Dungog Shire Council v Hunter Industrial Rental Equipment Pty Ltd (No 3) - [2019] NSWLEC 3

No judgment structure available for this case.

Land and Environment Court

New South Wales

Medium Neutral Citation: Dungog Shire Council v Hunter Industrial Rental Equipment Pty Ltd (No 3) [2019] NSWLEC 3
Hearing dates: 12 December 2018
Date of orders: 10 January 2019
Decision date: 10 January 2019
Jurisdiction: Class 4
Before: Molesworth AJ
Decision:
See orders at [84]

Catchwords: PRACTICE AND PROCEDURE – primary judgment found longstanding breaches of environmental and planning laws and issued injunctive relief, stayed for a period of three months - Notice of Motion to extend stay of orders to enable State Significant Development (SSD) process to be completed – SSD process unlikely to be completed by March 2020 at earliest – ongoing breach of planning and environment laws – importance of upholding planning and environment laws - impact on the community – inappropriate to stay until completion of SSD process in light of 2020 date - minimal further stay of two months granted to ameliorate impact of orders restraining offending conduct on employees and third parties
Legislation Cited: Environmental Planning and Assessment Act 1991 s 124 (now 9.46)
Cases Cited: ACR Trading Pty Ltd v Fat-Sel Pty Ltd (1987) 11 NSWLR 67
Arnhem Land Aboriginal Land Trust and Others v Northern Territory and Others 157 FCR 255; [2007] FCAFC 31
Bunnings Forest Products Pty Ltd v Bullen (1994) 54 FCR 342
Dungog Shire Council v Hunter Industrial Rental Equipment Pty Ltd (2016) 220 LGERA 43; [2016] NSWLEC 164
Dungog Shire Council v Hunter Industrial Rental Equipment Pty Ltd (No 2) [2018] NSWLEC 153
Grace v Thomas Street Café Pty Ltd (2007) 159 LGRA 57; [2007] NSWCA 359
Roosters Club Inc v Northern Tavern Pty Ltd (No 2) [2003] SASC 143
Warringah Shire Council v Sedevcic (1987) 10 NSWLR 335
Category: Procedural and other rulings
Parties: Dungog Shire Council (Applicant)
Hunter Industrial Rental Equipment Pty Limited (First Respondent)
Buttai Gravel Pty Limited (Second Respondent)
Environment Protection Agency (Third Respondent)
Representation:
Counsel:
Mr T Howard SC and Ms C Novak (Applicant)
Mr J Lazarus and Ms J Walker (First and Second Respondents)
Solicitors:
Coutts Mallik Rees (Applicant)
DWF (Australia) (First and Second Respondents)

File Number(s): 16/149935
Publication restriction: No

TABLE OF CONTENTS

Process established for seeking extension of stays
Notification requirements - compliance
Community submissions
Orders sought in the Extension of Motion
Withdrawal from motion of order seeking stay of declarations
Was there demonstration of taking of all steps to facilitate completion of SSD Application?
Was there demonstration of proceeding with expedition to secure all necessary consents?
Has there been implementation of and compliance with the IEMP?
Consideration of offer to operate in future under a Further Amended IEMP
Continuing breaches and the duty to uphold the rule of law
Legitimate community concerns
Impact on the Respondents’ commercial operations, employees and contractors
Timeframes suggested for determination of SSD Application
Exercise of discretion – balancing the considerations
Court advised of appeal to Court of Appeal
Costs
Orders

JUDGMENT

The primary judgment in these proceedings, Dungog Shire Council v Hunter Industrial Rental Equipment Pty Ltd (No 2) [2018] NSWLEC 153, was delivered on 12 October 2018.
Due to the necessity to make amendments, orders 24 and 25 did not take their final form until 25 October 2018, whilst order 26 took its final form on 26 October 2018. All of the substantive orders restraining the operation of the Martins Creek Quarry (Quarry), being orders 3, 5, 7, 9, 11, 13, 15, 17, 19, 21 and 23 (Restraining Orders), which were operative from 12 October 2018, were stayed for three months from the delivery of judgment, and those stays therefore expire 12 January 2019.
By Notice of Motion filed on 4 December 2018 (Extension Motion), the First and Second Respondents (Respondents) seek an extension of the stay of each of the Restraining Orders.

Process established for seeking extension of stays

By order 25, in its final amended form made 25 October 2018, the Court provided for a procedure by which an application could be made to extend the stays in the Restraining Orders. Order 25 provided as follows:

(25)   (a)   The First and Second Respondents have leave to apply to the Court to have extended the three-month stay provided for in Orders 3, 5, 7, 9, 11, 13, 15, 17, 19, 21, and 23.
(b)   An extension of the stay will not be granted unless the application seeking it is supported by affidavit setting out the basis for seeking the extension and the Court is satisfied that it is reasonable and proper in the circumstances to grant it. The affidavit, in particular, must:
1.   demonstrate that the First and Second Respondents have taken all steps necessary, with due diligence, to facilitate the completion of the SSD Application process;
2.   demonstrate that the First and Second Respondents have proceeded with expedition since the date of these Orders in their endeavours to secure all necessary consents, licences and associated approvals as are required for the Quarry, whether consequential to the SSD Application process or otherwise;
3.   confirm that the First and Second Respondents have duly implemented and complied with the Amended IEMP, and will continue to do so, in accordance with Order 24 of the Court;
4.   confirm that Dungog Shire Council has been advised of the application (so as to enable it being heard on the application); and
5.   confirm that a reasonably visible notice advising of the application was placed in the local newspaper with the highest circulation within the district which includes the towns of Martins Creek and Paterson (so as to enable representatives of the community to be heard, with leave, on the application).

In accordance with the procedure established by the Court by order 25, in order for the Court to entertain an application to extend the stays in the Restraining Orders, the Court needed to satisfy itself that any such application complied with its order. The Court accepted the Extension Motion as being an application of the kind envisaged by order 25.
In support of the Extension Motion, the Respondents relied upon the affidavits of:

Adam Kelly, sworn 4 December and 11 December 2018;

Barbara Crossley, affirmed 7 December and 11 December 2018; and

Brendan Tobin, affirmed 10 December 2018.

The process established by order 25 for seeking an extension of the stays had two elements: first, substantive matters, going to the ‘performance’ of the Respondents (being the matters set out in items 1, 2 and 3 of the order); and, secondly, procedural matters, going to the notification and participation of others in relation to an application for an extension of the stays (being the matters set out in items 4 and 5 of the order). The Court considered that each of these matters, be they substantive or procedural, constituted pre-conditions to a properly founded application for an extension of the stays.
It is sensible that the Court first consider whether it is established to the Court’s satisfaction that the two procedural matters, being those set out in items 4 and 5 of order 25, have been met.

Notification requirements - compliance

First, with respect to item 4 of order 25, regarding the notification of and participation of the Applicant in the principal proceedings (Council), the Court is satisfied that there has been compliance with the procedure the Court had established. Mr Tobin in his affidavit, at [3], confirmed that the solicitors on the record for the Council, Coutts Mallik Rees, were notified by e-mail correspondence dated 4 December 2018. Annexed as ‘BT1’ to that affidavit were copies of the correspondence and accompanying documentation, (including the Extension Motion and Mr Kelly’s affidavit dated 4 December 2018), which had been provided to the Council (via its solicitors). The provision of the Council’s submissions in response to the Extension Motion ahead of the hearing of the Motion, together with the appearance of counsel for the Council, confirms that item 4 has been met and that the Court’s objective of ensuring that the Council had the opportunity to respond to an application for extension of stay has been satisfied.
Secondly, with respect to item 5 of order 25, regarding the process established by the Court “so as to enable representatives of the community to be heard, with leave, on the application”, the Court is also satisfied that there has been compliance by the Respondents. Mr Tobin, in his affidavit at [4], confirmed that “a reasonably visible notice advising of the application” was published in the Maitland Mercury. Annexed as ‘BT2’ to that affidavit was a copy of the notice which was placed in that newspaper. Mr Tobin, at [6] of his affidavit, addressed the Court’s requirement that the newspaper in which the notice was published satisfied the Court’s requirement that it be “the local newspaper with the highest circulation within the district which includes the towns of Martins Creek and Paterson”. Considering the explanation provided in that affidavit and reviewing a document published by the Australian Community Media AdCentre setting out the readership and distribution details for the Maitland Mercury, which was annexure ‘BT3’ to the affidavit, the Court is satisfied that the Respondents did comply with the requirement in item 5 of Order 25.
The Court also notes, from [8]-[10] of Mr Tobin’s affidavit, that the Respondents went further by arranging for a further notice to appear, this time published in the Dungog Chronicle.
As Mr Tobin’s affidavit confirmed, at [11]-[12], the publishing of the required notice in the Maitland Mercury was effective, as James Ashton of the Martins Creek Quarry Action Group responded to the notice by having a conversation with Mr Tobin on 7 December 2018 regarding the notice, the Respondents’ application to extend the stays and seeking clarification of the process established by the Court.
In response to the notice, seven members of the community, as envisaged by item 5 of order 25, namely:

Mr Andrew Bower;

Ms Gabrielle Ryan;

Mr Evan Russell;

Mr Wally Fletcher; and

Mr Wally McNally; and

Mr Peter; and

Ms Alison Cook

communicated with the Court’s Registry on either 10 or 11 December 2018.

