Environment Protection Authority v Ghossayn - [2009] NSWLEC 181

No judgment structure available for this case.

Land and Environment Court

of New South Wales

CITATION: Environment Protection Authority v Ghossayn [2009] NSWLEC 181

PARTIES:
PROSECUTOR
Environment Protection Authority
DEFENDANT
George Ghossayn

FILE NUMBER(S): 50037 of 2008; 50038 of 2008

CORAM: Pepper J

KEY ISSUES:
PROSECUTION :- licenced waste facility - breach of s 126 of the Protection of the Environment Operations Act 1979 - guilty plea - air pollution - smouldering sub-surface fires and offensive odour - neighbouring property affected - sentencing considerations - defendant director with control over premises at all times - company with prior environmental convictions - only one director charged - forseeability of risk of harm - minimal environment harm - harm to regulatory regime - penalty
PROSECUTION :- waste facility without lawful authority - breach of s 144 Protection of the Environment Operations Act 1979 - guilty plea - failure to pay waste contributions to council - notice of suspension of facility - breach of notice of suspension - waste continued to be accepted despite suspension - s 10 of the Crimes (Sentencing Procedure) Act 1999 not appropriate - penalty

LEGISLATION CITED: Crimes (Sentencing Procedure) Act 1999 ss 3A, 10, 21A and 22
Protection of the Environment Operations Act 1997 ss 3, 55, 88, 132, 126, 144, 169, 212 and 241
Waste Avoidance and Resource Recovery Act 2001 s 3

CASES CITED: Axer Pty Ltd v Environment Protection Authority (2001) 113 LGERA 357
Bentley v BGP Properties Pty Ltd (2006) 145 LGERA 234
Cabonne Shire Council v Environment Protection Authority (2001) 115 LGERA 304
Camilleri's Stock Feeds Pty Ltd v Environment Protection Authority (1993) 32 NSWLR 683
Director-General of the Department of Environment and Climate Change v Rae [2009] NSWLEC 137
Dodds v R [2009] NSWCCA 191
Director of Public Prosecutions (Cth) v Said Khodor El Karhani (1990) 21 NSWLR 370
Environment Protection Authority v Barnes [2006] NSWCCA 246
Environment Protection Authority v Burrangong Meat Processors Pty Ltd [2003] NSWLEC 102
Environment Protection Authority v Caltex Refineries (NSW) Pty Limited [2006] NSWLEC 335
Environment Protection Authority v Coastal Recycled Cooking Oils Pty Limited [2008] NSWLEC 242
Environment Protection Authority v Fulton Hogan Pty Ltd [2008] 163 LGERA 345
Environment Protection Authority v Hogan [2008] NSWLEC 125
Environment Protection Authority v Werris Creek Coal Pty Ltd; Environment Protection Authority v Holley [2009] NSWLEC 124
Environmental Protection Authority v Obaid [2005] NSWLEC 171
Eurobodalla Shire Council v Leth [2007] NSWLEC 599
Filipowski v Hemina Holdings SA; Filipowski v Rajagopalan (No 2) [2009] NSWLEC 104
Gittany Constructions Pty Ltd v Sutherland Shire Council (2006) 145 LGERA 189
Kari & Ghossayn Pty Limited v Sutherland Shire Council (2006) 150 LGERA 231
Markarian v The Queen (2005) 228 CLR 357
PHAM v R [2009] NSWCCA 25
Pittwater Council v Scahill (2009) 165 LGERA 289
R v Kerr [2003] NSWCCA 234
Thorneloe v Filipowski (2001) 52 NSWLR 60
Veen v The Queen (1979) 143 CLR 458

DATES OF HEARING: 19 May 2009

DATE OF JUDGMENT:
23 October 2009

LEGAL REPRESENTATIVES:
PROSECUTOR
Mr P Brown (solicitor)
SOLICITORS
Department of Environment and Climate Change
DEFENDANT
Mr A Djemal
SOLICITORS
Lander & Rogers Lawyers

JUDGMENT:

THE LAND AND
ENVIRONMENT COURT
OF NEW SOUTH WALES

PEPPER J

23 October 2009

50037 of 2008 & Environment Protection Authority v
50038 of 2008 George Ghossayn

JUDGMENT

Introduction

1 HER HONOUR: The defendant pleads guilty to two offences against ss 126(1) and 144 of the Protection of the Environment Operations Act 1997 (“POEOA”). The offences concern a waste facility located at 7-23 Clifton Avenue, Kemps Creek, in the Penrith Local Government Area (described as lots 17-23 of Section A of DP 2556) (“the site”).

2 This judgment concerns the appropriate penalty to be determined in light of the guilty pleas and the facts and circumstances of the commission of the offences. For the reasons set out below, the Court fines the defendant a total of $51,000 for the commission of the two offences.

Legislative Framework

3 Section 126 of the POEOA provides as follows:

126 Dealing with materials

deal with materials means process, handle, move, store or dispose of the materials.

materials

4 Section 144 of the POEOA provides:

144 Use of land as waste facility without lawful authority

Maximum penalty:

5 Both offences were committed by the defendant as a result of the operation of s 169(1) of the POEOA, which provides:

169 Offences by corporations

6 The operation of s 169 of that Act was discussed by Jagot J in Environment Protection Authority v Hogan [2008] NSWLEC 125 at [12]-[13]:

[12] … it was apparent from the defendant’s submissions that the defendant believed his liability should be limited to trucks that he knew were entering the waste facility on and from 12 May 2006 and should have known were not carrying VENM. This involves a serious misunderstanding of the environmental compliance requirements of the POEO Act. Those who are directors of or accept management positions in corporations carrying out a scheduled activity under an environmental protection licence thereby accept important and onerous responsibilities. The statutory scheme is obviously directed at ensuring that such people personally ensure that the corporation in which they carry out their directorial or management activities has in place the required systems to avoid breaches of environmental laws. Under s 169, if the corporation breaches the POEO Act, then each person who is a director of the corporation or who is concerned in the management of the corporation is taken to have contravened the same provision unless the person can establish that they were not in a position to influence the conduct of the corporation in relation to its contravention of the provision or were in such a position but used all due diligence to prevent the contravention by the corporation. The defence of a contravention by a person without “the knowledge actual, imputed or constructive of the person” was repealed from 1 May 2006 (by the Protection of the Environment Operations Amendment Act 2005) and required a defendant to prove the lack of all three classes of knowledge. Mere lack of actual knowledge was never a defence for directors or persons concerned in management. Further, the offence created by s 144 of the POEO Act is a strict liability offence and thus knowledge is not an element of that offence.

7 Thus the defendant cannot reduce his culpability by suggesting, as he does, that he left the day-to-day operation of the site to other staff members.

Factual Background and Evidence

8 Save where otherwise indicated, the facts relating to the commission of the offences were agreed and were contained in a Statement of Agreed Facts and an Agreed Bundle of Documents tendered in relation to both offences. The prosecutor also relied on a photo taken at the site of the smouldering waste.

9 At all material times, the defendant was a director of Kari & Ghossayn Pty Ltd (“K&G”). K&G was the occupier and operated a waste facility receiving mainly building and demolition waste on the site. The company had operated this facility since approximately 1981.

10 The site is located in a predominantly rural area, however, there were some residential properties in the nearby vicinity, including on Clifton Avenue to the east of the site.

11 Whilst the defendant had a role in the management of K&G’s waste operation at the site, he was not involved in the daily running of the waste operations and had employed a full-time manager, Mr Elias Saab (“Mr Saab”), to undertake this role.

12 On 15 October 2004, the prosecutor granted an environmental protection licence no. 4581 to K&G pursuant to s 55 of the POEOA (“the Licence”). The Licence was subject to a number of conditions. In particular, the Licence authorised the carrying out of “scheduled activities” (as defined in the POEOA) at the site described in the licence as including “waste facilities – solid waste land”.

13 A Douglas Partners Pty Ltd report commissioned by the defendant and his company entitled Report on Design of Leachate Collection System dated November 2005 was tendered. The report set out the design and construction specifications for a leachate collection system to ensure that the site had a barrier to protect environmental quality and that there were no adverse impacts on existing and future development.

14 Evidence was given by the defendant who additionally relied upon a number of character references from persons who were aware of the charges and who nevertheless attested to his good standing in the local community.

