Environment Protection Authority v Port Kembla Copper Pty Ltd
[2001] NSWLEC 174
•08/02/2001
Reported Decision: 115 LGERA 391
Land and Environment Court
of New South Wales
CITATION: Environment Protection Authority v Port Kembla Copper Pty Ltd [2001] NSWLEC 174 PARTIES: PROSECUTOR
DEFENDANT
Environment Protection Authority
Port Kembla Copper Pty LtdFILE NUMBER(S): 50040 of 2000; 50041 of 2000; 50042 of 2000; 50043 of 2000 and 50044 of 2000 CORAM: Pearlman J KEY ISSUES: Environmental Offences :- breach of licence condition - plea of guilty - penalty LEGISLATION CITED: Protection of the Environment Operations Act 1997 s 64(1), s 241 CASES CITED: Camilleri's Stock Feeds Pty Ltd v Environment Protection Authority (1993) 32 NSWLR 683;
Environment Protection Authority v ADI Ltd [1999] NSWLEC 14;
Environment Protection Authority v Caltex Refining Company Pty Ltd (Stein J, NSWLEC, 21 July 1994, unreported);
Environment Protection Authority v Capral Aluminium Ltd (Cowdroy J, NSWLEC, 18 December 1998, unreported);
Environment Protection Authority v Norco Co-operative Ltd (2000) 108 LGERA 137;
Environment Protection Authority v Softwood Holdings Ltd (2000) 110 LGERA 87;
R v J C W [2000] NSWCCA 209;
R v O'Neill (1979) 2 NSWLR 582;
R v Olbrich (1999) 199 CLR 270;
R v Thomson (2000) 49 NSWLR 383;
State Pollution Control Commission v Australian Iron & Steel Pty Ltd (Cripps J, NSWLEC, 10 October 1991, unreported);
State Pollution Control Commission v Broken Hill Proprietary Company Ltd (No 2) (1991) 74 LGRA 358;
State Pollution Control Commission v CSR Ltd (1992) 75 LGRA 1;
State Pollution Control Commission v Metropolitan Collieries Ltd (No 2) (Cripps J, NSWLEC, 19 October 1990, unreported);
State Pollution Control Commission v Shell Refining (Australia) Pty Ltd (Cripps J, NSWLEC, 20 July 1990, unreported)DATES OF HEARING: 10/05/2001; 11/05/2001 DATE OF JUDGMENT:
08/02/2001LEGAL REPRESENTATIVES: DEFENDANT
PROSECUTOR
Mr C J Leggat (Barrister)
SOLICITORS
Environment Protection Authority
Mr T G Howard (Barrister)
SOLICITORS
Corrs Chambers Westgarth
JUDGMENT:
IN THE LAND AND 50040-50044 of 2000
ENVIRONMENT COURT
Pearlman J
OF NEW SOUTH WALES 2 August 2001
- Prosecutor
Defendant
Introduction
1. The defendant, Port Kembla Copper Pty Ltd, has pleaded guilty to five charges against s 64(1) of the Protection of the Environment Operations Act 1997 (“the POEO Act”). The charges allege that on five occasions between 23 February 2000 and 12 March 2000 the defendant breached a condition of its environment protection licence.
2. All five charges have been heard together, and this judgment concerns the determination of penalty in respect of each charge.
3. Each charge alleges a breach of condition L2(ii) of licence 001753 held by the defendant. Condition L2(ii) is in the following terms:
L2 The concentrations of air impurities emitted from the Acid Plant Stack, when measured in accordance with the provisions of this Licence, and before admixture of air, smoke or other gases, must not exceed the limits specified below:Point Source Discharge Limits
(ii) the equivalent of 7.2g/m3 of sulfur dioxide
Note
Sulfur dioxide monitoring must be undertaken in accordance with Condition M8.1. Compliance will be measured over any ten minute averaging period.
4. Condition M8.1 provides:
M8.1 A continuous monitoring system complying with the EPA specifications for continuous monitoring of sulfur dioxide emissions configured to provide measurements of g/m3 and g/s emissions, must be operated, maintained and calibrated to provide measurements representative of sulfur dioxide in the flue gases of both the:
(i) Main Stack; and
(ii) Acid Plant Stack.
The information must also include temperature and gas velocity.
