Eclipse Resources Pty Ltd v The State of Western Australia [No 4]
[2016] WASC 62
•9 MARCH 2016
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CIVIL
CITATION: ECLIPSE RESOURCES PTY LTD -v- THE STATE OF WESTERN AUSTRALIA [No 4] [2016] WASC 62
CORAM: BEECH J
HEARD: 16-27 NOVEMBER 2015
(FINAL WRITTEN SUBMISSIONS 17 DECEMBER 2015)
DELIVERED : 9 MARCH 2016
FILE NO/S: CIV 1364 of 2009
BETWEEN: ECLIPSE RESOURCES PTY LTD
Plaintiff
AND
THE STATE OF WESTERN AUSTRALIA
First DefendantTHE CHIEF EXECUTIVE OFFICER OF THE DEPARTMENT OF ENVIRONMENT REGULATION
Second DefendantTHE MINISTER FOR ENVIRONMENT
Third Defendant
FILE NO/S :CIV 2385 of 2013
BETWEEN :THE MINISTER FOR ENVIRONMENT
Plaintiff
AND
ECLIPSE RESOURCES PTY LTD
Defendant
FILE NO/S :CIV 2416 of 2014
BETWEEN :ECLIPSE RESOURCES PTY LTD
Plaintiff
AND
THE STATE OF WESTERN AUSTRALIA
First DefendantTHE CHIEF EXECUTIVE OFFICER OF THE DEPARTMENT OF ENVIRONMENT REGULATION
Second DefendantTHE MINISTER FOR ENVIRONMENT
Third Defendant
Catchwords:
Constitutional law - Duties of excise - Whether levy imposed on waste disposed of to landfill is a duty of excise
Local government and environment - Waste management - Whether materials received are 'waste' - Whether materials received are 'accepted for burial' - Whether materials deposited and compacted in a void are 'waste disposed of to landfill'
Legislation:
Environmental Protection Act 1986 (WA)
Environmental Protection Regulations 1987 (WA)
Waste Avoidance and Recovery Act 2007 (WA)
Waste Avoidance and Resource Recovery Levy Act 2007 (WA)
Waste Avoidance and Resource Recovery Levy Regulations 2008 (WA)
Waste Avoidance and Resource Recovery Regulations 2008 (WA)
Result:
Eclipse's claims dismissed
Government Parties' claims upheld
Category: A
Representation:
CIV 1364 of 2009
Counsel:
Plaintiff: Mr S Penglis and Mr P F Fletcher
First Defendant : Mr G R Donaldson SC and Ms J E Shaw
Second Defendant : Mr G R Donaldson SC and Ms J E Shaw
Third Defendant : Mr G R Donaldson SC and Ms J E Shaw
Solicitors:
Plaintiff: Fletcher Law
First Defendant : State Solicitor for Western Australia
Second Defendant : State Solicitor for Western Australia
Third Defendant : State Solicitor for Western Australia
CIV 2385 of 2013
Counsel:
Plaintiff: Mr G R Donaldson SC and Ms J E Shaw
Defendant: Mr S Penglis and Mr P F Fletcher
Solicitors:
Plaintiff: State Solicitor for Western Australia
Defendant: Fletcher Law
CIV 2416 of 2014
Counsel:
Plaintiff: Mr S Penglis and Mr P F Fletcher
First Defendant : Mr G R Donaldson SC and Ms J E Shaw
Second Defendant : Mr G R Donaldson SC and Ms J E Shaw
Third Defendant : Mr G R Donaldson SC and Ms J E Shaw
Solicitors:
Plaintiff: Fletcher Law
First Defendant : State Solicitor for Western Australia
Second Defendant : State Solicitor for Western Australia
Third Defendant : State Solicitor for Western Australia
Case(s) referred to in judgment(s):
Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [2009] HCA 41; (2009) 239 CLR 27
Anderson's Pty Ltd v The State of Victoria [1964] HCA 77; (1964) 111 CLR 353
Australian Capital Territory v Queanbeyan City Council [2010] FCAFC 124; (2010) 188 FCR 541
Australian Securities Commission v Marlborough Gold Mines Ltd [1993] HCA 15; (1993) 177 CLR 485
Betfair Pty Ltd v The State of Western Australia [2008] HCA 11; (2008) 234 CLR 418
Capital Duplicators Pty Ltd v Australian Capital Territory (No 2) [1993] HCA 67; (1993) 178 CLR 561
Carr v Western Australia [2007] HCA 47; (2007) 232 CLR 138
Certain Lloyd's Underwriters Subscribing to Contract No IH00AAQS v Cross [2012] HCA 56; (2012) 248 CLR 378
Chugg v Pacific Dunlop Ltd [1990] HCA 41; (1990) 170 CLR 249
CIC Insurance Ltd v Bankstown Football Club Ltd [1997] HCA 2; (1997) 187 CLR 384
City of Fremantle and The Chief Executive Officer of the Department of Environment and Conservation [2013] WASAT 24
City of Kwinana v Lamont [2014] WASCA 112
Collector of Customs v Agfa‑Gevaert Ltd [1996] HCA 36; (1996) 186 CLR 389
Commissioner for Australian Capital Territory Revenue v Kithock Pty Ltd [2000] FCA 1098; (2000) 102 FCR 42
Commissioner of Police v Eaton [2013] HCA 2; (2013) 252 CLR 1
Commissioner of Taxation v Consolidated Media Holdings Ltd [2012] HCA 55; (2012) 250 CLR 503
Cooper Brookes (Wollongong) Pty Ltd v Commissioner of Taxation [1981] HCA 26; (1981) 147 CLR 297
Dennis Hotels Pty Ltd v The State of Victoria [1960] HCA 10; (1960) 104 CLR 529
Du Buisson Perrine v Chan [2016] WASCA 18
Eclipse Resources Pty Ltd v Chief Executive Officer, Department of Environment and Conservation [2013] WASCA 152; (2013) 45 WAR 353
Environment Protection Authority v N (1992) 26 NSWLR 352
Epic Energy (Pilbara Pipeline) Pty Ltd v Commissioner of State Revenue [2011] WASCA 228; (2011) 43 WAR 186
Gosford Meats v New South Wales [1985] HCA 5; (1985) 155 CLR 368
Ha v New South Wales [1997] HCA 34; (1997) 189 CLR 465
Hematite Petroleum Pty Ltd v Victoria [1983] HCA 23; (1983) 151 CLR 599
Kelly v The Queen [2004] HCA 12; (2004) 218 CLR 216
K‑Generation Pty Ltd v Liquor Licensing Court [2009] HCA 4; (2009) 237 CLR 501
Kithock Pty Ltd v Commissioner for Australian Capital Territory Revenue [2001] HCA Trans 374
Knight v The State of Victoria [2014] FCA 369; (2014) 221 FCR 561
Lacey v Attorney General (Qld) [2011] HCA 10; (2011) 242 CLR 573
Logan Downs Pty Ltd v Queensland [1977] HCA 3; (1977) 137 CLR 59
Matthews v Chicory Marketing Board [1938] HCA 38; (1938) 60 CLR 263
Mijatovic v Legal Practitioners Complaints Committee [2008] WASCA 115; (2008) 37 WAR 149
MR Hornibrook (Pty) Ltd v Federal Commissioner of Taxation [1939] HCA 29; (1939) 62 CLR 272
Mutual Pools & Staff Pty Ltd v Commissioner of Taxation [1992] HCA 4; (1992) 173 CLR 450
Network 10 Pty Ltd v TCN Channel Nine Pty Ltd [2004] HCA 14; (2004) 218 CLR 273
Nominal Defendant v GLG Australia Pty Ltd [2006] HCA 11; (2006) 228 CLR 529
Philip Morris Ltd v Commissioner of Business Franchises [1989] HCA 38; (1989) 167 CLR 399
Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355
Queensland Nickel Pty Ltd v Commonwealth of Australia [2015] HCA 12; (2015) 89 ALJR 451
TEC Desert Pty Ltd v Commissioner of State Revenue (WA) [2010] HCA 49; (2010) 241 CLR 576
The State of Western Australia v Chamberlain Industries Pty Ltd [1970] HCA 5; (1970) 121 CLR 1
Trajkoski v Director of Public Prosecution (WA) [2010] WASCA 119; (2010) 41 WAR 105
Wilderness Society of WA (Inc) v Minister for Environment [2013] WASC 307; (2013) 45 WAR 471
Zheng v Cai [2009] HCA 52; (2009) 239 CLR 446
BEECH J:
Summary
The plaintiff, Eclipse Resources Pty Ltd (Eclipse), carried out resource recovery operations at three sites in the metropolitan region between 1 July 2008 and 30 September 2014. Each site had been quarried, resulting in a void in the ground at the site. As part of its operations at each site, Eclipse received materials from third parties and progressively deposited and compacted some of those materials in the void.
These actions concern whether Eclipse is liable to pay a waste levy from 1 July 2008 to 30 September 2014. Liability to pay the waste levy arises under a somewhat convoluted legislative regime that, in essence, imposes levy when waste is accepted for burial at premises and disposed of to landfill.
Eclipse claims, in broad summary, that:
(1)the materials it received from third parties were not waste;
(2)if they were, Eclipse did not accept them for burial;
(3)the materials that Eclipse deposited and compacted in the void were not waste disposed of to landfill;
(4)for one or more of these reasons, Eclipse is not liable to pay levy;
(5)alternatively, if Eclipse is otherwise liable to pay levy, in its practical operation in relation to Eclipse's sites, or some of them, on the following three alternative bases the legislation imposing the levy is unconstitutional because it amounts to a duty of excise:
(a)the levy is a tax on the materials received by Eclipse, and those materials, in Eclipse's hands, are a valuable commodity;
(b)the levy is a tax in respect of products that are made by Eclipse when it removes compacted materials and uses them to make soil products;
(c)the levy is a tax on or in respect of the sand and limestone quarried from one of the sites, in that the depositing and compacting of materials constitutes necessary rehabilitation of the quarried area.
The State of Western Australia, the Chief Executive Officer of the Department of Environment Regulation and the Minister for Environment (Government Parties) submit to the contrary in relation to all of these contentions.
Apart from the excise questions, the issues regarding whether the levy regime applies to Eclipse's operations turn critically upon the proper construction of the legislative regime. I have resolved the issues of construction adversely to Eclipse, and found that the levy regime applies to its operations at the three sites.
I am not persuaded that, in its application to all or any of Eclipse's sites, the levy is an excise.
The balance of these reasons is organised as follows:
(2)Findings of fact [8] ‑ [443].
(3)The legislative regime [444] ‑ [518].
(4)The parties' claims and the issues [519] ‑ [534].
(5)The proper construction of the levy regime [535] ‑ [627].
(6)Did Eclipse accept waste for burial at the Sites? [628] ‑ [643].
(7)Did Eclipse fail to comply with reg 10(6) of the Levy Regulations? [644] ‑ [664].
(8)Are the estimates of levy made by the CEO valid? [665] ‑ [678].
(9)Should Eclipse's claims for declarations relating to the return periods after 1 January 2012 succeed? [679] ‑ [685].
(10)Is the levy invalid as an excise in its application to Eclipse's Sites? [686] ‑ [800].
(11)Conclusion [801] ‑ [803].
Findings of fact
2.1 Introduction
Both parties tendered a substantial volume of evidence and sought a very large number of detailed findings of fact. Each party filed a lengthy submission setting out the findings of fact for which it contended. These submissions were, in total, almost 200 pages long. Many of the findings sought relate to matters of fine detail, the relevance of which to the resolution of the issues in these actions is not entirely clear to me. Nevertheless, in deference to the parties' submissions, and in case the matter goes on appeal and different views are taken as to the relevance of certain findings to the case (as developed on appeal), with limited exceptions I have made, or considered making and decided not to make, all of the findings of fact invited by the parties. The exceptions relate to proposed findings on matters of very fine detail that I think have no significance.
