Environment Protection Authority v Eljo Pty Limited; Environment Protection Authority v Solo Waste Aust. Pty Limited
[2005] NSWLEC 341
•06/06/2005
Land and Environment Court
of New South Wales
CITATION: Environment Protection Authority v Eljo Pty Limited; Environment Protection Authority v Solo Waste Aust. Pty Limited [2005] NSWLEC 341
PARTIES: PROSECUTOR:
Environment Protection Authority
DEFENDANTS
Eljo Pty Limited
Solo Waste Aust. Pty LimitedFILE NUMBER(S): 50004; 50005 of 2005
CORAM: Pain J
KEY ISSUES: Prosecution :- plea of guilty - breach of condition requiring licensed activities to be carried out in a competent manner - mitigating factors
LEGISLATION CITED: Clean Waters Act 1970
Crimes (Sentencing Procedure) Act 1999 s 22
Protection of the Environment Operations Act 1997 s 64(1), s 241, s 248CASES CITED: Camilleri's StockFeeds Pty Limited v Environment Protection Authority (1993) 32 NSWLR 683;
Environment Protection Authority v Coffs Harbour Hardwoods (Trading) Pty Limited [2004] NSWLEC 563;
Environment Protection Authority v New Generation Beverages Pty Limited; Environment Protection Authority v Pepsi Seven-Up Bottlers Australia [2000] NSWLEC 130;
Haynes v CI & D Manufacturing Pty Limited (No 2); Callahan v CI & D Industries Pty Limited (1995) 60 UR 455;
R v Sharma (2002) 54 NSWLR 300;
R v Thomson (2000) 49 NSWLR 383;
Workcover Authority of New South Wales v McDonald's Australia Limited and Anor [2000] NSWIRComm 1123DATES OF HEARING: 06/06/2005 EX TEMPORE JUDGMENT DATE: 06/06/2005
LEGAL REPRESENTATIVES: PROSECUTOR:
DEFENDANTS:
Ms S Mahony (solicitor)
SOLICITORS:
Environment Protection Authority
Ms M Sneddon (barrister)
SOLICITORS:
Hannigans
JUDGMENT:
THE LAND AND
ENVIRONMENT COURT
OF NEW SOUTH WALES
Pain J
6 June 2005
EX TEMPORE JUDGMENT50004 of 2005, 50005 of 2005 Environmental Protection Authority v Eljo and Solo Waste
1 HER HONOUR: There are two identical charges in these two matters against the two Defendant companies as both jointly hold an environmental protection licence. Both Defendants have pleaded guilty so that the essential legal elements of the charges have been admitted.
2 The summons seeks an order that the Defendants appear before this Court because between 18 February 2004 and 19 February 2004 inclusive, at or near Fishery Creek Road, Ballina (“the premises”), they committed an offence against s 64(1) of the Protection of the Environment Operations Act1997 (“the POEO Act”) in that they were joint holders of a licence a condition of which was contravened. That licence is Environment Protection Licence 10055 (“the license”).
3 The particular condition contravened is condition 01.1 of the license which provides:
- Licensed activities must be carried out in a competent manner. This includes:
· the processing, handling, movement and storage of materials and substances used to carry out the activity; and
· the treatment, storage, processing, reprocessing, transport and disposal of waste generated by the activity.
4 In relation to the manner of contravention, the summonses allege that there has been:
- Failure to treat and/or, store and/or handle grease trap waste at the licensed premises at Fishery Creek Road (“the premises”) in a competent manner in a number of ways including:
(i) causing grease trap waste to be treated in a filter press without adequate supervision;
(ii) causing grease trap waste to be treated, handled and/or stored in an inadequately bunded area at the premises;
(iii) failing to have systems in place to stop the filter press after a malfunction; and/or
(iv) failing to have systems in place to warn operators of a malfunction with the filter press.
- As a result of the Defendants’ failure to carry out the licensed activity in a competent manner, grease trap waste material escaped from the premises and flowed to a swale drain to the east of the premises and/or to an area of land owned by Ballina Shire Council to the west of the premises.
5 At the hearing the manner of contravention identified at (ii), whether or not the area was adequately bunded, was not particularly relied on by the Prosecutor. I note that the maximum penalty applicable for offences of this nature is $250,000 for a corporation.
