that a notice under s 37 is merely an intermediate procedural step which may lead to a final decision but which does not of itself affect the interests of the applicant.
If the committee ultimately did make a decision that the applicant was responsible for remediation of the site then the applicant would have a right of appeal on a question of law under s 40 and s 77 of the Act. Such an appeal would be determined by reference to a decision as to responsibility that the committee had actually made rather than dealing with the mere possibility of such a decision.
The use of prerogative writs to seek review of procedural decisions involves a fragmentation of the process and consequential delays. Allowing applications for judicial review at intermediate stages of the process for determining responsibility for remediation of contaminated sites is apt to increase the cost of that process to both the community and to the affected parties.
The applicant has yet to make submissions in response to the s 37 notice. It may be that if submissions are made they would persuade the committee that no decision adverse to the applicant should be made. If that occurred there would be no effect on the rights of the applicant and the issues of law said to be raised by the application for prerogative relief would be academic. Even if the applicant's submissions did not make the committee change its preliminary view they may well cause it to alter the terms of that decision in a way that may affect the issues of law which are said to require determination by this court. A refusal of prerogative relief would not affect the right of the applicant to appeal in the event that the committee makes a decision that the applicant was responsible for remediation of the site.
Regard must also be had to the fact that WASE and WKG have also been identified in the notice as having potential partial responsibility for the remediation. In these circumstances, it is possible that either of those entities may seek to appeal a decision that they are in part responsible for remediation. Any such appeal would very likely also involve the applicant. The approach of the applicant in seeking to institute judicial review proceedings is therefore likely to unnecessarily multiply the number of proceedings in this court in relation to a single ultimate determination of the committee.
It is also arguable that insofar as the applicant complains that an oral hearing should have been held by the committee that complaint may be premature. It may be open to the committee, after receiving the applicant's submissions responding to the notice, to hold an oral hearing or, indeed, to conduct a site inspection. If the submissions expose issues that can only be determined by such a hearing or site inspection then that may be a course that the committee considers necessary. While s 37(1)(e) and s 38(1)(b) of the Act only refer to the applicant having a right to make written submissions those provisions do not expressly, or by necessary implication, prevent the committee from conducting an oral hearing after the issue of a s 37 notice and receipt of written submissions. It would be inappropriate to make conclusions that the proceedings are unfair before those proceedings are complete. It is inappropriate to use prerogative relief as a pre‑emptive strike before the committee has had an opportunity to consider whether it should convene an oral hearing prior to making a final decision.
It should also be noted that ground 18.1 of the amended grounds identifies a number of matters with which the s 37 notice allegedly fails to deal. Only some of those matters were raised in correspondence with the committee prior to the issue of the notice. To suggest, as the ground does, that issues not raised with the committee should nonetheless have been referred to in the notice and that the failure to do so makes the notice deficient extends the concept of procedural fairness beyond any reasonable bounds. It is inappropriate to use prerogative relief to raise matters that should properly be raised in proceedings before the committee.
The applicant has raised as a justification for seeking prerogative relief that to await a final determination by the committee would result in further delay. Whether that is so and the extent of any such delay is difficult to determine. The applicant has made a considered decision not to make submissions to the committee but to proceed by way of this application. As I have noted, prior to the issue of the s 37 notice there has been very extensive correspondence between the committee and the applicant. There is nothing to suggest that the long delay that has already occurred has occasioned any prejudice to the applicant. What is certain is that the applicant would not be precluded from raising any of the matters which it now seeks to agitate by way of appeal if and when the committee does determine that the applicant is responsible for remediation of the site. Having voiced its objection it could not be said that the applicant has waived any right to be accorded procedural fairness or to receive a notice which complies with s 37 of the Act. The applicant has cited cases in which such a right was considered to have been waived, but they were cases where no objection had been raised to procedural irregularity: see In Re The Commercial Registrar; Ex parte Commissioner of Main Roads (Unreported, FCt, WASC, 9705405, 14 October 1997) and MH6 v Mental Health Review Board[2009] VSCA 184; (2009) 25 VR 382 [37].
In the circumstances of this case the right of appeal after any determination by the committee that the applicant is responsible for remediation of the site provides an equally efficacious remedy as the current application for prerogative relief. Where equally efficacious rights of appeal exist the discretion to grant prerogative relief should be exercised only in exceptional circumstances: Re Carey; Ex parte Exclude Holdings Pty Ltd [2006] WASCA 219; (2006) 32 WAR 501 [128] ‑ [142] (Martin CJ). In my view, there are no exceptional circumstances in this case. Indeed, the factors referred to above favour the refusal of prerogative relief on discretionary grounds. I will, nonetheless, consider the merits of the grounds.
Issue 1 - Should there have been a hearing and a site inspection?
The applicant's argument requires that it establish two matters. First, that the committee's power to issue the s 37 notice was conditioned by a requirement that it accord procedural fairness to the applicant before doing so. Secondly, that in the particular circumstances procedural fairness required that the committee undertake an oral hearing and a site inspection before issuing the s 37 notice.
If the committee were to make a final decision that the applicant had responsibility for remediation of the site that would undoubtedly be an administrative decision affecting the rights and interests of the applicant. In the absence of plain words of necessary intendment to the contrary, the principles of natural justice generally regulate the exercise of such a power: Plaintiff M61/2010E v The Commonwealth (The Offshore Processing Case) [2010] HCA 41; (2010) 243 CLR 319, 352 ‑ 353 [74] ‑ [75]. As such the rules of procedural fairness must condition the committee's power to decide that the applicant is responsible for remediation of the site.
