Environment Protection Authority v Ileowl
[2017] VSC 625
•13 October 2017
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
VALUATION, COMPENSATION AND PLANNING LIST
S CI 2016 03093
| ENVIRONMENT PROTECTION AUTHORITY | Applicant |
| v | |
| ILEOWL PTY LTD (ACN 002 478 266) | First respondent |
| and | |
| WODONGA CITY COUNCIL | Second respondent |
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JUDGE: | Bell J |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 8 March 2017 (written submissions 27 June and 22 September 2017) |
DATE OF JUDGMENT: | 13 October 2017 |
CASE MAY BE CITED AS: | Environment Protection Authority v Ileowl |
MEDIUM NEUTRAL CITATION: | [2017] VSC 625 |
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ENVIRONMENT PROTECTION – appeal – operation of proposed organic waste recycling and product manufacturing facility – order of Victorian Civil and Administrative Tribunal declaring that a works approval for facility was not required – whether issue related to interpretation or application of a planning scheme or use and development of land – whether VCAT had jurisdiction to determine issue – following successful mediation in the court, orders sought upholding appeal and declaring that VCAT did not have jurisdiction and that a works approval was not required for facility – whether orders would declare rights in relation to issues of jurisdiction and law – obligation of court to give independent consideration to issues before doing so – ‘interpretation’, ‘application’ – Victorian Civil and Administrative Tribunal Act 1998 (Vic) s 148(1), Planning and Environment Act 1987 (Vic) s 149A(1), Environment Protection Act 1970 (Vic) s 19A(1).
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APPEARANCES: | Counsel | Solicitors |
| For the applicant | Mr J Pizer QC with Ms J Lardner | Victorian Government Solicitor’s Office |
For the first respondent | Mr S Fiedler | Russell Kennedy |
| For the second respondent | No appearance | No appearance |
HIS HONOUR:
The first respondent (‘Ileowl’) operates an industrial facility at 219 and part 221 Whytes Road, Baranduda (‘the premises’). That facility includes:
(a)an organic waste recycling and product manufacturing process that produces compost or blends of compost and soil;
(b) retail product supply and sales; and
(c) a prescribed industrial waste storage and treatment facility.
The facility operates under several permits issued under the Planning and Environment Act1987 (Vic) and a licence issued under the Environment Protection Act 1970 (Vic).
Another permit issued under the Planning and Environment Act (No 28/2014) (‘the permit’) authorises Ileowl to construct ‘a building and ancillary works including silos and bio-filter units external to the building and internal fitout including pelletising plant and bagging plant’ (‘the development’).
Section 19A(1) of the Environment Protection Act requires the occupier of scheduled premises not to undertake works likely to cause certain adverse environmental consequences without first obtaining approval from the Environment Protection Authority, which is the applicant in this proceeding. It is common ground that the premises are such premises. Ileowl was (and is) of the view that this provision did not require it to obtain a works approval for the development. Under s 36D of the same Act, it therefore applied to the Victorian Civil and Administrative Tribunal for a declaration that a works approval was not required. That section allows a person to make application for a declaration ‘concerning any matter which may be the subject of an application’ to VCAT under the Act. VCAT dismissed that application upon the ground that it did not have jurisdiction to entertain it.[1]
[1]Ileowl Pty Ltd v Environment Protection Authority [2015] VCAT 1105 (31 July 2015) (Deputy President Dwyer).
Under section 149A(1)(a) of the Planning and Environment Act, Ileowl then applied to VCAT in a second and separate proceeding for the following declaration:
The EPA was not a referral authority for the purpose of clause 66 of the Wodonga Planning Scheme, more particularly clause 66.02-1, for planning permit application 28/2014 on the basis that a works approval in accordance with section 19A of the [Environment Protection Act] was required.
At all material times, Ileowl has acknowledged that the question sought to be determined in this second proceeding was whether it required a works approval under the Environment Protection Act for the development (having failed to have VCAT determine that question in the first proceeding brought under that Act).