5. Each charge alleges a contravention of the stipulated sulfur dioxide limit as a consequence of emission of sulfur dioxide from the Acid Plant Stack when measured in accordance with the provisions of the licence and before the admixture of air, smoke or other gases. The dates upon which and the times at which the licence condition was contravened differ from charge to charge, as does the alleged exceedence of the limit in each case. Those particulars are as follows, and they are pleaded cumulatively and/or in the alternative:
The first charge (50040/2000) : Condition L2(ii) is alleged to have been contravened on or about 23 February 2000 in the following respects:
· At about 4.00 am to 4.10 am, the equivalent of 11.82 g/m3 of sulfur dioxide was emitted;
· At about 4.10 am to 4.20 am, the equivalent of 9.21 g/m3 of sulfur dioxide was emitted;
· At about 4.00 am to 4.20 am, more than the equivalent of 7.2 g/m3 of sulfur dioxide was emitted;
The second charge (50041/2000): Condition L2(ii) is alleged to have been contravened on or about 23 February 2000 in the following respects:
· At about 5.30 am to 5.40 am, the equivalent of 10.38 g/m3 of sulfur dioxide was emitted;
· At about 5.30 am to 5.40 am, more than the equivalent of 7.2 g/m3 of sulfur dioxide was emitted.
The third charge (50042/2000) : Condition L2(ii) is alleged to have been contravened on 26 February 2000 in the following respects:
· the equivalent of 9.4 g/m3 of sulfur dioxide was emitted;
· more than the equivalent of 7.2 g/m3 of sulfur dioxide was emitted.
The fourth charge (50043/2000): Condition L2(ii) is alleged to have been contravened on 3 March 2000 in the following respects:
· the equivalent of 10.7 g/m3 of sulfur dioxide was emitted;
· more than the equivalent of 7.2 g/m3 of sulfur dioxide was emitted.
The fifth charge (50044/2000): Condition L2(ii) is alleged to have been contravened on 12 March 2000 in the following respects:
· the equivalent of 10.92 g/m3 of sulfur dioxide was emitted;
· more than the equivalent of 7.2 g/m3 of sulfur dioxide was emitted.
6. As it is required to do by conditions R8 and R11 of the licence, the defendant submitted incident reports in relation to the events the subject of each of the charges. From those incident reports, copies of which were annexed to the affidavit of Mr W J C Dove, environment protection officer, and from an agreed statement of facts furnished by the parties, I have derived the facts and circumstances surrounding each incident. I am satisfied beyond reasonable doubt that on each occasion the specified limit of sulfur dioxide emission was exceeded. However, before dealing separately with the cause of each incident, it is convenient to set out in a brief and general way a description of the smelting operations conducted by the defendant.
The smelting operation
7. The defendant operates a copper smelter on Military Road, Port Kembla (“the premises”). The smelting process involves a number of different furnaces, including the Noranda Furnace, the Holding Furnace, the Mitsubishi Continuous Converting Furnace (“the MI-C Furnace”), the Rotary Anode Furnace and the Electric Slag Furnace. During the smelting process, sulfur gases including sulfur dioxide are generated.
8. In an agreed statement of facts, the parties described the smelting process as follows:
(The defendant) produces copper from copper and precious-metal-bearing sulphidic concentrates. The concentrates, mixed with flux and coal, are reacted in a Noranda Furnace with oxygen enriched air to produce a copper matte, which is a complex mix of copper, iron and sulfur. Some of the sulfur is oxidised to sulfur dioxide in this step.
9. At the outset, I note a point raised in relation to this charge by Mr Howard, appearing for the defendant. He drew attention to the fact that the particulars set out in the summons state three different times of the day, namely, 4.00 am to 4.10 am, 4.10 am to 4.20 am and 4.00 am to 4.20 am. As I understood him, Mr Howard was concerned to ensure that the summons alleged only one offence. Mr Howard submitted that, having regard to the specification in condition L2 that concentrations must not exceed the specified limited “when measured in accordance with the provisions of ...” the licence, a breach of condition L2(ii) can only properly encompass one ten minute interval. I agree with this submission, although I note that the defendant made no application for striking out the summons as bad for duplicity and it has pleaded guilty to the charge. I also note that in the agreed statement of facts, the period of emission is specified as only the single ten minute interval between 4.00 am and 4.10 am. Accordingly, I am prepared to accept that the proper construction of the first charge is that it alleges that the specified sulfur dioxide limit was exceeded on the nominated day between 4.00 am and 4.10 am and that the concentration measured at that time was 11.82 g/m3.