In addition, the following members of the community communicated with the Council, regarding the proceedings, on either 10 or 11 December 2018:

Mr Paul Bennetts;

Mr Dean Djakiew;

Ms Elaine and Mr Don Foster;

Mr Richard Grant;

Mr Henry Malcolm;

Mr Robert Holt;

Ms Tracey Showman;

Mr Stephan Stibbard;

Ms Catherine Varcoe;

Mr Chris Wokes; and

Mr Neil and Ms Margaret Richie.

In all, these communications were from 20 individuals.

Community submissions

Early in the course of the hearing, Mr Howard, senior counsel for the Council, tendered into evidence “Exhibit A” which was a bundle of the communications from the members of the community referred to at [13] and [14] above. Mr Lazarus, lead counsel for the Respondents, submitted in relation to this bundle of communications: “I’ve got no objection to the tender of that material, so long as it’s understood that these are, in effect, submissions and not evidence” (Transcript 10.24-26). Mr Howard then confirmed that he was tendering them on that basis (Transcript 10.30), and the Court accordingly received them on that basis.
At the commencement of the hearing, members of the community, namely Mr Frederick Ashton, Mr John McNally, Mr Neil Ritchie and Ms Julia Wokes, made their presence in court known. After the Court explained the process that it intended to follow so as to enable members of the community to be heard and after the members of the community conferred with the Council’s solicitor, the Court was advised by Mr Howard that the community would be represented by two spokespersons, namely, Mr Frederick Ashton of the Martins Creek Quarry Action Group and Mr Neil Ritchie of the Brandy Hill and Seaham Action Group.
After hearing from counsel for each of the parties with respect to the way the Court intended to proceed with respect to the receipt of community statements, the Court gave leave to both Mr Ashton and Mr Ritchie to address the Court. The Court notes that Mr Lazarus indicated as follows:

Well, can I indicate, first of all, that we don’t oppose leave being granted by your Honour to those gentlemen addressing the Court. We don’t oppose leave being granted. So long as it is understood that they are, in effect, making submissions rather than giving evidence. (Transcript 6.22-25).

Both Mr Ashton and Mr Ritchie addressed the Court, with Mr Ashton reading a prepared statement. That statement, accepted as a submission, was subsequently marked for identification as “MFI1”. The statement, as read, appears at Transcript 12.15-49 and 13.1-18. MFI1 (with the formal header and footer omitted) was as follows:

1.   Martins Creek Quarry Action Group is an incorporated association formed to represent members impacted by the ongoing unlawful operations and proposed expansions of Martins Creek Quarry (the Site).
2.   Our membership includes residents who reside in Martins Creek, Vacy, Paterson, Bolwarra, Brandy Hill, Woodville, Lorn and East Maitland.
3.   The offsite impacts from the facility include significant and at times unmitigated lasting vibration, dust and industrial noise all impacting the amenity of residents and a number of our members, many of whom whose dwellings are located less than a few hundred metres from the site.
4.   Impacts are also incurred by our membership who reside along the haulage routes from haulage trucks along 26 km of local government roads through rural communities and village activity centres with significant amenity impacts from noise, dust and the physical presence of in some cases multiple hundreds of trucks per day through residential areas in the Dungog Shire, Maitland City, Port Stephen local government areas.
5.   These impacts and issues have been comprehensively detailed in public submissions by residents (see reference link below), MCQAG and other community groups (see reference link below), lodged with the Department of Planning during the November 2016 exhibition of SSDA14_6612.
6.   We append to this submission a number of personal submissions made by local residents following the advertisements of Daracon's intention to seek an extension to the stay.
7.   The scale of the operations (and impacts) from 2014 to present for many of those who reside around the site and/or along the haulage routes has been simply intolerable and unliveable.
8.   We understand from conversations with Dungog Shire Council's Jacqui Tupper on Thursday 6th December and then also from an advertised notice on Friday 7th December in the Maitland Mercury that the Respondents in Case No. 2016/00149935 is seeking to extend the period for the operation of the stay period under Order 25 of the Court's October 2018 decision and to seek orders that permit 20 loads, (40 truck movements) per hour and 90 loads being (180 truck movements) per day.
9.   Following detailed discussions with the NSW Environment Defenders Office, the MCQAG has been unable to secure legal representation or amicus curiae to enable for an application to be made for leave to be heard by the court. The EDO have advised they simply do not have the ability to provide such a service at short notice particularly having regard to the significant and detailed history of the issues to date. MCQAG does not wish to have the proceedings held over or delayed.
10.   None the less we make the following submission to the Court for your consideration.
11.   In relation to the orders being sought by Hunter Industrial Rental and Buttai Gravel: Our association does not oppose the ongoing operation of Martins Creek Quarry, we have never called for its closure. However, we have and will continue to request that it be required to be operated in accordance with the 1991 consent conditions and in a manner that restores and preserves rural and village amenity of residents surrounding the Site and the haulage routes. For these reasons, we strongly oppose and object to the requested extension to the Stay on the orders proposed to be heard on 12 October 2018.
SSDA14_6612 Public Submissions Link:
MCQAG Submissions Link:
sought in the Extension of Motion

Before examining the three substantive matters required of the Respondents pursuant to order 25, it is necessary to understand the orders sought by the Respondents. The Extension Motion, as filed, sought three substantive orders, as follows:

ORDERS SOUGHT
1   That pursuant to Order 25 of the Court’s orders, the stay of Orders 3, 5, 7, 9, 11, 13, 15, 17, 19, 21 and 23 be extended until 14 days after determination of the State Significant Development Application for the Martins Creek Quarry Project, or alternatively for such time as the Court thinks fit, upon the First and Second Respondents undertaking to:
a.   (subject to the amendments in paragraph b below) complying with Annexure C - Interim Environmental Management Plan - Martins Creek Quarry of the Court’s Orders (IEMP);
b.   amend the IEMP in the following respects:
i.   C1 to reduce the limit on road transport in any 12 month period from 650,000 tonnes to 449,000 tonnes;
ii.   C2 to reduce the number of laden trucks to be dispatched from the Quarry from 130 to no more than 90 laden trucks in any one calendar day; and
iii.   C3 to reduce the number of laden trucks to be dispatched from the Quarry in any 1 hour period from 30 to 20;
c.   pay a contribution to Dungog Shire Council of $0.50 per tonne of product transported by road on a monthly basis calculated by reference to weighbridge records (which will be made available to Dungog Shire Council on request) for the purpose of the maintenance or repair of the public roads comprising the haul route within the Dungog Shire local government area from the Quarry.
2   That Orders 1, 2, 4, 6, 8, 10, 12, 14, 16, 18, 20 and 22 also be stayed for the same time as the orders referred to in paragraph 1.
3   To the extent that it is necessary to do so, Orders 3, 5, 7, 9, 11, 13, 15, 17, 19, 21 and 23 be stayed pending the determination of this notice of motion.
Such other order as the Court thinks fit.
Withdrawal from motion of order seeking stay of declarations

Soon after the commencement of the hearing, the Court invited Mr Lazarus to request the Court to strike out the second order sought in the Extension Motion. The Court, expressing surprise at seeing an order being sought to stay declarations made some two months earlier, stressed that it should go. The Court indicated that it came ready with case law to cite confirming that such an order should never have been within contemplation when the Extension Motion was prepared. The Court confirmed that it is trite law that once declarations have been made, the law has been determined and that to subsequently seek an order to stay such declarations was an erroneous step. The case law which the Court had to hand was Arnhem Land Aboriginal Land Trust and Others v Northern Territory and Others 157 FCR 255; [2007] FCAFC 31, Bunnings Forest Products Pty Ltd v Bullen (1994) 54 FCR 342 at 347, and Roosters Club Inc v Northern Tavern Pty Ltd (No 2) [2003] SASC 143 at [18], [21] and [22].