15 The defendant also relied upon an affidavit of Mr John Sabat, a plumber, whose evidence is discussed further below.

Proceedings No. 50037 of 2008 (s 126 offence)

16 The charge period for this offence runs from 13 March to 24 May 2007. However, prior to the charge period, K&G allowed waste to be stockpiled at the northern end of the site. In December 2006, the prosecutor advised the defendant of the existence of smouldering sub-surface fires in this northern waste stockpile and invited submissions from K&G as to the measures it proposed to take to reduce the risk of fire on the site. The prosecutor did not receive a response from the defendant.

17 In January and February 2007, K&G received complaints from Mr & Mrs Maltese, the occupiers of an adjacent property at Clifton Avenue. The complaints related to smoke and odour emanating from the subject premises. Adjacent to the stockpile was a large pit referred to as landfill Cell 2A. The pit was constructed for the purpose of storing waste brought onto the premises. Due to delays in the completion of Cell 2A, waste was stockpiled for a period greater than planned.

18 On 13 March 2007, Ms Fox on behalf of the prosecutor attended the site in order to conduct an inspection. She observed that the stockpile contained smouldering sub-surface fires from which smoke could be seen emanating from three locations. The smoke had an unpleasant odour of burning plastic and wood. The smell of burning plastic and wood was detected by Ms Fox along Clifton Avenue and extended from the entrance of the site to about 10 m past its northern boundary.

19 On 21 March 2007, Ms Fox and Mr Stephen Beaman, also employed by the prosecutor, met with the defendant. During the meeting Mr Beaman said to the defendant:

There are still fires occurring in the 70,000 cubic metres of stockpiled waste outside the landfill Cell. Smoke and odour is being generated and it can be detected outside the premises.

I have six guys working at the landfill and I have dozers and watercarts why are there still fires at the waste?

20 On 23 March 2007, Ms Fox again attended the site in order to conduct an inspection. Again she observed smouldering sub-surface fires from which smoke could be seen emanating from two locations, the smoke having an unpleasant odour of burning plastic and wood. The smell of the burning plastic and burning wood was detected by Ms Fox along Clifton Avenue. Ms Fox advised Mr Saab of the existence of the two smouldering sub-surface fires prior to leaving the premises.

21 On 28 March 2007, Ms Fox met with the defendant at the site. An inspection was carried out during which Ms Fox pointed to two locations where smoke was emanating from smouldering sub-surface fires in the northern waste stockpile. In response the defendant stated: “I cannot see the fires”.

22 On 27 April 2007, Ms Molly Tregoning and Ms Deanne Pitts, officers employed by the prosecutor, attended the site to again conduct an inspection. No odour was detected outside the premises on this occasion. However, whilst there, white smoke was observed emanating from the stockpile and an intermittent smoky odour was detected.

23 On 1 May 2007, Ms Fox attended the site for an inspection and observed one smoulder which had the same unpleasant odour. Once again, the odour was detected by Ms Fox along Clifton Avenue.

24 On 24 May 2007, Ms Fox attended the site in order to conduct an inspection and observed smouldering sub-surface fires from which smoke emanated and which had the usual unpleasant odour. The odour could again be detected by Ms Fox along Clifton Avenue.

25 On 22 April 2007, K&G received a complaint from Mr Peter Maltese in relation to the smoke emanating from the subject premises and associated amenity impacts. This complaint was, in accordance with their obligations under the Licence, recorded in the company’s complaint log.

26 The smouldering sub-surface fires at, and the emanation of smoke from, the stockpile had several causes. These were as follows:

(a) waste self igniting due to the high organic load in the waste;

(b) K&G’s storage of waste in a stockpile, rather than within a properly constructed landfill cell where waste is properly compacted;

(c) inadequate application of virgin excavated natural material or similar cover material on top of the stockpile, which is a recognised means of minimising risk of fires; and

(i) reduce the existence of voids which allow oxygen to fuel the fire and reduce rainfall infiltration; and

27 The stockpile had an approximate volume of between about 71,500 m3 and about 78,000 m3 of waste. The waste consisted primarily of mixed building and demolition materials in the nature of bricks, concrete, wood, vegetation, plastic, paper, cardboard, soil and asbestos. The stockpile also contained small amounts of shale and clay which had been dug out of the ground to create landfill Cell 2A.

28 It was agreed by the parties that the small smouldering sub-surface fires burned in the stockpile continuously throughout the charge period. As a result of the fire, smoke also emanated from the northern stockpile continuously. The smoke had an odour of burning plastic and burning wood.

Proceedings No. 50038 of 2008 (offence pursuant to s 144)

29 On 8 December 2006, a notice of intention to suspend the Licence was served upon K&G. The notice related to unpaid waste contributions pursuant to s 88 of the POEOA. K&G acknowledged receipt of the notice by letter dated 7 December 2006, signed by the defendant in his capacity as Managing Director.

30 Following this correspondence, K&G made payments for the waste contributions in the sum of $101,823.58. However, as at 8 February 2007, a total of $117,820.03 in waste contributions remained outstanding. As a result, the prosecutor prepared a notice of suspension on 15 February 2007.

31 On 16 February 2007, the notice of suspension was served by the prosecutor on K&G. Condition 1 of the notice of suspension provided as follows:

any

32 On 16 February 2007 at approximately 3.00pm, Mr Beaman had a telephone conversation with the defendant with words spoken to the following effect:

Mr Beaman: George, do you understand that the EPA has suspended your licence. You are not lawfully able to accept any more waste at the landfill. Do you understand?

33 However, on 19 February 2007, Ms Fox observed a skip bin entering the site.

34 On 21 February 2007 at approximately 4.00pm, Mr Beaman had a telephone conversation with the defendant with words spoken to the following effect:

Mr Beaman: EPA officers have seen some of your skip bin trucks go into the landfill. This is not allowed. We also have weighbridge records that show more than 600 tonnes have gone into the landfill, while the licence has been suspended. You cannot use the landfill George. Do you understand?

35 Weighbridge records for the site disclose that between 16 February 2007 and 21 February 2007, about 57 truck loads of waste were disposed of at the site. This comprised of about 686 tonnes of waste. The waste deposited at the site during this period generally comprised of building, excavation and demolition waste. It included the deposit of the waste in the stockpile the subject of proceedings 50037 of 2008.

36 K&G received about $29,000 in fees for the waste that was deposited at the site during this period.

37 The notice of suspension has remained in place since it was served on K&G. No further waste contribution payments were made by K&G.

38 In June 2007, a receiver was appointed to K&G. K&G was placed in liquidation in December 2007 and was deregistered in July 2008. The site was sold to another waste operator in 2007 and a new licence has been granted to this operator.

39 The defendant participated in a record of interview with officers of the EPA on 5 March 2008 pursuant to s 212(2) of the POEOA.

Evidence of Mr John Sabat

40 Mr John Sabat deposed in his affidavit that he was a plumber who ran his own plumbing business and that he had been engaged by K&G to carry out plumbing services at the site.

41 The plumbing services involved the supply and installation of a leachate collection system. This involved installing a pump. The installation of the pump was initially delayed by rain in early 2007. The installation of the pump was delayed indefinitely when in early 2007 he was informed by the company’s electrician that the job required the installation of phase three power at Clifton Avenue by Integral Energy to enable work to commence. Mr Sabat, therefore, did not install a leachate collection system at the site.

Evidence of Mr Ghossayn

42 Mr Ghossayn deposed in his affidavit that he could not read or write English but that he could speak English proficiently. He emigrated to Australia from Lebanon in 1971.

43 In 1981 he established and became director of K&G. K&G was a large construction company that carried out demolition, removal and storage of waste and was involved in tunnelling and the construction of Westfield shopping centres.

44 Mr Ghossayn also established himself as director of the following Australian companies: Ghossayn Constructions Pty Limited; Cheap & Quick Waste Bins Pty Limited; Ghossayn International Trading Pty Limited; Salmoussa Pty Limited; G Ghossayn Building and Construction Pty Limited; Berradawn Pty Limited; Magic Glow Pty Limited and Ghossayn Group Pty Limited.

45 Mr Ghossayn deposed to numerous awards and commendations for his work in the Australian community and in Lebanon over the past 19 years.