The EPA was a party to the second proceeding. It contended that VCAT did not have jurisdiction to determine the application, and requested that the question of jurisdiction be dealt with at a preliminary hearing. VCAT refused that request. The question of jurisdiction was, however, determined at the final hearing of the proceeding. VCAT found that it had jurisdiction to entertain the application, and that it was appropriate to exercise its discretion to make the declaration sought.[2] By order, it determined that the application would be allowed and made the declaration (‘the order’).
[2]Ileowl Pty Ltd v Wodonga City Council [2016] VCAT 945 (6 July 2016) (Deputy President Gibson and Member Wilson).
Upon several grounds of error of law, in this court the EPA has sought leave to appeal and, if leave were granted, appeals under s 148(1)(b) of the Victorian Civil and Administrative Tribunal Act 1998 (Vic) against the order.
Arising out of a successful mediation in which the parties participated at the invitation of the court, EPA and Ileowl have invited the court to grant leave to appeal and uphold the appeal upon the ground that VCAT erred in law in determining that it had jurisdiction to make the declaration and order. They have also invited the court to declare that Ileowl is not required by s 19A(1) of the Environment Protection Act to obtain a works approval for the development and to grant leave to amend the originating motion accordingly.
Ileowl and the EPA have followed the provisions of para 8 of Practice Note SC CL 9 of the court in judicial review and appeal cases by providing joint memoranda explaining the legal justification of the proposed orders. As required in circumstances where the court on judicial review or appeal is required to determine whether or not the exercise of public power by a tribunal or other administrator was lawful,[3] the court has independently considered the issue and determined to uphold the appeal, for the reasons that follow. Upon independent consideration of the issues raised by the proposed declaration, the court also will make the declaration sought, for which reasons also follow. It is unnecessary to determine the other grounds.
[3]Irwin v Military Rehabilitation and Compensation Commission (2009) 174 FCR 574, 577-8 [12]-[16] (Downes, Greenwood and Tracey JJ).
Error of law (want of jurisdiction)
As noted, in the second application Ileowl applied to VCAT for a declaration under s 149A of the Planning and Environment Act. That section relevantly provides:
(1)A specified person may apply to the Tribunal for the determination of a matter if—
(a) the matter relates to the interpretation of the planning scheme or a permit in relation to land or a particular use or development of land;
(b) the matter relates to whether section 6(3) applies to a particular use or development of land; or
(c) the matter relates to a provision of a planning scheme or amendment permitting the continuation of a use lawfully existing before the coming into operation of the planning scheme or amendment, or permitting the use of buildings or works for a purpose for which they were lawfully erected or carried out before the coming into operation of the planning scheme or amendment.
(1A) A specified person or a party to the agreement may apply to the Tribunal for the determination of a matter relating to the interpretation of an agreement under section 173.
(2)The Tribunal may determine the matter and may do one or both of the following—
(a) make any declaration that it considers appropriate;
(b) direct a specified body to take, or refrain from taking, action specified by the Tribunal.
By its terms, s 149A(1) confers jurisdiction on VCAT in different ways. In one kind of case (para (a)), the matter must relate to the ‘interpretation’ of a document (such as a planning permit, a planning scheme or a s 173 agreement). In another kind of case (para (b)), the matter must relate to whether a provision of the Planning and Environment Act ‘applies’ to a particular use or development of land. In yet another kind of case (para (c)), the matter must simply ‘relate’ to a provision of a planning scheme or amendment in certain specified situations (and I would accept that, for the purpose of that paragraph, a matter may ‘relate to’ a provision of a planning scheme or amendment if, in such situations, it raises a question of how the provision should be interpreted or how that provision applies in a given case).
Here, however, Ileowl’s application was made under s 149A(1)(a) of the Planning and Environment Act. Such an application cannot be made simply because it relates to how a planning scheme applies in a given case or because it relates to a provision of a planning scheme or amendment. That is not enough. An application can only be made under that paragraph if the matter relates to the interpretation of the planning scheme in relation to a particular use or development of land.