In response to the Court’s reaction to the second order being sought in the Extension Motion, Mr Lazarus said the Court “can assume that we won’t be pressing order 2 of the notice of motion” (Transcript 5.9-10). In response, the Court stated, “… quite frankly, it is in your motion, it should go ...”. Mr Lazarus replied, “I accept that”. Later, when confirming to the Court the Extension Motion before it, Mr Lazarus reiterated, “with the exception of prayer 2” (Transcript 7.40-41).

At the conclusion of the hearing the Court confirmed that it had struck from the Extension Motion the second prayer for relief (Transcript 80.2-3).

Was there demonstration of taking of all steps to facilitate completion of SSD Application?

Returning to [7] above, as explained, the procedure established by the Court for the Respondents to seek an extension of the stays in the Restraining Orders requires the Court to be satisfied of three substantive matters that go to the ‘performance’ of the Respondents. The first item of those three matters was for the Respondents to demonstrate that they “have taken all steps necessary, with due diligence, to facilitate the completion of the SSD Application process”.
First, it is necessary to clarify that the taking of steps with due diligence, as expressed in order 25(b)(i), was not restricted to the period following the making of the orders on 12 October 2018. The first and second items in order 25(b) were drafted with a different focus as to timing. The second item was intended to focus on the period after the making of the orders, whereas the first item with respect to the SSD (State Significant Development) Application was to invite a review of the Respondents ‘performance’ over the whole ‘life’ of the SSD Application processing.
Save for that which had been tendered into evidence in the course of the primary hearing regarding the SSD Application, the Court had been reliant upon the submissions of the parties, primarily from counsel for the Respondents, as to how the Second Respondents’ SSD Application had been progressing up until the conclusion of the primary hearing before the Court on 20 April 2017. As submissions on the Extension Motion from the Council confirmed, it had been submitted to the Court, on a number of occasions, in the course of the primary hearing that the SSD Application process was well advanced.
Council’s submissions on the Extension Motion at [13]-[15] highlight some of the assurances the Court had received during the primary hearing:

13. The Court will recall that at the commencement of the hearing in the substantive proceedings the first and second respondents advised the Court that the SSDA was likely to be determined in around September - December 2017. The first and second respondents', in their outline of opening submissions stated (citations omitted), at [164]:
A state significant development application for the current operations at the Quarry, plus increased production of up to 1.5 Mtp (the SSDA) was lodged on 27 September 2016. The second respondent commenced preparation of the SSDA in June 2014. Buttai is committed to working with its consultants and with the Department of Planning to obtain consent for the operations as soon as possible, and to implementing the consent once it is granted, it is estimated that the SSDA is likely to be determined in around September to December 2017.

14. On various dates between 13 February 2017 - 20 April 2017 the Court heard evidence and argument in the substantive proceedings. On 12 April 2017, Senior Counsel for the first and second respondents told the Court that a ‘response to submissions' would be lodged within 4-6 months. i.e., at the latest, by October 2017.
15. The first and second respondents in their outline of closing submissions stated at [273] that:
A state significant development application for the current operations at the Quarry, plus increased production of up to 1.5 Mtpa (the SSDA) was lodged on 27 September 2016, the second respondent having commenced preparation of the SSDA in June 2014. The application is currently being assessed by the Department of Planning and the Environment

[Emphasis added]

The Court confirms that these submissions on behalf of the Respondents had satisfied the Court that the SSD Application was not only well advanced but that a resolution of it was on the horizon. At [852] of the primary judgment the Court stated: “the Court is also cognizant of the implications of the SSD Application process which must be well advanced” [emphasis added]. At [884] the Court confirmed that its judgment was written without actual knowledge of the status of the SSD Application (after the conclusion of the hearing). The Court said:

The determination of the questions of law and fact in this judgment has occurred, properly, without reference to or knowledge of the current status of the SSD Application, although a considerable amount of material relating to the SSD Application was placed into evidence.

Critically, the stance adopted by the Court was made very apparent in [885]:

Cognizant of the fact that the SSD Application would be assessed in accordance with current-day environmental, planning and amenity criteria, the Court has decided, in the exercise of its discretion, to stay the restraint orders for three months. In addition to the reasons set out above in [880]-[881] of this judgment, in a context where the consideration of the SSD Application must surely be well advanced, perhaps approaching conclusion, three months should allow that DA to be determined. By setting a three month effective deadline, a message of urgency is being conveyed to complete the SSD Application process. With the Court having made the findings that much of the current operations at the Quarry lack consent and/or are in breach of controls, the completion of the decision-making process with respect to the SSD Application will be better informed: essentially, that the starting point for the SSD Application is not one where the current quarry operations are in compliance with the controls, rather there are many clear instances where the planning and environmental controls are being breached. [Emphasis added]

Finally, at [891] the Court again reiterated its stance:

The emphasis must now be on the SSD Application being determined as it will be in accordance with current day planning and environmental standards, with such determination now being within the context of the status quo at the Quarry being largely illegal, being operated contrary to the EPA Act. That is the relevant baseline context by which the SSD Application is to be assessed and determined.

At the hearing of the Extension Motion, the Court became informed of the status of the SSD Application. The Court was, to put it baldly, surprised at the lack of progress, given the submissions that had been received during the primary hearing from counsel for the Respondents. The Court accepts that the Council’s submissions at [12], [16] and [17] accurately portray the situation:

12. Since 2 December 2016, the further progress of the SSDA has been in the hands of the second respondent. That is, the Department of Planning and Environment has been awaiting a 'report that comprehensively addresses the submissions received on the project, as well as those raised in the community meeting held on 2 November 2016.' (Kelly affidavit [10])
…
16. Notwithstanding the previous representations made to the Court Mr Kelly, in his affidavit of 4 December 2018 now deposes that from as late as January 2017 he had concerns regarding the environmental assessment for the SSDA; (Kelly affidavit [12]-[15]) moreover in January 2017, Umwelt (Australia) Pty Ltd was engaged to provide high level strategic advice on the SSDA. (Kelly affidavit [16])
17. To date, over 2 years since the Department's 2 December 2016 request for a response to submissions, there has been no such response; Ms Crossley now deposes that further technical studies are being undertaken (Crossley affidavit, 7 December 2018, [25]-[26]) and that an amended State Significant Development Application will be lodged. At present, the second respondent aims to have an amended application lodged by late May 2019 (Crossley affidavit, 7 December 2018, [65]).

Further, the Court considers the following submissions of the Council are correct:

21.   It is evident from the history of the current SSDA that the second respondent has failed to progress its application in a timely fashion. Whilst there is evidence that the second respondent obtained some 'high level strategic' advice in May 2017, the Court would not accept that 'detailed internal consideration' during the period up to September 2017 (when Buttai made the decision to commission Umwelt as the lead consultant) is evidence of Buttai being committed to working with its consultants and with the Department of Planning to obtain consent for the operations as soon as possible.
22.   Any suggestion that the second respondent was justified in delaying the progress of its SSDA because it was awaiting the outcome of the litigation. (Crossley affidavit, 7 December 2018, [23]) is unfounded. The decision to delay any or all of the components of the SSDA was a strategic one made by them and they are not in a position to complain about the results.
23.   It should be uncontentious to note that any State Significant Development Application is required to include an assessment of the environmental impacts of the proposal. Those impacts are dictated by the scope of the proposal put forward by the proponent. In respect of the second respondent's SSDA it was open to it to compare impacts on contingent baselines. There is no evidence that such a comparison would be a difficult task. The fact they chose not to do so is entirely of their own making and they should not be entitled to any indulgence at this stage.
24.   The first and second respondents are seeking to take the benefit of the second respondent's dilatory conduct in failing to respond to the Department's 2 December 2016 request for a response to submissions and thereby continue operations in breach of the EP&A Act. The court should not acquiesce in a continued breach of the EP&A Act.