Some of the findings of fact invited by Eclipse involve a detailed recitation of parts of a written statement of one of Eclipse's witnesses. In some such cases I have not made the particular findings invited by Eclipse because the subject‑matter of that part of the written statement relied on by Eclipse is also dealt with by other evidence, and I have made broader findings which reflect my view of the evidence as a whole.
In the context of the substantial volume of evidence tendered by the parties, there were relatively few factual issues of any real magnitude. Many facts were agreed.[1] The most significant and most substantial factual issue relates to the timing and extent of Eclipse's 're‑mining' of materials that it had compacted in the voids, and its intention to do so.
[1] See exhibit A and exhibit B.
In submissions filed after the conclusion of the trial, each party identified those of the findings sought by the other party which it agreed should be made. Where all parties agreed that a finding of fact should be made, and where it accorded or was not inconsistent with any view of the facts that I had formed, I have made the finding of fact without having always given close attention to all of the references in the footnotes in the relevant party's submissions.
2.2 Eclipse's sites
Since 1994, Eclipse has been the occupier of land on Flynn Drive in Carramar, Western Australia comprising:
(a)lot 1 on diagram 46611, being the whole of the land contained in certificate of title volume 1385 folio 18 (now known as lot 9000 on deposited plan 74654, being the whole of the land contained in certificate of title volume 2831 folio 692); and
(b)lot 2 on diagram 48842, being the whole of the land contained in certificate of title volume 1434 folio 718,
(together, the Flynn Drive Site).[2]
[2] Exhibit A [23].
Eclipse is (and has been since April 2002 for lot 115 and since May 2005 for lot 2) the occupier of land on Abercrombie Drive in Postans, Western Australia comprising:
(a)lot 115 on plan 48295 (formerly known as lot 180 on plan 213404), being the whole of the land contained in certificate of title volume 2602 folio 976); and
(b)lot 2 on plan 29392, being the whole of the land contained in certificate of title volume 2219 folio 775,
(together, the Abercrombie Road Site).[3]
[3] Exhibit A [10].
Since June 2009 (and previously between June 2002 and March 2004), Eclipse has been the occupier of land on Wanneroo Road in Neerabup, Western Australia comprising a portion of lot 12 on plan 9605, lot 12 on plan 9605 being the whole of the land contained in certificate of title volume 1925 folios 276 to 280 (Wanneroo Road Site).[4]
[4] Exhibit A [17].
The Flynn Drive Site, the Abercrombie Road Site and the Wanneroo Road Site (Sites) are all within the metropolitan region within the meaning of s 4(1) of the Planning and Development Act 2005 (WA).[5]
[5] Exhibit A [27].
Each of the Sites contained a void created by the previous quarrying of sand or limestone (or both) when Eclipse took occupation of it.[6]
2.2.1 Abercrombie Road Site
[6] Exhibit A [13], [21], [24].
One of the lots comprising the Abercrombie Road Site (lot 2) was initially acquired by Eclipse, the other (lot 115) by a related company, Bayardo Pty Ltd.[7] It appears from Eclipse's application in February 2010 to the Town of Kwinana for planning approval that at that time lot 2 was owned by Eclipse and lot 115 by Bayardo. By 1 January 2012, it appears, and I find, that Bayardo owned both lots.
[7] Exhibit D1 [32]; exhibit A, attachment 20, pages 755, 757 and 761.
On 1 January 2012, Eclipse and Bayardo entered into an agreement by which Eclipse was granted a licence to occupy and use the Abercrombie Road Site.[8] The agreement licenses Eclipse to use the Abercrombie Road Site for all of its activities for two consecutive five‑year terms.[9] One of the conditions of the licence is that, having quarried the site, Eclipse progressively fills the resulting void with inert material that meets requisite environmental standards, compacting that material to specified geotechnical standards that are acceptable by Bayardo and appropriate to qualify the restored land for subdivision, sale and use for the construction of light industrial buildings.[10] No time limit is stipulated for compliance with that condition.
[8] Exhibit B [4], attachment S31.
[9] Exhibit B, attachment S31, cl 2, sch item 1.
[10] Exhibit B [4], attachment S31, cl 3.3.
Eclipse agreed to pay a licence fee of 10% of gross turnover to Bayardo.[11]
[11] Exhibit B [4], attachment S31, cl 5.1, sch item 3.
After Eclipse's operations have ceased and the Abercrombie Road Site has been filled to its final level by Eclipse, Bayardo intends to develop the site as an industrial subdivision. No application for subdivision or planning approval in respect of the site has as yet been made.[12]
[12] Exhibit A [16].
When Eclipse and Bayardo acquired the Abercrombie Road Site, Mr Delroy estimated that the total potential resources from the site were approximately 8 million tonnes (or about 5 million m3) of mainly good quality limestone and to a lesser extent yellow sand, a relatively small amount of which had already been mined prior to acquisition.[13]
[13] Exhibit D1 [33.1].
As at July 2015, Eclipse had about 3 million tonnes of virgin limestone and sand left to mine at the site.[14]
2.2.2 Wanneroo Road Site
[14] Exhibit D1 [36].
The Wanneroo Road Site is currently uncleared. The vegetation is in good to excellent condition, except for the 11 ha site of the former limestone quarry. The quarry consists largely of the void created by the removal of the side of a hill.[15]
[15] Exhibit A [21].
The Wanneroo Road Site was private property when Eclipse commenced operations on it.[16]
[16] Exhibit G1 [84].
In 1999, 2002 and 2008, Eclipse and the then owners of the Wanneroo Road Site entered into deeds of agreement by which Eclipse was granted a licence to occupy and use the Wanneroo Road Site.[17]
[17] Exhibit A [18], attachments 4 ‑ 8.
In 2002, Eclipse entered into a deed of agreement with the family who owned the site, the Bourke family, to rehabilitate the quarry on the site.[18]
[18] Exhibit D1 [21].
Around 750,000 m3 of fill is required to reconstruct the original contours of the quarry site.[19]
[19] Exhibit D1 [22].
The Wanneroo Road Site was reserved under the Metropolitan Region Scheme and the City of Wanneroo District Planning Scheme 2 for 'Parks and Recreation' for many years before 2002. In around 2012, the Western Australian Planning Commission (WAPC) acquired the site from the Bourke family for the purpose of adding it to the adjacent 943 ha Neerabup National Park in the future. Pursuant to an agreement between the WAPC and the Bourke family, the WAPC agreed to be bound by the Bourke family's obligations under the licence granted to Eclipse.[20]
[20] Exhibit A [19].
Eclipse and the WAPC entered into a new deed of agreement dated 22 August 2014.[21]
[21] Exhibit A [20], attachment 9.
Each of the deeds of agreement entered into between Eclipse and the owners of the Wanneroo Road Site in 2008 and 2014 granted Eclipse a licence to occupy and use the Wanneroo Road Site. Pursuant to the deeds, Eclipse was required, amongst other things, to fill the quarry void at the site by a certain date.[22]
[22] Exhibit A, attachments 8 and 9.
When the quarry on the Wanneroo Road Site has been restored and revegetated by Eclipse, the WAPC intends to integrate it into the Neerabup National Park.[23]
2.2.3 Flynn Drive Site
[23] Exhibit A [22].
When Eclipse first took occupation of the Flynn Drive Site in 1994, it consisted of two contiguous lots with a total area of approximately 98 ha. A large former limestone quarry with a void capacity of about 4 million m3 and dilapidated lime kilns of heritage interest occupied the northern part of the site. The vegetation on the balance of the land was in good to excellent condition. The land was zoned 'Rural' in the Metropolitan Region Scheme and in the City of Wanneroo's Town Planning Scheme No 1. In 1995, before Eclipse commenced using the Flynn Drive Site, Eclipse put forward a proposal, which was subsequently approved, to rezone the land (except for the quarry) to 'Special Residential' and to rezone the quarry to 'Parks and Recreation' under the City of Wanneroo's Town Planning Scheme.[24]
[24] Exhibit A [24].
Consulting engineers engaged by Eclipse prepared a landfill and earthworks management plan dated January 1995 for the Flynn Drive Site.[25] The report formed part of an application by Eclipse to the City of Wanneroo for development approval to conduct the proposed filling and earthworks at the site. Eclipse's ultimate proposed use of the site was for a residential subdivision of bush lots of approximately 2,000 m2 to 3,000 m2 in size.
[25] Exhibit D1, attachment TD1.
On 11 October 1996, Eclipse and the City of Wanneroo entered into a deed the object of which was to satisfy the City's requirements for the finalisation of the rezoning of the Flynn Drive Site.[26] In effect, the deed provided that the former quarry on the site would become a recreation park that would be transferred to the City and managed by a Home Owners' Association established by Eclipse.[27]
[26] Exhibit D1, attachment TD2.
[27] Exhibit D1, attachment TD2, cl 2.3 and cl 2.4, annexure A.
By cl 7(b) of the deed, Eclipse acknowledged that the City would not issue final clearance for the first stage of the subdivision of the site until landfilling in the former quarry was completed, unless and to the extent otherwise agreed.
The October 1996 deed was superseded by a deed dated 18 May 2009 between Eclipse, the City of Wanneroo and the mortgagee.[28] Under that deed Eclipse agreed to develop the quarry area, referred to as the Recreation and Equine Park, at its own expense and transfer it free of charge to the Home Owners' Association.[29] By cl 6(b), Eclipse again acknowledged that the City would not issue final clearance for the first stage of the subdivision until landfilling in the former quarry was completed.
[28] Exhibit A, attachment 41.
[29] Exhibit A, attachment 41, cl 2.3.
In 2004, Eclipse prepared a document which identified how much peat and topsoil it would need to make water retentive soils that could be put over the whole 20 ha area of the quarry void at the Flynn Drive Site on the completion of shaping of the void. The document was subsequently modified as a live document.[30] I will say more about it in my findings about re‑mining.
[30] Exhibit D4; ts 336 ‑ 340.
By 1 July 2008, the void at the Flynn Drive Site had almost been filled.[31] Much of the area of the void had reached its final levels, with the final cover of remediated peat having been placed over the fill and extensive revegetation having commenced.[32]
[31] Exhibit G1 [102].
[32] Exhibit G1 [102].
Eclipse completed progressive filling of the void at the Flynn Drive Site in June 2009. Since then, the area has been landscaped and vegetated so that it can be used as a park in accordance with the deed of 18 May 2009.[33]
[33] Exhibit A [25].
The Flynn Drive Site had ceased accepting materials for fill by June 2009. By this time, the kilns on the site had been restored and Eclipse had received an approval dated 5 February 2010 from the WAPC to subdivide the site.
Eclipse had previously been granted subdivision approval by the WAPC in respect of the Flynn Drive Site. The first subdivision approval was granted in or around November 1999. The last subdivision approval was granted to the current landowner, Man O War Resources Pty Ltd, on 24 December 2013 and amended on 9 May 2014.[34] The site has not yet been subdivided into approved lots but developments in the form of reticulated landscaping, community facilities and retaining walls have been commenced and, in many instances, completed.[35]
2.3 Overview of Eclipse's operations
[34] Exhibit G1 [103].
[35] Exhibit A [26].
These three actions concern Eclipse's liability to pay levy in respect of its operations at the Sites between 1 July 2008 and 30 September 2014. More specifically, the proceedings relate to Eclipse's liability for the Flynn Drive Site, from 1 July 2008 to 30 June 2009, for the Abercrombie Road Site from 1 July 2008 to 30 September 2014 and for the Wanneroo Road Site from 1 June 2009 to 20 September 2014. I will refer to those periods for each site as the Relevant Period. (CIV 1364 of 2009 also concerns questions relating to the period from 1 July 1998 to 30 June 2008. However, by consent of the parties, the court made an order that the trial of that action, so far as it relates to the period before 1 July 2008, be deferred until the final determination of the parties' claims concerning the period after 1 July 2008.)
Eclipse carried out a number of different activities at each of the Sites during the Relevant Period.
As set out in more detail below, at its Flynn Drive Site during the Relevant Period, Eclipse:
(a)produced mulch for use on site;
(b)produced blended soils for use on site; and
(c)completed the filling of the former quarry void on the site.