46 Mr Ghossayn deposed to the fact that he had no prior convictions for environmental offences notwithstanding a long history of running waste management facilities (approximately 25 to 30 years). This is a matter to which I will return later.

47 In relation to the operation of the site, Mr Ghossayn deposed that Mr Elias Saab, Quarry and Waste Manager, ran the site full-time together with a crew. It was Mr Saab’s responsibility to look after the site on a daily basis and to deal with all safety issues.

48 Mr Ghossayn stated that the times when he would visit the site would vary. Sometimes he would see the site twice in one week and other times he would not visit the site for a month. The frequency with which he visited the site varied depending on his financial responsibilities and commitments as a director of K&G and his other companies.

49 Mr Ghossayn stated that at the end of 2006 the company began to experience financial difficulties. This necessitated frequent travelling between Melbourne and Sydney with less opportunity to visit the site.

50 In relation to the pollution offence, Mr Ghossayn stated that he had previously employed an environmental engineer, Mr Senthil Kumar, who was overseeing the construction of Cell 2A for the disposal of waste at the northern end of the site. With Mr Kumar working on the site Mr Ghossayn thought it would take approximately six months to one year to complete the cell provided that no delays occurred. However, delays in fact resulted in the non completion of the cell due to inclement weather and the requirement to install phase three power. Mr Ghossayn said he did not know that the company required phase three power for the installation of the leachate collection system until late 2006 when Mr Michael Sabat informed him that this was necessary.

51 In November 2006, Mr Kumar’s employment with the company ended and Mr Sabat was made responsible for the construction of the new cell. Significantly, at this stage Mr Ghossayn was aware that there was a “reasonably big sized stockpile by then”.

52 Mr Ghossayn deposed that he did not foresee the northern waste stockpile becoming so large. Moreover, he did not think that the stockpile would cause any potential hazards and assumed that if there was any likelihood of a potential hazard that the Environment Protection Authority (“EPA”) would raise it with him. Mr Ghossayn stated that he never realised that Cell 2A would never be completed.

53 Mr Ghossayn stated that from the date the company commenced business there has never been a major pollution event, sub-surface fire or even surface fire event at the site. Mr Ghossayn complained that there was no guidance or suggestions given to him by the EPA other than the measures that he had been implementing at the site to stop the sub-surface fires from occurring.

54 Mr Ghossayn deposed that from March to June 2007 he had instructed all of his employees at the site to take immediate action in relation to any emissions from the stockpile. This included bringing to the attention of Mr Saab the EPA’s concerns about the smoke and fires from the stockpile. Mr Ghossayn said that as far as he was aware his employees performed these tasks.

55 The measures that he had implemented at the site to control the emissions included: inspections three to four times a day; the use of excavators; the use of water carts; a water tanker and a dowser; sprinklers installed where the water cart could not get access to spray water; digging and pushing dirt onto the stockpile; the use of bulldozers; the use of trucks and the application of virgin excavation material.

56 Mr Ghossayn said that he believed he was doing everything in his power to try to stop the emissions from occurring. Mr Ghossayn also stated that on three occasions he had put pressure on Mr Saab to cover the site with virgin fill. There was no reason not to cover the site and he did not understand why it had not occurred.

57 Mr Ghossayn further stated that there was one complaint from Mr and Mrs Maltese and that Mr Ghossayn had telephoned Mrs Maltese and painted her house as a consequence of the complaint. Mr Ghossayn noted that there were other neighbours across the road from the site who had not complained.

58 Mr Ghossayn stated that he spoke to the EPA frequently at the end of 2006 and towards early 2007 in relation to the payment of the company’s levies and that he had told the EPA how serious the cash flow problem of the company was. Mr Ghossayn stated that he tried to organise finance in order to pay the outstanding contributions but was unsuccessful when his business partner, Mr George Kari, refused to sign guarantees for further financial assistance.

59 Mr Ghossayn stated that he did not understand the seriousness or urgency of the notice of suspension received from the EPA dated 15 February 2007. Mr Ghossayn suggested that the notice would have been received and read by Ms Marta Kazzi, his receptionist at the head office and passed onto Ms Marian Wang. Mr Ghossayn stated that he believed that Ms Wang may have filed the notice after she received it and had not brought it to the immediate attention of Mr Saab, as instructed by Mr Ghossayn. Further, he stated that on 21 February 2007, Mr Ghossayn instructed Mr Saab not to accept any further waste onto the site. Mr Saab appeared to understand this instruction. Mr Ghossayn said it was not his intention to allow waste to be accepted at the premises after the notice of suspension had been served.

60 Mr Ghossayn said that after the new receiver was appointed in June 2007, he kept several staff present at the site to ensure that there were no further fires and that the waste was secure. Mr Ghossayn said that it cost him between $11,000 and $12,000 per week to keep the staff at the site during this period.

61 Under cross examination Mr Ghossayn admitted that it was he who made the “big decisions” about the company and that it was he who was the face of K&G. Mr Ghossayn also conceded that he was very experienced in relation to waste management facilities and landfills.

62 Initially Mr Ghossayn said that he believed that Cell 1 had ceased to operate by the time the company was in financial difficulty in late 2006. Mr Ghossayn rejected the assessment by Douglas Partners in the November 2005 report that Cell 1 had been capped and was completed by November 2005. This was because Cell 1 was very large and depending on how you measured it there was variation in the time estimate as to when the cell had been completed. Ultimately, Mr Ghossayn conceded that it was when landfill Cell 1 was capped in early 2006 that landfill began to be deposited next to Cell 2A.

63 Mr Ghossayn further conceded that he should not have received any further waste once Cell 1 was full. But he stated that he could not do this because he needed the money from the receipt of the waste to keep the company going as a financial concern.

64 Mr Ghossayn said that to stockpile waste cost the company money because further expense was incurred by moving waste from Cell 1 to Cell 2A.

65 With respect to the relationship between Mr Ghossayn and Mr Saab, Mr Ghossayn said that Mr Saab had been employed by him for a long time and that he knew him well. Mr Ghossayn stated that he did not know what qualifications Mr Saab had but that he knew that he was not an engineer. Mr Ghossayn stated that Mr Saab had authority to spend money at the site on the company’s behalf but that for large items of expenditure, Mr Saab had to obtain prior authorisation from Mr Ghossayn. Mr Ghossayn said he did not know where Mr Saab was now.

66 Mr Ghossayn stated that by contrast Mr Kumar, who was overseeing the construction of Cell 2A prior to the cessation of his employment in November 2006, was an environmental engineer. Mr Ghossayn stated that he had been looking for an environmental engineer to replace Mr Kumar but that he could not find anyone. Mr Ghossayn said that in any event Mr Saab had been involved in the construction of Cell 2A from day one with Mr Kumar.

67 Mr Ghossayn told Mr Saab that it was his responsibility to look after the sub-surface fires and smoke. Mr Ghossayn said that he showed Mr Saab how to extinguish the fires and went to the site for approximately five or six hours to demonstrate what to do. Mr Ghossayn said that because they were only sub-surface fires he did not seek any expert advice in relation to their extinguishment.

68 Finally, Mr Ghossayn conceded that he should have started digging Cell 2A before Cell 1 was full. Mr Ghossayn stated that he had started digging Cell 2A before November 2005 and that had it gone according to plan, the cell would have been finished within six months to a year.

Overview of Prosecutor’s Case

69 In summary, the prosecutor submitted the following:

(a) first, that Mr Ghossayn had, from the outset, sought to blame others for the acts and omissions which caused environmental harm;

(b) second, that insufficient planning had taken place to ensure that the pollution did not occur. In particular, that a scheme was not implemented prior to Cell 1 becoming full to ensure that Cell 2A was completed thereby avoiding the stockpiling of waste;

(c) third, that insufficient practical measures had been put into effect by Mr Ghossayn to avoid the environmental harm. The reason why was because to do so would have resulted in financial detriment to the company;

(d) fourth, that while the environmental harm caused by the commission of the offences was relatively minimal, it was the harm to the regulatory regime that was the real issue; and

Overview of the Defendant’s Case

70 The defendant’s submissions may be summarised as follows:

(a) first, there was no plan by the defendant to allow the stockpile to occur, rather it was a matter of accident inasmuch as Cell 2A was not completed before Cell 1 was full;

(b) second, there was ample uncontested evidence that Mr Ghossayn attempted to deal with the environmental issues the subject of these proceedings and that he took his responsibilities very seriously;

(c) third, that he had delegated the work to, in particular, Mr Saab, who had not complied with various instructions and requests;

(d) fourth, that there had been only one complaint during the charge period in relation to the odour and that the sub-surface fires were relatively minimal; and

Sentencing Considerations

71 The purposes of sentencing are set out in s 3A of the Crimes (Sentencing Procedure) Act 1999 (“CSPA”) as follows:

3A Purposes of sentencing

The purposes for which a court may impose a sentence on an offender are as follows:

72 Sections 21A(2) and (3) of that Act list aggravating and mitigating factors which the Court is required to take into account in determining the appropriate sentence. The aggravating factors are largely inapplicable in the present case. However, a number of mitigating factors are applicable.