10. The cause of the incident is described in the incident report, the affidavit of Mr J W Griffiths, who is the smelter technical manager employed by the defendant, and in the affidavit of Mr J D Court, an environmental engineering consultant who gave evidence for the prosecutor. From that evidence, I find that the cause of the incident was as follows. The Acid Plant was off-line and was being preheated with air in order to bring it up to the temperature required to make it capable of accepting offgas from the MI-C Furnace. During the course of this pre-hearing with air, the manual bypass valve 3310-061 GP was in the open position. With the pre-heater still operational, the control room technician decided to bring the Acid Plant on line. The manual bypass valve 3310-061 GP remained, however, in the open position, and as a consequence, a portion of the offgas from the MI-C Furnace (containing a high concentration of sulfur dioxide) bypassed the Final Converter and Absorbing Tower 2 and passed instead to the Acid Plant Stack, resulting in an exceedence of the licence emission limit.
11. The incident report noted that, upon recognising that the incident had occurred, the MI-C Furnace was immediately “brought off-line”. The report also noted that, since the incident, procedures have been amended so that the “start-up of the Acid Plant will not be made passing process gas through the pre-heater to the Converter” and that “[m]ore rigorous use and sign off of the Acid Plant ‘Pre-Start Checklist’” will be adopted.
The second charge – the conversion incident
12. Again relying upon the incident report and the evidence given by Mr Griffiths and Mr Court, I find that this incident was caused as follows. The Acid Plant and the MI-C Furnace were prepared for operation, and, based on previous experience with the Noranda Furnace, it was understood by the defendant’s technicians that the Acid Plant had attained the required start-up temperature prior to the introduction of the MI-C Furnace offgases. However, what occurred is described in the incident report as follows:
Introduction of the initial offgases from the MI-C Furnace to the Acid Plant resulted in unsatisfactory conversion of the SO2 to SO3 within the Primary Converter, and consequently also within the Final Converter. Thus, there was a discharge of unconverted SO2 through to the Acid Plant Stack.… the time between blowing the MI-C Furnace and obtaining off gases of high enough SO2 concentration for satisfactory conversion to SO3 was longer than expected. This was due to a less volatile reaction within the MI-C Furnace than anticipated.
13. The incident report noted that, immediately the incident had been recognised, the MI-C Furnace was brought off-line. After the incident, the relevant technician was instructed to ensure that the Acid Plant was satisfactorily pre-heated prior to the introduction of the gas stream from the MI-C (or Noranda) Furnace to the required converters.
The third charge – the cooling fan incident
14. A description of this incident appears in the incident report, in the affidavit of Mr Court, and also in the affidavit of Mr A S Blair, the defendant’s environment manager. From that evidence, I find that the cause of the incident was the failure of a cooling fan on the Bypass and Final Converter due to a thermal overload. The consequence was a rise in the temperature of the catalyst beds, a loss of conversion efficiency and a subsequent rise in sulfur dioxide concentration in the Acid Plant Stack. The impact of the failure of the cooling fan was exacerbated by a slightly elevated inlet concentration of sulfur dioxide to the Acid Plant because at the time the optimum concentration had not been attained.
15. When the cooling fan failed, an alarm was activated and the Acid Plant was immediately brought off-line. However gases already in the Acid Plant continued to flow out of the Acid Plant Stack. The defendant has now instituted a procedure for automatic shut down of the Acid Plant blower if an exceedence of a specified limit is likely so that gases already in the Acid Plant will not continue to flow out of the Acid Plant Stack.
The fourth charge – the copper matte incident
16. From the incident report and the affidavits of Mr Blair and Mr Court, I find that the cause of this incident was as follows. Transfer of copper matte from the Holding Furnace to the MI-C Furnace was scheduled. The defendant’s technicians relied upon the programming of the computerised distributed control system (“DCS”) which had been designed to configure the heat burners in the MI-C Furnace to provide a neutral atmosphere. However, there was an error in the flow meter instrumentation which resulted in an oxidising atmosphere being produced in the MI-C Furnace. That had the effect of partial oxidation of residual copper matte in the MI-C Furnace to copper oxide. When the copper matte was transferred from the Holding Furnace to the MI-C Furnace, there was a vigorous reaction with the residual material that resulted in the rapid formation of copper material and the generation of sulfur dioxide. That consequence was aggravated by too high a rate at which the copper matte was transferred from the Holding Furnace to the MI-C Furnace.
17. Upon the incident occurring, the roof vents in the building were immediately closed, and the ventilation in the MI-C Furnace building was activated, but the volume of gas at elevated levels of sulfur dioxide was too great to be contained and the gas was released from the building. The transfer of matte from the Holding Furnace also ceased.