However, no decision as to responsibility for remediation has yet been made. The question in the present case concerns the validity of the s 37 notice rather than the validity of a decision as to responsibility for remediation. The question is whether the Act implicity conditions the power to issue a notice under s 37 by imposing a requirement that the identified elements of procedural fairness be rendered prior to that notice issuing. A condition that a power conferred by statute upon the executive will be exercised with procedural fairness to those whose interest may be adversely effected by the exercise of that power is usually implied: Plaintiff S10/2011 v Minister for Immigration [2012] HCA 31; (2012) 86 ALJR 1019 [97] (Gummow, Hayne, Crennan and Bell JJ). See also Re Refugee Tribunal; Ex parte Aala [2000] HCA 57; (2000) 204 CLR 82.
Crucially, as I have earlier noted, a notice under s 37 does not affect the rights or interests of the applicant; it is one step in the process by which the committee reaches a decision. The decision to issue a s 37 notice is not one that would be expected to attract obligations of procedural fairness. The proper characterisation of a s 37 notice is that it is one of the mechanisms by which procedural fairness is accorded to a person who may ultimately be held responsible for remediation of a site. The requirement to issue a s 37 notice is a modification of the common law requirements of procedural fairness, imposing on the committee a stricter obligation than might otherwise apply: BP Australia Pty Ltd v Contaminated Sites Committee [2012] WASC 221 [110] (Martin CJ).
In essence, the applicant's contention is that it is entitled to be accorded procedural fairness in a particular manner before the procedural fairness requirements provided for in s 37 have been accorded to the applicant. To construe the Act in this manner would be to treat a s 37 notice as having greater significance and effect than is provided for in the Act. Furthermore, it would be to impose prescriptive obligations as to the way in which, and timing of, aspects of procedural fairness are to be delivered. This is likely to impose a process which is more concerned with formalities than s 34 implies. Procedural fairness is concerned with substance, not form. It is concerned with the substance of the entirety of the process, not part of it: See South Australia v O'Shea [1987] HCA 39; (1987) 163 CLR 378.
The applicant placed reliance on the process here being what was described as 'two‑tier decision‑making'. That is to say that the process involves an investigation and a preliminary decision before a final decision is made. Reference was made to Hot Holdings Pty Ltd v Creasy [1996] HCA 44; (1996) 185 CLR 149 and Gribbles Pathology v Cassidy [2002] FCR 856; (2002) 122 FCR 78. But the use of general categorisations like 'two‑tier decision‑making' is apt to obscure the importance of the particular circumstances. Hot Holdings involved a preliminary decision by someone other than the final decision‑maker that the final decision‑maker was then required to take into account. That is materially different to the present case. In any event, whether and to what extent procedural fairness requirements apply to a preliminary stage in proceedings must always depend on the particular statutory framework within which the decision is made.
In my view, the committee's authority to decide that the applicant is responsible for remediation of the site is conditioned by a requirement to accord procedural fairness to the applicant. However, the authority to give the applicant a notice under s 37 is not so conditioned. The validity of the notice did not depend, either in these circumstances or at all, on the committee first holding a hearing or a site inspection.
The concern of the applicant is that the issue as to whether or not the damage to the pipe was caused by the drilling undertaken in August 2004 depends upon an understanding of the condition and appearance of the pipe and on a resolution of conflicting expert opinions. It is submitted that the committee could not properly conclude that one expert opinion should be favoured over another unless there had been an opportunity for the qualifications, expertise and credibility of the contesting experts to be tested in a hearing. Whether or not those contentions are correct, they say nothing about the validity of the s 37 notice.
The threshold for the issue of a s 37 notice is that the committee reasonably suspects that the person has caused or contributed to the contamination. This is a low threshold and one commonly applied to the initiation of investigative processes: See George v Rockett [1990] HCA 26; (1990) 170 CLR 104, 115; Ruddock v Taylor [2005] HCA 48. It is a state of mind that must have some factual basis, but it is something less than belief or knowledge. It is not a threshold that requires any comparison or resolution of competing evidence. That is a matter to be determined at the next stage.
It would appear that in this case there was a period of over three years before the s 37 notice issued and that in that period the applicant entered into correspondence with the committee endeavouring to persuade it that any suggestion that it was responsible for the contamination was without merit. It may be that the applicant is concerned that having strenuously argued its case the issue of the s 37 notice is an indication by the committee that those arguments have been rejected. But this is speculative and ignores the fact that the s 37 notice is not, and does not purport to be, a final determination of the issue of responsibility.
In any event, the applicant has not established that the failure to undertake an oral hearing or a site inspection amounted to a failure to accord procedural fairness in the circumstances of this case. That there has not been a proven failure to render procedural fairness is compelled both by the statutory context and the nature of the evidentiary material before the committee.