73 Further, s 241 of the POEOA requires the Court to consider the following additional matters to the extent that they are relevant:

241 Matters to be considered in imposing penalty

74 The sentence must reflect both the objective and subjective circumstances of the offence (Veen v The Queen (1979) 143 CLR 458 at [490]). The penalty should be determined by an instinctive synthesis of all the relevant objective and subjective circumstances (Markarian v The Queen (2005) 228 CLR 357 at [37]-[39], [56] and [73]).

75 The sentence of the Court is a public denunciation of the conduct of the offender. It must ensure that the offender is held accountable for his or her actions and is adequately punished.

76 The sentence must also deter the offender from committing a similar offence in the future (Director-General of the Department of Environment and Climate Change v Rae [2009] NSWLEC 137 at [8]). Moreover, the sentence of the Court needs to operate as a “powerful factor” in preventing the commission of similar offences by persons who may be tempted to do so (Rae at [9]).

Objective Gravity of Offence

77 There are two components to the assessment of the objective gravity of an offence. These were summarised by Biscoe J in Environment Protection Authority v Fulton HoganPty Ltd [2008] 163 LGERA 345 at [138]:

R v Carroll

Hoare v The Queen

R v McNaughton

Bentley v BGP Properties Pty Ltd

R v McNaughton

R v Whyte

Environment Protection Authority v Waste Recycling and Processing Corporation

R v Dodd

Veen (No 2)

Maximum Penalty

78 The maximum statutory penalty is of considerable significance in determining the objective gravity of the offence. In Camilleri's Stock Feeds Pty Ltd v Environment Protection Authority (1993) 32 NSWLR 683 at 698 it was stated that:

the maximum penalty available for an offence reflects the "public expression" by parliament of the seriousness of the offence ...

79 In Markarian at [31], the High Court unequivocally referred to the need to have regard to the maximum penalty as a legislative yardstick to enable comparison between the worst possible case and that currently before the court.

80 The maximum penalty is an expression by the legislative of the seriousness of the offence (Camilleri’s at 698; Director of Public Prosecutions (Cth) v Said Khodor El Karhani (1990) 21 NSWLR 370 at 380). The seriousness of an offence under ss 126 (see s 132 of the POEOA) and 144 of the POEOA is reflected in the maximum penalty for individuals which is $250,000.

Nature of the Offences Having Regard to the Objects of the Legislation

81 In determining the objective seriousness of the offence, the Court may take into account the objects of the legislation which have been breached (Bentley v BGP Properties Pty Ltd (2006) 145 LGERA 234 at [168]-[172]).

82 The objects of the POEOA relevantly include the following contained in s 3(a), (d), (e) and (g):

3 Objects of Act

The objects of this Act are as follows:

(a) to protect, restore and enhance the quality of the environment in New South Wales, having regard to the need to maintain ecologically sustainable development,

…

(e) to rationalise, simplify and strengthen the regulatory framework for environment protection,

…

Waste Avoidance and Resource Recovery Act

83 The objectives of the Waste Avoidance and Resource Recovery Act 2001 relevantly include at s 3(a) and (e):

(a) to encourage the most efficient use of resources and to reduce environmental harm in accordance with the principles of ecologically sustainable development

…

84 It is clear that Mr Ghossayn has acted in a manner that compromises the object of this Act and the POEOA in failing to protect the quality of the environment by permitting a stockpile of waste to accumulate, including after a notice of suspension was served, thereby resulting in sub-surface fires and malodorous emissions.

85 Mr Ghossayn submits that these objects have not been greatly compromised by the commission of the offences having regard to the fact that only minor harm resulted. While this may be so, I accept the prosecutor’s submission that in committing the offences the defendant has failed to assume the appropriate level of responsibility in relation to dealing with waste in accordance with the community’s expectations. In so doing he has caused harm not only to the environment but harm to the regulatory regime.

Extent of Environmental Harm

86 The objective gravity of the offence is measured in part by whether there has been any actual environmental harm and if so, its degree of seriousness (s 241(1)(a) of the POEOA). Usually the more serious the environmental harm, the higher the penalty (Camilleri’s at 701 and Fulton Hogan at [148]).

87 It was not seriously in dispute that the offences caused environmental harm in that they had the effect of degrading the environment and resulted in “air pollution” as that term is defined in the POEOA (see also Environment Protection Authority v Coastal Recycled Cooking Oils Pty Limited [2008] NSWLEC 242 at [14]).

88 In the present case, in relation to the s 126 offence the level of environmental harm was assessed as low by both the prosecutor and the defendant. Although overall, there was potential for greater environmental harm based on the evidence before the Court I accept the submission that the actual harm was relatively low subject to one qualification. The qualification is that the harm was of sizable duration, persisting for approximately ten weeks. This augments the seriousness of the offence. So too does the fact that the harm impacted upon third persons, namely Mr and Mrs Maltese, living close to the site who complained about the odour emanating from it.

89 In relation to the s 144 offence, the defendant submits that no actual or potential harm was caused by the unauthorised use of the land as a waste facility for the five days from 16 to 21 February 2007. This was because the suspension notice was issued not for a breach of its licence, but merely for the non-payment of s 88 contributions required under the POEOA. Furthermore, none of the waste deposited during this time period was hazardous in nature.

90 While there is some force in this submission, it overlooks the fact the acceptance of further waste onto the site during the suspension period contributed to the stockpile and thus indirectly assisted in the commission of the s 126 offence. However, I accept that overall minimal environmental harm was caused by the commission of this offence. This reduces the objective gravity of the offence.

State of Mind of Offender

91 An offence against ss 126 or 144 of the POEOA is a strict liability offence and therefore mens rea is not an element of it (Pittwater Council v Scahill (2009) 165 LGERA 289 at [69]). Nevertheless the state of mind of an offender at the time of the offence is relevant insofar as it can have the effect of increasing or decreasing the seriousness of the crime. Thus a strict liability offence that is committed intentionally or recklessly is objectively more serious than one which is committed unintentionally (Scahill at [69] and Fulton Hogan at [172]).

92 I find that Mr Ghossayn did not intend the commission of either offence. I make this finding in relation to the offence committed pursuant to s 144 in particular, on the basis that notwithstanding that Mr Ghossayn knew that he was not to accept anymore waste onto the site, the unchallenged evidence of the defendant was that he requested Ms Wang to notify Mr Saab about the suspension notice but that his instructions in this regard were not executed.

Practical Measures

93 A factor which bears on the objective gravity of an offence is the practical measures that may be taken to prevent, control, abate or mitigate the harm to the environment (Axer Pty Ltd v Environment Protection Authority (1993) 113 LGERA 357 at 359 and s 241(1)(b) of the POEOA). The prosecutor submits that there were simple practical measures that Mr Ghossayn could and should have taken. These include:

(a) providing for the completion of Cell 2A prior to Cell 1 being capped;

(b) planning ahead in the design and approval of a leachate system in anticipation of the capping of Cell 1 in early 2006;

(c) ensuring that his instructions to the employees of K&G were adhered to regarding the application of virgin excavated natural material to the waste stockpile and other steps to take in order to reduce the risk of sub-surface fires developing;

(d) not accepting any further waste onto the site; or

94 Mr Ghossayn submits that he did have a system in place but that unforeseen events caused it to fail. He submitted, first, that by November 2005 he had a leachate design report commissioned and completed by Douglas Partners. Second, he employed an environmental engineer when Cell 2A was conceived and construction commenced. Third, he had sought to replace that environmental engineer when his employment with K&G ceased but was unable to do so. And, fourth, inclement weather, problems with the electrical supply and other matters beyond his control caused Cell 2A not to be completed as planned.

