Environment Protection Authority v Snowy Hydro Ltd - [2008] NSWLEC 264

No judgment structure available for this case.

Reported Decision: 162 LGERA 273

Land and Environment Court

of New South Wales

CITATION: Environment Protection Authority v Snowy Hydro Ltd [2008] NSWLEC 264

PARTIES:
PROSECUTOR:
Environment Protection Authority
DEFENDANT:
Snowy Hydro Ltd

FILE NUMBER(S): 50039 of 2007

CORAM: Biscoe J

KEY ISSUES: Environmental Offences :- sentence - polluting waters of river during connection of dam to river at the end of dam upgrade works - pollutant sediment laden waters containing soil, earth, clay or similar inorganic matter - factors to be taken into account on sentencing - principle that an offender cannot be sentenced for a more serious offence.

LEGISLATION CITED: Crimes (Sentencing Procedure) Act 1999 (NSW), ss 3A, 21A, 23(1)
Environmental Planning and Assessment Act 1979 (NSW)
Protection of the Environment Operations Act 1997 (NSW), ss 3(1), 91, 114, 116(1), 119, 120, 123, 241, 246, 248, 250(1)(e), 257
Snowy Hydro Corporatisation Act 1997 (Cth)
Snowy Hydro Corporatisation Act 1997 (NSW)
Snowy Hydro Corporatisation Act 1997 (Vic)

CASES CITED: Alphacell Ltd v Woodward [1972] AC 824
Axer Pty Ltd v Environment Protection Authority (1993) 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 of Public Prosecutions (Cth) v Said Khodor El Karhani (1990) 21 NSWLR 270
Environment Agency (formerly National Rivers Authority) v Empress Car Co. (Arbertillery) Ltd [1999] 2 AC 22
Environment Protection Authority v Ballina Shire Council (2006) 148 LGERA 278
Environment Protection Authority v Barclay Mowlem Construction Ltd [1998] NSWLEC 304
Environment Protection Authority v Centennial Newstan Pty Ltd [2006] NSWLEC 732
Environment Protection Authority v Cleary Bros (Bombo) Pty Ltd [2007] NSWLEC 466
Environment Protection Authority v CSR Building Products Limited [2008] NSWLEC 224
Environment Protection Authority v Daryl McCarthy Constructions Pty Ltd [2000] NSWLEC 223
Environment Protection Authority v Duke Eastern Gas Pipeline Pty Limited [2002] NSWLEC 84
Environment Protection Authority v Fulton Hogan Pty Ltd [2008] NSWLEC 268
Environment Protection Authority v G. Pezzimenti & Sons Pty Ltd [1994] NSWLEC 6
Environment Protection Authority v Gosford City Council (1997) 95 LGERA 338
Environment Protection Authority v Hochtief AG and Thiess Pty Limited [2007] NSWLEC 177
Environment Protection Authority v Integral Energy Australia Pty Ltd [2006] NSWLEC 141
Environment Protection Authority v Lithgow City Council [2007] NSWLEC 695
Environment Protection Authority v Nalco Australia Pty Ltd [2007] NSWLEC 831
Environment Protection Authority v Nowra Chemical Manufacturers Pty Ltd [2008] NSWLEC 187
Environment Protection Authority v Sell & Parker (2006) 149 LGERA 209
Environment Protection Authority v Taylor Woodrow (Australia) Pty Ltd (No 2) (1997) 97 LGERA 368
Environment Protection Authority v Timber Industries Ltd [2001] NSWLEC 25
Environment Protection Authority v Waste Recycling and Processing Corp (2006) 148 LGERA 299
Hardt v Environment Protection Authority (2007) 156 LGERA 337
Hoare v The Queen (1989) 167 CLR 348
Lovegrove v The Queen [1961] Tas S.R. 206
Markarian v The Queen (2005) 228 CLR 357
NSW Sugar Milling Co-Operative Ltd v Environmental Protection Agency (1992) 59 A Crim R 6
R v Booth (unreported, 12 November 1993, NSWCCA)
R v Carroll [2008] NSWCCA 218
R v Channells (unreported, 30 September 1997, NSWCCA)
R v Daetz (2003) 139 A Crim R 398
R v Dodd (1991) 57 A Crim R 349
R v Henry (1999) 46 NSWLR 346
R v JB; R v RJH [1999] NSWCCA 93
R v McNaughton (2006) 66 NSWLR 566
R v Slattery (1996) 90 A Crim R 519
R v Thompson; R v Houlton (2000) 49 NSWLR 383
R v Webb (2004) 149 A Crim R 167
R v Whyte (2002) 55 NSWLR 252
The Queen v De Simoni (1981) 147 CLR 383
Veen v The Queen (1979) 143 CLR 458

DATES OF HEARING: 10-13/06/08, 23/06/08 and 30/06/08 (written submissions)