The content of the rules of procedural fairness will always be subject to the proper construction of the statute under which a particular decision is made: Salemi v McKellar (No 2) [1977] HCA 26; (1977) 137 CLR 396, 401 (Barwick CJ), 419 (Gibbs J) and 460 (Aitken J); The Queen v McKellar; Ex parte Ratu [1977] HCA 35; (1977) 137 CLR 461, 463 (Barwick CJ), 470 (Gibbs J) and 475 (Mason J); Heatley v The Tasmanian Racing and Gaming Commission [1977] HCA 39; (1977) 137 CLR 487, 491 (Barwick CJ), 498 (Aitken J). Procedural fairness does not require the inflexible application of a fixed body of rules; it requires fairness in all the circumstances, which include the nature of the jurisdiction or power exercised and the statutory provisions governing its exercise: NCSC v News Corp [1984] HCA 29; (1984) 156 CLR 296 (Gibbs CJ).
In this case there are a number of aspects of the statutory context which are inconsistent with any requirement that the committee is required to hold an oral hearing before giving an applicant a notice under s 37. First, as noted earlier, neither the Act nor the Regulations confer power on the committee to compel witnesses to attend for examination or cross‑examination. The committee would therefore only be able to carry out an oral hearing of the kind sought by the applicant if the persons who the applicant wishes to cross‑examine attended voluntarily and agreed to answer the questions which the applicant wishes to pose. Secondly, the committee has no power to administer oaths or affirmations to witnesses: See s 6 of the Oaths, Affidavits and Statutory Declarations Act 2005 (WA). Thirdly, the committee is constituted as an administrative committee that may, but is not required to, include a person with legal qualifications. Fourthly, the fact that s 37 refers only to the making of written submissions after a s 37 notice is given tends to suggest that the process as a whole is not one intended to include oral hearings.
Where legislation does not mandate an oral hearing, or contemplate such a hearing occurring as a matter of course, a right to such a hearing may be less readily inferred as being required by the rules of procedural fairness. A requirement to provide an oral hearing will be more readily inferred where the statute provides the necessary framework for such a hearing to occur: NAHF v The Minister for Immigration (2003) 128 FCR 351 [34].
An oral hearing may be more important where it is clear that affected persons are unlikely to be able to prepare written submissions or to obtain the necessary assistance to do so: Singh v The Minister for Immigration and Ethnic Affairs (1987) 15 FCR 4. However, where the affected persons are able to provide evidence and submissions in a complete and detailed manner in writing it is less likely that an oral hearing will be necessary. Indeed, in cases involving highly complex or technical issues written submissions may be preferable to an oral hearing.
In this case all parties have engaged legal advisers and provided detailed submissions and expert reports prior to the s 37 notice issuing. Whether or not differing expert evidence should be tested by cross‑examination may depend upon the nature of that difference. There is no general requirement that it be tested in this way: Wiechmann v Lovering (1992) 59 SASR 203, 204 (King CJ) and 212 (Mullighan J).
A right to cross‑examine will be more readily inferred where there are issues of credibility, serious issues of fact to be resolved or where the subjective state of mind of certain persons must be determined. In this case, the disparities are not in regard to the relevant primary factual material, which is largely documentary in nature. Rather the issues relate to what inferences should be drawn from that material. The only person who the applicant could arguably usefully cross‑examine is Mr Sims, the engineer who prepared the reports that conclude that the contamination was caused by the drilling undertaken in 2004. However, the applicant has been given the relevant reports and has taken the opportunity to produce a detailed criticism of Mr Sims' reports. The points of difference between Mr Sims and experts who have prepared reports on behalf of the applicant have been the subject of extensive submissions provided to the committee and circulated between the relevant parties. It is not apparent how oral submissions or cross‑examination would usefully augment the extensive and detailed legal and factual submissions, counter‑submissions, expert technical reports and critiques of expert reports that have been submitted by the applicant and other parties.
Lawyers have a tendency to assume that cross‑examination will render significant practical benefits in resolving conflict between witnesses. But that assumption may be based upon a professional bias in favour of adversarial proceedings rather than a rational assessment of the circumstances of the instant case. Cross‑examination is not an essential element of an oral hearing, far less is it a necessary element of procedural fairness. There are good reasons why it may be inappropriate in a particular case. These reasons include increased length of proceedings, greater formality and increased cost: NCSC v News Corp Ltd (314) (Gibbs CJ). Cross‑examination may also accentuate conflict and, where many parties are involved, make proceedings quite unmanageable: Kingham v Cole [2002] FCA 45; (2002) 118 FCR 289.
It is not apparent in this case that the applicant would suffer a substantial injustice or practical unfairness or be denied the opportunity to challenge the conclusions reached by Mr Sims if an oral hearing was not conducted. The relative merits of the competing expert opinions rely on the thoroughness, consistency and logicality of the reports. These are matters which can be addressed in written submissions; indeed, they are likely to be better addressed in that manner with evidence of this type which depends less on demeanour and more on questions of accuracy and intellectual rigour.
As regards the request by the applicant that the committee conduct a site investigation, it would seem that the purpose of this would be to determine the precise location of the underground pipes and whether other pipes had been repaired and replaced. The concern of the applicant is that there are mismatchings of colouration and markings on the damaged pipe and that these inconsistencies might suggest that the damage was in fact on the underside of the pipe which would be inconsistent with damage caused by drilling using a hand auger. It also contended that if the damage to the pipe was located above an underground tank, which is an area that the applicant claims was not the subject of drilling, then that may suggest that either WASE or WKG may be concealing other sources of contamination.