95 While I accept that Mr Ghossayn did not envisage the delay or the non completion of Cell 2A, I nevertheless accept the prosecutor’s submissions that there were practical measures that could have been taken by him to avoid the harm. Because of the difficulties with the weather and the electrical supply, Mr Ghossayn should have had a plan in place that would permit flexibility due to unforeseen problems arising. He did not. His reliance on Mr Elias Saab cannot exculpate him in this regard. Moreover, once it became apparent that Cell 2A would not be completed before Cell 1 was full he should have instructed that less (or no) waste be accepted onto the site to avoid stockpiling.

Foreseeability of Risk of Harm

96 A factor bearing on the objective gravity of the offence is the extent to which the offender could reasonably have foreseen the harm caused or likely to be caused to the environment by the commission of the offences (s 241(1)(c) of the POEOA).

97 In relation to the s 126 offence, Mr Ghossayn deposes that he did not foresee the northern waste pile becoming so huge, he did not foresee the construction delays and that he did not foresee that sub-surface fires would result. He additionally stated that he “did not think” that the stockpile was hazardous and that if it was, the EPA would have raised the matter with him.

98 Mr Ghossayn argued that because stockpiling was not part of the business of the company, the stockpile was unplanned and that neither the odour nor the fires were foreseeable. Indeed, Mr Ghossayn said that he was led to believe by various experts that any problems relating to odour and fire were not likely. Mr Ghossayn relied on the fact that there was only one complaint by Mr and Mrs Maltese as evidence of the unforeseeability of the odour.

99 In my view, Mr Ghossayn could, and should reasonably, have foreseen that the failure to complete the construction of Cell 2A in a timely fashion, whilst still receiving waste material onto the site after Cell 1 was capped, would result in a stockpile being created that could not be managed and which could cause problems of the type the subject matter of these proceedings. Any belief to the contrary was, in my view, unreasonable.

100 This conclusion is based on:

(a) the fact that before the charge period complaints were made to the defendant concerning the smoke and odour emanating from the site;

(b) the fact that the defendant was put on notice during the charge period as to the existence of the fires as a consequence of discussions as to the very harm that was caused as a result of the s 126 offence, that took place between himself and the prosecutor both prior to and during the commission of that offence; and

101 It was likewise foreseeable that unless adequate measures were instituted to ensure proper communication of instructions occurred, the fact of the service of the notice of suspension would not be made known to Mr Saab thereby resulting in waste unlawfully being received onto the site.

Control Over the Causes

102 A factor bearing on the objective gravity of the offence is the extent to which the offender had control over the causes that gave rise to the offence (s 241(1)(d) of the POEOA). While Mr Ghossayn conceded that he was the face of the company and the director who made all the significant decisions on behalf of the company, Mr Ghossayn sought to blame his staff, in particular Mr Saab (who Mr Ghossayn knew had no engineering qualifications) for the commission of the offences by not following instructions. Mr Saab was not called as a witness in the proceedings.

103 This explanation is inadequate. It was Mr Ghossayn who, as director of K&G, had at all relevant times control of the company and over the causes giving rise to the offences. It was he who was responsible for the implementation of effective controls to prevent pollution. It was he who had an obligation to ensure that fires did not start and that if they did, that they were promptly extinguished. It was also he who had an obligation to ensure that no odours escaped the site. In short, it was Mr Ghossayn who had the capacity to organise the company’s affairs to ensure that K&G did not contravene the POEOA. On the evidence before me, I find beyond reasonable doubt that Mr Ghossayn wielded this degree of control and that he failed to properly exercise it.

104 In relation to the offence committed pursuant to s 144 of the POEOA, the defendant states that he did not understand the seriousness or urgency of the suspension notice. This is inconsistent with the statement he made to Ms Wang when he received the notice, namely, to “tell Elias about this. Take action immediately”. I find beyond reasonable doubt that the defendant did appreciate the effect and degree of urgency explicit in the notice. It is he who must accept responsibility for K&G continuing to accept waste at the site up until 21 February 2007.

Reasons for Commission of Offences

105 The objective seriousness of an offence may also be measured by reference to the reasons for its occurrence (Fulton Hogan at [170]). In Scahill Preston CJ stated that (at [80]-[81]):

[80] The criminality involved in the commission of an offence is to be measured not only by the seriousness of what actually occurred, but also by reference to the reasons of its occurrence: Axer Pty Ltd v Environmental Protection Authority (1993) 113 LGERA 357 at 366; Bentley v BGP Properties Pty Ltd at [237]; Gittany Constructions Pty Ltd v Sutherland Shire Council at [140] and Garrett v Williams (2006) 160 LGERA 115 at [120].

Garrett v Williams

106 As previously stated, I accept that there was no deliberate commission of the offences, rather the offences were caused by Mr Ghossayn’s poor organisation and planning. I also accept that Mr Ghossayn was commercially motivated by his desire to keep the company afloat.

107 Thus there was a financial imperative for the commission of the offences. Mr Ghossayn conceded as much when he stated to the Court that he could not refuse to accept any further waste pending the completion of Cell 2A because he needed the money. Had he done so, arguably neither ss 126 nor 144 would have been contravened. This factor increases the objective seriousness of the offences.

Conclusion on Objective Circumstances

108 Having regard to the objective factors present in this case, I conclude that the commission by Mr Ghossayn of the offences to be of relatively low objective seriousness.

Subjective Factors

109 A proportionate sentence requires the Court to take into account any personal or mitigating factors present (Gittany Constructions Pty Ltd v Sutherland Shire Council (2006) 145 LGERA 189 at [144] and the authorities cited thereat).

110 The evidence discloses mitigating factors that the Court must take into account in determining the appropriate penalty (s 21A(3) of the CSPA).

111 The subjective circumstances of Mr Ghossayn to be considered include:

(a) any prior criminal record;

(b) the plea of guilty;

(c) any contrition and remorse;

(d) any cooperation with regulatory authorities; and

Prior Good Character

112 Mr Ghossayn’s lack of prior convictions and general good standing in the community are acknowledged and are mitigating factors (s 21A(3)(e) and (f) of the CSPA and Fulton Hogan at [184]).

113 However, K&G has been somewhat less laudable in fulfilling its corporate environmental obligations. In particular, K&G has been convicted of three offences for breaches of s 76(1)(a) of the Environmental Planning and Assessment Act 1979 (due to the removal of vegetation from a development site in contravention of its consent: see Kari & Ghossayn Pty Limited v Sutherland Shire Council (2006) 150 LGERA 231).

114 An issue therefore arises as to what extent I can take into account the fact that K&G does not have a blemish free environmental history given that it is not the defendant in these proceedings. Unsurprisingly, Mr Ghossayn submits that I cannot take these earlier convictions into account. The prosecutor submits that I can, having regard to the defendant’s source of liability under s 169 of the POEOA. That is to say, the defendant’s source of liability with respect to the offences arises directly as a result of his capacity as a director of K&G. However, the prosecutor concedes, correctly in my view, that these earlier convictions cannot found a factor in aggravation pursuant to s 21A(2)(d) of the CSPA.

115 I accept the prosecutor’s submissions as to the relevance of K&G’s antecedents having regard to the nature of the defendant’s liability pursuant to s 169 of the POEOA. It would be somewhat artificial, if not misleading, for the defendant to put himself forward as being a person of impeccable character when the company of which he is a director and which has committed the offences for which he is deemed liable, is not. It was not suggested by Mr Ghossayn that he was not a director of K&G at the time the earlier offences were committed or that he had no knowledge of their commission at the time.

Plea of Guilty

116 Mr Ghossayn’s plea of guilty is a mitigating factor (ss 21A(3)(k) and 22 of the CSPA). It was not entered at the earliest possible opportunity but was entered on the sixth mention before the Court. The prosecution agreed, though, that it was entered immediately after negotiations had concluded between the defendant and the prosecutor as to the entry of a plea.

117 In not pleading guilty on the first mention date the utilitarian value of the plea was diminished but not by a material degree (see Rae at [58]-[64] and the authorities cited at [61]). Accordingly, in my view, the defendant is not entitled to the full 25 per cent discount for its early plea of guilty, however, only a modest reduction of the full discount is warranted. I therefore find a discount of 22 per cent is appropriate in all the circumstances.