In circumstances where further information had been sought from the Second Respondent on 2 December 2016 by the Department of Planning in response to public submissions on the SSD Application, to find that the Department still awaits a response to those submissions more than two years later, does not demonstrate, in the Court’s opinion, effort on the part of the Respondents to take “all steps necessary, with due diligence, to facilitate the completion of the SSD Application process.”
Further, for the Court to be informed that the Respondents had organised a review by new environmental consultants, resulting in the receipt of high level advice in May 2017, but that it took another four months before that advice was accepted, and the consultants were actually commissioned in September 2017 to be lead project consultant, similarly indicates a lack of effort to take to take “all steps necessary, with due diligence, to facilitate the completion of the SSD Application process”. It might be said that, in effect, a replacement SSD Application process was now in the pipeline. 15 months then passed before the Court was informed that a revised SSD Application was now proposed to be lodged, another 5 months on in May 2019. This extended chronology indicates to the Court there has been an inadequate compliance with item 1 in order 25.
Therefore, the Respondents have failed to demonstrate to the Court’s satisfaction that they have taken all steps necessary, with due diligence, to facilitate the completion of the SSD Application process.

Was there demonstration of proceeding with expedition to secure all necessary consents?

In the second item of order 25 the Respondents are required to satisfy the Court that, since the date of the orders, they have proceeded with expedition in their endeavours to secure all necessary consents, licences and associated approvals as are required for the Quarry, whether consequential to the SSD Application process or otherwise. As stated earlier in this judgment at [24], it is to be noted that in this requirement the focus here is on ‘performance’ since the date of the orders.
The Council’s submissions on this aspect were as follows:

25. It is to be recalled that in the course of oral address, Senior Counsel for the first and second respondents, in addressing on issues of discretion, represented that a development application (not being a State Significant Development Application) could readily be lodged for the pugmill and pre-coat plant to regularize its use. Mr Robertson SC said:
Let's say it's the failure to obtain a development consent for the pugmill, to come back to the pugmill. It would be a simple thing for us to lodge a DA, we could probably do it next week, for approval for the operation of the pugmill. (Transcript 27.02.17. 531.18-20)

26. Later, in respect of the pugmill he said:
First we would say we had no difficulty with the declaration being made If your Honour finds that it's unlawful, your Honour can make a declaration that reflects your Honour's finding, however, we say the declaration should be suspended to enable consent to be obtained because in this case the activity is not prohibited.
This is indifferent to whether the consent is given in the SSDA process or we lodge an application for consent simply for the pugmill, which is a course that would be open to us if your Honour were to find against us. The better course, we respectfully submit in relation to the pugmill is to suspend the declaration pending the regularisation of the planning rights, and your Honour should make no order.
We make the same submission with the pre-coat plant, that's 23 and 24, both seeking a declaration and an order.
…
Our approach to it is similar to the pugmill, that your Honour would make a declaration if you found against us and that declaration could be suspended, or an order made under s 124(3) which would give us an opportunity to obtain consent. As I said, that order doesn't have to focus on the SSDA. although we would get consent if the SSDA is approved for these plants, but it's open to us to lodge a development application now.
May I say, we haven't done so for obvious reasons because we've got it in the SSDA and it would seem to be superfluous, but if the SSDA now is taking longer to process, an immediate answer to these claims is simply to lodge a development application. (Transcript 12.04.17. 1169-1170)

27. Plainly the first and second respondents have been aware that there are alternative avenues which may be available to them to regularise, at least in part, some of the uses found to be unlawful. No evidence has been given as to the preparation or lodgement of a development application with the Council.
[Emphasis added]

With respect to other approvals, the Respondents’ submissions at [17] described interactions between the Respondents and Roads and Maritime Services (RMS) regarding the capacity of a single lane bridge, Gostwyck Bridge, which needs to be traversed by quarry-related traffic. Mr Kelly’s affidavit of 4 December 2018 at [29]-[34] provided the background detail to the submissions. Although finally resolved in June 2018 to the Respondents’ satisfaction, twelve months of negotiations were occupied with this issue alone. Given that such issues can and will arise with any substantial project the subject of applications for planning and environmental approval, it becomes a legitimate question, a highly relevant question to the exercise of discretion, as to whether the Respondents ought to be permitted to continue operating, contrary to planning and environmental laws, whilst all such issues are worked through to their conclusion. In circumstances where the Court has found that there are unacceptable off-site impacts on the community of the existing Quarry operations, the prospect of prolonged delays in project formulation and then assessment must surely aggravate an already unacceptable situation.
These concerns of the Court regarding further prolonged delays became heightened when receiving the following submission from the Respondents, at [21]-[23] of their written submissions, which were read in the context of the two affidavits of Barbara Crossley:

21.   The need for any other approvals consequent upon any consent granted to the SSD Application will largely be governed by the terms of that consent. Sections 4.41 and 4.42 of the EPA Act provide that various additional approvals are either not required or must not be refused.
22.   The process for obtaining the requisite approvals is either in train or must await the outcome of the SSDA.
23.   The Project requires approval as a controlled action under the Environment Protection & Biodiversity Conservation Act 1999. For this purpose, it is being assessed under the Bilateral process between the New South Wales and Commonwealth governments, meaning that the State Significant assessment will also be used to fulfil Commonwealth assessment requirements. The Commonwealth Minister will decide whether or not to approve of the controlled action after any approval of SSD Application.
[Emphasis added]

In concluding this section of the judgment, although it might be true that the Respondents have been proceeding with as much expedition as may be possible to secure “all necessary consents, licences and associated approvals”, in the context that some of those approvals may be found necessary as an outcome of the SSD Application process, and with the earliest estimated completion of that SSD Application process alone being foreshadowed as March 2020, one scenario that must be in prospect is a situation in 2020 when the Court is again approached to further extend the stays on the Restraining Orders. With the Court already considering March 2020 to be too far away for it to be reasonable for the Court to exercise its discretion in favour of the Respondents (which would, if exercised, be against the public interests – as expressed by both the Council and the community representatives), the prospect that the periods now estimated being uncertain (which was clearly confirmed by Ms Crossley in evidence), the adage of “how long is a piece of string?” comes to mind. In short, the uncertainty of the Respondents being able to progress the miscellaneous approvals that may be required for the project within a timely fashion, is a factor that weighs against the exercise of discretion in favour of the Respondents’ application on the Extension Motion.
A further relevant consideration is that the Respondents may not be successful with their revised SSD Application and the many associated or ancillary approvals. In circumstances where the Court has found that the extant Quarry is being operated in breach of both planning and environmental laws and, further, given the Court has found that unacceptable impacts have been and are being experienced by the wider community, is it an acceptable scenario for the Court to extend the Restraining Orders for at least 14 months, as requested, when it may be, from the Respondents’ perspective “all for naught” whilst the wider community continues to suffer ongoing impact? Again, this is a consideration going to discretion that weighs against the Respondents’ application.

Has there been implementation of and compliance with the IEMP?

The third item in order 25(b) requires the Respondents to demonstrate that they have “duly implemented and complied with the Amended IEMP in accordance with Order 24 of the Court” (as amended on 25 October 2018).
Mr Kelly, in his affidavits of 4 December 2018 at [35]-[51] and 11 December 2018 at [2]-[14], gave evidence that the Respondents had taken steps to comply with the “Amended IEMP”, that is, the Interim Environmental Management Plan contained at Annexure C to the primary judgment (IEMP), in the period commencing 14 days after 12 October 2018 (the date of the orders) to the hearing on the Extension Motion. Mr Kelly was cross-examined during the course of the hearing on other matters, but there was no cross-examination on compliance with the IEMP. Therefore there is nothing before the Court which would dispel the proposition that there has been due implementation and compliance with the IEMP. Mr Lazarus for the Respondents submitted to the Court that the absence of challenge to the evidence in this regard should be noted by the Court (Transcript 58.45-47). The Court is satisfied that the Respondents have endeavoured to operate in accordance with the IEMP, which, as acknowledged, is a factor in their favour.

However, going to discretion (as distinct to the prerequisite steps required by the Court before it would entertain an application to extend the stays in the Restraining Orders), there is a relevant context within which the IEMP is to be considered. Despite the Respondents getting “over the bar” in order to have their application on the Extension Motion considered, there remains the question whether compliance with the IEMP is such a persuasive consideration that it should influence the Court’s discretion to extend the stays. The relevant context of the IEMP was explained in [890] of the primary judgment:

890 As for the IEMP in the short term, it is seen as a very interim measure, in essence accepted by the Court on the basis that something is better than nothing. The Court accepts the Applicant Council’s submissions regarding the IEMP (summarised at [850] in this judgment) – essentially that the document is far from acceptable, let alone ideal. I also note the accurate assessment of Sheahan J at [137] in his judgment in Dungog Shire Council v Hunter Industrial Rental Equipment Pty Ltd that “the respondents’ IEMP really maintains the status quo, be it lawful or otherwise”. However, pragmatically, the Court identifies that the IEMP is at least a form of environmental management that can be commenced virtually immediately; hence Order 24 requires its implementation within 14 days of the Court’s orders.