These are matters that were addressed by WASE, whose contractors removed the pipe in 2005. The photos of the pipe in situ whilst being excavated at that time show the same differences in colour. Connecting sections of the pipe which were not damaged have been removed and only the damaged sections retained as evidence. There is no evidence as to whether the damaged parts of the pipe overlay the tanks, that is merely a suggestion made by the applicant.
The applicant's allegations would not lead a reasonable person to form the opinion that appropriate action had not been taken to investigate damage to the pipe and the cause of contamination. There is no compelling reason to think that a site investigation would assist in resolving the matters in issue. In any event, the committee has no power to require a site investigation. Section 49 of the Act confers power on the CEO to order the owner of land to carry out a site investigation but 'only if, in the opinion of the CEO, there are grounds to indicate that appropriate action to investigate, monitor or assess the site is not being, or has not been, taken'.
If the applicant's position is that the available evidence leaves some issues relevant to its liability unresolved then that may be a point properly made in submissions in response to the s 37 notice. If the exact position of the damage and the location of the fuel pipes cannot be determined, the applicant could doubtless raise these matters as reasons why a finding that it has responsibility for remediation should not be made.
The applicant has not made out its claims that in the circumstances of this case procedural fairness required an oral hearing and a site inspection prior to the issue of the s 37 notice. The grounds of review that suggest to the contrary are without merit and must fail.
Issue 2 - Does the applicant know the case it has to meet?
The applicant contends that the notice is deficient because it does not adequately provide it with notification of the case which it has to meet. The applicant submits that the lack of precision as to the allegation against it and the basis for that allegation means that it is practically impossible for it to make meaningful submissions in respect to the notice.
The notice which is dated 21 March 2012 is in the following terms:
NOTICE UNDER S.37 OF THE CONTAMINATED SITES ACT 2003 REGARDING RESPONSIBILITY FOR REMEDIATION
SITE: 7 (LOT 152) HUTTON ST, OSBORNE PARK
WA Seafood Exporters (the Applicant) filed an application, received by the Contaminated Sites Committee (the Committee) on 14 July 2008, requesting it to make a decision under s.36(2)(a) of the Contaminated Sites Act 2003 (the Act) as to who is responsible for remediation of Lot 152 on Plan 2849 as shown on Certificate of Title Volume 1805, Folio 993, known as 7 Hutton Street, Osborne Park, (the site). The Applicant currently owns the site and was registered as proprietor of the site on 27 July 1988. The site was classified by the Department of Environment and Conservation (DEC) on 7 May 2008 as contaminated - remediation required.
Section 36 of the Act empowers the Committee to make decisions as to who is (or are) responsible for remediation of a site and the extent of that responsibility. The relevant provisions of the Act are summarised in Attachment 1. Full details of the provisions of the Act may be found online at
MPL Group Pty Ltd, an environmental consultant which conducted investigations on the site, was purchased by Coffey International Ltd (Coffey) in January 2010. Coffey was identified as a person who may be responsible, to some extent, for remediation of the site under the Act. Before making a final decision as to whether or not Coffey is a person responsible for remediation of the site, and the extent of that responsibility, the Committee provides the following written notice under s.37 of the Act. This notice relates to the site and any affected sites.
The information obtained from documents listed in Attachment 2 has been assessed against soil and groundwater investigation levels adopted by DEC as criteria suitable for Western Australian soil and groundwater conditions. These criteria can be found within 'Assessment Levels for Soil, Sediment and Water' (DEC, 2010), 'Contaminates Sites Reporting Guideline for Chemicals in Groundwater' (Department of Health, 2006) and 'Groundwater Intervention Values' (Netherlands Ministry for Housing, Spatial Planning and Environment, 2000).
Based on the information referred to in Attachment 2, the Committee has divided the relevant history of the site into six periods as outlined in Attachment 3.
Based on the information referred to in Attachment 2, the Committee reasonably suspects that:
a.contamination now present on the site and on associated affected sites was caused or contributed to by damage to the unleaded petrol remote fill pipe that occurred as a result of impact by a soil auger on 18 August 2004;
b.given the extent of contamination identified in soil and groundwater to date, contamination from the damaged unleaded petrol fill pipe contributed all significant contamination now present on the site and associated affected sites;
c.the damage to the unleaded petrol fill pipe was identified on 7 April 2005 and repaired on 8 April 2005, at which time the damage had been present for 233 days.
Attachment 4, which forms part of this notice, specifies for each relevant period and source of possible contamination,
•the nature and extent of the contamination that the Committee reasonably suspects was caused or contributed to;
•the act or acts, if any, that the committee reasonably suspects were carried out without lawful authority and gives details of 'an act that was done without lawful authority'; and
•the person or persons that the Committee considers are responsible for remediation, the shares of responsibility and the reasons why the Committee reasonably suspects that they are a person responsible for remediation of the site.
Note that Attachment 4 includes information relating to all periods and sources for which the Committee has considered potential sources of contamination in response to claims made by one or more of the parties in this matter.