Background
6 There was an agreed statement of facts that was provided to the Court in these proceedings. As has already been noted, the Defendants jointly hold Environment Protection Licence 10055 for the activity of waste facilities and I note that they run that business in the name of Richmond Waste Pty Limited as a partnership.
7 At approximately 9.30 pm on 18 February 2004 the night shift operator had sent material to the filter press for pressing before he left. Some time between 9.30 pm on 18 February 2004 and 5.30 am on 19 February 2004 a spill of grease trap waste occurred at the Defendants’ premises as a result of a malfunction in one of the components of a filter press grease trap. The premises were unsupervised overnight and the next shift operator arrived at the premises at 5.30 am on 19 February 2004. As a result of the malfunction, waste flowed from the Defendants’ premises into the stormwater drain onto the road outside the premises. As has already been noted in the summons, some grease trap waste flowed to a swale drain and tidal wetland to the east of the Defendants’ premises and some of that waste flowed to land to the west owned by Ballina Shire Council. Clean up of the spill of grease trap waste commenced immediately on 19 February 2004 and was completed within several days after the spill, although there was some delay in the commencement of the clean up of the spill on the east of the premises as heavy machinery was required to be obtained to remove the grease trap waste.
8 Mr Ian Greenbank, the Prosecutor’s Regional Operations Officer, attended the Defendants’ premises on 23 February 2004 and collected two samples of the discharged material from the premises for chemical and ecotoxicological analysis. Those analyses confirmed that what was on the site and what flowed off the site were the same and were consistent with grease trap waste.
9 Mr Marino Julli, the Prosecutor’s expert witness in the area of marine pollution, undertook an investigation of the chemical and ecotoxicological analyses conducted by the Prosecutor and he has provided an affidavit sworn 6 April 2005 which was referred to in the statement of agreed facts. Mr Julli stated in his affidavit that the actual harm to the environment is likely to be limited to the death of plants and insects smothered with the grease trap waste. Mr Julli also expected that there would be short-term damage associated with the physical removal of the waste and underlying soil by heavy machinery. His view was that given the majority of the spill was removed in a relatively short period of time it is highly unlikely that significant residual environmental harm effects did occur. Based on the result of his analysis it was also agreed that the spill could have potentially led to the harming of aquatic organisms and may potentially have deoxygenated the soil over which the waste was placed, damaging plant roots and vegetation had it reached a watercourse or had it remained on the soil for a lengthy period.
- Section 241(a) the extent of the harm caused or likely to be caused to the environment by the commission of the offence
10 The Prosecutor submitted that there was actual harm to the environment in terms of the smothering of plants and insects by the grease trap waste. The Prosecutor argued the escape was substantial with some 4,000 litres of liquid and grease trap waste including around 2,000 litres of concentrated grease escaping. According to the affidavit evidence of Mr Julli, this material had a very high chemical oxygen demand level with the capacity to rapidly deoxygenate waters and kill aquatic life. The grease settled in areas that were dry but were wetland and also into a swale drain leading to Fishery Creek. When the grease was removed from amongst protruding roots of mangroves, the heavy equipment used also removed topsoil and vegetation, and that was also considered to be harm to the environment by the Prosecutor.
11 While the Defendants did not dispute there was actual harm, they considered the harm was minimal. The grease waste itself spread only some 30 metres from the premises to the east and did not travel far along the watercourse leading to any nearby creeks, these being a distance of some 300 metres away. Further, the Defendants noted that the area cleared by heavy machinery has now revegetated and there has been no lasting damage.
12 My view about environmental harm under this subsection is that while there was clearly actual harm to the environment, the harm certainly was not substantial, although the material clearly had the potential, had it reached a water body, to do significant harm to aquatic life and soil had it remained in the environment for a long period. I do note however that the amount of the spill was fairly substantial.
Section 241(b) the practical measures that may be taken to prevent, control, abate or mitigate that harm
13 It is clear from the evidence that there were practical measures that could have been taken to prevent the spill, the most obvious of which was the installation of a pressure switch. This would have caused the filter system to shut down if a similar event occurred in the future. I further note that the Defendants installed a pressure switch in March 2004.
Section 241(c) the extent to which the person who committed the offence could reasonably have foreseen the harm caused or likely to be caused to the environment by the commission of the offence
14 In the Prosecutor’s submissions the incident and the harm caused were foreseeable given that the Defendants’ equipment was operating overnight without any supervision. There was no bunding to contain any spill if the machinery malfunctioned without a pressure switch in place.