Eclipse did not produce or sell any products from the Flynn Drive Site during the Relevant Period.[36]
[36] ts 230 ‑ 231.
As set out in more detail below, at its Abercrombie Road Site during the Relevant Period, Eclipse:
(a)quarried virgin, naturally occurring, sand and limestone (Quarry Materials) from the site, thereby increasing the size of the void created by the existing quarry;
(b)produced mulch for sale;
(c)produced blended soils for sale;
(d)continued filling the quarry void on the site; and
(e)at times from about July 2014, removed materials it had previously deposited and compacted in the quarry void on the site as fill.
As set out in more detail below, at its Wanneroo Road Site, during the Relevant Period, Eclipse:
(a)excavated some remediated (previously acidic) peat buried by Eclipse at the Wanneroo Road Site between June 2002 and March 2004 (and the crushed limestone the peat was buried with in order to neutralise it) ;
(b)produced mulch for sale;
(c)produced blended soils for sale; and
(d)continued filling the quarry void on the site.
Eclipse invites findings that at both Abercrombie Road and Wanneroo Road, among the blended soils that it produced for sale during the Relevant Period was water retentive landscape shaping soil.[37] As explained in more detail later in these reasons, I am not satisfied that Eclipse produced that product prior to July 2014.
[37] Eclipse's Detailed Response to the Facts which the Government Parties Contend Should be Found [9(c)], [10(c)].
During the Relevant Period at the Abercrombie Road Site Eclipse produced structural fill, some at least of which was produced for sale.[38]
[38] Exhibit A [40(c)], [62(1(i)].
Eclipse also invites a like finding in respect of the Wanneroo Road Site,[39] and findings that it produced fill for sale at both the Wanneroo Road Site and the Abercrombie Road Site,[40] by reference to what is said in Mr Sippe's witness statement.[41] Those parts of Mr Sippe's statement address what Eclipse 'produces' as at the time of the statement. I am not satisfied that during the Relevant Period Eclipse consistently made the same products that it was making when Mr Sippe's statement was signed in July 2015. Those parts of Mr Sippe's evidence do not satisfy me as to what occurred during the Relevant Period.
[39] Eclipse's Detailed Response to the Facts which the Government Parties Contend Should be Found [10(d)].
[40] Eclipse's Detailed Response to the Facts which the Government Parties Contend Should be Found [9(e)], [10(e)].
[41] Exhibit G1 [34], [35].
More generally, many parts of Mr Sippe's evidence in his statements are directed to describing Eclipse's then current practices and procedures, and are not expressed to relate to the position over the course of the six years comprising the Relevant Period. I am by no means satisfied that the position as at July 2015 can be taken to reflect the position in all relevant respects from July 2008 to September 2014. I will give other examples of this later in my reasons.
2.4 The nature of Eclipse's business
Mr Sippe gave general evidence as to the nature of Eclipse's business. It was expressed in the present tense. As I have said, I am not satisfied that his description of Eclipse's current products applied throughout the Relevant Period. With that exception, I accept that Mr Sippe's statement of the current position in describing the general nature of Eclipse's business reflected the position during the Relevant Period.
Mr Sippe says that Eclipse operates an integrated business involving sequential land use and resource recovery operations and incorporating: limestone and sand mining; production of water retentive soils and mulches; and production of structural fill for off‑site sales and for on‑site projects.[42] Although perhaps not spelt out, an element of Eclipse's operations at each of the Sites was the filling of the void at the site.
[42] Exhibit G1 [9].
Eclipse accepts only certain kinds of materials that are considered by it to be environmentally and geotechnically fit for Eclipse's purpose. Other parties usually pay Eclipse to take these materials, although Eclipse does pay for certain materials if they are needed for a specific purpose or to meet a sales order.[43] Eclipse accepts materials that it considers to be a resource from which, through processing, re‑use or recycling, it can produce resaleable or re‑usable commodities.[44] Mr Sippe says that Eclipse receives materials and processes them as required to render them suitable for:
(a)the manufacture of water retentive blended soils;
(b)the manufacture of mulches; or
(c)use on‑site or sale off‑site as geotechnically and environmentally suitable fill.[45]
[43] Exhibit F1 [46].
[44] Exhibit G1 [12].
[45] Exhibit G1 [79].
As I will explain in more detail below, Eclipse determined the environmental suitability of materials by reference to certain criteria published by the Department of Environment Regulation (DER).[46] These criteria are known as environment investigation levels (EILs) and health investigation levels (HILs).
[46] In these reasons, the term DER is also used to refer to predecessors of the Department of Environment Regulation, such as the Department of Environment and Conservation, the Department of Environment and the Department of Environmental Protection.
Any material received that Eclipse considered to be environmentally and geotechnically unfit for Eclipse's purpose and that had no potential to be rendered fit for purpose, for example by remediation, was rejected and, with one exception, stockpiled to be taken, at Eclipse's expense, for disposal elsewhere. The exception is metals that Eclipse has from time to time stockpiled and sold as scrap metal. From the Abercrombie Road Site, unfit material is taken to the Millar Road Class III landfill operated by the City of Rockingham and, from the Wanneroo Road Site, to the licensed Tamala Park Class III facility run by Mindarie Regional Council. Any loads of material offered to Eclipse which Eclipse judges to be unsuitable or too expensive to process may also be directed to a nearby Class I landfill operated by Waste Stream Pty Ltd.[47]
[47] Exhibit G1 [14].
Eclipse and its sister company, Eclipse Soils Pty Ltd, are part of a group of companies, known as the Marford Group, controlled and owned by Mr Trevor Delroy.[48] The Marford Group operates under the principles of sustainability.[49]
[48] Exhibit D1 [1].
[49] Exhibit G1 [18]; exhibit F1 [43], [44].
Eclipse and Eclipse Soils undertake significant research and development as part of their strategic planning.[50]
[50] Exhibit D1 [43]; exhibit G1 [121] ‑ [122].
At each of its sites, Eclipse conducted its different operations as part of one integrated business.[51] By operating in this way, Eclipse was able to exploit what Mr Bowman describes as 'a logistical synergy' between its quarrying, soil blending and filling activities.[52]
[51] ts 204.
[52] Exhibit F1 [34].
Although integrated, the different operations are segmented and easily identifiable at the Abercrombie Road Site.[53] Different activities are and were conducted on different areas of the site, and materials directed to the appropriate place pending use, including as follows:
(a)Materials to be used in the production of blended soils are taken and deposited in the soil blending area. This area is presently located in the north of the site, but is relocated from time to time as part of the management of site logistics.
(b)Materials contaminated with hydrocarbons, pesticides or acid sulfates, which require remediation, are deposited in stockpiles positioned on lined waterproof pads prepared on a limestone base so that drainage waters or leachate cannot escape into the underlying soil. These pads are located in the north west of the site.
(c)Plant material that has arrived at the gate of the site is directed by Eclipse staff to be deposited on flat hardstands of crushed limestone to await processing by grinding.
(d)Materials for which Eclipse has no present use, including materials which are not suitable for blended soil production, are not plant material, and are not contaminated, may be used for filling the void.[54]
[53] Exhibit E1 [18].
[54] Exhibit F1 [14], [15].
Eclipse's executives describe its business as involving sequential land use. Mr Sippe's evidence is that for Eclipse, and the Marford Group generally, sequential land use involves:
(a)mining a strategic basic raw material like limestone or sand, or acquiring a site where mining has occurred or is still occurring, such that a void is being or has been created;
(b)progressively filling the void with compacted inert material, which Eclipse is satisfied has no adverse environmental impacts and is geotechnically suitable for the development purpose;
(c)re‑mining suitable deposited material and making recycled products for off‑site sale in response to market conditions;
(d)placing 1 ‑ 2 m high quality suitable sand on top of compacted inert material for development, or water retentive blended soils for landscaping or parks; and
(e)ultimately developing the land for a higher and better use. In the case of land owned by the Marford Group, the ultimate land use is either subdivision for residential or industrial purposes, or use as open space and community facilities as part of a residential development. In the case of the Wanneroo Road Site, which is not owned by the Marford Group, that land use is parks and recreation as a future addition to the Neerabup National Park.[55]
I will deal with the question of the extent to which re‑mining of deposited and compacted material was part of Eclipse's activities during the Relevant Period later in these reasons. Subject to that, I accept Mr Sippe's evidence in this regard.
2.5 Eclipse's quarrying of naturally occurring sand and limestone
2.5.1 Flynn Drive Site
[55] Exhibit G1 [26].
During its occupation of the Flynn Drive Site prior to 1 July 2008, Eclipse excavated Quarry Materials from the site for sale.[56] However, during the Relevant Period, Eclipse did not excavate any Quarry Materials from the site.[57]
2.5.2 Abercrombie Road Site
[56] Exhibit D1 [19.2].
[57] Exhibit A [44].
Throughout the Relevant Period, Eclipse excavated, and contracted third parties to excavate, Quarry Materials from the Abercrombie Road Site. The excavation increased the existing quarry void at the site.[58]
[58] Exhibit A [37].
The limestone extracted from the site by Eclipse during the Relevant Period was, where necessary, crushed and screened to meet specifications such as particle size distribution.[59]
[59] Exhibit A [38].
Eclipse sold quarried sand and limestone from the Abercrombie Road Site. The third parties contracted by Eclipse to extract Quarry Materials from the site during the Relevant Period also sold, or used for their own purposes, some of the Quarry Materials they extracted.[60]
[60] Exhibit A [39].
Eclipse used some of the limestone and sand it and its contractors extracted from the site for:
(a)the remediation of acid sulfate soils;
(b)the production of water retentive blended soils;
(c)the production of structural fill,
and in smaller quantities, for the construction of:
(d)limestone pads and bunds used in the treatment of acid sulfate soils;
(e)limestone pads used to stockpile and compost plant material;
(f)stabilising areas used to erect fuel tanks and as parking space for machinery, trucks and other vehicles; and
(g)pads for sheds and tracks for trucks and machinery travelling across the site.[61]
[61] Exhibit A [40].
Eclipse uses and intends to use sand produced from the Abercrombie Road Site for the top one metre of final cover over compacted fill. Ultimately, to cover the 40 ha site that will require about 400,000 m3 of sand. Sand has also been used from time to time in blended soil. Sand to be used for final cover is excavated ahead of the mining front and stockpiled. Any deficit of sand for final cover will most likely result in sand being purchased by Eclipse.[62]
2.5.3 Wanneroo Road Site
[62] Exhibit G1 [42]; ts 415.
During the Relevant Period, Eclipse did not excavate Quarry Materials from the Wanneroo Road Site for sale.[63]
[63] Exhibit A [41].
Eclipse extracted limestone and sand from the site, including that which it had previously deposited and compacted in the void at the site between 2002 and 2004.[64]
[64] Exhibit A [42].
Eclipse used the limestone and sand it extracted from the site during the Relevant Period to:
(a)construct vehicle access tracks, stabilising areas, hardstands, pads and bunds within the site;
(b)remediate acid sulfate soils accepted at the site; and
(c)produce water retentive blended soils.[65]
2.6 Eclipse's receipt of materials
[65] Exhibit A [43].
During the Relevant Period, Eclipse received and accepted materials from third parties at each of the Sites.[66]
[66] ts 341.
Material received by Eclipse at the sites would generally be transported by a third party to a site in a large truck with a capacity of more than 20 tonnes.[67]
[67] ts 341.
Materials were also delivered to some of the sites in skip bins. The final versions of the parties' respective closing submissions as to the facts suggest that the only issue in that regard is whether material was delivered to the Flynn Drive Site in skip bins.[68] I do not think anything turns on that question. In any event, I accept, based on Mr Delroy's evidence,[69] that skip bins were not brought to the Flynn Drive Site during the Relevant Period.
[68] See Eclipse's Detailed Response to the Facts which the Government Parties Contend Should be Found [18].
[69] ts 341.