Having regard to the above, the Committee proposes to decide that the following parties are responsible for remediation to the extent indicated:
Persons responsible for remediation
Shares of responsibility
Coffey International Ltd
70%
Wesfarmers Kleenheat Gas Pty Ltd
15%
WA Seafood Exporters Pty Ltd
15%
Caltex Australia petroleum Pty Ltd
0%
The shares of responsibility outlined in the above table may be changed in response to submissions received in accordance with the provisions of s.37 of the Act. Under s.37 of the Act, if you disagree with any of the statements made in this notice (including the Attachments) you may, on or before 4pm on 26th April 2012, make a written submission to the Committee:
i.specifying any statement that you disagree with;
ii.giving reasons as to why you disagree with the statement; and
iii.providing any information or documents supporting the reasons given.
As such submissions may contain aspects of a legal nature, you may need to obtain the independent legal advice of solicitors to assist in the preparation of the submission.
The Committee will make its final decision in relation to this matter no sooner than the expiration of 6 weeks from the date of this letter.
As is apparent the notice alleges that employees of the applicant, or an associated company, damaged a fuel pipe by the operation of a soil auger on 18 August 2004. It is alleged that the damage to the pipe caused contamination to the site by leakage of unleaded petrol when the fuel pipe was subsequently used to fill an underground storage tank. Although the applicant's employees reported a suspected encounter with an underground fuel line they did not report the damage or potential damage to WASE which by that time was the operator of the site. The manner by which the contamination is alleged to have occurred and the location of the pipe in question is detailed in Attachment 4.
Because this alleged contamination occurred prior to the commencement of the Act the liability of the applicant depended upon there being a reasonable suspicion that the act that caused the contamination was carried out without lawful authority. Attachment 4 to the notice meets this requirement by alleging that the damage to the pipe and subsequent contamination constituted an offence of causing pollution contrary to s 49(3) of the Environmental Protection Act 1986 (WA) (EP Act). Further it is alleged that the failure to inform WASE involved the applicant allowing the pollution to be caused also contrary to s 49(3) of the EP Act. The basis for those contentions is identified in the notice.
Prior to the issue of the notice three sets of written submissions had been provided to the committee by the applicant. These included the provision of two expert reports commenting on expert reports provided by WASE. WASE had provided an initial written application and an additional six sets of written submissions including at least five expert reports. WKG had provided nine written submissions and at least seven expert reports. A former tenant of the site, Caltex Australia Pty Ltd, had provided two submissions. A large proportion of these submissions and expert reports are devoted to analysis and refutation of submissions and expert reports provided by other parties. All of this material had been provide to the applicant prior to the issue of the s 37 notice. This level of participation is inconsistent with the suggestion that the applicant was labouring in the dark.
It is not doubted that procedural fairness requires that a person faced with a potentially adverse decision needs to know the case he or she has to meet. An ability to make meaningful submissions in response assumes that notification of what is alleged is given to affected parties: Apache Northwest Pty Ltd v Agostini [No 2] [2009] WASCA 231. However, the necessary content of a notice is variable: Traill v McRae (2002) FCR 349.
In this case, the purpose and content of the notice is provided for in s 37. The purpose is not to decide contentious issues but to provide a person with an opportunity to participate. This is done by advising of what in essence is a provisional decision. Procedural fairness does not usually require decision‑makers to disclose their thinking processes or proposed conclusions. To the extent that s 37 does require such notification it imposes a stricter obligation than would be required by the common law: BP Australia v Contaminated Sites Committee [2012] WASC 211 [110] (Martin CJ).
The fact that s 37 requires notification of a provisional decision does not mean that all of the requirements that would otherwise apply to a final decision are grafted on to the provisional decision. The applicant suggests that the notice should address the arguments advanced by it and indicate the committee's reasons for preferring the evidence of some witnesses over that of others. This presumes that the committee has necessarily rejected the arguments of the applicant and has formed final views as to competing evidence. But no claim of bias or prejudgment is made. In any event, that presumption is without proper basis.
The applicant's contentions are simply inconsistent with the provisional nature of the s 37 notice. The alleged deficiencies rely on the conflation of requirements applicable to a final decision with those relevant to a provisional notice. The correct measure of the adequacy of the notice is the terms of s 37. The notice clearly meets those terms and the applicant's contention that the notice is deficient is without merit.
Issue 3 - Has there been a failure to provide reasons?
The applicant contends that the committee had a duty to give reasons for issuing the s 37 notice. The suggestion is that such a duty can be implied from the provisions of the Act.
Procedural fairness does not usually entail the provision of detailed reasons prior to the making of a decision. Rather, what it requires is an opportunity to comment on adverse material which is before the decision‑maker and is credible, relevant and significant to the matter in issue. In Apache Northwest Pty Ltd v Agostini [No 2] Buss JA (with whom Wheeler and Newnes JJA agreed) said:
Ordinarily, a decision-maker is not required to disclose to a person to whom procedural fairness must be accorded the decision-maker's mental processes, provisional views or proposed conclusions before a final decision is made. Similarly, the decision-maker is not, ordinarily, obliged to send to a person to whom procedural fairness must be accorded, a draft of a report by the decision-maker which contains findings adverse to the interests of the person, for the purpose of enabling him or her to make comments or submissions. See Minister for Health v Thomson (1985) 8 FCR 213, 224 (Beaumont J); Alphaone, 590 - 591; Ex parte Palme [22]; OzEpulse Pty Ltd v Minister for Agriculture, Fisheries and Forestry [2007] FCA 1601; (2007) 163 FCR 562 [55] (Emmett J).