DATE OF JUDGMENT:
22 September 2008

LEGAL REPRESENTATIVES:
PROSECUTOR:
Mr T. Howard
SOLICITORS:
Department of Environment & Climate Change
DEFENDANT:
Mr D. Buchanan SC and Mr D. Jordan
SOLICITORS:
Baker & McKenzie

JUDGMENT:

THE LAND AND
ENVIRONMENT COURT
OF NEW SOUTH WALES

BISCOE J

22 September 2008

50039 of 2007

ENVIRONMENT PROTECTION AUTHORITY v SNOWY HYDRO LTD

22 September 2008

1 HIS HONOUR: The defendant, Snowy Hydro Limited, pleads guilty to the charge that, from about 30 July 2006 and continuing until about 2 August 2006, it polluted waters at Jindabyne contrary to s 120(1) of the Protection of the Environment Operations Act 1997 (POEO Act). Section 120 provides:

pollute

2 The offence relates to a series of related incidents which occurred over the charge period during the final stages of a major construction project being carried out in, and immediately downstream of, the Jindabyne Dam, known as the spillway upgrade and outlet works. A component of the Snowy Mountains Hydro-electric Scheme, the Jindabyne Dam at Lake Jindabyne holds back waters of the Snowy River. The pollutant was sediment laden waters containing soil, earth, clay or similar inorganic matter. The polluted waters (the subject of the charge) were a stretch of the Snowy River approximately 15 kilometres downstream of a permeable silt curtain, which was the sole sediment control.

3 Snowy Hydro’s contractor FRH Group Pty Ltd (FRH) – which is now called Fulton Hogan Pty Ltd – has pleaded guilty to an identical charge arising out of the same incident. The two proceedings were heard concurrently. I sentence FRH in a separate judgment: Environment Protection Authority v Fulton Hogan Pty Ltd [2008] NSWLEC 268. There is a large common body of agreed facts in both cases. However, the evidence in each case was not identical and this has led to some findings in one case which are absent or inconsistent with findings in the other case. That is the inevitable consequence of having to decide each case only on the evidence in that case without regard to the evidence in the other.

4 Snowy Hydro did not directly carry out the works which introduced the pollutants into the waters. They were carried out by FRH. Snowy Hydro was the occupier of the premises from which the pollution occurred and is taken to have caused the pollution pursuant to s 257 of the POEO Act, which provides:

257 Occupier of premises responsible for pollution from premises

5 The prosecutor also submits that Snowy Hydro caused the pollution of waters according to ordinary principles of causation in that it engaged in a course of conduct, by act and omission, as presented in the case against it, which led to the proscribed pollution result (e.g. Alphacell Ltd v Woodward [1972] AC 824; Environment Agency (formerly National Rivers Authority) v Empress Car Co. (Arbertillery) Ltd [1999] 2 AC 22). While accepting that it is guilty by reason of s 257, Snowy Hydro does not accept that it also caused the pollution.

6 The main issue is one of characterisation of Snowy Hydro’s conduct in the period before and during the incident. The prosecutor submits that Snowy Hydro and FRH are equally culpable for failing to prevent and control the incident.

BACKGROUND
Snowy Hydro

7 Snowy Hydro is jointly owned by the Commonwealth (13 percent), New South Wales (58 percent) and Victorian (29 percent) Governments. Snowy Hydro provides electrical energy, electricity price risk management products and ancillary services within the national electricity market. It also owns and operates the Snowy Mountains Hydro-electric Scheme.

8 As a result of the Snowy Hydro Corporatisation Act 1997 (NSW), the Snowy Hydro Corporatisation Act 1997 (Cth) and the Snowy Hydro Corporatisation Act 1997 (Vic), Snowy Hydro is successor at law to the Snowy Mountains Hydro-electric Authority.

The spillway upgrade and outlet works

9 The passage of the Snowy Hydro Corporatisation Acts was followed by the Snowy Water Inquiry, which considered the environmental effects of the Snowy Mountains Hydro-electric Scheme, including river flows, catchment management and Snowy River rehabilitation. The Snowy Water Inquiry resulted in the formulation of heads of agreement between the New South Wales, Victorian and Federal governments, which had among its environmental objectives the improvement of the environment of the Snowy River. The heads of agreement also detailed the need for environmental releases of water (environmental flows) from Lake Jindabyne to the Snowy River downstream of Jindabyne Dam.

10 The dual purposes of the spillway upgrade and outlet works were, first, to enable environmental flows to be delivered to the Snowy River (through the outlet works) and, secondly, to provide increased spillway capacity in the event of extreme floods (through the construction of an auxiliary spillway). The construction of the spillway upgrade and outlet works was an obligation imposed upon Snowy Hydro under its Snowy Water Licence which was issued on corporatisation pursuant to the Snowy Hydro Corporatisation Act 1997 (NSW).