The materials received by Eclipse at the sites were given to it by persons who had no present use for the materials, who did not want the materials, and who generally paid Eclipse to accept them.[70]
[70] Exhibit G1 [12] ‑ [13]; ts 341 ‑ 342.
Eclipse sometimes did not charge for, or paid for, materials it needed to produce blended soils.[71] There is no evidence that, and I am not satisfied that, Eclipse paid for any of the material that it received at the sites to be deposited and compacted in the voids at the sites.
2.7 Eclipse's pricing for materials it received
[71] Exhibit G1 [12], attachment RS03; exhibit F1 [46]; ts 342 ‑ 343.
During the Relevant Period, Eclipse periodically published price lists for each of its sites, advertising the fees it charged to receive different types of material.[72]
[72] Exhibit C, pages 3 ‑ 4, 137 ‑ 138, 141 ‑ 143, 147 ‑ 156, 160 ‑ 166.
Eclipse's overall pricing is set by the Chairman of the Marford Group in consultation with the Marford Group's Company Secretary/Chief Financial Officer (CFO), Eclipse's Manager of Operations (MO) and Eclipse's Managing Director (MD).[73]
[73] Exhibit G3 [62].
Prices are and have at all relevant times been listed either on Eclipse's published price lists (categories G1, G3, G4, G5 and G6) or set through negotiation for 'special jobs' (categories 2A, 2B, 2C, 2D, 2E, 2F, and 2G). Special jobs are given a unique number in Eclipse's record system.[74]
[74] Exhibit G3 [63]; exhibit C, pages 3 ‑ 4, 137 ‑ 138, 141 ‑ 143, 147 ‑ 156, 160 ‑ 166.
Eclipse's published price lists for the Abercrombie Road Site effective for the Relevant Period are at items 4, 14, 18, 22, 24, 26, 28, 30, 33, 35, 37 and 39 of exhibit C.[75]
[75] Exhibit G3 [64].
Eclipse's published price lists for the Wanneroo Road Site effective from 25 May 2009 to 30 September 2014 are at items 17, 19, 23, 25, 27, 29, 31, 34, 36 and 38 of exhibit C.[76]
[76] Exhibit G3 [65].
Eclipse's published price lists for the Flynn Drive Site effective from 1 July 2008 until June 2009, when it ceased accepting materials, are at items 3 and 13 of exhibit C.[77]
[77] Exhibit G3 [66].
During the Relevant Period, Eclipse charged 'cash on delivery' rates of:
(a)between $14/m3 and $23/m3 plus GST for 'Grade 1 General Construction' and 'Grade 1 Clean - no sorting required (eg sand, bricks, concrete, stone)';
(b)$5/m3 plus GST for 'Grade 3 Clean fill' and 'Grade 3 Clean sand - virgin excavated natural material';
(c)between $16/m3 and $25/m3 plus GST for 'Grade 4 Loads difficult to manage (spaghetti reo/tin/pvc pipe etc)' and 'Grade 4 Minor sorting required';
(d)between $10/m3 and $150/m3 plus GST for different types of green waste;
(e)between $25/m3 and $33/m3 plus GST for 'GW4 Mixed load greens/rubble';
(f)between $70/m3 and $150/m3 plus GST for 'Grade 6 Asbestos';
(g)between $40/m3 and $45/m3 plus GST for 'Grade 5 General Construction with less than 40% timber'; and
(h)between $33/m3 and $50/m3 plus GST for 'Grade 5 Load requires sorting'.[78]
[78] Exhibit C, pages 3 ‑ 4, 137 ‑ 138, 141 ‑ 143, 147 ‑ 156, 160 ‑ 166.
For special jobs for which no price is given on Eclipse's published price lists, the price is provided on application through negotiation. Job‑specific pricing is generally set as follows:
(a)If the total revenue from the job is greater than approximately $50,000, then the Chairman and one or more of the MD, CFO and MO set the price.
(b)If the total revenue from the job is less than approximately $50,000, then the MD, CFO and MO set the price and the Chairman is normally informed.[79]
[79] Exhibit G3 [67].
In addition, the fees charged by Eclipse to receive materials from large 'special projects' during the Relevant Period were set by negotiation.[80] In his oral evidence Mr Delroy indicated, and I accept, that 'the great majority of [Eclipse's] business is done by negotiation nowadays'.[81]
[80] ts 342.
[81] ts 342.
In or about January 2010, Eclipse factored the levy (in part) into the prices it charged for some materials received at the sites.[82] It applied an increase of $1.84 per m3 on the basis that about 20% of materials received would be subject to the levy increase of $9 per m3. It also factored in 20 cents for exposure to a negative litigation outcome regarding the designated civil works area (see section 2.21 below).
2.8 Sources and nature of received material
[82] ts 343 ‑ 345; exhibit C, pages 157 ‑ 159.
This part of the reasons deals with materials received at the Sites, not specifically with materials that were deposited and compacted in the voids at the Sites. As I have said, given Eclipse's various activities at the Sites, only some of the materials received by Eclipse were deposited and compacted in the voids.
At each of the Sites during the Relevant Period, Eclipse accepted various different types of material from various different sources. The materials received by Eclipse at the Sites came from source sites located in various suburbs in Western Australia.[83]
[83] Exhibit 10 [49]; exhibit 7 [19], [23], [28], [34], [38], [50], [56], [68], [73], [79], [84], [90], [93]; exhibit 13 [15]; exhibit G1 [118] ‑ [119], attachment RS32, pages 455 ‑ 457; exhibit 2 [6] ‑ [45], attachments CC1 ‑ CC38.
At each of the Sites during the Relevant Period, Eclipse accepted plant material, including grass and tree branches, stumps and logs arising from vegetation clearing as part of site works for residential, commercial and industrial development, and from kerb‑side pickups by local governments.[84]
[84] Exhibit A [69], attachment 46, pages 1691 ‑ 1692; exhibit G1 [31(b)], attachment RS32, page 454; exhibit 9 [16], [26], attachment LIF15; exhibit 14 [86], [88], [91], attachment JD46I; exhibit 5 [32] ‑ [33], [35], [60] ‑ [61], [65], attachments CLW12 and CLW32; exhibit 7 [16], [26], [59], attachments SF5, SF6, SF9, SF11, SF13, SF16, SF18, SF21; exhibit 13 [15].
At each of the Sites during the Relevant Period, Eclipse accepted materials that came from construction, demolition and remediation works and earthworks on other sites. These included works relating to tunnels, underground car parks, roads, railways, service trenches, basements, man‑made inlets, larger‑scale residential, commercial and industrial developments, and smaller‑scale housing sites and swimming pools.[85]
[85] Exhibit G1 [31(a)], [32(b)], [118] ‑ [119], attachment RS32, pages 455 ‑ 457.
The materials accepted by Eclipse included materials that had been excavated as part of the preparation of sites for development which were unsuitable for, or excess to the requirements of, the developer; surplus materials from construction and demolition projects; virgin material and construction and demolition material from site clean‑ups; and materials arising from the demolition of buildings and infrastructure, being mainly concrete and bricks.[86]
[86] Exhibit G1 [43] ‑ [44]; ts 345 ‑ 348, 364.
The materials accepted by Eclipse at the Sites during the Relevant Period from the sources referred to in the two preceding paragraphs included the materials set out immediately below, as well as the materials referred to in the following paragraphs (namely [92] ‑ [102]):
(a)Soil (sometimes containing plant roots or other plant matter), sand, rocks, limestone (except at the Flynn Drive Site), clay, peat, silt and diatomaceous earth (at the Abercrombie Road Site only).
(b)Bricks, pavers, concrete (including reinforced concrete), limestone blocks, bitumen, asphalt, gravel, roof tiles, other tiles, and small quantities of glass (for example, bottles), plasterboard, Hardifence panels and other rubble arising from construction and demolition works and earthworks.
(c)Small quantities of plastic strapping (including green plastic brick strapping), wrapping, sheeting, bags and piping and other plastic (such as buckets and drink containers).
(d)Small quantities of paper packaging, cardboard, wood (including wooden pallets), steel roof sheeting, corrugated metal sheeting, metal wires, and other metal (such as metal drainage grates and paint cans).
(e)Small quantities of bicycles, bathtubs, fabric, carpet and insulation materials.[87]
[87] Exhibit G1 [31(a)], [32]; exhibit 14 [4] ‑ [135], attachments JD2 ‑ JD75; exhibit 9 [8], [16], [21] ‑ [25], [27], [29] ‑ [34], [36] ‑ [42], attachments LIF11 ‑ LIF14, LIF16, LIF18 ‑ LIF35; exhibit 10 [7] ‑ [12], [19], [27] ‑ [38], [40] ‑ [55], attachments RKR10 ‑ RKR20, RKR22 ‑ RKR30, RKR32 ‑ RKR34; exhibit 13 [8] ‑ [34], [39], [42] ‑ [44], [47] ‑ [56], attachments CAF1 ‑ CAF15, CF18 ‑ CAF19, CAF22 ‑ CAF25; exhibit 5 [9] ‑ [12], [26] ‑ [34], [36] ‑ [43], [46] ‑ [48], [52] ‑ [58], [60] ‑ [69], [78] ‑ [91], [95], [99], [103], [107], attachments CLW1, pages 27 ‑ 30, CLW2, pages 37, 39 ‑ 40, CLW9 ‑ CLW11, CLW13 ‑ CLW17, CLW20, CLW23 ‑ CLW26, CLW28 ‑ CLW34, CLW36 ‑ CLW52; exhibit 7 [14] ‑ [56], [64] ‑ [93], attachments SF5 ‑ SF37; exhibit B [2] ‑ [3], attachments S1 ‑ S30.
The loads of materials accepted by Eclipse at the Sites often contained a mixture of various different types of material. There was soil mixed together with bricks, concrete, tiles and pieces of plastic, metal and paper. Some of the materials received at the Sites had previously been used or were broken, chipped, bent or otherwise damaged.[88]
[88] See references to exhibits 5, 7, 9, 10, 13 and 14 in the preceding footnote.
Eclipse accepted materials containing asbestos wrapped in plastic at the Abercrombie Road Site between 1 July 2008 and June 2012.[89] Eclipse also accepted soils containing or potentially containing asbestos chips at the Abercrombie Road Site during the Relevant Period.[90]
[89] Exhibit G1 [33(d)]; ts 347.
[90] Exhibit G1 [33(c)].
Asbestos is a material that was widely used in building materials up to 1987. It can be hazardous to human health and requires special management techniques for its safe handling.[91] It is common for a precautionary approach to be taken if any asbestos containing material is found on a development site; approximately 100 ‑ 150 mm of topsoil across the site will be excavated for off‑site disposal.[92]
[91] Exhibit 11 [31] ‑ [32].
[92] Exhibit G1 [43(g)].
Eclipse's receipt and management of wrapped asbestos and soil containing or potentially containing asbestos chips was governed by its management plan for the Abercrombie Road Site, which made specific provision for asbestos safety policies and procedures.[93]
[93] Exhibit G1 [72], [75]; see also the various management plans.
Under the management plan, the process is and was as follows. The coordinates for areas of the Abercrombie Road Site that have been identified and designated by Eclipse for receipt and disposal of soil actually or potentially containing asbestos chips are plotted by Eclipse's consultant surveyors, McMullen Nolan Group (McMullen Nolan), on plans of the site. Site employees of Eclipse also mark the corners of the areas on the ground.[94]
[94] Exhibit G1 [73].
Eclipse's employees direct trucks containing potentially or actually contaminated soil to the designated areas for disposal. Following the deposit of soil from the trucks, site employees of Eclipse promptly deposit suitable inert fill materials to cover the soil. This process occurs in relation to soil deposited from the bottom of the void up and until 5 m below final levels. The levels are determined by periodic surveys conducted by McMullen Nolan. The senior executives of the Marford Group get regular briefings from Eclipse's Operations Manager on levels within the designated asbestos area. This area is kept damp during active depositing by reticulated water supplied from Eclipse's two licensed on‑site bores to avoid dust.[95]
[95] Exhibit G1 [74].