Although procedural fairness does not, ordinarily, require the decision-maker to reveal a proposed conclusion to a person to whom procedural fairness must be accorded, it may be necessary, in a particular case, for the adverse conclusion to be disclosed and for the person to be given an opportunity to comment on or make submissions in respect of it, if the proposed conclusion could not reasonably have been anticipated. See South Sydney City Council [260] - [261] (Mason P, Ipp AJA agreeing); OzEpulse [57]. [217] ‑ [218]
As noted earlier, s 37 modifies the common law requirements of procedural fairness and imposes upon the committee a stricter obligation with respect to the provision of notice to parties likely to be effected by the decision of the committee than that which would otherwise apply. This does not mean that s 37 imposes an obligation on the committee to provide detailed reasons for its decision to issue a notice.
There is no express obligation in the Act to provide reasons in a s 37 notice. This should be contrasted with the express requirement for reasons set out in s 39. Having made express provision for reasons in specified circumstances it is likely that if the legislature had intended that reasons were required in respect of a s 37 notice it would have made express provision in that regard. The fact that s 37(1) sets out a number of specific matters that the committee must include in the notice is inconsistent with an implication that the notice should also include a statement of reasons.
Bearing in mind that a s 37 notice is a provisional statement made prior to any final decision as to responsibility for remediation it would be surprising if detailed reasons were required. It would be premature for the committee to engage in any consideration of competing evidence at that stage and any attempt to do so or resolution of such conflict would be an inappropriate prejudgment.
Whilst in this case the applicant had provided the committee with expert reports and submissions supporting its own position, it was under no obligation to do so. Nor does the fact that it has done so prevent it from providing further written submissions and information in response to the s 37 notice. The committee is under an obligation before making any final decision to provide the applicant with an opportunity to deal with adverse information and also under an obligation to take into account any submissions or information that the applicant provides in response. In these circumstances there is no reason to imply an additional requirement to identify material evidence in a s 37 notice.
The applicant appears to be motivated by a concern that having provided extensive submissions and reports the committee has nonetheless issued a s 37 notice. In common parlance the applicant tried to nip the proceedings in the bud. It has thrown a great deal of effort into this attempt and takes the continuation of the proceedings by issue of the notice as being an implicit final rejection of all of the information, evidence and submissions it has advanced. But this is simply an erroneous characterisation of the notice. It also fails to acknowledge that the state of mind and standard of proof required for a s 37 notice is different from that required for a final decision under s 38. Evidence that may be sufficient to raise a reasonable suspicion may not be sufficient to found a final decision as to liability for remediation.
Section 37 of the Act does not contain the implied requirement to provide reasons or to identify material relied upon to support a reasonable suspicion. The applicant's contentions to the contrary must be rejected.
Issue 4 - Does the notice fail to comply with s 37(b) of the Act?
The applicant contends that the notice does not comply with s 37(b) because it does not 'specify or deal with' what are said to be 'pertinent matters detailed in paragraph 18 of the order nisi'. There is also a complaint that the notice is deficient because it refers to other affected sites which are not specified.
Section 37(b) of the Act requires that the notice specify the act that the committee reasonably suspects the person carried out without lawful authority. It must also give details of any contravention which constitutes an act done without lawful authority, as defined in s 25(5) of the Act.
In this case, the conduct is identified as being breach of the fuel pipe with a hand auger which then led to discharge of petrol when the pipe was used and a subsequent failure to inform WASE of the damage or potential damage. The notice specifies that the act was done without lawful authority because it was a contravention of s 49(3) of the EP Act in that it caused pollution and that the applicant also allowed pollution to be caused. In these circumstances, there is no obvious deficiency in the notice.
Paragraph 18 of the amended order nisi is as follows:
18Further and in the alternative, upon a proper construction of s 37 of the Act, and with particular reference to s 37(b), the First Respondent failed or refused to fulfil its duty pursuant to s 37(b) to specify the act or acts that the First Respondent reasonably suspects the Applicant carried out without lawful authority and to give details of any relevant contravention in that:
18.1with respect to the alleged first offence, the Notice fails to specify or deal with the following pertinent matters some of which were also raised by the submissions it had received, namely that:
(a)the Applicant contracted with the Second Respondent to do an environmental assessment of the Site on the basis that the Second Respondent had to provide to the Applicant an accurate layout plan identifying subsurface locations on all existing services (e.g. electrical, telephone and underground storage tanks) (affidavit of McFerran sworn on 1 June 2012 (affidavit McFerran p 1483);
(b)the Second Respondent then supplied to the Applicant a layout map or diagram of the Site (the Site Map) (affidavit McFerran pp 23-4; 127, 226, 714, 1161, 1302-3);
(c)the Applicant relied upon the Site Map in drilling test holes on the Site on 17 August and 1 September 2004, including borehole SB11 (affidavit McFerran p 1483);
(d)in terms of the Site Map, none of the Applicant's boreholes intersected with underground pipe work (affidavit McFerran pp 1302, 1303);
(e)the Second Respondent accepted that the Site Map was inaccurate, with reference to opinions expressed by URS and JFTA Engineering Services engaged by it (affidavit McFerran pp 1307; 1418, sub-paragraph 9);