Contrition

118 Remorse is a mitigating factor to be taken into account (s 21A(3)(i) of the CSPA). Mr Ghossayn has expressed remorse which demonstrates some insight into how he came to offend. However, to the extent that Mr Ghossayn has not wholly accepted responsibility for his actions insofar as he has sought to blame others for the commission of the offences – in particular Mr Saab, Mr Kumar, Ms Wang, Mr and Mrs Maltese, Integral Energy and even the prosecutor – this derogates from the contrition that he has expressed for the commission of the offences.

119 Thus while I find that the defendant has indicated his contrition, I do not accord this factor full weight for the reasons given above.

120 Likewise, while this factor also makes it less likely that the defendant will re-offend in the future (s 21A(3)(g) of the CSPA), I cannot discount this possibility entirely in light of Mr Ghossayn’s lack of insight into how and why the offences were committed.

Cooperation with Authorities

121 Mr Ghossayn has cooperated with the authorities but not to the fullest extent possible. For example, while he participated in a record of interview with the prosecuting authority, the interview took place under force of statutory compulsion pursuant to s 212(2) of the POEOA.

122 Furthermore, to the extent that he seeks to rely by way of cooperation on his employment of staff to maintain the site after the receiver was appointed, I accept the submissions of the prosecutor that this was no more than what Mr Ghossayn was obliged to do in performance of his obligations under the notice of suspension. In these circumstances this act cannot be truly characterised as cooperation with the authorities.

123 Consequently, I do not give full weight to this factor.

Capacity to Pay Fines

124 Turning to the financial position of the defendant, there was no suggestion that Mr Ghossayn would not be in a position to pay any fine imposed on him (see s 6 of the Fines Act 1996).

Payment of the Prosecutor’s Costs

125 The defendant has agreed to pay the costs of the prosecutor fixed in the sum of $40,000. The payment of these costs is an aspect of his punishment (Environment Protection Authority v Barnes [2006] NSWCCA 246 at [78]) and is a relevant factor in determining penalty.

Only Mr Ghossayn is Prosecuted

126 The defendant submitted that the fact that Mr Ghossayn is the only director of K&G who was prosecuted, and not Mr Kari, is a factor in mitigation. In support of this submission he relied on the decision in R v Kerr [2003] NSWCCA 234 and its articulation of the ‘parity principle’ at [19].

127 In response, the prosecutor proffered the decision of PHAM v R [2009] NSWCCA 25 at [31]-[38] where Latham J sought to circumscribe the limits of Kerr, an authority which her Honour described as applicable only “in a very limited class of case” (at [36] with whom Giles JA at [1] and Mathews AJ at [53] agreed).

128 Kerr involved the application of the parity principle in relation to co-offenders charged with different offences. There the Court stated that an injustice may result where one co-offender is charged with a serious offence and given a punishment greatly in excess of that imposed on another co-offender who is charged with a less serious offence (at [19]-[20]).

129 The facts of that case diverge significantly from those before me, concerning as they did three co-offenders involved in a robbery who were charged with different offences of varying severity.

130 By contrast in PHAM, after making the observation quoted above, Latham J was at pains to stress that “it could not be seriously argued that a person should receive a reduction in sentence because a co-offender is not charged or where, for some reason, the charge does not proceed” (at [36]). Her Honour went on to say that “if such disquiet does arise, it is a result of the prosecutor’s actions and not the sentences imposed by the court” (at [37]).

131 There being no basis for an inquiry into the prosecutorial discretion exercised in the present case, I do not see any reason for taking into consideration the fact that only Mr Ghossayn, and not Mr Kari, was charged with the offences. The type of injustice raised by the Court in Kerr is not, in my opinion, enlivened in these proceedings.

Conclusion as to Subjective Circumstances

132 The subjective circumstances of the defendant mitigate the sentence that is to be imposed for each offence.

General Deterrence

133 The purposes for which a court may impose a sentence include deterring others from committing similar offences (s 3A(b) CSPA). In Bentley (at [139]-[140]) Preston CJ said in relation to general deterrence that (see also Axer at 359 and Fulton Hogan at [189]):

[139] The sentence must serve the purpose of general or public deterrence. It is the duty of the Court to see that the sentence which is imposed will operate as a powerful factor in preventing the commission of similar crimes by those who might otherwise be tempted by the prospect that only light punishment will be imposed: R v Rushby [1977] 1 NSWLR 594 at 597-598.

Environment Protection Authority v Capdate Pty Ltd

Director General of National Parks and Wildlife v Wilkinson

134 Any fine needs to be large enough to make it worthwhile so that the cost of precautions is to be taken to outweigh any gains by not doing so and so as to not to appear a mere licence fee for illegal activity (Fulton Hogan at [190]).

135 Mr Ghossayn submits that only limited general deterrence is required having regard to the fact that the incident involved no dangerous or harmful materials, that it has not been established that any actual environmental harm occurred and that the impact on the amenity of the neighbourhood was low.

136 In my opinion, there is still a need for general deterrence in determining the appropriate penalty. This is to ensure that others who engage in waste disposal operations with potential air pollution consequences do so lawfully. It is also to ensure that suspension notices are strictly complied with.

Specific Deterrence

137 In Gittany the Court stated the following applicable principles in relation to specific deterrence as a component of an appropriate penalty for the offences (at [188]-[189]):

[188] In fixing the appropriate punishment for the offences, the Court needs to consider the purposes of sentences relevant to the offences in this case.

138 The purposes for which a Court may impose a sentence includes deterring the defendant from committing a similar offence in the future (s 3A(b) of the CSPA).

139 In relation to the s 126 offence, Mr Ghossayn submitted that there were extenuating circumstances surrounding the commission of the offence, namely, the delay in completing Cell 2A. In relation to the s 144 offence, Mr Ghossayn submitted that there was only about four days of waste taken after the relevant notice. Finally, in relation to both offences he submitted that it was costly for him to have a stockpile.

140 In respect of the practical measures that he could have taken in relation to the sub-surface fires, Mr Ghossayn submitted that there was no cross examination that he could have done anything more in this regard. On the contrary, he submitted, he did everything he could to avoid and eliminate them.

141 The defendant submitted that there needed to be some evidence enlivening the specific deterrence and in the present case there was none. In the alternative, the defendant submitted that the question of individual deterrence ought to be given very little weight as there was nothing to suggest that there was an ongoing problem with the defendant or the company, especially given the latter was in liquidation.

142 I am satisfied that individual deterrence remains a consideration in relation to Mr Ghossayn. First, while he has made some efforts to analyse and gain insight into his offending (he conceded that Cell 2A should have been finished earlier and that he was derelict in relation to timetabling), his propensity to blame others for the offences remains. Second, the defendant continues to participate in the operation and management of a number of other companies operating within the demolition, building, construction and waste industries. Specific deterrence is required to ensure that the defendant conducts the business of these companies without harm to the environment and in compliance with the regulatory regime.

Evenhandedness

143 A relevant consideration in sentencing is the ascertainment of the existence of a general pattern of sentencing by the courts for offences such as the offence in question (Gittany at [179]-[183]).

144 The proper approach is for the Court to look at (Gittany at [182]):

R v Morgan

Capral Aluminium Ltd v Workcover Authority of NSW

145 Of course care must be taken because each case is different and a sentence in one case does not demonstrate the limits of a sentencing judge’s discretion (Axer at 365 and CabonneShire Council v Environment Protection Authority (2001) 115 LGERA 304 at 312).

146 Consistency in sentencing is an important object in a rational and fair system of criminal justice (Markarian at 390). Regard should be had to comparable cases to see if they disclose a general pattern of sentencing (Camilleri’s at 701-702). However, sometimes it is difficult with environmental crimes to obtain guidance from decisions where sentences have been imposed for the same type of offence. This is because of the wide range of facts and circumstances comprising environmental offences and the need to tailor sentences to the individual circumstances of each case (Fulton Hogan at [197]).

147 Sentencing statistics for criminal matters dealt with by the Land and Environment Court are now available in graphical form on the Judicial Information Research System (‘JIRS’). I sought to obtain JIRS statistics but the sample was of such limited breadth that little utility could be gained from them (Dodds v R [2009] NSWCCA 191 at [4]).