Relevantly, paragraph [891] went further to highlight that the IEMP was only being imposed on what was clearly the Court’s expectation that the completion of the SSD Application process was not in the not too distant future:

891 The Court toyed with the alternative of having the parties prepare a better and more extensive IEMP through a process of negotiation, including consultation with the community, which would then return to the Court for examination and adoption. Such a process could be fraught by delay and may not see anything better put into operation within months. Hence the Court decided to adopt the IEMP as a very interim measure. The emphasis must now be on the SSD Application being determined as it will be in accordance with current day planning and environmental standards, with such determination now being within the context of the status quo at the Quarry being largely illegal, being operated contrary to the EPA Act. That is the relevant baseline context by which the SSD Application is to be assessed and determined.
[Emphasis added]

Although the Court considers that the Respondents have complied with order 24 since 26 October 2018, it would have expected nothing less, for after all, it was a Court order that imposed the IEMP and so compliance was required. The context remains that it was a far from acceptable document, imposed as a very interim measure in the expectation that the SSD Application process was soon to be completed. In circumstances where the Court now knows that a revised SSD Application is to be lodged in May 2019 and a completion of the process is not expected prior to March 2020, the Quarry continuing to operate in breach of planning and environmental laws is not acceptable, even on an interim basis and albeit in accordance with an IEMP (modified or not).

Consideration of offer to operate in future under a Further Amended IEMP

In support of their case for the Court to continue the stays on the Restraining Orders, at 1(b) of the Extension Motion, the Respondents suggested various refinements to the IEMP (see earlier at [19]). The Court understands the rationale for further tightening the IEMP, given the Council’s opposition to any extension of the stays and the community’s on-going expressed concerns with the operations of the Quarry (including offsite impacts). However, none of the measures proposed come anywhere near to a position of compliance with their obligations under planning and environmental laws, which the Court identified in its primary judgment as having been breached years before the primary hearing. There would remain multiple on-going breaches of both planning and environmental laws.
The Court considers the position submitted by the Council is correct when at [30]-[31] it said as follows:

30. The first and second respondents' very reliance upon the lEMP supports the proposition that a further stay should not granted. The lEMP is an untested document put forward by the operator of the Martins Creek Quarry unsupported by any evidence of an environmental consultant as to its appropriateness or what alternatives may be available to protect the environment (including the amenity of the neighbourhood). Indeed, the lEMP which is presently in place was found by the Court as a ‘very interim measure' and accepted that the document was 'far from acceptable, let alone ideal’.
31. The Court should not accept that the lEMP is an appropriate document to be in place for an indefinite period of time pending the determination of an amended SSDA (that amended SSDA intended to be lodged sometime in the future).

The Court has decided that it will extend the stays in the Restraining Orders for a minimal period of two months to 12 March 2019, so as to enable the Respondents to make suitable arrangements to lessen the impact on ‘innocent’ persons, that is, ordinary employees of the Respondents, contractors and their employees, and persons who have entered into supply contracts who may be seriously impacted upon by an immediate closure of operations at the Quarry. In those circumstances, there will be continuing operations at the Quarry, or in association with the Quarry, over that two month period. Given that those operations will be, in effect, continuing in breach of planning and environmental laws as found by the Court in its primary judgment. It is appropriate that the impact of those operations be ameliorated.
Accordingly, the Court has decided to adopt all the ameliorating measures that the Respondents offered at 1(b) and (c) in the Extension Motion. These ameliorating measures, which will apply for the duration of the 2 months that the Court is by this judgment allowing the Quarry to remain operating, are considered necessary given the adverse impacts on the community of the Quarry operating at its unapproved level. It follows that the measures described in 1(b) of the Extension Motion will amend the extant IEMP.

Continuing breaches and the duty to uphold the rule of law

In its principal judgment at [852], the Court confirmed that the principles which were set out in the 1987 cases ACR Trading Pty Ltd v Fat-Sel Pty Ltd (1987) 11 NSWLR 67, and Warringah Shire Council v Sedevcic (1987) 10 NSWLR 335, were the appropriate ones which it should apply in the exercise of discretion under s 124 of the Environmental Planning and Assessment Act 1979 (now s 9.46). As the Court said:

852 It is adherence to those principles which guides the Court to make a number of the declarations sought. The Applicant Council as a public authority is properly seeking to have the public law enforced and once it has demonstrated breach, the Court should appropriately demonstrate its disapproval through the making of appropriate declarations and orders in an effort to enforce the law. As Kirby P, as he then was said in Warringah Shire Council v Sedevcic at [340D]:
[w]here the application for the enforcement of the Act is made by the Attorney-General, or a council, a court may be less likely to deny equitable relief than it would in litigation between private citizens: Associated Minerals Consolidated Ltd v Wyong Shire Council (at 692). This is because the Attorney-General or the Council are seen as the proper guardians of public rights. Their interest is deemed to be protective and beneficial, not private or pecuniary …

At [854] of the primary judgment the Court concluded:

854 The wider implications of the unlawfully expanded Quarry, especially upon the township of Paterson, reinforce the Court’s resolve that it must exercise its discretion cognizant of those impacts and the clear need, indeed duty, in accordance with the Warringah Shire Council v Sedevcic principles, to uphold the rule of law.

At [855] of the primary judgment the Court reinforced its conclusion cited in the paragraph above, stressing the course which it considered appropriate:

855 This Court is duty bound to uphold the law if it finds the law has been breached. The simple fact remains a persuasive influence on the exercise of discretion: any development lacking lawful consent should be properly assessed in order to determine the acceptable operating parameters. “Acceptable operating parameters” not only allow an appropriate and reasonable proposal to be approved, but concurrently ensures that the public interest is safeguarded. Where that public interest includes protection from adverse environmental and amenity impacts, the Court should not relax standards by taking a too lenient approach, especially when, as the evidence has shown in this case, conditions have been incrementally worsening over many years.

The Court is not prepared to accept that it should stay the Restraining Orders for what is now likely to be an open-ended period before the proposed revised SSD Application is processed to completion. March 2020 is the earliest date identified as being possible, but Ms Crossley, in evidence, confirmed that a resolution could not be guaranteed by that time. In the circumstances, the Quarry would be continuing to operate, for all the reasons exhaustively described in the primary judgment, contrary to planning and environmental laws. Further, the impacts of continuing breach, also as found proved in the primary judgment, would be continued to be suffered by the wider community. The community’s concerns, expressed in their submissions, and referred to at [15] - [18] above, highlight that ongoing breaches of the law ought not be condoned.
Even if the Court were to accept the further revisions to the IEMP as proposed by the Respondents in 1(b) of the Extension Motion, despite the Respondents believing their proposed further restraints are a compromise on their current operations, the operational levels proposed would still be far in excess of those which the Court has found had been originally approved. In other words, operating in accordance with the proposed revised IEMP would constitute the Quarry continuing to operate in breach of the law. To restate the closing words of the primary judgment in [855] cited above:

Where that public interest includes protection from adverse environmental and amenity impacts, the Court should not relax standards by taking a too lenient approach, especially when, as the evidence has shown in this case, conditions have been incrementally worsening over many years.

Legitimate community concerns

It follows from what the Court has stated earlier in this judgment, that the views expressed by the broader community are legitimate concerns, confirming many of the primary findings of the Court in its principal judgment, which are relevant considerations to the exercise of discretion on the Extension Motion.

Impact on the Respondents’ commercial operations, employees and contractors

The Council’s submissions at [28] are pertinent to the issue of the consideration given by the Court in its primary judgment to employees and contractors:

It is to be observed that the first and second respondents have continued to operate Martins Creek Quarry and receive the fruits of those operations for some 1.5 years whilst judgment in the substantive proceedings has been outstanding. Notwithstanding the generation of profits over that period of time Mr Kelly says that 15 employee positions would either be reallocated to roles elsewhere within the Daracon Group or be made redundant. Mr Kelly does not give evidence as to what communications and arrangements have been made with the current non-executive employees as to their willingness to be reallocated to roles elsewhere in the Daracon Group. Moreover, there is simply no demonstrable financial imperative to make any (of an uncertain number of) employees redundant; any decision to do so is entirely a matter for the respondents.