(f)the Third Respondent produced to the First Respondent a site map showing that the Site Map was inaccurate (affidavit McFerran pp 23, 25);
(g)the Applicant reasonably relied upon the Site Map in undertaking drilling on the Site and if it had damaged the ULP fill pipe (which is denied), then that occurred by accident;
(h)the Third Respondent had submitted that the Applicant had reasonably relied upon the Site Map in undertaking drilling on the Site (affidavit McFerran, p 23, paragraph 4.1) and that any damage to the ULP fill pipe by the drilling of the Applicant on the Site had occurred 'accidentally' (affidavit McFerran, pp 28; 151);
(i)even if the hand augur used by the Applicant to drill the boreholes had damaged the ULP fill pipe at SB 11 (which has been denied by the Applicant), then the Applicant did not or could not have contravened s 49(3) of the EP Act by reason of its reliance on the Site Map and:
(i)the circumstance that the pipe had been damaged by accident which caused the relevant event, the release of fuel, within the meaning of s 23B(2) of the Criminal Code of WA; and/or
(ii)the application of s 24 of the Criminal Code of WA, in that the borehole at SB 11 was drilled in the honest and reasonable but mistaken belief that it would not hit any underground pipe work; and/or
(iii)the application of s 74(1a) of the EP Act, as the Applicant had taken reasonable precautions and exercised due diligence to prevent the commission of the offence;
18.2with respect to the alleged second offence, the Notice fails to specify or deal with the following pertinent matters which were also raised by the submissions it had received, namely:
(a)when and how the Applicant knew of the leaking ULP fill pipe, so as to be in a position to 'allow' contamination to be caused by continued leaking;
(b)the issue that at all material times before April 2005, when contractors of the Third Respondent uncovered the damaged ULP fill pipe, the Applicant submitted it did not know that the ULP fill pipe had been damaged or that (if that be a fact) its drilling by hand augur on 17 August 2004 had damaged it (affidavit McFerran, p 1154);
(c)on what basis the Applicant had a duty to communicate any such knowledge of continuing contamination (assuming it had such knowledge) to the Third Respondent, in circumstances where the Applicant contracted with the Second Respondent to do the environmental assessment of the Site and had been instructed by the Second Respondent not to communicate directly with the Third Respondent (affidavit McFerran, p 113 at (h));
(d)that the Second Respondent had on or about 18 October 2004 received the report of the Applicant of that date (the MPL Report), which in the borelog for SB11 notified the Second Respondent what had happened and the extent of the Applicant's knowledge in that context, while the Applicant at the same time had reported the presence of petroleum contamination near the underground pipe work and identified the pressing need for remedial work, at pp 3, 20, 21, 22 of the MPL Report (affidavit McFerran, pp 1164, 1185, 1186, 1187);
(e)that the Applicant was not requested by the Second Respondent to carry out all of the recommended remedial work, despite the receipt of the MPL Report (affidavit McFerran, pp 1138, 1139);
(f)that the Third Respondent stated in submissions to the First Respondent that it knew of contamination of the Site in September 2004 (affidavit McFerran, pp 12, 15);
18.3in respect of both alleged offences, the Notice fails to specify:
(a)which properties or sites were the affected sites purportedly covered by the Notice;
(b)on what basis any of the alleged offences applied to such affected sites or any of them.
The 'pertinent matters' referred to by the applicant in paragraph 18 of the order nisi consist of factual contentions and legal arguments that the applicant submits should lead to the conclusion that it has not in fact contravened s 49(3) of the EP Act. As I have noted earlier, many of these matters were not put to the committee prior to the issue of the notice and were only raised in an amendment to the order nisi. It is difficult to understand how it can be suggested that the notice is deficient because it fails to deal with matters that were not raised with the committee at the relevant time. In any event, s 37(b) does not require that matters of this nature be specified in the notice. Arguments that the applicant did not contravene the EP Act are matters properly to be raised in submissions under s 38 which the committee would then be required to take into consideration. They are not matters that can sensibly be suggested to affect the validity of the notice.
As regards the question of other affected sites, the notice does state that it relates to 'the site and any affected sites'. The body of the notice which sets out possible findings for each relevant period does not refer to any 'affected site' other than 7 Hutton Street. The term 'affected site' is used in the Act only in relation to s 27(2)(a) and s 27(2)(b). Those provisions concern the responsibility of the owner of a site. An owner who is responsible for remediation of a 'source site' under s 27(1) or s 27(2) is also responsible for remediation of an 'affected site' by operation of s 27(2)(a). Accordingly, the concept of an affected site is not relevant given that the applicant's responsibility for remediation is not suggested as being based upon it being an owner of the relevant land.
At the hearing it was accepted by the intervenors that the notice to the applicant could not properly extend to other affected sites. In these circumstances, it was agreed that there should be a declaration to that effect.
Defences to EP Act contraventions
Given my conclusions both in regards to discretion and to the merits of the grounds for review the order nisi must be discharged. There were also arguments raised in respect of the operation of s 49(3) of the EP Act and the impact of possible defences. Whilst it is strictly unnecessary to reach any conclusions in respect of those arguments I will deal with them for the sake of completeness.
The applicant contends that even if it caused damage to the pipe its actions were not unlawful as they did not constitute a contravention of the EP Act. In that respect the applicant argues that it is not guilty of any such contraventions because it is able to avail itself of defences under either the EP Act or the Criminal Code (WA). In order to understand this argument it is necessary to say something about the relevant offence provision.