Eclipse accepted soils contaminated with hydrocarbons and pesticides at the Abercrombie Road Site during the Relevant Period.[96] Hydrocarbons are organic compounds of hydrogen and carbon, such as, relevantly, those which are the chief components of petroleum and natural gas. Some of the hydrocarbon contaminated soils accepted by Eclipse came from various service station sites where the petrol drums and storage containers had leaked into the sand.[97]
[96] Exhibit A [64]; exhibit G1 [33(b)]; ts 347, 354.
[97] ts 364 ‑ 365.
Eclipse accepted acid sulfate soils (including peats) at the Abercrombie Road Site and the Wanneroo Road Site during the Relevant Period.[98]
[98] Exhibit A [58]; exhibit G1 [33(a)]; ts 347, 354.
Acid sulfate soils are naturally occurring soils that contain iron sulphide minerals. When acid sulfate soils are excavated or disturbed, the exposure of the iron sulphide minerals to atmospheric oxygen causes the oxidation of the minerals and the production of sulfuric acid. This sulphuric acid can cause environmental harm if it is allowed to escape into the surrounding environment.[99]
[99] Exhibit F1 [20].
During the Relevant Period, a significant proportion of the materials received by Eclipse comprised soils, sand, peat, riverine silts, clay and limesand dredgings excavated from source sites that were (at the time of Eclipse's receipt of the materials or subsequently) classified under the Contaminated Sites Act 2003 (WA).[100] Some of the source sites were classified as 'Contaminated - remediation required' or 'Possibly contaminated - investigation required'.[101] They were classified, in part, because of the presence of hydrocarbons, heavy metals, pesticides, asbestos and waste materials in the soils at the sites.[102] Some of them were former landfills (for example, Elizabeth Quay).[103] Eclipse accepted materials from classified sites with the intention that they would be remediated or bio‑remediated.[104]
[100] Exhibit G1 [118], attachment RS32; exhibit 2 [6] ‑ [45], attachments CC1 ‑ CC38; exhibit G2 [102] ‑ [103]; ts 352 ‑ 356, 362 ‑ 369, 398 ‑ 399. Division 2 of pt 2 of the Contaminated Sites Act provides for the classification of sites in accordance with the classifications set out in sch 1.
[101] Exhibit 2 [6] ‑ [45], attachments CC1 ‑ CC38.
[102] Exhibit 2 [6] ‑ [45], attachments CC1 ‑ CC38.
[103] Exhibit 2 [6] ‑ [7], [22] ‑ [26], [32], [36], [40], [42] ‑ [43], attachments CC14 ‑ CC18, CC24, CC28, CC32, CC33, CC35, CC36.
[104] ts 433.
Occasionally, Eclipse received used motor vehicle tyres at the Abercrombie Road Site and the Wanneroo Road Site during the Relevant Period.[105] Some of these tyres were used by Eclipse on‑site as markers. Tyres were not used as fill.[106] Excess tyres were disposed of off‑site following sorting.[107]
[105] Exhibit 9 [8] ‑ [16], [21] ‑ [22], attachment LIF11; exhibit 14 [50] ‑ [54], attachment JD32A.
[106] Exhibit E2 [9.3], [14.2].
[107] Exhibit G1 [14].
Quantities of rock and concrete in materials accepted by Eclipse has considerably decreased (although gradually) from 2008. Data with respect to quantities of rock and concrete are not collected by Eclipse. During the Relevant Period, on Mr Sippe's estimate no more than approximately 5% of material accepted by Eclipse comprised rocks and concrete.[108]
[108] Exhibit G3 [17].
Eclipse uses the following classification coding for invoicing clients:
(a)G1: Clean construction and demolition materials for which no sorting is required and which are established as meeting EILs by virtue of sampling and analysis, either before the material is transported or in accordance with Eclipse's testing protocol.
(b)2A: Natural Earth Material (predominantly sand) for which analytical data has been provided, before acceptance by Eclipse, showing that the material meets EILs.
(c)2B ASS - peat: Acidic peats containing organic matter for which analytical data has been provided by the producer or their consultants prior to acceptance that satisfies Eclipse that it should receive the materials because they are capable of remediation to counter their acidity and, following remediation and validation, will be usable for the manufacture of products.
(d)2C ASS - soil: Acidic soil for which analytical data has been provided by the producer or their consultants prior to acceptance that satisfies Eclipse that the soils are capable of remediation to counter their acidity and, following remediation and validation, will be usable for making products.
(e)2D: Soils suitable for bio‑remediation; soils contaminated with hydrocarbons or some pesticides and for which analytical data has been provided by the producer or their consultants prior to acceptance that satisfies Eclipse that it should receive the materials because they can be bio‑remediated in compliance with Eclipse's management plan and, once validated, will be usable for products.
(f)2E: Any other special job (for example, one that requires special handling, processing or pricing). Normally, and if relevant, these are materials for which analytical data has been provided by the producer or their consultants prior to acceptance that satisfies Eclipse that it is able to receive and process the materials.
(g)2F: Soil actually or potentially containing asbestos chips. The presence of any asbestos chips, or the potential for any, in soil is normally identified in an environmental report provided by the producer or their consultant, or through visual inspection by a civil engineer, prior to acceptance by Eclipse. Usually it is identified by the producer's (typically, the property developer's) environmental or engineering consultants as part of planning the construction or demolition activity generating the materials.
(h)2G: Inert material for which analytical data has been provided before acceptance by Eclipse showing that the materials may exceed EILs but do not exceed HILs.
(i)2H: Structural fill. Product made from recycled and virgin materials to meet relevant customer specifications. This code was only introduced in September 2014.[109]
(j)G3: Virgin materials. If these materials are coming from a site and a reputable operator known to Eclipse, they are usually accepted and then stockpiled for use in blended soils or for final cover. Otherwise, a site inspection of the originating area is usually carried out by Eclipse personnel before trucking.
(k)G4: General inert construction and demolition materials with only minor sorting required. After sorting, those sorted materials which Eclipse is satisfied are fit for its purpose (that is, those that meet EILs by virtue of sampling and analysis in accordance with Eclipse's testing protocol, or that meet HILs) are used as fill.
(l)G5: General inert construction and demolition materials with sorting required. After sorting, those sorted materials which Eclipse is satisfied are fit for its purpose are used as fill.
(m)G6: Asbestos.[110]
[109] Exhibit G3 [46].
[110] Exhibit G1 [43].
Between July 2010 and August 2012, Eclipse accepted at its Wanneroo Road Site approximately 10,000 tonnes of material, known as 'coarse heavies', that had come from a facility operated by BioVision under the management of SUEZ Environment (formerly known as SITA Australia Pty Ltd) in Neerabup (BioVision Facility).[111]
[111] Exhibit 6 [1] ‑ [3], [6], [16]; exhibit 4 [6]; exhibit G2 [44], [58] ‑ [61].
At the BioVision Facility, between July 2010 and August 2012, household waste set aside for kerb‑side collection within various local government areas was processed, using specialist composting plant and equipment, into soil conditioner which was sold into different markets, including agricultural markets.[112] The coarse heavies received by Eclipse consisted of dense materials, less than 35 mm in size, extracted during the production process using various pieces of equipment and collected in a bin for off‑site disposal.[113] In other words, they were an unwanted residue created as part of the soil conditioner production process.[114]
[112] Exhibit 6 [4] ‑ [5], [7] ‑ [13]; exhibit 4 [7] ‑ [9].
[113] Exhibit 6 [10] ‑ [11], [14]; exhibit 4 [9].
[114] Exhibit 6 [6], [10] ‑ [11]; exhibit 4 [9].
The coarse heavies received by Eclipse consisted of small fragments of material that included or may have included bones, bricks, stones, ceramics, coarse pieces of wood, ferrous and non‑ferrous metals, 'fines' (part organic, part mineral material), glass, paper, cardboard, plastics (for example, plastic bottle and container tops and pegs), processible garden material (including grass clippings, leaves, soft plant material), unprocessible garden material (including high lignin prunings, plant cuttings, coco palm leaves, tree material), textiles and, potentially, other materials such as lighters, medication, drugs, dry cell batteries and wet batteries.[115]
[115] Exhibit 4 [6], [10] ‑ [14], attachment HTH1, pages 29 ‑ 30; exhibit 9 [24] ‑ [25], attachments LIF13, LIF14; exhibit 14 [73] ‑ [74], attachments JD42, JD43; exhibit G2 [44], [67].
On 16 August 2012, Eclipse received 20.58 tonnes of coarse heavies from the BioVision Facility at its Wanneroo Road Site.[116] DER Inspector James Donis observed the material deposited at the site on that date and advised the Site Manager that he did not consider that the material was appropriate to be accepted at the site.[117]
[116] Exhibit G2 [60], attachment RS48; exhibit 14 [68], [71], [73] ‑ [75], attachments JD42, JD43.
[117] Exhibit 14 [74].
Following Mr Donis' inspection, Eclipse took that material to the Tamala Park Class III landfill.[118] Since 17 August 2012, Eclipse has not accepted any more coarse heavies at its Wanneroo Road Site.[119]
[118] Exhibit G2 [60], attachment RS48.
[119] Exhibit G2 [59]; exhibit 6 [18].
Eclipse accepted the coarse heavies because it considered that they could not or would not be putrescible because they had undergone two composting processes and were inert.[120]
[120] Exhibit G2 [59].
I accept the unchallenged evidence of Mr Bowman, an experienced environmental scientist, that when account is taken of the information revealed by the sampling done by Dr Hofstede,[121] the various materials comprising or potentially comprising the coarse heavies either present no environmental risk or are present in such small proportions that they are unlikely to create any significant environmental risk when placed in fill for land development.[122]
2.9 Quality control, inspection and testing of materials
[121] Exhibit 4, attachment HTH1.
[122] Exhibit F2 [14].
At all times during the Relevant Period, Eclipse prepared, and undertook its operations pursuant to, management plans for each of the Sites.[123]
[123] Exhibit A [32] ‑ [34], attachments 42 ‑ 50; exhibit G1 [36], [83], [99].
Eclipse's management plans are live documents; any changes to Eclipse's management practices and any amendments added as addenda are incorporated as part of a periodic updating process.[124]
[124] Exhibit G3 [55].
When there was no regulation by the State Government (that is, before the passage of the Environmental Protection Amendment Act 1998 (WA) and the associated Environmental Protection (Landfill) Levy Act 1998 (WA), Eclipse developed and implemented its own quality control standards.[125]
[125] Exhibit G1 [108].
Eclipse's management plans for the Sites contain detailed quality control procedures.[126]
[126] See exhibit A, attachments 46, pages 1729 ‑ 1759, 49, pages 2045 ‑ 2051, 50, pages 2107 ‑ 2110, 2128 ‑ 2129.
As will be explained in more detail later in these reasons, in the first half of 2009, at both the Abercrombie Road Site and the Wanneroo Road Site, Eclipse divided its site into two areas, one designated the category 63 area and the other the civil works area. During that period, Eclipse adopted a protocol (Protocol) which contained formal testing procedures for materials deposited and compacted in the voids at both sites. The testing was based on the EILs set out in a document published by DER entitled Assessment Levels for Soil, Sediment and Water.[127]
[127] Exhibit G3 [6] ‑ [14].
The Protocol was developed by Eclipse in close consultation with its consultants, Coffey Environments and Coffey Mining.[128]
[128] Exhibit G3 [9].
For high volume jobs, the source would normally provide data to Eclipse before delivery in the form of analyses done by a National Association of Testing Authorities, Australia (NATA) accredited laboratory as an email attachment or a compact disc. This data would then be compared with relevant criteria for EILs and HILs set out in DER's Assessment Levels document.[129]
[129] Exhibit G1 [110].
Eclipse would also take samples, and have the samples analysed by a NATA accredited laboratory, to validate that materials deposited at the Abercrombie Road Site met EILs. If any sample showed that EILs had been exceeded, a management response would be initiated.[130]
[130] Exhibit G1 [111].