Ileowl’s application sought a declaration that the EPA was not a referral authority under cl 66.02-1 of the Wodonga Planning Scheme for the planning permit application that led to the permit. VCAT concluded that this declaration did relate to the interpretation of the Wodonga Planning Scheme. In reaching this conclusion, VCAT did not identify any question or dispute about how that scheme should be interpreted. Rather, it proceeded upon the basis that a matter will relate to the interpretation of a planning scheme simply because the question to be determined is whether a provision of the scheme applies to a particular use or development of land.
In my view, this involved an error of law. By proceeding in this way, VCAT erroneously failed to appreciate or apply the clear distinction between the concepts of interpretation, application and relating that are embodied in the text of s 149A(1)(a), (b) and (c) of the Planning and Environment Act. Had VCAT appreciated or applied this distinction, it would have concluded that it did not have jurisdiction to entertain the proceeding. This is because the declaration sought by Ileowl did not relate to the interpretation of the Wodonga Planning Scheme.
Clause 66.02-1 of the Wodonga Planning Scheme starts with these words:
an application of the kind listed in the table below must be referred to the person or body specified as the referral authority. The table below specifies whether the referral authority is a determining referral authority or a recommending referral authority.
There is no suggestion that these words are unclear or ambiguous. There is no dispute about what they mean. No question of interpretation arises. The table to cl 66.02-1 relevantly provides that the EPA is a determining referral authority for ‘a use or development requiring any of the following: … works approval in accordance with section 19A of the [Environment Protection Act]’. Again, there is no suggestion that these words are unclear or ambiguous. There is no dispute about what they mean. No question of interpretation arises here either. Rather, the dispute centres on whether Ileowl’s development involves a use or development that requires a works approval in accordance with s 19A of the Environment Protection Act. This is a question of determining whether particular facts fall within a clear and unambiguous provision. This is a question of application, not interpretation. It follows that the declaration sought concerned a matter that did not relate to the interpretation of the Wodonga Planning Scheme. Therefore, VCAT did not have jurisdiction to make the declaration and the order. It was an error of law for it to do so.
Works approval not required in given operational conditions
At the court’s suggestion, in the mediation the parties examined whether a works approval under s 19A(1) of the Environment Protection Act was required for the development. Through this process (which occurred on a without prejudice basis), the EPA requested and obtained from Ileowl the parameters that would control the operation of the development, and the company confirmed that those parameters would be complied with. The process of examination was extensive and has been explained in the joint memoranda provided to the court.
As a result of this process, the EPA has concluded that Ileowl does not require a works approval for the development if it operates in accordance with the following conditions (‘the prescribed conditions’):[4]
[4]Being the conditions set out in para 13(b) of the affidavit of Quentin Cooke dated 27 July 2017.
16.1The compost material will be fully pasteurised and screened before it is moved into the building proposed to be constructed under the permit (‘the building’) for pelletising and bagging, according to the following specifications:
(a)the compost will be pasteurised for a minimum composting period of eight weeks in the open windrows;
(b)the core temperature of the composting mass within the compost windrows will be maintained at 55 degrees Celsius or higher for 15 days or longer within this period;
(c)the compost windrows will be turned a minimum of five times within this period; and
(d)the temperature of the compost in the open windrows will be monitored and recorded —
such that no further composting of the screened pasteurised compost will occur inside the building (‘the product’);
16.2no further composting of the product will occur inside the building, by reason of the product, when in the building, having:
(a)a temperature of not more than 10 degrees Celsius above ambient temperature; and
(b)a moisture content of less than 30%;
16.3the activities conducted within the building will consist solely of the following:
(a)moving the product inside the building;
(b)pelletising or bagging the product without the addition of any additives (including dewatered organics and other substances);
(c)storing bagged product, pelletised product and bulk product for sale; and
(d)mechanically venting exhausted air from the building, at a rate of four air exchanges per hour, to two biofilters installed as permitted by the permit;
16.4point source odour collected from the dewatering facility will not be diverted to the biofilters to be constructed to serve the building; and
16.5Ileowl will implement ongoing procedures for control, monitoring and maintenance of the biofilters, to ensure that:
(a)the biofilters are well operated; and
(b)odour concentrations at the surface of the biofilters will not exceed 1000 odour units.