15 The Defendants had made enquiries in January 2004 before the incident occurred about the installation of a pressure switch, but this was not installed until after this event and a second similar incident. The Defendants submitted this was not a highly foreseeable circumstance. There had been no previous difficulties with the filter press which it had installed a few months previously. While it was second hand, the previous owners also said they had not had any such problems. On this basis the Defendants argued that it was simply not foreseeable that any problems would develop.
16 I consider the harm caused by the incident was clearly foreseeable given the nature of the grease trap waste and I do not understand there to be any dispute about that. I consider the occurrence of this incident was also foreseeable in the sense that there was very little done to prevent any escape occurring from the filter press area in the event there was an equipment malfunction, which was all the more likely given there was no one supervising the plant operation overnight.
Section 241(d) the extent to which the person who committed the offence had control over the causes that gave rise to the offence,
17 I agree with the Prosecutor that the Defendants are joint licensees of the premises and are wholly and jointly responsible for ensuring that activities take place in a competent manner. They clearly had control of the system in place which included the operation of equipment without supervision for several hours overnight. There was no equipment installed which would cause it to shut down if there was a malfunction, and I consider they were responsible given the circumstances.
18 I note it has been agreed that s 241(e) does not apply.
19 Overall the Prosecutor submitted the matter was reasonably serious and a substantial monetary penalty ought be imposed. The Defendants’ alternative submission was the matter is not serious and the penalty imposed should be at the low end of the low penalty range.
20 In deciding what level of penalty I should impose I must have regard to the overall culpability of the Defendants and the individual circumstances which led to the commission of the offence. In addition to the matters that I must have regard to under s 241 of the POEO Act, there are some other issues that I must consider.
General deterrence
21 There is a need to consider general deterrence in assessing penalty as identified in Camilleri’s StockFeeds Pty Limited v Environment Protection Authority (1993) 32 NSWLR 683, particularly in this case because the Defendants hold an environment protection licence.
22 I note that the Prosecutor has also made submissions in relation to the need to consider specific deterrence in this case. The Prosecutor argued that the Defendants failed to promptly report the incident to the Prosecutor and their employees took measures which included hosing the waste into the stormwater system as part of the clean up. Further, the Defendants operate a business for profit and failing to install the pressure switch costing approximately $1,760 could have been done earlier but was not done until several weeks after the incident.
23 The Defendants submitted however that when their behaviour is taken into account over a period that they have acted responsibly. The Defendants purchased the facility in a very rundown state approximately two years ago and at the time it was purchased the actual site was processing very little waste. Since then substantial capital improvements have been made and compliance with all necessary regulatory requirements maintained. The facility is the only one in northern New South Wales which properly processes waste of this kind and is currently processing approximately 550,000 litres. The Defendants have no other convictions for offences of this nature, and maintain that they did act promptly in cleaning up and did not deliberately delay notifying the Prosecutor. The Defendants did note that they notified Ballina Council promptly at the time the spill occurred. I consider in the circumstances the Defendants’ behaviour does not particularly warrant a penalty which takes into account specific deterrence.
Even handedness
24 It is desirable that this Court ensures that like offences receive similar penalties. The parties did not present any particular cases to the Court in this regard but I have considered my earlier decision of Environment Protection Authority v Coffs Harbour Hardwoods (Trading) Pty Limited [2004] NSWLEC 563 where I imposed $7,200 after taking into account various mitigating factors for a less serious matter. I also note the decision of Lloyd J in Environment Protection Authority v New Generation Beverages Pty Limited; Environment Protection Authority v Pepsi Seven-Up Bottlers Australia [2000] NSWLEC 130, which I will come to in more detail shortly. In that case his Honour imposed a penalty of $15,000 taking into account mitigating factors in a case with some similarities to this case but with arguably more environmental harm caused than in the matter before me.
25 One issue that does arise is how the two Defendants ought be sentenced. In these proceedings, the Defendants face identical charges. The totality principle which considers overall criminality where there are different offences does not apply in my view. The Prosecutor has argued that because each Defendant has responsibility separately under the licence, the penalty for each should be the same as the penalty that would otherwise be imposed if there was only one defendant. There does not appear to be any authority in support of this submission.