The steps taken for testing purposes pursuant to the Protocol were as outlined by Mr Sippe.[131] It is not necessary to detail them.
[131] Exhibit G3 [20].
The materials in respect of which Eclipse (or its external consultants) generally reviewed analytical data were earth materials such as sand, soil, clay and peat.[132] Eclipse did not test other construction and demolition materials received at its Sites against EILs. Eclipse considered those materials to be inert, and adopted what it called a 'risk‑based approach', meaning that it considered that the low level of risk did not warrant testing.[133]
[132] Exhibit A [47].
[133] Exhibit G2 [100.3]; exhibit G3 [9].
The portion of jobs for which comprehensive data sets are provided has increased over time, and most of the jobs now received by Eclipse are accompanied by data sets provided by the supplier of the material prior to Eclipse's acceptance of it.[134]
[134] Exhibit G3 [16].
During the Relevant Period, Eclipse inspected materials received at each of the Sites by one or more of the following methods:
(a)Eclipse's personnel inspected materials on their arrival at the Sites.
(b)Eclipse's personnel inspected materials when they were unloaded at the Sites.
(c)Eclipse's personnel inspected materials at their source site.
(d)Eclipse's personnel took samples of materials (sometimes after they were laid out in the active fill area or deposited in the soil remediation and blending area of the site), which were analysed by NATA accredited laboratories. If appropriate, the results were then reviewed by Eclipse's environmental consultants.
(e)Eclipse's staff or external consultants reviewed analytical data relating to the physical and chemical properties of material provided by the producer or their environmental consultant.[135]
[135] Exhibit A [46]; ts 419 ‑ 420.
When Eclipse received large quantities of materials from a particular source for which analytical data was provided and Eclipse had reviewed the data, it did not necessarily inspect each individual load of the material upon its arrival at the relevant site. Once the material was unloaded, Eclipse's personnel inspected the materials to check for visible problems.[136]
[136] Exhibit A [48]; see also exhibit G1 [46].
At trial and during closing submissions, the parties joined issue on the appropriateness of Eclipse's use of EILs in assessing material that it proposed to place in the voids at the Sites. In broad summary, the Government Parties contend and point to evidence that the intended use of EILs is as criteria for identifying contamination, not as desirable soil quality criteria and, further, that EILs apply only to soil, sediment and water and not to all of the materials received by Eclipse, such as bricks and rubble.[137] Eclipse correctly points out that when it began using EILs DER had not published any policy, guidelines, criteria or standards that prescribed desirable soil quality criteria or provided for testing of materials such as bricks and rubble. Eclipse says that, taking into account expert evidence and industry practice, its use of EILs was reasonable and appropriate.[138]
[137] See Government Parties' closing submissions pt VII [50] ‑ [54].
[138] See Amended Findings of Fact contended for by Eclipse Resources Pty Ltd [70] ‑ [74].
In my view, it is neither necessary nor appropriate to resolve the parties' competing contentions about the appropriateness of Eclipse's use of EILs. The parties' submissions did not identify, and I am unable to identify, any respect in which my decision on any of the issues in these actions is affected by any conclusion about the appropriateness of the use of EILs by Eclipse. As I will explain later in these reasons, whether material was environmentally suitable for Eclipse's purposes, or whether using it as fill may have involved any risks to the environment, does not influence whether that material was waste disposed of to landfill.
Coffey Geotechnics Pty Ltd (Coffey) was engaged by Eclipse in April 2002 for the purpose of providing advice on how the placement and compaction of materials at the Abercrombie Road Site should occur to ensure that the rehabilitated site could support light steel structures.[139]
[139] Exhibit E1 [25].
In February 2004, Coffey prepared a Quality Plan for Filling Operations by Eclipse at the Site (Quality Plan). The Quality Plan was prepared to provide a level of confidence to the council and other approving bodies that the site has been filled in accordance with a suitable level of geotechnical quality control. Adherence by Eclipse to the Quality Plan will ultimately provide a basis for Coffey to provide written certification that the site is suitable for the construction of light steel structures.[140]
[140] See Exhibit E1 [55] ‑ [68].
The Quality Plan included advice provided by Coffey in 2002 and was supplemented to include reporting schedules and requirements for record keeping. Auditing by Coffey on a six‑monthly basis was also included in the plan, and has subsequently occurred.[141] The Quality Plan is a live document and was prepared by Coffey in accordance with Australian Standard AS 2990 - Quality System Specification for Engineering and Construction Projects. This standard provides guidance on the recommended contents of a quality plan. Various revisions to the Quality Plan have been carried out by Coffey and superseding documents have been issued.[142]
[141] Exhibit G1 [114].
[142] Exhibit E1 [28], attachments SE04 ‑ SE08B.
Eclipse Soils also carries out testing on its products to ensure compliance with relevant Australian Standards.[143]
2.10 Directing and sorting of materials
[143] Exhibit G1 [80].
Some of the trucks arriving at one of the Sites during the Relevant Period were directed to deposit their loads at the 'operational bench' in the void at the site.[144] A 'bench' is a horizontal strip or layer of fill deposited, mixed (as appropriate) and spread to a specified thickness.[145] That part of the operational bench where materials are deposited is often referred to as the 'tip face' or 'active tip face'.[146]
[144] Exhibit A [54]; ts 350, 351 ‑ 352.
[145] Exhibit A [54].
[146] See, for example, exhibit 7 [27], [65]; exhibit 14 [20]; exhibit A, attachment 50, page 2090.
Active tipping areas at the Sites were often demarcated through the placement of tyres.[147]
[147] Exhibit E1, attachment SE11, page 186; exhibit 5 [55], attachment CLW24; exhibit 9 [37], attachment LIF25.
Some materials were directed to be deposited in a dedicated sorting area at the site, or were directed to be deposited near the 'operational bench' for sorting.[148]
[148] Exhibit G1 [71]; exhibit 10 [35], attachments RKR4, RKR17-RKR18; exhibit 14 [4] ‑ [10], [15] ‑ [19], [25] ‑ [29], [36] ‑ [40], [43] ‑ [47], [50] ‑ [53], [57] ‑ [61], [68] ‑ [72], [86] ‑ [91], [121] ‑ [125], [129] ‑ [132], attachments JD1 ‑ JD3, JD7 ‑ JD9, JD17 ‑ JD18, JD26A ‑ JD26B, JD27 ‑ JD29, JD32A ‑ JD32B, JD33 ‑ JD35, JD40 ‑ JD41, JD46H ‑ JD46J, JD56, JD64 ‑ JD66, JD72 ‑ JD73; exhibit 9 [8] ‑ [16], [21] ‑ [22], attachments LIF7, LIF11; exhibit 5 [9] ‑ [10], [60] ‑ [61], [65], attachments CLW1, page 29, CLW2, page 37, CLW32 ‑ CLW33; exhibit 7 [24], [26], [33], attachments SF11, SF15.
Eclipse sorted loads containing a mixture of different types of material received at its Sites when it considered necessary to do so.[149] Eclipse generally sorted the materials with the use of excavators and loaders equipped with rake buckets and specialised grabs.[150] Some materials were also manually removed by hand from the stockpiles by Eclipse's employees and contractors.[151]
[149] Exhibit A [49].
[150] Exhibit A [49].
[151] Exhibit A [49].
Eclipse's procedure was that any large items of materials not considered by Eclipse to be fit for its purpose that had been deposited in the void would be removed from the operating face before a further load of fill was deposited there.[152]
[152] Exhibit G2 [69].
In sorting materials, Eclipse removed, where it considered necessary:
(a)materials such as plastic and timber and transported them off‑site to a licensed Class III landfill for disposal;
(b)metals for separate stockpiling and subsequent sale by Eclipse as scrap metal; and
(c)plant material for separate stockpiling in its mulching area for use in the production of mulch.[153]
[153] Exhibit A [50].
Eclipse removed the material referred to in subpars (a) and (b) of the preceding paragraph because that material was not suitable for use by Eclipse (due to environmental, geotechnical or other reasons).[154]
[154] Exhibit A [51].
The remainder of the materials not removed from sorted loads were moved to the operational bench in the void at the site to be deposited and compacted there.[155]
[155] Exhibit A [53] ‑ [54]; exhibit 10 [57], attachment RKR36, page 70 (see (xii)).
For various reasons, mostly commercial in nature, Eclipse reduced the extent of sorting of materials at the Abercrombie Road Site and the Wanneroo Road Site during the Relevant Period.[156]
2.11 Eclipse's mulching operation
[156] Exhibit G1 [20] ‑ [21].
During the Relevant Period, Eclipse produced mulch from plant material received at the Sites.[157] Mulch is a substance derived from plant material that is applied to the surface of soil to prevent evaporation of moisture, control weeds and to improve visual amenity.[158]
[157] Exhibit A [69].
[158] Exhibit A [70].
Plant material received at the Sites was stockpiled and then ground with the use of a tunnel grinder. At the Abercrombie Road Site, the grinding was carried out by Eclipse Soils. At the Flynn Drive Site and the Wanneroo Road Site, the grinding was carried out by Eclipse.[159]
[159] Exhibit A [71].
Prior to approximately 25 February 2014, the ground plant material produced at the Wanneroo Road Site was stockpiled and then transported to the Abercrombie Road Site for processing into composted mulch by Eclipse. After approximately 25 February 2014, the ground plant material produced at the Wanneroo Road Site was composted at that site.[160]
[160] Exhibit A [72].
The remainder of the mulch produced by Eclipse at the Wanneroo Road Site and the Abercrombie Road Site during the Relevant Period was sold and distributed by Eclipse Soils.[161] There is little direct evidence as to the financial arrangement between Eclipse Soils and Eclipse.
[161] Exhibit G1 [16], [34(c)], [35(a)].
Ownership of the mulch produced by Eclipse was transferred to Eclipse Soils at the point of sale; that is, when the mulch was ordered by a customer.[162]
[162] Exhibit G1 [16]; exhibit A [125].
Eclipse Soils reimbursed Eclipse for the costs of machinery, labour and other input materials used to produce soil products and mulch.[163]
[163] Exhibit C, pages 190 ‑ 195.
The process of producing mulch is outlined in the Statement of Agreed Facts.[164]
[164] Exhibit A [73].
Eclipse used a by‑product of its production of mulch at the Sites, known as 'mulch fines', in the production of blended soils at the Sites.[165]
[165] Exhibit A [73]; exhibit F1 [17] ‑ [19].
The ingredients of Eclipse Soils' blended soils and mulches include, and during the Relevant Period included, remediated acid sulfate soils, remediated hydrocarbon contaminated soils, topsoils recovered from land development sites, clays, fly ash, mulch fines and sand.[166]
[166] Exhibit F1 [26].
The various Eclipse Soils' blended soils and mulches are produced by blending specific ingredient streams together according to formulae which have been predetermined by laboratory testing.[167]
2.12 Eclipse's soil remediation operations
2.12.1 Acid sulfate soils
[167] Exhibit F1 [27].
During the Relevant Period, Eclipse remediated acid sulfate soils at the Abercrombie Road Site and the Wanneroo Road Site by mixing them with crushed limestone.[168]
[168] Exhibit A [58] ‑ [60].
Some of the limestone used to remediate acid sulfate soils was received by Eclipse at the Sites, while some of the limestone was quarried from the Abercrombie Road Site.[169]
[169] Exhibit G1 [70], [81].
At each site, acid sulfate soils were remediated and tested in accordance with Eclipse's Acid Sulfate Soils Management Plan contained within its (then) current management plan for the site. This Acid Sulfate Soils Management Plan was prepared by Eclipse and, in respect of the plan for the Abercrombie Road Site, reviewed by its independent environmental consultants.[170]
[170] Exhibit A [59].
There are a number of variables involved as to the length of time required for the ASS remediation process, including temperature, moisture, the nature of the acidic material and exposure to oxygen, but usually remediation is completed within a few weeks.[171]
[171] Exhibit G1 [67].