The fifth charge – the bypass valves incident
18. From the incident report and the affidavits of Mr Court and Mr Blair, I find that the cause of this incident was as follows. The Noranda Furnace was on line and the Acid Plant was prepared to receive gases from it. This preparation included closing the bypass valves to the Acid Plant Converters. However, the action of the relevant technician in closing the bypass valves was overridden by the DCS, and accordingly the bypass valves remained in open position. Consequently, gases from the Noranda Furnace were not treated by the Acid Plant, and this caused elevated levels of sulfur dioxide in the Acid Plant Stack.
19. Upon the incident occurring, the DCS was immediately modified and the Acid Plant was operated successfully later that day.
Sentencing principles
20. The defendant’s plea of guilty to each offence amounts to an admission of each of the essential legal ingredients of the particular offence (R v O’Neill (1979) 2 NSWLR 582 at 588; R v Olbrich (1999) 199 CLR 270 at 275).
21. Section 241(1) of the POEO Act provides that, in imposing a penalty for an offence against that Act, the Court is to take into consideration a number of specified matters so far as they are relevant. Section 241(2) provides that the Court may take into consideration other matters that it considers relevant.
22. In imposing a penalty for each of the offences with which the defendant is charged, it is important to bear in mind that each of the offences charges the defendant with a contravention of a licence condition. Environmental harm per se is not an ingredient of any of these offences. The question then arises as to whether some of the factors specified in s 241(1) are relevant, especially so far as they relate to environmental harm, and whether there are any other factors relevant to take into account under s 241(2).
23. It has long been held in this Court that a contravention of a pollution licence involves a breach of public trust. This approach was first expressed by Cripps J in State Pollution Control Commission v CSR Ltd in a case heard in 1989 but reported in (1992) 75 LGRA 1. At pp 4 – 5, his Honour said:
CSR Ltd was given a licence to pollute. Its licence was conditional upon it not polluting any more than permitted and maintaining certain standards to ensure that its limit was not exceeded. Its licence placed it in a special category over and above other persons and corporations and consequently imposed on it certain obligations. In effect, CSR was trusted so to conduct its operations that it would not pollute the water more than that for which permission was given.
24. Cripps J repeated that approach in State Pollution Control Commission v Shell Refining (Australia) Pty Ltd (NSWLEC, 20 July 1990, unreported), in State Pollution Control Commission v Metropolitan Collieries Ltd (No 2) (NSWLEC, 19 October 1990, unreported) and also in State Pollution Control Commission v Australian Iron & Steel Pty Ltd (NSWLEC, 10 October 1991, unreported). The same approach was adopted by Stein J in State Pollution Control Commission v Broken Hill Proprietary Company Ltd (No 2) (1991) 74 LGRA 358, and again adopted by him in Environment Protection Authority v Caltex Refining Company Pty Ltd (NSWLEC, 21 July 1994, unreported). More recently, Bignold J has followed that approach – see Environment Protection Authority v Norco Co-operative Ltd (2000) 108 LGERA 137 and Environment Protection Authority v Softwood Holdings Ltd (2000) 110 LGERA 87. In Environment Protection Authority v ADI Ltd [1999] NSWLEC 14, Talbot J adopted a similar approach, expressing the opinion at par 23 that the fact that a company held a licence “heightened its responsibility to keep the level of discharge … within the parameters set by the licence”. Although eschewing the phrase “breach of trust” as representing an equitable doctrine inappropriate under environmental offences legislation, Cowdroy J nevertheless adopted a similar approach in Environment Protection Authority v Capral Aluminium Ltd (NSWLEC, 18 December 1998, unreported), regarding a contravention of a licence as “a most serious matter where the public interest is involved …” (par 59).
25. I take it from this line of authority that an important consideration, relevant to take into account as an additional matter under s 241(2), is the seriousness of each offence, because each involves a breach of the trust reposed in the defendant to carry out its operations within the limits specified in the licence. In so concluding, I reject Mr Howard’s submission that this approach involves double jeopardy to the defendant, and that the offences should simply be regarded as breaches of the law.
26. The Court is required also to take into consideration the matters specified in s 241(1) if they are relevant. In my opinion, some of those matters are likely to be relevant, if the contravention of the condition of the licence results in pollution. They become relevant in this case, because environmental harm was the consequence of the commission of each of the offences. That conclusion follows from a number of definitions under the POEO Act. In the dictionary to the POEO Act, “harm” is defined to include “any act or omission that results in pollution”. The expression “pollution” is defined to mean “air pollution” (as well as other forms of pollution). “Air pollution” is defined to mean “the emission into the air of any air impurity”, and “air impurity” is defined to include “gases”. In this case, once gases were emitted from the Acid Plant Stack into the air, then “pollution” within the meaning of the POEO Act occurred.