Section 49(3) of the EP Act provides that a person who causes pollution or allows pollution to be caused commits an offence. The term 'pollution' was defined at the relevant time in s 3A(1) of the EP Act to mean 'the direct or indirect alteration of the environment (a) to its detriment or degradation; (b) to the detriment of any environmental value; or (c) of a prescribed kind that involves a mission'. The definition of pollution should be informed by the ordinary meaning of that word as involving the introduction of harmful contaminants into the environment: Pallos Verdes Estates Pty Ltd v Carbon (1991) 6 WAR 223, 235 and 239. It cannot be doubted that the contamination of soil and water at the site by petroleum products must meet the definition of pollution.
A person contravenes s 49(3) if they cause pollution or allow it to be caused. The term 'allow' has at least as wide a meaning as 'permit': DeKuyper v Crafter [1942] SASR 238, 243. A person permits something if they have knowledge of it and the authority or power to prevent it occurring. The knowledge required may be actual knowledge or knowledge of circumstances such that it could be said that they shut their eyes to the obvious or allowed something to go on not caring whether it occurred or not: Grays Haulage Co v Arnold [1966] 1 All ER 896, 898.
The term 'cause' unlike the term 'allow' does not suggest any requirement of knowledge. It is not necessary to show that an alleged offender intended to cause the pollution or was negligent in failing to prevent the pollution before a court will find that a person caused the pollution: Alphacell Ltd v Woodward [1972] AC 824; [1972] 2 All ER 475 and Majury v Sunbeam Co Ltd [1974] 1 NSWLR 659. It is sufficient that the pollution arises from some positive act of the defendant: SPCC v Kristin Nominees Pty Ltd (1991) 72 LGRA 337, 342 (Hemmings J). Where the pollution is a result of such process, even where the pollution is a consequence of an occurrence that the defendant could not have foreseen, the defendant will nonetheless be held to have caused the position: Alphacell Ltd v Woodward; Majury v Sunbeam Corporation Ltd and Price v Cromack [1975] 2 All ER 113. The question is not what caused the pollution but whether the identified acts of the defendant caused the pollution: Environmental Agency (formerly National Rivers Authority) v Empress Car Co (Abertillery) Ltd [1998] 1 All ER 481; [1999] 2 AC 22, 35.
In Masha Nominees Pty Ltd v Mobil Oil Australia Pty Ltd [2006] VSC 15; (2008) Aust Contract R 90‑237 a question arose as to whether Mobil had breached a clause in its lease which required it to comply with the requirements of the Environmental Protection Act 1970 (Vic). Sections 39(1)(b) and s 45(1)(b) of that Act made it an offence to pollute soil or ground water at land so as to make or be reasonably expected to make the soil or ground water harmful or potentially harmful to the health or welfare of human beings. The evidence in that case established benzene contamination in both soil and ground water at the site which had been used by Mobil as a petrol station. Hargrave J found:
That it is probable that this contamination was the result of the conduct by Mobil of a petrol station business at the land during the period of the lease [210].
The EP Act provides for a range of defences. Section 74(1)(a)(ii) of that Act provides that it is a defence where the act which caused or contributed to pollution occurred as a result of an accident caused otherwise than by the negligence of that person. Section 74(1a)(a) of the EP Act provides that it is a defence that the person who caused pollution took reasonable precautions and exercised due diligence to prevent the commission of the offence. In both cases the defences can only be availed of if the defendant has notified the CEO of the Department of the emission of pollution or the occurrence of the offence as soon as practicable after they occurred. In this case there is no evidence that the CEO was so notified. Accordingly it is not apparent that the applicant could avail itself of those defences. In any event, the onus of proving those defences falls upon the defendant. The committee can reach a preliminary view that a contravention had occurred without having to exclude the possibility that a defence could be raised and made out.
The applicant has also suggested that it could avail itself of the defence provided for in s 23B of the Criminal Code. Section 23B(2) of the Criminal Code refers to an event which occurs by accident. Section 74(1)(a)(ii) of the EP Act creates a specific defence in respect of an emission if the person charged with that offence proves that the emission occurred as a result of an accident caused otherwise than by the negligence of that person. Unlike s 23B(2) of the Criminal Code which, when raised, has to be negatived by the prosecution beyond reasonable doubt, the defence under s 74(1)(a)(ii) must be affirmatively established by the defendant. The inconsistency between the operation of s 74(1)(a)(ii) and s 23B(2) of the Criminal Code must lead to a conclusion that s 23B(2) of the Code is not intended to apply. Section 5 of the EP Act provides that the EP Act is to prevail in the event of inconsistency with any other written law.
It is apparent that the legislature has addressed the question of accident in the context of EP Act offences and provided separate and discrete defences which modify the onus of proof and depend upon particular notification being provided to the CEO. Furthermore, having a reasonable suspicion that an offence has been committed does not require the consideration and exclusion of all possible defences any more than defences have to be excluded before a criminal charge can be preferred. In these circumstances, the applicant's contention that no conclusion, even a preliminary one, could be reached that it had contravened the EP Act because possible defences had not been excluded cannot be accepted.
Conclusion
The applicant's grounds for seeking a review are without merit. In any event, the circumstances of this case could not justify the granting of prerogative relief in the exercise of discretion. The order nisi is discharged. There will, however, be a limited declaration to the effect that the notices does not relate to any site other than 7 Hutton Street.
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