Section 126 Offence

148 In relation to the s 126 offence, the prosecutor took the Court in detail to three decisions by way of comparison. First, the decision of Coastal Recycled Cooking Oils Pty Limited concerned two offences for contravening a condition to maintain and operate all plant and equipment installed at the premises in proper and efficient manner contained in the defendant company’s environmental protection licence. Pain J found that the odour resulting from the contravention was of limited duration in relation to both offences. For the March offence, a complaint was made at around 9.00am and the odour had dissipated by 1.00pm. For the May offence, the odour lasted for one and a half hours. In relation to both offences the defendant took prompt action to resolve the problem.

149 Pain J considered that the March offence warranted dismissal pursuant to the application of s 10 of the CSPA. Her Honour considered the offence trivial, the defendant was of good character, had worked to remedy the problems with its wastewater treatment system, including spending substantial amounts of money ($635,509.30) remedying the problems with the system, and there were extenuating circumstances in that an employee, who knew better, left the top off the balance tank after cleaning it. However, her Honour considered the second offence to be more serious. The odour was described by a neighbour as “absolutely putrid”. Nonetheless, her Honour found that there was minimal environmental impact and the defendant’s culpability was low. For the May offence, the Court considered that a penalty of $30,000 was appropriate, which was reduced to $18,000 in light of mitigating matters. The company was ordered to pay the $18,000 to an environmental project pursuant to s 250 of the POEOA (the maximum penalty was $1,000,000).

150 Second, in Environment Protection Authority v Burrangong Meat Processors Pty Ltd [2003] NSWLEC 102 the company, which operated an abattoir in Young, was charged with four offences. The first offence involved a breach of s 64(1) of the POEOA, namely, that it contravened a condition of its environmental protection licence in that it failed to operate its sewerage treatment system in a proper and efficient manner by overloading the system with effluent. This offence involved an excess of effluent being pumped through the system which produced offensive odours detectable in North Young. The other three offences involved a contravention of s 129(1) of the POEOA on the basis that the defendant was the occupier of premises at which a scheduled activity was carried out under the authority of a licence and which caused an offensive odour to emanate from the premises.

151 Pain J found that whilst there was no evidence of medical treatment being required, considerable discomfort was caused to the residents’ amenity by the harm, although it was not long lasting. Pain J considered that the defendant had a high level of culpability. There were practical measures available but which were not implemented in a context where the defendant increased production knowing the effluent system was inadequate. Her Honour also found that the offences were foreseeable (referring to the fact that some two years prior to the offences the defendant was or should have been aware of the problems caused by its operation). The factors in mitigation included an early plea of guilty and the defendant’s agreement to pay $930,000 to undertake works aimed at minimising pollution. Pain J considered that a penalty of $50,000 (the maximum penalty for each of the four offences was $250,000) was warranted for each offence, which was reduced having regard to mitigating matters and the totality principle as follows:

152 Third, in Environment Protection Authority v Caltex Refineries (NSW) Pty Limited [2006] NSWLEC 335 the defendant company operated a large fuel refinery at Kurnell. It was charged with causing air pollution contrary to s 124(b) of the POEOA between 17 and 21 October 2004. The offence involved the overflow of a tank which resulted in the overflow of a waste by product from the refinery, which had a rotten egg odour. A high level alarm system did not detect the overflow. As a result, black smoke was emitted from the refinery’s furnace. The smoke lasted nine minutes and action was taken immediately. Thirty one people made complaints, which included symptoms of nausea, headaches and diarrhoea. Since the incident, the defendant had taken action to ensure that it did not reoccur.

153 The Court found that while the harm was reasonably serious it was short term with no evidence of any long lasting impacts or that medical assistance was sought by any of the complainants. The Court found that there were practical measures which could have been taken to prevent the incident, the harm was foreseeable and that the defendant had inadequate risk assessment processes in place. The Court also took into account mitigating factors including an early guilty plea, the expression of contrition by the refinery’s manager, the defendant’s cooperation and that it responded quickly to the incident, cleaned up promptly and voluntarily implemented an environmental management system. The Court therefore considered a penalty of $110,000 was appropriate, which was reduced to $77,000 (the maximum penalty was $250,000).

154 The defendant submitted that the above decisions all concerned behaviour far more culpable than that engaged by himself and that an appropriate penalty ought to be less than that imposed in Coastal Recycled Cooking Oils.

155 While there is some merit in this submission, the evidence discloses significant points of distinction from Coastal Recycled Cooking Oils. First, in the present case, despite the one complaint during the charge period, the air pollution was more persistent; second, it cannot be said that the defendant took prompt action to resolve the problem of the emissions; and third, unlike Coastal Recycled Cooking Oils, the defendant had knowledge of the breach of s 126 while the contravention was occurring.

Section 144 Offence

156 In relation to the s 144 offence, the defendant looked at the criteria for s 10 of the CSPA, namely, the character of the offence and its triviality and submitted that the application of s 10 and the imposition of a bond would be suitable in the circumstances of the commission of the offence and would more adequately fulfil any need for specific deterrence.

157 In support, the defendant relied on the decision in Thorneloe v Filipowski (2001) 52 NSWLR 60 (at [146]-[158] and see the recent discussion in Filipowski v Hemina Holdings SA; Filipowski v Rajagopalan (No 2) [2009] NSWLEC 104 at [142]-[151]). In that case the Court of Criminal Appeal held that where there is a comparatively minor pollution by a first offender and where it is difficult to identify any effective step which the offender could have done that did not require virtual perfection, these considerations should be given weight in any application to have the charge dismissed under s 10 of the CSPA. The defendant argued that on the facts of the present case, he could not have taken any effective step absent perfection to avert the breach of s 144.

158 I disagree. It is true that, according to his evidence, Mr Ghossayn entrusted the task of communicating the notice of suspension to Mr Saab, to Ms Wang who did not carry out his instructions. However, not only were these persons employees of K&G, over whom the defendant had control (cf Environment Protection Authority v Werris Creek Coal Pty Ltd; Environment Protection Authority v Holley [2009] NSWLEC 124 at [142]), but because the defendant was aware of the urgency and seriousness of the notice it was beholden upon him to ensure that K&G’s staff complied with its contents. In short, the defendant should have been more vigilant in ensuring that no further waste was accepted onto the site.

159 Moreover, that waste was deposited after the service of the notice of suspension was not a singular event, unlike the pollution event which occurred in Filipowski (where the Master of a vessel was successfully prosecuted as a result of a small amount of oil discharged into the waters of Botany Bay caused by the failure of the chief officer to adequately monitor a faulty gauge during the loading of fuel). Rather, between 16 and 21 February 2007 approximately 57 truck loads of waste were disposed of at the site. This comprised approximately 686 tonnes of waste for which the defendant received $29,000. This constitutes, in my view, a more than “trivial” offence (s 10(3)(b) of the CSPA).

160 Furthermore, as discussed above, considerably less than perfection was required to ensure that the suspension notice was communicated to, and therefore complied with by Mr Saab. Accordingly, I do not consider that the facts surrounding the commission of the s 144 offence warrant the application of s 10 of the CSPA.

161 The prosecutor specifically referred the Court by way of comparison to the following three cases in respect of contraventions against s 144 of the POEOA. First, in Hogan Jagot J considered a fine of $20,000 to be appropriate, which was discounted to $18,000 in light of mitigating factors (the maximum penalty was $250,000). The case involved a contravention of s 144 of the POEOA by the defendant, as a person concerned with the management of a corporation, Riverstone Earthmoving, by virtue of s 169 of the POEOA. The defendant used land as a waste facility without lawful authority from 12 May to 21 June 2006 following a notice of suspension being issued by the EPA. Matters considered by Jagot J as relevant to sentence included:

(a) although the defendant was general manager of the corporation and concerned with its management, he had no financial interest in the corporation (the sole director and shareholder was another person);

(b) the defendant did have an interest in another company that was interested in buying the waste facility;

(c) the corporation had insufficient experience and resources to manage the waste facility in compliance with its legal requirements;

(d) the defendant and the director had too many responsibilities which contributed to a lack of systems and procedures capable of ensuring environmental compliance at the waste facility;

(e) the operation of the waste facility breached some of the more fundamental requirements of the licence (such as the nature and application of cover material and the quantity of tyres stored);

(f) after suspension of the licence, the corporation permitted trucks to enter and deposit waste on numerous occasions between 12 May and 21 June 2006; and

162 Jagot J found that the defendant knew about the suspension notice but did not take adequate steps to inform either himself or the employees that worked at the weighbridge about its requirements. Jagot J accepted that there was no actual environmental harm caused and that likely harm appeared limited to circumstances that prompted the issuing of the suspension notice rather than its contravention.