Matters relevant to assessing the appropriate penalty
Breach of public trust
27. Each of the contraventions of the licence condition is to be regarded as serious, because, as I have earlier explained, each contravention involves a breach of public trust.
The extent of the harm
28. Section 241(1)(a) provides that the Court is to take into consideration “the extent of the harm caused or likely to be caused to the environment by the commission of the offence”.
29. Evidence about the likely extent of ground level concentrations of sulfur dioxide was provided on behalf of the defendant by Dr N E Holmes, a consultant atmospheric physicist, and on behalf of the prosecutor, by Mr N G Agapides, the manager, air assessments unit at the Environment Protection Authority.
30. Dr Holmes relied upon a dispersion model known as CALPUFF in order to predict the ground-level concentrations of sulfur dioxide for each of the times when the licence emission limit was exceeded. He compared his predictions against the standard set by the World Health Organisation (“WHO”) for exposure to sulfur dioxide, and against the Australian national ambient air quality standard published as part of the National Environment Protection Measures (Air NEPM). For present purposes, the relevant WHO guideline is 17.5 parts per hundred million (“pphm”)(10-minute average concentration), at or below which there would not likely be harm to the health of the community, and the Air NEPM standard is set at 20 pphm (1-hour average concentration). Dr Holmes concluded that the estimated maximum 10-minute average ground-level concentration in pphm would not have exceeded 17.5 pphm at any of the five incidents, and that the 1-hour average concentrations would have been substantially less than 20 pphm.
31. In Mr Agapides’ opinion, these calculations are likely to be subject to error. He stressed the inherent uncertainties in dispersion modelling, and expressed the view that there was likely to be an error of plus or minus 50 per cent in the model. Mr Agapides made calculations, using mathematical relationships developed by Hibberd (1998) and Borgas (2000), and concluded that, on three of the five occasions, the WHO standard was likely to have been exceeded. Thus, he calculated that, in relation to the cooling fan incident (the third charge), the average ground level concentration was likely to be 17.8 pphm; in relation to the copper matte incident (the fourth charge), it was likely to be either 23.2 pphm or 22.0 pphm; and in relation to the bypass valves incident (the fifth charge) it was likely to be 17.9 pphm.
32. In cross-examination, Dr Holmes conceded that there is likely to be error in dispersion modelling, although he thought it was more likely to be in the range of plus or minus 40 per cent than plus or minus 50 per cent. I turn, then, to consider the expert medical evidence about the likely effect of average ground level concentrations as calculated by Mr Agapides.
33. Dr V Westley-Wise is a medical practitioner and public health physician who gave evidence for the prosecutor. She described the effects of sulfur dioxide in her affidavit as follows:
SO2 is an irritant to the respiratory tract. In the upper airways, SO2 can irritate nerve endings causing coughing. In the lower airways SO2 can cause narrowing of the airways (‘bronchoconstriction’) and hence a drop in lung function, and, if severe enough, asthma symptoms, such as chest tightness, wheeze and/or coughing.
34. In the opinion of Dr Westley-Wise, no health effects are expected at levels of less than 17.5 pphm but she described the following health effects at levels between 17.5 pphm and 50 pphm:
Some exercising asthmatics can get a drop in lung function. Particularly at the upper end of this range, some exercising asthmatics (and others with respiratory disorders) may also get symptoms, such as chest tightness and coughing … There is no good evidence that these SO2 concentrations trigger more severe episodes, nor that they have any lasting effect on asthma. In non-asthmatics (and those without other respiratory disorders) effects have not been shown at these SO2 concentrations.
35. Dr J A Bisby, who is an international health consultant with medical qualifications, gave evidence for the defendant. He thought it highly unlikely that any smell, taste or other health effects would have resulted from any of the emissions of sulfur dioxide on any of the five occasions. In his opinion, at levels below 100 pphm, sulfur dioxide is not irritant to the eyes, nose or throat, and would have no effect “except for the effect of minor changes in lung function in exercising asthmatics not receiving medication”. In his opinion, substantially greater levels were required to produce a result – 100 - 300 pphm for odour threshold, 500 - 1000 pphm for eye irritation, and 500 pphm for nasal irritation.