Eclipse remediated acid sulfate soils by placing them on a pad of crushed and compacted limestone and mixing them with calculated amounts of crushed limestone of known alkalinity and neutralising capacity.[172]
[172] Exhibit A [60].
In order to confirm whether the soils were sufficiently remediated, Eclipse took samples of them and used an independent NATA accredited laboratory to test the samples.[173]
[173] Exhibit A [61].
The remediated acid sulfate soils produced during the Relevant Period were:
(a)at the Abercrombie Road Site:
(i)predominantly used, and stockpiled for future use, by Eclipse to produce water retentive blended soils and structural fill at the Abercrombie Road Site; and
(ii)deposited and compacted in the void;
(b)used, and stockpiled for future use, by Eclipse as the final cover material for filled areas of the void at the Wanneroo Road Site and the Flynn Drive Site;
(c)used, and stockpiled for future use, by Eclipse to produce water retentive blended soils at the Wanneroo Road Site.[174]
[174] Exhibit A [62].
Any remediated acid sulfate soils that were not suitable, or were not at that stage wanted by Eclipse for the production of blended soils or as final cover materials, were deposited and compacted in the voids at the Sites.[175]
2.12.2 Bio‑remediation
[175] Exhibit A [62(a)(ii)]. See also the 'ASS reuse options' section of the various versions of the management plan for the Abercrombie Road Site and the Wanneroo Road Site. Exhibit A, attachments 42, page 1167, 43, page 1296, 44, page 1438D, 45, page 1580, 46, page 1708, 47, page 1878, 48, page 1961T, 49, page 2048.
During the Relevant Period, Eclipse bio‑remediated soils contaminated with hydrocarbons or pesticides at the Abercrombie Road Site by mixing them with composting plant material, nitrogen, fertiliser and water.[176]
[176] Exhibit A [63] ‑ [67].
During the Relevant Period, soils contaminated with hydrocarbons or pesticides judged by Eclipse on the basis of analytical data to be suitable for bio‑remediation were placed onto two cells lined with high density polyethylene to form an impervious layer. The cells were constructed in accordance with a works approval granted to Eclipse by DER on 1 May 2008 (Works Approval W4424/2008/1). The cells will be decommissioned prior to the proposed final subdivision and development of the site.[177]
[177] Exhibit A [64].
Eclipse bio‑remediated and tested soils contaminated with hydrocarbons or pesticides in accordance with its Management Plan for the Bioremediation of Hydrocarbon and Pesticide Containing Material, included in its (then) current management plan for the site.[178]
[178] Exhibit A [65].
Eclipse mixed the contaminated soil with micro‑organisms and sources of carbon in the form of composting organic plant material, nitrogen and other nutrients in the form of fertiliser, and water.[179]
[179] Exhibit A [66].
In order to confirm whether the soils were sufficiently remediated, Eclipse took samples of them and used an independent NATA accredited laboratory to test the samples.[180]
[180] Exhibit A [67].
The bio-remediated soils produced at the Abercrombie Road Site during the Relevant Period were:
(a)used, and stockpiled for future use, by Eclipse as final cover material for filled areas of the void at the site;
(b)deposited and compacted in the void at the site; and
(c)used by Eclipse to produce water retentive blended soils at the site.[181]
[181] Exhibit A [68].
Some of the soils received by Eclipse at the Sites which Eclipse considered suitable for bio‑remediation are likely to have contained, and I infer that they did contain, materials that would interfere with the bio‑remediation process, such as construction and demolition materials. I infer that in such cases Eclipse acted in accordance with its management plan by removing those materials and depositing them and compacting them in the void at the Abercrombie Road Site.[182]
[182] See, for example, exhibit A, attachment 42, page 1177.
Some soils contaminated with hydrocarbons or pesticides that could not be bio‑remediated to the target contaminant concentrations for use in the production of blended soils were deposited and compacted in the void at the Abercrombie Road Site, in accordance with Eclipse's management plan.[183]
2.13 Eclipse's soil blending operations
[183] Exhibit A, attachment 42, page 1182 under heading 'End Use Targets and Validation Procedures', and corresponding sections of subsequent versions of the management plan.
During the Relevant Period, Eclipse produced a number of different types of blended soils at the Sites.[184]
[184] Exhibit G1 [15], [34(c)], [35(a)], [85(a)], [98]; exhibit F1 [13(g)], [19], [27].
Eclipse produced blended soils by mixing together different types of soils from stockpiles, together with other materials, such as mulch fines, clay, fly ash and sand.[185]
[185]Exhibit F1 [26]; exhibit D1 [29.2], [29.4].
Eclipse used peat, which it had previously deposited at the Wanneroo Road Site between June 2002 and March 2004, and which it dug out of the site during the Relevant Period, to produce blended soils at the Wanneroo Road Site and the Abercrombie Road Site.[186]
[186] Exhibit G1 [30], [84] ‑ [85], [98]; exhibit D1 [25] ‑ [26].
Materials used in the production of blended soils were screened with the use of a screening machine to ensure they had a desired particle size range. Any 'oversize' materials produced as a result of the screening process not suitable to be used in the production of blended soils were deposited and compacted in the voids at the Sites as fill.[187]
[187] Exhibit G1 [81(d)]; exhibit F1 [32], [35].
On Eclipse's first excise contention, a question arises whether, by the time Eclipse disposes of materials to landfill, they have earlier reached the hands of a consumer, namely Eclipse. Eclipse's answers to that question are:
(1)the landowner, not it, was the consumer of the materials as fill;[754]
(2)the materials did not constitute the commodity of fill before they reached Eclipse's hands; and[755]
(3)further or alternatively, Eclipse's use of the materials as fill did not amount to consumption.[756]
[754] Eclipse's closing submissions [284]; ts 747.
[755] Eclipse's closing submissions [282].
[756] Eclipse's closing submissions [286], [289].
Given the conclusions I have reached, it is not necessary to deal with this question. Similarly, it is unnecessary to decide whether, if the materials received by Eclipse were goods, they would have been second‑hand goods.
10.3 Eclipse's second excise contention: is the levy a tax on the Products?
Eclipse's second excise contention relates to the Abercrombie Road Site and the Wanneroo Road Site. Eclipse says that, at those sites, the levy is a tax on a step in the production of valuable products (Products), namely water retentive soil and structural fill.[757] This contention is put in two slightly different ways. First, it is said that the levy is an excise insofar as materials are deposited and compacted as a stockpile for future use in making the Products.[758] Secondly, the levy is said to be an excise insofar as materials deposited in the void were subsequently re‑used for the purpose of making the Products.[759] Beyond this, Eclipse's second excise contention was not developed in further detail in written or oral submissions.
[757] Eclipse's opening submissions [34(a)]; Eclipse's closing submissions [184.2], [186.3] ‑ [186.5], [186.8], [214] ‑ [216], [228.1]; ts 287, ts 739 ‑ 740; SC1 [28.3].
[758] Eclipse's opening submissions [34(a)]; Eclipse's closing submissions [184.2], [186.3], [228.1].
[759] ts 287; Eclipse's closing submissions [215].
The factual findings I have made as to Eclipse's intention to re‑mine, and as to the re‑mining that it conducted, largely but not entirely remove the factual premises for Eclipse's second excise contention. With the exception of the return period 1 July 2014 to 30 September 2014 for the Abercrombie Road Site, I have found that:
(1)re‑mining or availability for re‑mining was not a substantial or operative purpose of the depositing and compacting of materials in the voids at the Sites;
(2)Eclipse's purpose in depositing and compacting materials in the voids was for them to be used to fill space in the voids;
(3)the evidence does not establish that any materials deposited and compacted in the voids at the Sites during the Relevant Period were re‑mined and used to make Products during the Relevant Period.
Thus, I do not accept that materials were deposited and compacted 'as a stockpile for future use' in making the Products.
The position is different in relation to the period 1 July 2014 to 30 September 2014 at the Abercrombie Road Site. I have found that during that period, Eclipse deposited and compacted materials in the void in order to fill the void, but also so that the deposited and compacted materials would be available for re‑mining. I have also found that during that period, about 47,900 m3 of materials were extracted from the void and used to produce just over 50,000 m3 of Products, including fill sand and shaping soil.
For the reasons that follow, I am not persuaded that the levy operates as an excise in relation to the period 1 July 2014 to 30 September 2014 at the Abercrombie Road Site in the respect asserted by Eclipse's second excise contention.
As explained in section 10.1 of these reasons, in determining whether a tax is an excise, it is necessary to assess the nature and extent of the connection between the tax and the relevant step in the manufacture, production or distribution of the goods, in order to determine whether it is, in substance, a tax on that step. Factors relevant to that assessment may include the indirectness of the tax, its immediate entry into the cost of the goods, the proximity of the transaction it taxes to the relevant step in manufacture, production or distribution, and the form and content of the legislation imposing it.
None of these factors support the characterisation of the levy in its application to the Products as an excise. There is no evidence to suggest that the levy enters into the cost of the Products, directly or indirectly. Nor is there any natural tendency for that to occur. The transaction taxed by the levy is not proximate to the production of the Products. What is taxed by the levy is the disposal of waste to landfill. Nothing in the form or content of the levy regime favours its characterisation as an excise in relation to the Products.
To be an excise, a tax must bear a close relation to the production of goods. In this case, there is not a sufficiently close relation between the levy and the production of the Products to sustain a characterisation of the levy as, in substance, a tax on that production. When waste is disposed of to landfill, by definition it is not then being used to make Products. When the materials were put into the ground, that reflected Eclipse's decision that, from its perspective, that was the most efficient and productive use of them at that time.[760] The materials were compacted on the basis that they would be 'treated as permanent fill and therefore placed and compacted accordingly'.[761] Compacted materials may or may not be re‑mined, depending on later economic circumstances and the materials available to Eclipse at later times.[762] The existence of that possibility does not sustain a conclusion that the levy bears a close connection to the production of Products that may or may not, at some uncertain subsequent time, be produced from materials disposed of to landfill during the return period in question. The disposal of materials to landfill in these circumstances is not an essential or natural step in the production of the Products from that material.
[760] ts 379, 380, 381.
[761] Exhibit A, attachment 46, page 1752.
[762] ts 379 ‑ 382.
There is no proportionate relationship between the amount of the levy and the amount or value of any of the Products. Nor is there any 'natural' connection between them. The position is quite the opposite. The levy only applies to what has been disposed of to landfill. By definition, in dealing with materials in that way, Eclipse decided that it did not then propose to use them to make Products, but rather to add them to the void. Waste received and not put in the void, but used to produce Products, is not disposed of to landfill and so is not subject to the levy.
Eclipse submits that there is a proportionality between the levy and the Products in that the amount of levy payable is directly related to the volume of materials available in the void, in the nature of a stockpile, for potential future production of Products.[763] I do not accept that this is the right way to assess the nature and extent of the relationship between a tax and the goods a step in the production of which is said to be burdened by the tax. The enquiry is directed to the connection, if any, between the amount of levy payable and the quantity or value of the Products. There is no connection between the amount of levy payable and the quantity or value of any Products made during a given return period. Any connection is founded on what might happen in the future, not on what has happened during the return period in which the levy becomes payable.
[763] ts 742 ‑ 743.
Moreover, if and when Eclipse later decided to remove some material to use it to produce a relevant product, subject to a qualification, in the return period in which that occurred Eclipse would be given a credit in respect of that 'cutting' from the void. The qualification is that if during a return period, there was a net cut from a site, the return would be shown as zero, not a negative figure. Consequently, no credit would be given for re‑mining if and to the extent it produced a net negative figure during the return period. During the Relevant Period, there was no return period for Abercrombie Road or Wanneroo Road in which there was a net cut.
For these reasons, I do not accept Eclipse's second excise contention.
10.4 Eclipse's third excise contention - is the levy a tax on Quarry Materials?
Eclipse's third excise contention is that the levy is a tax on a step in the production of the limestone and sand quarried at the Abercrombie Road Site because in order to mine these Quarry Materials it is necessary to rehabilitate the land, and the levy is a tax on the rehabilitation of the land.[764]
[764] Eclipse's opening submissions [34(b)]; Eclipse's closing submissions [184.2.3], [272] ‑ [280]; ts 287, 742, 744 ‑ 745, 747 ‑ 749.