26 In its submissions, the Prosecutor referred to the industrial relations cases of Haynes v CI & D Manufacturing Pty Limited (No 2); Callahan v CI & D Industries Pty Limited (1995) 60 UR 455, and Workcover Authority of New South Wales v McDonald’s Australia Limited and Anor [2000] NSWIRComm 1123. Haynes is authority for the proposition that an offence should be viewed in a global way and each defendant should receive a proportion of the total fine. While Walton J in McDonald’s stated that the global approach in Haynes appears to sit uneasily with principles of parity and totality, I do not consider it supports the Prosecutor’s submissions.
27 The Defendant relied on a case from this Court in New Generation Beverages. In that case two defendants were charged with offences under the Clean Waters Act 1970 arising from the same incident. Lloyd J said at [40]:
- The Prosecutor submits that since there are two separate charges against two separate Defendants, the penalty that would be otherwise imposed should be imposed on both of them in equal amounts.
- As I understand the submission, that would result in a total fine greater than would be the case if the offence had been committed by a single Defendant. This is a novel approach to me. I am unaware of any case in the past where that has been done. The Prosecutor has been unable to identify any authority where such an approach has been adopted in this Court or for that matter in any other court. The fact is that the activities being conducted on the land are being conducted by a partnership. Pepsi Seven Up Bottlers Australia Pty Limited and New Generation Beverages Pty Limited is the partnership that is carrying on a single business. The Defendants are not carrying on separate businesses or engaged in separate enterprises. I am not persuaded that the submission of the Prosecutor should be accepted.
28 While the charges in this case are slightly different to those in New Generation Beverages, I do not consider it should be distinguished on that basis.
29 I intend to adopt the same approach in these proceedings so that I will consider the total criminality of the offence in arriving at a penalty and then divide that figure between the two Defendants. While I consider this matter is not substantially serious, I do not consider the matter to be trivial and a more than trivial penalty is justified. However, there are a number of mitigating factors that I should take into account to reduce any penalty.
30 Firstly, there is the matter of a guilty plea. It is clear the Defendants have pleaded guilty at the earliest opportunity. A plea of guilty does entitle a defendant to a discount in a penalty under s 22 of the Crimes (Sentencing Procedure) Act 1999 and that discount can be in the range of 10 to 25 per cent as recognised in R v Thomson (2000) 49 NSWLR 383 and R v Sharma (2002) 54 NSWLR 300, decisions of the Court of Criminal Appeal of New South Wales. I consider given the early stage of the plea of guilty that a high level of discount is warranted.
31 The Defendants have through Mr Barnes, director of Eljo Pty Limited and also manager of Richmond Waste Pty Limited, expressed their contrition and remorse, which I accept. I also consider there was total co-operation with the Prosecutor’s investigations of the incident. There was prompt attention to the clean up of the site. While there was some delay in removal of the waste, that was because it took a little while to get the heavy machinery onto the site according to the Defendants’ evidence and I accept that evidence.
32 I further note the Defendants have now implemented measures at some cost including the installation of a pressure switch, which means a repeat of the incident is very unlikely to occur. I further note that additional measures taken are set out at tab five in the agreed statement of facts, in a letter from Richmond Waste Pty Limited to the Prosecutor dated 23 February 2004.
33 The amount of the Prosecutor’s costs has been agreed at $15,000 and the Defendants have also agreed to pay the amount of $1,545 for the ecotoxicology tests undertaken by the Prosecutor, as sought and provided for by s 248 of the POEO Act. In all the circumstances I think the Defendants’ penalty should be discounted and that a fine of $11,500 is appropriate to be split between the two Defendants.
34 The Court makes the following orders:
In matter no. 50004 of 2005:
- 1. The Defendant is convicted of the offence with which it is charged.
2. The Defendant is fined the sum of $5,750 to be paid to the Registrar of the Court within twenty eight days of today’s date.
3. The Defendant must pay the Prosecutor’s costs of the proceedings in the sum of $7,500.
4. The Defendant must pay the Prosecutor’s costs of the ecotoxicology tests in the sum of $772.50.
5. The exhibits may be returned.
In matter no. 50005 of 2005:
- 1. The Defendant is convicted of the offence with which it is charged.
2. The Defendant is fined the sum of $5,750 to be paid to the Registrar of the Court within twenty eight days of today’s date.
3. The Defendant must pay the Prosecutor’s costs of the proceedings in the sum of $7,500.
4. The Defendant may pay the Prosecutor’s costs of the ecotoxicology tests in the sum of $772.50.
5. The exhibits may be returned.
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