163 Second, in Eurobodalla Shire Council v Leth [2007] NSWLEC 599 Lloyd J considered a fine of $5,000 was appropriate, which he reduced to $2,500 taking into account mitigating factors (the maximum penalty was $120,000). The defendant had permitted the land to be used for the storage of waste without lawful authority by making his land available to a friend to store waste. No environmental harm was caused and no revenue was received from the breach.

164 Third, Environmental Protection Authority v Obaid [2005] NSWLEC 171 concerned four breaches of s 144(1) of the POEOA relating to the storage of used tyres at various sites in Sydney. Lloyd J considered the following penalties were appropriate prior to taking into account a discount for an early plea (the maximum penalty was $120,000):

(a) Rossmore site: $60,000 discounted to $39,000;

(b) Ingleburn site: $30,000 discounted to $19,500;

(c) Cecil Park site: $15,000 discounted to $9,750; and

(d) Riverstone site: $7,500 discounted to $4,875.

165 The sentencing considerations included:

(a) whilst there was no evidence of actual harm to the environment, the risks created by the stockpiling of large amounts of tyres on all of the sites were obvious and potentially catastrophic;

(b) there were practical measures that could have been taken, but the defendant did not take adequate steps to mitigate the harm;

(c) the likely harm was clearly foreseeable; and

166 In my view, the decision of Hogan is most analogous to the facts of the present case, particularly in light of the maximum penalty applicable in that case. The culpability of the defendant in Obaid was more serious than the culpability of the defendant in the present proceedings, while conversely, the culpability of the defendant in Leth was less than that of Mr Ghossayn.

Totality Principle

167 It was submitted by the parties that the totality principle should apply to the offences. I accept this submission. In Gittany the Court described this principle and its application as (at [196] and [200]):

196 The totality principle is a principle of sentencing which must be applied when sentencing an offender who has committed more than one offence. The court should consider questions of cumulation or concurrence as well as questions of totality. When reviewing the aggregate sentence, the Court must consider whether it is “just and appropriate” and reflects the total criminality before the court: see Mill v Queen (1988) 166 CLR 59 at 62-63; Pearce v The Queen (1988) 194 CLR 610 at [49]; R v Kalache (2000) 11 A Crim R 15 at [110], [180]; R v AEM [2002] NSWCCA 58 at [70]; and R v Bahsa (2003) 138 A Crim R 245 at [62], [63].

…

R v A

Pearce v The Queen

R v Wheeler

R v AEM

168 However, the Chief Judge went on to state that (at [199]):

R v Wheeler

Conclusion and Orders

169 Having regard to all the evidence, I find that the offences, while not trivial, fall at the lower end of the scale of the range of appropriate penalties available for both offences. I therefore consider that:

(a) in respect of the s 126 offence a penalty of $60,000 is imposed with a deduction of 30 per cent in recognition of the utilitarian value of the plea of guilty and the subjective factors of the defendant. Accordingly, a total penalty of $42,000 is to be imposed in respect this offence;

(b) in respect of the s 144 offence a penalty of $20,000 is imposed with a total deduction of 30 per cent in recognition of the utilitarian value of the plea of guilty and the subjective factors of the defendant. Accordingly, a total penalty of $14,000 is to be imposed in respect this offence; and

170 The orders of the Court are as follows:

(1) the defendant is convicted of the offences as charged;

(2) the defendant is fined the total sum of $51,000 for both offences;

(3) the defendant is to pay the prosecutor’s costs of the proceedings agreed in the sum of $40,000; and

(4) the exhibits are returned.

Citations

Environment Protection Authority v Ghossayn [2009] NSWLEC 181

Most Recent Citation

Cases Citing This Decision

11

Environment Protection Authority v Maules Creek Coal Pty Ltd (No 4) [2025] NSWLEC 92

Environmental Protection Authority v Bald Hill Quarry Pty Ltd [2024] NSWLEC 114

EPA v Ghossayn Group Pty Ltd [2023] NSWLEC 127

Cases Cited

34

Statutory Material Cited

3

Environment Protection Authority v Hogan [2008] NSWLEC 125

Veen v The Queen [1979] HCA 7

Markarian v The Queen [2005] HCA 25

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CITATION:	Environment Protection Authority v Ghossayn [2009] NSWLEC 181
PARTIES:	PROSECUTOR Environment Protection Authority DEFENDANT George Ghossayn
FILE NUMBER(S):	50037 of 2008; 50038 of 2008
CORAM:	Pepper J
KEY ISSUES:	PROSECUTION :- licenced waste facility - breach of s 126 of the Protection of the Environment Operations Act 1979 - guilty plea - air pollution - smouldering sub-surface fires and offensive odour - neighbouring property affected - sentencing considerations - defendant director with control over premises at all times - company with prior environmental convictions - only one director charged - forseeability of risk of harm - minimal environment harm - harm to regulatory regime - penalty PROSECUTION :- waste facility without lawful authority - breach of s 144 Protection of the Environment Operations Act 1979 - guilty plea - failure to pay waste contributions to council - notice of suspension of facility - breach of notice of suspension - waste continued to be accepted despite suspension - s 10 of the Crimes (Sentencing Procedure) Act 1999 not appropriate - penalty
LEGISLATION CITED:	Crimes (Sentencing Procedure) Act 1999 ss 3A, 10, 21A and 22 Protection of the Environment Operations Act 1997 ss 3, 55, 88, 132, 126, 144, 169, 212 and 241 Waste Avoidance and Resource Recovery Act 2001 s 3
CASES CITED:	Axer Pty Ltd v Environment Protection Authority (2001) 113 LGERA 357 Bentley v BGP Properties Pty Ltd (2006) 145 LGERA 234 Cabonne Shire Council v Environment Protection Authority (2001) 115 LGERA 304 Camilleri's Stock Feeds Pty Ltd v Environment Protection Authority (1993) 32 NSWLR 683 Director-General of the Department of Environment and Climate Change v Rae [2009] NSWLEC 137 Dodds v R [2009] NSWCCA 191 Director of Public Prosecutions (Cth) v Said Khodor El Karhani (1990) 21 NSWLR 370 Environment Protection Authority v Barnes [2006] NSWCCA 246 Environment Protection Authority v Burrangong Meat Processors Pty Ltd [2003] NSWLEC 102 Environment Protection Authority v Caltex Refineries (NSW) Pty Limited [2006] NSWLEC 335 Environment Protection Authority v Coastal Recycled Cooking Oils Pty Limited [2008] NSWLEC 242 Environment Protection Authority v Fulton Hogan Pty Ltd [2008] 163 LGERA 345 Environment Protection Authority v Hogan [2008] NSWLEC 125 Environment Protection Authority v Werris Creek Coal Pty Ltd; Environment Protection Authority v Holley [2009] NSWLEC 124 Environmental Protection Authority v Obaid [2005] NSWLEC 171 Eurobodalla Shire Council v Leth [2007] NSWLEC 599 Filipowski v Hemina Holdings SA; Filipowski v Rajagopalan (No 2) [2009] NSWLEC 104 Gittany Constructions Pty Ltd v Sutherland Shire Council (2006) 145 LGERA 189 Kari & Ghossayn Pty Limited v Sutherland Shire Council (2006) 150 LGERA 231 Markarian v The Queen (2005) 228 CLR 357 PHAM v R [2009] NSWCCA 25 Pittwater Council v Scahill (2009) 165 LGERA 289 R v Kerr [2003] NSWCCA 234 Thorneloe v Filipowski (2001) 52 NSWLR 60 Veen v The Queen (1979) 143 CLR 458
DATES OF HEARING:	19 May 2009
DATE OF JUDGMENT:	23 October 2009
LEGAL REPRESENTATIVES:	PROSECUTOR Mr P Brown (solicitor) SOLICITORS Department of Environment and Climate Change DEFENDANT Mr A Djemal SOLICITORS Lander & Rogers Lawyers