36. Based on the predictions of Dr Holmes and Mr Agapides, and the opinion of both Dr Westley-Wise and Dr Bisby, I find that it is unlikely that there was any harm to human health from the exceedences of the licence emission limit on any of the five occasions. Nevertheless, there was evidence from a number of persons about symptoms which they suffered at the respective times of the cooling fan incident (the third charge) and the copper matte incident (the fourth charge).
37. Dealing first with the cooling fan incident, affidavits were furnished by Mrs J M Medcalf, Mr J I Roach and Mr K C Coltman, all of whom reside in the general vicinity of the defendant’s smelter. Mrs Medcalf deposed to the fact that, at about 3.00 pm on 26 February 2000, she experienced “an acid-like sulfur smell” and she “could taste the sulfur in the back of my throat”. She stated that at the time she saw “heavy emissions of grey fumes coming out of the small stack at Port Kembla Copper”. Mr Roach deposed to the smell and taste of sulfur dioxide at the same time on the same date, and stated that “[I]t gave me a headache”. He said that he could clearly smell and taste sulfur dioxide at approximately 3.30 pm on the same date. Mr Roach said he saw “heavy white emissions coming from the smelter building” and “heavy dark grey emissions coming from the Acid Plant Stack”. Mr Coltman stated that, at about 3.00 pm on the same date, he could taste sulfur dioxide and it made him feel “uncomfortable”.
38. The copper matte incident (the fourth charge) took place on 3 March 2000. Evidence about the symptoms which they suffered on that date was given by Mr Roach, and by Mrs H M Hamilton, who also lives in the general vicinity of the premises. Mr Roach’s evidence was that, at about 8.20 pm on 3 March 2000, he saw “heavy grey coloured fumes being discharged from the smelter building” and he could smell and taste sulfur dioxide. He said that they were not strong odours “but they did make the inside of my nostrils burn”. Mrs Hamilton said that, at approximately 8.10 pm, she started to taste “a metallic-like taste”, she developed a throat irritation and started to cough. She stated that she could see “heavy ground level emissions coming from the direction of the buildings at Port Kembla Copper”.
39. Dr Holmes used the CALPUFF model to calculate the likely level of sulfur dioxide at the residences of each of the persons who gave the evidence I have outlined above. He found that, in the case of Mrs Medcalf, the predicted concentration would have been approximately 10 pphm; in the case of Mr Roach on 26 February 2000, it would have been approximately 12 pphm and on 3 March 2000 it would have been less than 1 pphm. In the case of Mr Coltman, it would have been approximately 1 pphm. In the case of Mrs Hamilton it would have been “well below 1 pphm”.
40. There is a significant amount of uncertainty in all the evidence relating to actual or likely harm to human health. First, there are uncertainties in dispersion modelling and predictions of average ground level concentrations of sulfur dioxide. Secondly, although I accept the evidence of each of the above persons that they experienced the symptoms which they have described, there is no direct evidence that emissions from the Acid Plant Stack were the cause of those symptoms. The expert evidence is that the particular exceedences were not of a sufficient level of concentration to cause any effect on human health. If there were higher levels of ambient sulfur dioxide which caused the symptoms experienced in each case by these persons, then there is considerable doubt as to the source of any higher levels, and there may also have been some contribution from sources other than the Acid Plant Stack.
41. Having regard to all the evidence, I am not satisfied beyond reasonable doubt that the contraventions of the licence condition on any of the five occasions had an effect on human health.
42. However, there was, on each occasion, a degree of environmental harm in the very fact the gases were emitted into the air. But in each case the amount by which the licence emission limit was exceeded was comparatively small. At the most (that is, in relation to the preheating incident – the first charge) the exceedence was 4.62 g/m3 over the permitted limit of 7.2 g/m3. I find accordingly that the harm was not significant.
Prevention
43. Section 241(1)(b) provides that the Court is to take into consideration “the practical measures that may be taken to prevent, control, abate or mitigate that harm”.
44. Each of the incidents was extensively analysed by Mr Court. He has identified a number of measures which, in his opinion, could have been taken to prevent the occurrence of each of the incidents. These included adequate and proper training of technicians, more direct and adequate checking of instrumentation and plant, and better operating procedures. Mr Court also identified various technical measures which were in fact taken by the defendant after the incidents had occurred. Those measures were identified in the various incident reports and I have set them out above.