The Court’s primary judgment, at [880]-[883], addressed the issue of the impact on the Respondents’ employees, contractors and persons with extant supply contracts should the Quarry’s current level of operations be ordered to cease. Mr Kelly’s affidavits of 4 December 2018 at [52]-[56], and 11 December 2018 at [15]-[18], addressed these matters, although the Court considered that in the circumstances of the hearing, this material was largely unable to be tested or verified. Nevertheless, accepting that there will be some impact with a closure of the Quarry, in the orders that the Court has decided to make in response to the Extension Motion, a two month period of time is to be allowed to lessen that impact.

Timeframes suggested for determination of SSD Application

The evidence placed before the Court on the Extension Motion suggests that the SSD Application may not be determined until March 2020, without any certainty as to that date.
The Council’s submissions, at [8]-[11], correctly summarise the position:

8.   The first and second respondents seek a stay ‘… until 14 days after determination of the State Significant Development Application for the Martins Creek Quarry Project, or alternatively for such time as the Court thinks fit …’
9.   Similar to the position adopted by the Council on the first and second respondents' notice of motion to adjourn the proceedings (in the 2016 Dungog Shire Council v Hunter industrial Rental Equipment Pty Ltd [2016] NSWLEC 164) (Dungog No 1)), it is submitted that the application before the Court in effect seeks a stay for an indefinite period.
10.   The proposition that the stay is for an uncertain and indefinite period of time has been strengthened by the events which have transpired since the judgment of Sheahan J in Dungog No 1. In order to fully appreciate the indefinite nature of this application it is instructive to have regard to a short chronology of events.
11.   A chronology of events relating to the SSDA up to 9 December 2016, being the date of hearing of the first and second respondents' application to stay the substantive proceedings, is helpfully set out by Sheahan J in Dungog No 1 at paragraphs [40]-[62]. In addition, it is to be noted that the substantive proceedings were originally commenced on 30 March 2015.

As for the timing for the completion of the SSD Application, now that the Court is informed that an amended application is within contemplation, the Council’s submissions at [18]-[19] are accepted as accurate:

18. Assuming a lodgment date of late May 2019, Ms Crossley's best estimate as to the timing of assessment and determination of the amended State Significant Development Application is March 2020. (Crossley affidavit, 7 December 2018, [68]). Whilst a date of March 2020 for determination is Ms Crossley's best estimate, she properly concedes that '... there are many factors that may influence and extend the timing of this process, and therefore the timing is not certain”. (Crossley affidavit, 7 December 2018, [69])
19. The protracted history and inadequacies of the current SSDA documentation highlights the invariably flexible and uncertain timing as to the determination of this application. There is in any event no certainty that a consent to that application will issue.

The Court agrees with the Council that if it were to contemplate a stay in the context of such an uncertain timeframe, where the Court has no confidence that over the past few years the Respondents have proceeded with due diligence, taking all steps necessary to facilitate the completion of the SSD Application process, effectively the Court would be countenancing the continued unlawful conduct of the Martins Creek Quarry for an indeterminate period of time.

Exercise of discretion – balancing the considerations

The Council, in its submissions on the Extension Motion at [3]-[4], correctly identified that the Court’s reasons for staying the Restraining Orders included consideration for ‘innocent’ persons:

3.   In addressing the discretionary considerations the Court found that it was appropriate to stay the suite of restraining orders for a period of three months, and explained why. The Orders were stayed for essentially two reasons:
(a)   firstly, to enable suitable arrangements to be made to reasonably ameliorate the effect of the Orders on innocent non-executive employees;
(b)   secondly, to enable suitable arrangements to be made in respect of persons dependent upon the fulfilment of current supply contracts entered into with the second respondent.

4. That the Court's exercise of discretion for a temporary three month stay was primarily directed to concern for innocent employees and contracting parties is further borne out having regard to paragraphs 880-883 of the judgment.

It is also true that the stays were granted on the basis that the SSD Application was well advanced down the approval pipeline, and nearing completion (or so it was thought). The nuance expressed at [2] of the Respondents’ submissions misrepresents what the Court actually said at [885] of the primary judgment. The Respondents said:

The stay was granted in anticipation that the SSD Application process would be “well advanced” by the time judgment was delivered, enabling the Quarry to remain open until the SSD Application was determined.

There was no suggestion in the Court’s primary judgment that the Quarry would simply remain open until the SSD Application was determined. As was clear from [885], the Court left no doubt that there was a need to expedite the resolution of the unacceptable breaches of environmental and planning controls it determined had been proved. To reiterate, extracting the key words from [885]:

In addition to the reasons set out above in [880]-[881] of this judgment, in a context where the consideration of the SSD Application must surely be well advanced, perhaps approaching conclusion, three months should allow that DA to be determined. By setting a three month effective deadline, a message of urgency is being conveyed to complete the SSD Application process. [Emphasis added]

Despite the Court confirming that the decision-making process with respect to the SSD Application would be better informed by the Court’s finding, it was erroneous for any interpretation of the Court’s judgment to suggest that there was any support for the Quarry to remain open, on a totally open-ended basis, until the SSD Application was determined.
The Council’s submissions as to how the Court should exercise its discretion in determining whether the stays on the Restraining Orders should be extended were summarised, at [7] of its submissions on the Extension Motion, as follows:

7.   The Court should not entertain a renewed application to seek a stay of orders pending the determination of the State Significant Development Application (SSDA) for the following reasons:
(a)    the Court should not continue to countenance an ongoing breach of the law by the first and second respondents;
(b)   the timeframe for the determination of the SSDA is uncertain and as such the Court is being asked to grant a stay for an indefinite period;
(c)   the first and second respondents have consistently failed to progress the SSDA in a timely fashion and are seeking to take the benefit of their dilatory conduct by being permitted to continue operations - here is no incentive to progress the SSDA in a timely fashion;
(d)   the first and second respondents have failed to demonstrate that they have taken all reasonable steps to secure development consents;
(e)   the first and second respondents continued to operate and receive the fruits of those operations for some 1.5 years whilst judgment was outstanding; there is no demonstrable financial imperative to make any (of an uncertain number of) employees redundant and any decision to do so is entirely a matter for the respondents;

(f) there is a community expectation that, like all citizens, the respondents must adhere to the law;
(g) the proposed lEMP was disclosed only when Council received the notice of motion on 4 December 2018, has not been the subject of consultation with the Council, and is inappropriate as a long-term environmental safeguard.

The Respondents in their submissions on the Extension Motion, at [5]-[9], summarised the breadth of the Court’s discretion in considering what orders should be made once it is satisfied that a breach of the Act has been committed:

5. Where the Court is satisfied that a breach of the Act has been committed, it has a broad power to make “such order as it thinks fit to remedy or restrain the breach”: s.9.46 (previously s.124). The words “as it thinks fit” confer a wide discretion on the decision maker (F Hannan Pty Ltd v Electricity Commission of NSW No (3) (1985) 66 LGRA 306 at 312-313; Warringah Shire Council v Sedevic (1987) 10 NSWLR 335 at 339C). The power is to be exercised having regard to the public interest as well as the rights and interests of the parties (Rowley v NSW Leather Trading Co Pty Ltd (1980) 46 LGRA 250 at 260-261).
6. Relevant factors in the exercise of the discretion include whether the local authority has delayed in bringing enforcement proceedings, whether the breach is purely technical, and the environmental impacts (if any) of the breach. An important consideration in exercising the discretion is the public interest in upholding the orderly enforcement of planning law. However, the Court of Appeal has also recognised that in some cases it may be appropriate to “soften” the effect of planning laws by postponing injunctive relief.
7. The discretion can be used as a shield as well as a sword. The Court has on many occasions exercised its discretion to refuse to restrain an unlawful use: see for example Warringah Shire Council v Sedevcic (1987) 10 NSWLR 335; Parramatta City Council v RA Motors Pty Limited (1985) 59 LGRA 121. In Grace v Thomas Street Café Pty Ltd (2007) 159 LGERA 57 the Court of Appeal found that a café was operating unlawfully, but declined to make any consequential orders itself, instead remitting the matter back to the Land and Environment Court. Beazley JA (with whom Spigelman CJ and McClellan CJ at CL agreed) observed at [138]:
The range of relief that the Court might grant in such circumstances is extraordinarily wide, extending from refusing relief to granting relief, but allowing the café to continue to trade for a period of time, with or without conditions of continued use being imposed, to ordering full relief as sought by the appellants.