In more detail, Eclipse submits as follows:
(1)The Quarry Materials are a valuable commodity.[765]
[765] Eclipse's closing submissions [272].
(2)The Quarry Materials would not be mined if the site was not going to be rehabilitated to an appropriate standard to permit its subsequent industrial use. Rehabilitation is required by the conditions of the Town of Kwinana's planning approval for the quarrying.[766]
[766] Eclipse's closing submissions [273] ‑ [275].
(3)The only suitable material that can economically be used as fill is the inert material acquired by Eclipse for that purpose.[767]
(4)Filling the void is a necessary element of mining the Quarry Materials because:
(a)that was a condition of approval by the Town of Kwinana;[768] and
(b)after mining all of the Quarry Materials, Eclipse intends to subdivide the site for industrial use, and it should be inferred that, if Eclipse could not rehabilitate the site using inert material, Eclipse would not have quarried it.[769]
(5)In order to extract maximum limestone and sand, it is necessary to fill the resultant void with lower value material than what was quarried; the void cannot be permitted to get too big. That shows the close temporal connection between the mining of the Quarry Materials and the filling of the void.[770]
(6)There is a proportionate relationship between the amount of levy payable and the quantity of Quarry Materials because there is a direct proportionate relationship between the volume of materials quarried and the volume of fill required to rehabilitate the site.[771]
(7)For these reasons, there is a direct connection between the depositing of fill in the void and the production of the Quarry Materials. The filling of the void with the inert material used by Eclipse is a necessary step in the mining of the Quarry Materials.[772]
(8)Thus, in its practical operation in relation to Eclipse's Abercrombie Road Site, the levy is an excise.
[767] Eclipse's closing submissions [276].
[768] Eclipse's closing submissions [278]; ts 748 ‑ 749.
[769] Eclipse's closing submissions [279] ‑ [280].
[770] Eclipse's closing submissions [279]; ts 745.
[771] ts 742.
[772] Eclipse's closing submissions [277].
In its terms and in its direct operation, the levy is a tax on or in respect of the waste disposed of to landfill, and not upon or in respect of the Quarry Materials taken from the land. The question is whether in its practical operation the levy is indirectly a tax upon or in respect of the Quarry Materials because it is a tax on the rehabilitation of the site and that rehabilitation is a necessary step in the mining of the Quarry Materials.
It is unclear which Quarry Materials are said by Eclipse to be burdened by the levy for which it became liable during the Relevant Period. Is it the Quarry Materials the earlier mining of which created the part of the void that was filled during the Relevant Period? Or is it the Quarry Materials that were mined during the Relevant Period? As I understand Eclipse's argument, it is the former, but I have given attention to both in considering the third excise contention.
As outlined in section 10.1, to be an excise, a tax must bear a close relation to the production, manufacture, or distribution of goods and must be of such a nature as to affect them as the subjects of manufacture or production, or as articles of commerce. The question of characterisation of a tax involves questions of degree, in relation to which a number of factors may be relevant but not decisive.
For the reasons that follow, I am not satisfied that there is a sufficiently close relationship between the levy and the mining and sale of the Quarry Materials to sustain a characterisation of the levy in its application to the Abercrombie Road Site as an excise.
I refer to my detailed findings of fact relating to the planning approvals for the use of the Abercrombie Road Site, set out in section 2.24 above. The filling of the void with waste was proposed by Eclipse, not imposed by the Town of Kwinana. From the outset, it was an element of Eclipse's proposal that it would rehabilitate the quarry by landfilling it with class 1 waste materials from construction and demolition projects.[773] That is how the council of the Town of Kwinana understood the proposal.[774] The Town of Kwinana imposed conditions. The object of the conditions was to ensure that landfilling with class 1 inert waste materials, as proposed by Eclipse, would be done in a way that would enable a subsequent use of the site for light industrial purposes. The conditions did not specify the nature and source of the materials to be used as fill.
[773] Exhibit A, attachment 21, pages 797 ‑ 798.
[774] Exhibit C, for example, at pages 287 and 291.
Similarly, the 2004 application regarding lot 2 attached a management plan that said that the excavated area would be backfilled with inert class 1 materials.[775] That is how the proposal was understood by council.[776] The same position pertained in relation to the 2010 application.
[775] Exhibit A, attachment 22, pages 828L ‑ 828N.
[776] Exhibit C, page 317.
Under SPP 2.4, in force when planning approval for the Abercrombie Road Site was initially granted, applications for extractive industry operations would be accompanied by a management plan and report setting out proposals for the progressive and ultimate rehabilitation of the site for its intended long term use.[777] SPP 2.4, and its predecessors and successors, do not set out requirements as to the methods of rehabilitation of land in achieving sequential land use. The refilling of a void with specific materials such as inert waste is not required by any planning policy.[778]
[777] Exhibit 3, attachment NF2 [5.7].
[778] Exhibit 3, attachment NF2 [6.3] ‑ [6.4].
When planning approval was initially granted, the Town of Kwinana's Extractive Industry Local Law required an applicant to submit, among other things, a rehabilitation and decommissioning programme. Neither the Local Law nor its successor specified the method or form that land rehabilitation should take. They did not require that filling of the land take place, or that filling of the land with waste be carried out.
Mr Neil Foley, an experienced planner, gave evidence that the filling of the Abercrombie Road Site with inert waste was not the only option for preparing the land for a sequential land use after the extraction of sand and limestone by Eclipse.[779] The land could have been filled with lower value clean fill, or other material sourced from elsewhere.[780] Further, depending on the sequential use or uses proposed and thought appropriate, a plan could have been prepared providing for a limited amount of fill sufficient to enable the quarry to remain a safe, stable structure.[781]
[779] Exhibit 3, attachment NF2 [6.38].
[780] Exhibit 3, attachment NF2 [6.38].
[781] Exhibit 3, attachment NF2 [6.38] ‑ [6.40].
Eclipse submits that Mr Foley's evidence is theoretical in nature, in that he has not been to the Abercrombie Road Site, and has not assessed whether in all the circumstances it was practically possible to use any of the other approaches to rehabilitation that he has identified.[782] I accept that this is so. However, on the whole of the evidence, Eclipse has not satisfied me that there was no practical alternative to using waste as fill to rehabilitate the site following mining of the Quarry Materials. In any event, even if I were so satisfied, in light of the other matters to which I have referred, and refer to below in this section 10.4, I am not satisfied that the levy operates as an excise on or in respect of the Quarry Materials.
[782] Eclipse's closing submissions [60].
When Eclipse initially sought planning approval, it would have been open to the Town of Kwinana to approve alternative sequential uses for the quarry that did not involve a landfill and that were consistent with the rural zoning of the land.[783] Further, other alternative sequential uses could have been approved by the Town of Kwinana if a request for a rezoning amendment had been successful and finalised.[784]
[783] Exhibit 3, attachment NF2 [7.1] ‑ [7.13].
[784] Exhibit 3, attachment NF2 [7.13].
Among the factors relevant to the assessment of the nature and extent of the connection between a tax and the production of goods are the indirectness of the tax and its immediate entry, or otherwise, into the costs of the goods.
There is no evidence that the waste levy has been factored into the price of the Quarry Materials. I am not satisfied, in the circumstances of the case, that there is any significant tendency for that to occur. Eclipse is paid by suppliers of waste to take the waste. The evidence does not establish with precision the relative scale of what Eclipse earns from doing that, as against income earned by Eclipse from the sale of Quarry Materials, but it can safely be said that the latter is dwarfed by revenue from the suppliers of the waste. A summary attached to Mr Sippe's third witness statement provides some information as to Eclipse's income from the sales of, among other things, Quarry Materials.[785] I am not satisfied that this revenue was substantial when put in the context of Eclipse's other revenue at the Abercrombie Road Site, including from the fees paid to it by suppliers of waste. Eclipse's records indicate that total revenue at the Abercrombie Road Site from July 2008 to May 2012 from suppliers of the materials received by Eclipse was in the order of one hundred times its income from the sale of Quarry Materials during the Relevant Period.[786] Any tendency for the levy to affect prices charged by Eclipse would, on the evidence, seem to lie in the price to be charged by Eclipse for materials it received, and not in the price at which Quarry Materials were sold.
[785] Exhibit G3 [46], attachment RS57.
[786] See exhibit C, pages 29, 36, 61, 81, 94, 117 and 126 and the preceding footnote.
Moreover, it should not be overlooked that, for some of the Relevant Period, third party contractors extracted Quarry Materials from the Abercrombie Road Site and sold or used for their own purposes some of the extracted materials.[787] There is no evidence of the extent of mining by the contractors for their own benefit, as compared to the extent of mining of Quarry Materials by Eclipse. There is no evidence that Eclipse passed on or attempted to pass on to the contractors any part of the levy paid by Eclipse or claimed by the Government Parties to be due by Eclipse.
[787] Exhibit A [39].
The transaction the subject of the levy is not proximate to the mining of the Quarry Materials. There is no necessary or close temporal connection between the mining of the Quarry Materials and the filling of the site, the latter being the conduct that attracts the levy. At the Abercrombie Road Site, Eclipse is not under any obligation to fill the void at any particular rate. When the rehabilitation of the area mined during the Relevant Period will occur, making levy payable in respect of it, is uncertain. It may be years away. When the mining occurred of the area that was filled during the Relevant Period is, on the evidence, unclear. Some quarrying had occurred before Eclipse took possession of the site.[788] There is no reason to suppose that filling of an area occurred soon after that area had been mined.
[788] Exhibit D1 [33].
In support of its submission that there is a close temporal connection between the mining of Quarry Materials and the filling of land, Eclipse points to Mr Delroy's evidence that 'the void is never allowed to get too big ... in case something goes wrong and you are left with a huge hole that you can't fill'.[789] That evidence was given in relation to re‑mining of materials deposited and compacted in the void, not in relation to the mining by Eclipse of Quarry Materials. In any event, the effect of that generalised statement is that, if an unidentified limit is reached, the need to ensure that the void is not too big may constrain the extent of mining. That evidence does not satisfy me that there is a close temporal connection between the mining of the Quarry Materials and the filling of the void. For the reasons already given, I am not satisfied that there is any such close connection.
[789] ts 386.
For these reasons, I am not satisfied that there is a sufficiently close connection between the levy and the mining of the Quarry Materials to sustain a characterisation of the levy as a tax upon or in respect of the Quarry Materials. Consequently, I do not accept Eclipse's third excise contention.
Conclusion
My major conclusions may be summarised as follows:
(1)My construction of the levy regime is explained in section 5 of the reasons and summarised in section 5.5.
(2)At each site during each return period in the Relevant Period, Eclipse received waste and accepted waste for burial (section 6).
(3)Consequently, each site was a licenced category 63 landfill at all times during the Relevant Period.
(4)Waste was disposed of to landfill at each site, including outside of the Category 63 Area of each site, during each return period in the Relevant Period. Consequently, the power of the CEO to make estimates of the levy payable by Eclipse was enlivened (section 7).
(5)The estimates of levy made by the CEO in the return periods from 1 July 2008 to 31 December 2011 are valid. In making those estimates, the CEO did not misconstrue the levy regime (section 8).
(6)As a result, the Government Parties' claims for the levy estimated and for penalties succeed.
(7)The declarations sought by Eclipse regarding return periods after 1 July 2012 should not be made (section 9).
(8)In its application to Eclipse's operations at the Sites, the waste levy is not invalid as an excise (section 10).
In light of those conclusions, Eclipse's actions against the Government Parties should be dismissed. On the face of it, the other orders that should be made would seem to be those identified in the Government Parties' closing submissions.[790]
[790] Government Parties' closing submissions part XII [2] ‑ [4].
However, I will hear further from the parties as to the orders that should be made in light of these reasons, including orders as to costs.
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