45. This is not a case, however, where the evidence discloses that practical measures were readily identifiable but were simply ignored. The defendant pointed to the fact that each of the incidents occurred during the commissioning of the plant. Mr Blair referred to this period as being a time when “… you literally have to iron out the bugs in the system and learn how the plant will actually operate”. Mr Dove agreed in cross-examination that the commissioning period had been determined in consultation with the Environment Protection Authority, and specific licence conditions (although not condition L2(ii)) had been imposed in recognition that the commissioning period could be a difficult time. Mr Court also agreed in cross-examination that the smelter is a complex plant and that teething problems could be expected to occur. Furthermore, the defendant had engaged various expert consultants to assist in the commissioning process (such as Mitsubishi engineers, Noranda Furnace experts, acid plant experts and Elsag Bailey Pty Ltd whose personnel were expert in relation to the DCS) and these experts were on site at all times during the commissioning of the plant.
46. I conclude, therefore, that immediate practical measures were taken following upon each incident, and that, subject to what I say below in relation to foreseeability, there were no particular further practical measures that the defendant could have taken to prevent, control, abate or mitigate the harm.
Foreseeability
47. Section 241(1)(C) requires the Court to take into consideration the extent to which the defendant “could reasonably have foreseen the harm caused or likely to be caused to the environment by the commission of the offence”.
48. A critical matter in this case is the question of the adequacy of the defendant’s risk assessment. An acid plant risk assessment had been carried out by Mr Griffiths, who was plant manager at the time of the incidents. He conceded in cross-examination that this was the first full risk assessment that he had carried out, but he stated that the analysis that he undertook conformed generally to the risk management standards set by Standards Australia. He also said that a “large” number of risk assessments had been carried out by the defendant and that they were being “continually updated in light of information gained”.
49. Nevertheless, Mr Court was highly critical of the adequacy of the acid plant risk assessment. His opinion was that each of the incidents were foreseeable, and, if a more thorough risk assessment had been carried out, each of the incidents could have been prevented. In his affidavit, he stated that a thorough risk assessment would identify problems before they occurred, and this was a better approach than operating an ongoing risk assessment to sort out problems as they arise. This latter approach, he said, “… might be a common manner of operating in industries with minimal complexity and relatively benign pollutants, (but) it is not adequate … for an industry as complex as smelting of metal sulphide ores and with emissions as potentially harmful as sulphur dioxide …”.
50. Mr Court pointed to a number of risks which the risk assessment failed to identify. Thus, he said, a thorough risk assessment would have identified the possibility of the manual bypass valve remaining open, as occurred in the preheating incident (the first charge). Similarly, a thorough risk assessment would have identified the risks inherent in the process which led to the exceedences in the preheating incident (the second charge). Again, a thorough risk assessment would have identified the risk of excessive emissions occurring if the cooling fan failed (as it did in the cooling fan incident (the third charge)). Mr Court pointed out that the risk assessment did not analyse the risk likely to occur from failing to maintain non-oxidising conditions in the MI-C Furnace, as occurred in the copper matte incident (the fourth charge). And, finally, in relation to the bypass valves incident (the fifth charge), a thorough risk assessment would have identified the computer system operation of the bypass valves as a critical factor. More generally, a thorough risk assessment would have considered the automatic shut off of the Acid Plant blower when emissions of sulfur dioxide leaving the Acid Plant reach a certain level during specified conditions, a device which was subsequently installed and which, in Mr Court’s view, could have prevented or at least minimised all incidents.
51. In response to this criticism, the defendant, through the evidence of Mr Griffiths and Mr Blair, claimed that the acid plant risk assessment process had been carried out in a reasonable manner, and in particular that risk assessment training had been provided by a risk management expert to risk assessment team members prior to carrying out risk assessments. It denied that the acid plant risk assessment was inadequate having regard to current standards, and it claimed that Mr Court was advocating a standard of perfection in hindsight. It pointed to the fact that the systems used in the smelter are extremely complex, and that the incidents were always likely to occur during the commissioning period. It claimed that none of the incidents were foreseeable in these circumstances.
52. I think, however, that the evidence of Mr Court is compelling. The very fact that the smelter was adopting new and complex technology in an operation involving potentially harmful gases should have required a great deal of attention to be paid to risk assessment, and to the possibility that incidents would occur during the commissioning period. I consider therefore that the possibility that the licence emission limit would be exceeded on each occasion was reasonably foreseeable, and as a result each of the incidents could have been prevented.
Control
53. Section 241(1)(d) requires the Court to take into consideration the extent to which the defendant had control over the causes which gave rise to each offence.