Ileowl agrees with the conclusion reached by the EPA, and that the development will operate in accordance with the prescribed conditions. It is clear from the material that has been jointly provided to the court that the EPA and Ileowl have agreed to the determination of the appeal by consent upon this basis.
Section 19A of the Environment Protection Act sets out the circumstances in which a works approval is required. It relevantly provides:
(1)The occupier of a scheduled premises must not do any act or thing, including the commencement of any construction, installation or modification of plant, equipment or process or any subsequent step in relation thereto, which is likely to cause—
(a)an increase or alteration in the waste discharged or emitted from, deposited to, or produced at, the premises; or
…
(c)a change in any method or equipment used at the premises for the reprocessing, treatment, storage, containment, disposal or handling of waste, or of substances which are a danger or potential danger to the quality of the environment or any segment of the environment; or
…
except in accordance with a works approval or a licence or a requirement specified in a notice given by the Authority as the case may be unless the act or thing is only in the course of and for the purpose of general maintenance.
The word ‘waste’ is defined in s 4 of the Environment Protection Act to include:
(a)any matter whether solid, liquid, gaseous or radio-active which is discharged, emitted or deposited in the environment in such volume, constituency or manner as to cause an alteration in the environment.
It is agreed that the evidence in this proceeding establishes, and I so find, the following:
19.1If the development operates in accordance with the prescribed conditions, the compost material will be a pasteurised product (according to the Australian Standard 4454 (2012), entitled Composts, Soil Conditioners and Mulches, and the EPA’s Publication 1588, entitled Designing, Constructing and Operating Composting Facilities) before it is moved into the building. That being so, the development will involve the storage and handling of product, rather than the storage and handling of waste.
19.2If the product meets the prescribed conditions, the biological activity in, and odour generated by, the compost material will almost cease.
19.3If the development operates in accordance with the prescribed conditions, it is not likely to cause either:
19.3.1For the purposes of s 19A(1)(a) of the Environment Protection Act, an increase or alteration in waste (namely, odour emissions) discharged or emitted from, or produced at, the premises; or
19.3.2For the purposes of s 19A(1)(c) of that Act, a change in any method or equipment used for the reprocessing, treatment, storage, disposal or handling of waste at the premises or of substances which are a potential danger to the quality of the environment or a segment of the environment.
Upon the basis of these findings, I am of the view that s 19A(1)(a) and (c) of the Environment Protection Act does not apply to the development and therefore no works approval is required.
There are sound discretionary reasons for making a declaration to this effect and giving leave to amend the originating motion accordingly. If the court were to decline to do so, the issue at the heart of the dispute between the parties – namely, whether a works approval is required for the development – would remain undetermined both in VCAT and this Court. The dispute has a long history. Through the mediation process in this court, the parties have agreed that, if the development operates in accordance with the prescribed conditions, a works approval is not required. I have independently determined this to be correct. Ileowl considers that the EPA has not maintained a consistent position in relation to this issue and, without the declaration, could change its position. Whilst the EPA does not agree with Ileowl's position and does not consider its concerns to be warranted, it does agree that a judicial declaration should be made to give Ileowl commercial certainty in relation to the development. I will therefore make the declaration.
Conclusion
The EPA and Ileowl agree that there should be no order for costs.
No orders are sought against the second respondent, which has entered a purely submitting appearance.
For the above reasons, there will be orders granting leave to amend the originating motion and leave to appeal, upholding the appeal upon the ground of want of jurisdiction (which issue has been independently considered by the court), setting aside the order (and therefore VCAT’s declaration) and declaring that a works approval for the development is not required under s 19A(1) of the Environment Protection Act (which issue has also been independently considered by the court), with no order as to costs.
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