8. It is also relevant that the Court’s discretion is forward-looking, and should not (in civil enforcement proceedings) be used to punish a respondent for past bad behaviour. As was recently observed by Moore J in Hopkins v Quinn [2016] NSWLEC 163 at [104]:
The discretion under s 124 of the EP&A Act is either therapeutic or prophylactic. It is not punitive and I should not approach it in that fashion.

9. In the present case, the first and second respondents accept that the Court has already decided in the exercise of its discretion to grant some form of injunctive relief. However, by making Order 25, the Court has left open the possibility that relief could be further postponed pending determination of the SSD Application.

Analysing the various propositions in the Respondents’ submissions on this point, the Court finds little support for their case on the Extension Motion. In this case, given the extensive findings set out in the primary judgment regarding a multiplicity of breaches of both planning and environmental law, the public interest in upholding the orderly enforcement of the law is the paramount consideration in this instance.
Comparing the impact of a café continuing to operate contrary to planning law to the impacts of the multiplicity of breaches that the Court has found with respect to the Quarry, clearly distinguishes the justification for exercising discretion in Grace v Thomas Street Café Pty Ltd (2007) 159 LGERA 57; [2007] NSWCA 359 from the current circumstances. As just one illustration, the Respondents are offering to reduce laden trucks from 130 per day, to 90 per day, which means from up to 260 truck movements to up to 180 truck movements a day. Further highlighting the difference between the cases, with respect to the Quarry, the extended period being sought to further stay the Restraining Orders is 14 months at the minimum estimate, with a further extension being sought being quite conceivable on Ms Crossley’s evidence alone.
The Court had already exercised its discretion in “softening” the orders in the primary judgment by postponing the Restraining Orders, but it did so within an understanding of the context of the Quarry being the subject of an SSD Application – specifically the timing and, supposedly, advanced state of that SSD Application. Whatever decision the decision-makers might reach on that SSD Application, they could not right the wrong of the years of breaches of the law which the Court found had been proved. However, the primary judgment, by clarifying the legal status of the Quarry, would inevitably inform the baseline from which the SSD Application would be considered. Such a baseline could thereby inform standards and controls that took into account the need to address the implications of impacts on the community which the Court found proved in the primary judgment. The Court was cognizant of the fact that the SSD Application would be considered and determined within a modern context, applying the standards and requirements set by current-day planning and environmental laws and policies. The Court was also aware that the SSD Application was not simply seeking approval of the extant, unapproved, Quarry, let alone the significantly smaller and more constrained railway ballast quarry which had originally received approvals, rather, that the Second Respondent was seeking a significant expansion of scale and operations.
As said earlier, the Court exercised its discretion to stay the Restraining Orders, after clarifying the legal status of the Quarry in the declarations it made, primarily in consideration of the ‘innocent persons’ the Court had identified in the course of the proceedings, essentially the ordinary employees, contractors and those who had entered into, possibly critical, supply contracts. The three months’ grace was to ensure that these persons were not impacted upon whilst the Respondents pursued the completion of the SSD Application with diligence, indeed expedition, for as the Court said in [885] of the primary judgment:

By setting a three month effective deadline, a message of urgency is being conveyed to complete the SSD Application process.

It is apparent from the process the Court established in order 25 that the Court anticipated it might be necessary to build in some leeway, to provide more time, if it had transpired that the assurances regarding timing that the Court had received during the primary hearing were miss-estimates.
However, to find that the Respondents had left unanswered requests for further information from the relevant Department (being responses to 925 submissions), received in December 2016, despite the passage of two years, was a surprise to the Court, and unacceptable in the context of the assurances of advanced progress the Court had received during the primary hearing. To then find that the Respondents had been sufficiently concerned with aspects of their proposed expanded project the subject of the SSD Application, to commission a full review by new consultants at a time proximate to the primary hearing before the Court, and then find that months passed before a decision was made to appoint the new consultants replacing the Respondents’ earlier team working on the SSD Application compounded the surprise. It is to be kept in mind that the SSD Application was essentially for an expanded quarry project, presumably incorporating efforts to re-set the parameters of the extant Quarry. There may have been many internal company deliberations and consultations over many months but there was essentially little real ‘external’ progress with the SSD Application as it was originally cast. This is a conclusion the Court has reached despite a review of Annexure B to Mr Kelly’s 4 December 2018 affidavit. It was inevitable that a revised SSD Application, which might be effectively a replacement of the original version, would ‘reset the clock’. The possibility of readvertising the revised SSD Application, further consultations and the Department starting afresh the assessment of Quarry project could have been anticipated by the Respondents. Is the Court (and the Council and community-at-large) to standby, with the Restraining Orders stayed, whilst the Respondents progress their project refinements?
Mr Kelly, at [12] of his 4 December 2018 affidavit, states that, after receiving communication from the Department in December 2016 and reviewing the summary of the public submissions:

I became concerned that the consultants who were then engaged possibly did not have the required expertise to best guide and advise on a project of the scale, complexity and significance of the Martins Creek Quarry Project.

At [13] of his 4 December 2018 affidavit, Mr Kelly identified no fewer than five areas, (being social impact, traffic, noise, water and air quality), in relation to which he had concerns regarding the adequacy of previous work. In the context of the Court being advised during the primary hearing on 12 April 2017 (Transcript 1188.8-10) that the Respondents’ response to the public submissions on the SSDA would be lodged within 4 to 6 months, the change in the Respondents’ circumstances is highly material. Mr Kelly outlines, at [16]-[24] of his 4 December 2018 affidavit, what then transpired:

16.   This request led to the engagement in January 2017 of Umwelt (Australia) Pty Ltd (Umwelt) to provide a high level strategic review of the current SSDA situation.
17.   In May 2017, Umwelt advised and recommended that:
a.   substantial further base-line studies, environmental impact assessment, and stakeholder engagement would be required to adequately respond to the matters raised in submissions; and
b.   refinement of the Project was likely to be necessary to further minimise environment and community impacts and ensure all reasonable and feasible mitigation measures were in place.
18.   During the period from May 2017 to September 2017, the detailed advice and recommendations of Umwelt were considered in conjunction with the evidence given in the Land & Environment Court and the existing advice which had led to the formulation of the Project as contained in the EIS.
19.   Also during that period, Buttai Gravel undertook a detailed internal consideration of the advice provided by Umwelt and in particular its advice that the Project needed to be refined. The refinements recommended by Umwelt were in essence that there needed to be a reduction in both the total production from the Quarry and the level of road transport. The advice the company received was that 1.5 Mpta was unlikely to be approved based upon the issues which had been raised in the Secretary's Request.
20.   In September 2017, Buttai Gravel made a decision to commission Umwelt as the lead consultant for the SSDA.
21.   Since that time, Umwelt have been the lead environmental consultant tasked with taking forward the SSDA for the Project.
22.   I generally meet with Barbara Crossley and other team members of Umwelt on a weekly basis to go through the matters which are being carried out by Umwelt and its team of specialist consultants.
Instructions to Umwelt
23.   In September 2017, I was advised by Ms Crossley that the following studies would need to be substantially revised, to adequately address the issues raised in the Secretary's Request, and to take account of the detail raised in all submissions:
a.   Roads and Traffic Impact Assessment, including further work on road intersection assessment and design, and Gostwyck Bridge structural and safety assessment;
b.   Noise Impact Assessment;
c.   Air Quality Impact Assessment;
d.   Social Impact Assessment - including community and stakeholder consultation;
e.   Groundwater impact assessment;
f.   Surface water assessment; and
g.   Biodiversity;
24.   Ms Crossley also advised that given the nature of the issues raised in submissions on the Project, that some of these studies warranted re-work by more experienced experts, more accustomed to the relevant requirements and rigour required for a SSDA. On this basis, Buttai Gravel agreed with Umwelt a program of work that included selecting and engaging new expert team members for a number of technical studies.