54. There is no doubt in this case that the defendant had such control.
Matters in mitigation
55. I take into account in the defendant’s favour that incidents took place during the commissioning period of the smelter, and that during such a period problems in the operation of the smelter are likely to occur.
56. In his affidavit, Mr Griffiths referred to the fact that the incidents were “regrettable”. This is some expression of contrition, but it hardly indicates a genuine remorse. To the contrary, the evidence of Mr Blair and Mr Griffith was directed to showing that the risks were adequately assessed, and that, during a period of commissioning, incidents of the nature of those which occurred were to some degree inevitable. Accordingly, I place no weight upon Mr Griffiths’ statement of regret.
57. The agreed statement of facts noted that the defendant cooperated with the Environment Protection Authority in the investigation of the charges, and I take that cooperation into account in mitigation of penalty.
58. I turn now to another matter. After the judgment in these proceedings were reserved, I presided at the hearing of proceedings numbered 50002 of 2001 which involved a charge (“the pending charge”) brought by the prosecutor against the defendant in respect of an offence under s 120(1) of the POEO Act, namely the pollution of waters. The offence is alleged to have occurred on 17 January 2000 (that is, before the dates of the offences charged in these current proceedings) and the summons appears to have been filed on 11 January 2001. On 27 April 2001, prior to the hearing of these current proceedings, the defendant entered a plea of guilty to the pending charge. However, as at the date of this judgment, judgment in the proceedings relating to the pending charge remains reserved and the defendant has not been convicted of the pending charge. Despite the existence of the pending charge, no mention of it was made at the hearing of these proceedings by counsel for either the prosecutor or the defendant. Furthermore, the agreed statement of facts made no reference to it, merely noting that the defendant has no prior convictions for environmental offences.
59. It would have been appropriate to take into account the pending charge for the purposes of rejecting any claim for mitigation of penalty on the basis is that it is “representative” of the defendant’s behaviour (R v J C W [2000] NSWCCA 209) and on the basis that the current charges could not be regarded as an isolated occurrence. But in view of the fact that no reference whatsoever to the pending charge was made during the hearing of these charges, and, to the contrary, the agreed statement of facts suggests that the defendant has an unblemished record of environmental behaviour, I propose to ignore the pending charge, and take into account in mitigation the fact that the defendant has no prior convictions for environmental offences.
The totality principle
60. The offences with which the defendant is charged are tier 2 offences under the POEO Act and each carries a maximum penalty, in the case of a corporation, of $250,000.
61. Dealing first with the first offence, and taking into account the seriousness of the offence, the matters specified in s 241 of the POEO Act, and the matters in mitigation, I have concluded that the amount of penalty for that offence should be $75,000.
62. As to the remaining offences, I take into account the close time frame during which the five offences occurred, and the fact that they all occurred during the commissioning period. They must accordingly be seen as connected, and the totality principle applied (Camilleri’s Stock Feeds Pty Ltd v Environment Protection Authority (1993) 32 NSWLR 683). At pp 703 – 704 of that case, Kirby P cited with approval a passage from the judgment of Street CJ in R v Holder (1983) 3 NSWLR 245 at 260, which explained the totality principle as follows:
… the sentencing judge will evaluate, in a broad sense, the overall criminality involved in all of the offences and, having done so, will determine what, if any, downward adjustment is necessary…in the aggregate sentences in order to achieve an appropriate relativity between the totality of the criminality and the totality of the sentences.
63. Having regard therefore to the overall criminality involved in all the offences, I have concluded that the appropriate penalties should be $25,000 for the second offence, $20,000 for the third offence, $15,000 for the fourth offence and $10,000 for the fifth offence.
64. There is no dispute that the defendant entered pleas of guilty to all five offences at an early stage. It is therefore entitled to a discount for the utilitarian value of those pleas, that is, the utilitarian advantage derived by the criminal justice system from an early plea of guilty (R v Thomson (2000) 49 NSWLR 383 at 411). I consider that a discount of 20 per cent should be applied, reducing the penalties to amounts as follows:
For the first offence: $60,000
For the second offence: $20,000
For the third offence: $16,000
For the fifth offence: $8,000For the fourth offence: $12,000
Final orders
65. No submissions were made by the parties in relation to costs. After judgment had been reserved, the prosecutor applied, by way of notice of motion, to reopen the hearing on penalty for the purpose of seeking an order that the defendant pay the costs of the prosecutor. Upon the return of that motion, I stood it over for determination on the date of delivery of this judgment, and I agreed not to enter final orders until that motion had been determined.
66. I grant leave to the parties to obtain a date for hearing of submissions on costs.
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