It is now apparent to the Court that the expectations the Court had following the primary hearing were considerably different to the scenario that has subsequently been played out with respect to the SSD Application, viz, a complete change of head consultants and the engagement of a new expert team for new technical studies, leading to recommendations for the revision, in particular, down-sizing, of the SSD Application project. This gives rise to the question of whether the public interest is served by the community awaiting the deliberations and studies to be carried out for the Respondents’ prospective revised or new SSD Application, and then a predicted 10 months at the minimum for the new SSD Application to be considered and determined by the authorities, whilst the Quarry is allowed to continue to operate contrary to law. That is the scenario that would result if the Court were to accede to the Respondents’ Extension Motion. The alternative scenario, given the identified, and Court acknowledged, impacts on the wider community, is that the operations at the Quarry should cease during what is still an expected extended period before any resolution is likely as to the future operations of a quarrying operation at Martins Creek.
In all circumstances, the Court has concluded that it should not exercise its discretion in favour of the Respondents’ application in the Extension Motion. The continuing breaches of planning and environmental law, in the context of the unacceptable impacts upon the broader community which, in its primary judgment, the Court accepted, ought not be condoned. The Court had expected that the SSD Application process would have been concluded within a reasonable timeframe of a few months, rather than years, with the expectation that modern-day controls would thereby be appropriately imposed on the Quarry’s operations. With the expectation that a revised SSD Application is now to be lodged, and that the process in relation to it is unlikely to be completed prior to March 2020 at the earliest, discretionary considerations weigh against the Respondents’ application for an extension of the stays in the Restraining Orders. Therefore the orders sought by the Respondents will not be made.
However, with the Court being conscious of, and sensitive to, the likely impact of an immediate closure of the Quarry, the Court will nevertheless extend each of the stays by a minimal period of 2 months, that is, to 12 March 2019. The intention of this minimal extension of the stays is to enable the Respondents to take measures to soften the impact of a foreshadowed closure on its employees, contractors and persons with extant pressing supply contracts, all of whom may be harmed to a degree. That harm has to be offset against the public interest and the overriding requirement to uphold the rule of law.

Court advised of appeal to Court of Appeal

By e-mail dated 9 January 2019 at 5.22 pm, the solicitor for the Respondents wrote to the Court:

This communication is sent with the consent of the Applicant.
We refer to the Notice of Motion filed by the First and Second Respondents on 4 December 2018 to extend the stay of his Honour Molesworth AJ’s orders of 12 October 2018.
We advise the First and Second Respondents have filed a Notice of Appeal dated 2 January 2019 to the Court of Appeal. The Notice of Appeal is attached.
Further, the First and Second Respondents have filed a Notice of Motion for expedition and for stay on his Honour’s orders pending the determination of the appeal.
Given the application to extend the stay granted by his Honour is presently under consideration, we consider that the filing of the appeal and the motion are material circumstances which require his Honour to be given notice of.

The Court had been previously advised, by letter dated 3 January 2019, of the filing of the Notice of Appeal, however was not informed of the Notice of Motion until the 9 January 2019 e-mail set out above.
In the absence of viewing this Notice of Motion, the Court presumes that the orders sought to be stayed pending the determination of the appeal are the same Restraining Orders made 12 October 2018 which are the subject of the Extension Motion being considered and determined in this judgment. Receiving this communication late in the afternoon on the eve of the date the judgment on the Extension Motion had been listed for handing down could be considered to be placing inappropriate pressure on the trial judge. What were the “material circumstances” within the contemplation of the Respondents which warranted the Court being advised, on the eve of handing down judgment, that the matters which had been fully ventilated in hearing were now to be ventilated again before the Court of Appeal? It is perhaps prospectively within contemplation that orders made in this judgment will also be the subject of the further stay application now being brought before the Court of Appeal.
I have decided that there is no basis for this Court to not proceed to judgment on the Extension Motion, determining whether, in the exercise of discretion, a further stay of the Restraining Orders should be granted. As I was the trial judge, intimately informed of the significantly extensive and exceedingly complex history in this matter, after an exceptional hearing extending over 22 days examining thousands of pages of exhibited documents, the Court of Appeal may be assisted in understanding the perspective of the trial judge with respect to the discretionary matters that have influenced the Court’s decision regarding this stay application.

Costs

The Respondents having primarily failed on their Extension Motion must pay the Council’s costs on the Motion. Although the Court has, in its discretion, granted a two month further stay, such a stay is far from the stay period they sought.

Orders

The Court orders:

The stays provided for in orders of the Court dated 12 October 2018, being Orders 3, 5, 7, 9, 11, 13, 15, 17, 19, 21 and 23 shall be extended until 12 March 2019.

In accordance with Order 24 of the primary judgment (as amended on 25 October 2018), the Respondents shall undertake to continue to comply with Annexure C – Interim Environmental Management Plan – Martins Creek Quarry (IEMP) but with it amended as follows:

In C1, the limit on road transport in any 12-month period is to be reduced from 650,000 tonnes to 449,000 tonnes, pro rata adjusted for the two month further stay allowed in Order 1;

In C2, the number of laden trucks to be dispatched from the Quarry is to be reduced from 130 to no more than 90 laden trucks in any one calendar day; and

In C3, the number of laden trucks to be dispatched from the Quarry in any one-hour period is to be reduced from 30 to 20;

The Respondents shall pay a contribution to Dungog Shire Council of $0.50 per tonne of product transported by road on a monthly basis calculated by reference to weighbridge records (which will be made available to Dungog Shire Council on request) for the purpose of the maintenance or repair of the public roads comprising the haul route within the Dungog Shire local government area from the Quarry.

The Respondents are to pay the Council’s costs on the Notice of Motion.

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Decision last updated: 14 January 2019

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Citations

Dungog Shire Council v Hunter Industrial Rental Equipment Pty Ltd (No 3) [2019] NSWLEC 3

Most Recent Citation

Dungog Shire Council v Hunter Industrial Rental Equipment Pty Limited [2019] NSWLEC 132

Cases Citing This Decision

3

Hunter Industrial Rental Equipment Pty Ltd v Dungog Shire Council [2019] NSWCA 147

Buttai Gravel Pty Ltd v Independent Planning Commission [2025] NSWLEC 1525

Dungog Shire Council v Hunter Industrial Rental Equipment Pty Limited [2019] NSWLEC 132

Cases Cited

9

Statutory Material Cited

1

Dungog Shire Council v Hunter Industrial Rental Equipment Pty Ltd (No 2) [2018] NSWLEC 153

Arnhem Land Aboriginal Land Trust v Northern Territory of Australia [2007] FCAFC 31

Roosters Club Inc v Northern Tavern Pty Ltd (No 2) [2003] SASC 143

Medium Neutral Citation:	Dungog Shire Council v Hunter Industrial Rental Equipment Pty Ltd (No 3) [2019] NSWLEC 3
Hearing dates:	12 December 2018
Date of orders:	10 January 2019
Decision date:	10 January 2019
Jurisdiction:	Class 4
Before:	Molesworth AJ
Decision:	See orders at [84]
Catchwords:	PRACTICE AND PROCEDURE – primary judgment found longstanding breaches of environmental and planning laws and issued injunctive relief, stayed for a period of three months - Notice of Motion to extend stay of orders to enable State Significant Development (SSD) process to be completed – SSD process unlikely to be completed by March 2020 at earliest – ongoing breach of planning and environment laws – importance of upholding planning and environment laws - impact on the community – inappropriate to stay until completion of SSD process in light of 2020 date - minimal further stay of two months granted to ameliorate impact of orders restraining offending conduct on employees and third parties
Legislation Cited:	Environmental Planning and Assessment Act 1991 s 124 (now 9.46)
Cases Cited:	ACR Trading Pty Ltd v Fat-Sel Pty Ltd (1987) 11 NSWLR 67 Arnhem Land Aboriginal Land Trust and Others v Northern Territory and Others 157 FCR 255; [2007] FCAFC 31 Bunnings Forest Products Pty Ltd v Bullen (1994) 54 FCR 342 Dungog Shire Council v Hunter Industrial Rental Equipment Pty Ltd (2016) 220 LGERA 43; [2016] NSWLEC 164 Dungog Shire Council v Hunter Industrial Rental Equipment Pty Ltd (No 2) [2018] NSWLEC 153 Grace v Thomas Street Café Pty Ltd (2007) 159 LGRA 57; [2007] NSWCA 359 Roosters Club Inc v Northern Tavern Pty Ltd (No 2) [2003] SASC 143 Warringah Shire Council v Sedevcic (1987) 10 NSWLR 335
Category:	Procedural and other rulings
Parties:	Dungog Shire Council (Applicant) Hunter Industrial Rental Equipment Pty Limited (First Respondent) Buttai Gravel Pty Limited (Second Respondent) Environment Protection Agency (Third Respondent)
Representation:	Counsel: Mr T Howard SC and Ms C Novak (Applicant) Mr J Lazarus and Ms J Walker (First and Second Respondents) Solicitors: Coutts Mallik Rees (Applicant) DWF (Australia) (First and Second Respondents)
File Number(s):	16/149935
Publication restriction:	No