11 The outlet works carried out as part of the spillway upgrade and outlet works included:

12 The plunge pool as constructed is 18 metres deep and has a volume of approximately 76 megalitres. It was excavated at the base of the spillway in the Snowy River on the downstream side of the Jindabyne Dam and was designed to dissipate energy resulting from extremely large environmental flows during spillway releases and cone valve releases once the new outlet was completed.

13 While the spillway upgrade and outlet works were being undertaken, Snowy Hydro maintained, as an environmental control, an environmental release flow of approximately 96 megalitres per day via a siphon outlet which discharged water from Lake Jindabyne to a point on the Snowy River located downstream of the outlet works. This flow was often called “the riparian flow”.

14 The final stages of the works included commissioning of the plunge pool by physically connecting it to the downstream waters of the Snowy River. To achieve the connection, the plunge pool was filled, two temporary coffer dams were removed, and the earthen material next to the plunge pool was excavated to form an outlet channel to connect the plunge pool to the downstream waters. The shape and dimensions of the outlet channel were important because they had to match the shape and dimensions of the Snowy River watercourse. It was during the process of physical connection of the plunge pool to the Snowy River that the pollution occurred.

15 Until the plunge pool commissioning works were completed, the commissioning works on the mini hydro and the outlet valves could not take place, and the riparian flow could not be re-directed through the plunge pool.

16 One of the two temporary coffer dams required to be removed was a rock coffer dam. Its purpose was to prevent the waters of the Snowy River flowing back into the plunge pool construction site. Behind the rock coffer dam was a depression which functioned as a sediment basin (Sediment Basin 4). Behind that, next to the plunge pool construction site, was a clay coffer dam. Over the top of the clay coffer dam was a haul road so that construction traffic could cross the Snowy River.

17 Because the coffer dams were temporary works, Snowy Hydro did not pay as much attention to them as it did to permanent works.

18 The pollutant which entered the waters of the Snowy River downstream of the construction site comprised soil, earth, clay or similar inorganic matter:

Contract between Snowy Hydro and FRH

19 On 7 April 2004 Snowy Hydro, as principal, entered into a construction contract for the spillway upgrade and outlet works with Belmadar Constructions Pty Ltd. Later, Belmadar constructed the two coffer dams and the haul road. With effect from 1 December 2005, the contract was novated so that FRH took the place of Belmadar as contractor.

20 In the contract, Snowy Hydro emphasised that pollution in the Snowy River was a major concern to it. Under the contract, Snowy Hydro, through its Superintendent, had power to demand from FRH a method statement and a risk management assessment for the works relating to removal of the coffer dams. It also had the power to give directions to FRH in relation to those works including in relation to the prevention and control of pollution. No such method statement or risk assessment was demanded or provided. Snowy Hydro gave some directions in relation to the works, but gave none in relation to the prevention or control of pollution until Wednesday 2 August 2006.

21 The terms of the contract included the following:

The Contractor shall note that pollution in the Snowy River and Lake Jindabyne is a major concern to the Principal and the Superintendent will enforce the requirements for Soil Conservation and Erosion Controls rigidly;

(c) all works would be carried out in accordance with the development approval and an environmental management plan prepared by the contractor, which was to be submitted to the Superintendent for approval. That was to be a plan which described the measures which would be taken by the contractor to avoid adverse environmental impacts, in each specific location of works under the contract (Section E Specification cl 1.13, Section D Conditions cll 9.31 and 14.3). Among the matters to be included in the environmental management plan were details of the site specific controls to be adopted to ensure environmental requirements were met; details of the resources proposed to be used to manage environmental issues; details of water quality discharge requirements; details of each environmental issue and impacts; and risk assessment of each potential impact using the appropriate Australian Standard (Section E Specification cl 2.15);

(d) FRH was obliged to immediately report to the Superintendent all safety and environmental incidents, accidents and potential hazards. If such an incident occurred, the Superintendent could direct all works on site to be suspended (Section D Special Conditions cl 9.5);

(e) FRH was obliged to satisfy all legislative requirements including the requirements of the POEO Act: (Section C General Conditions cl 11.1, Section D Special Conditions cl 9.3.3);

(f) the “Superintendent” under the contract was a Snowy Hydro executive, Mr Brett Jones (Section C General Conditions cl 1);

(g) FRH was required to carry out and complete the works under the contract “in accordance with the Contract and directions authorised by the Contract” (Section C General Conditions cl 2.1). Directions could be given by the Superintendent or by the Superintendent’s representative (Section C General Conditions cll 20 and 21). The Superintendent’s powers of direction included a power to direct FRH to suspend the carrying out of any works if the Superintendent was of the opinion that it was necessary because of an act, default or omission of FRH (Section C General Conditions cl 33);

(h) formal progress meetings between Snowy Hydro and FRH were to (and did) take place on a weekly basis (Section D Special Conditions cl D.7);

(i) the contract contains a number of clauses whereby FRH agrees to indemnify Snowy Hydro.

Snowy Hydro’s active role

22 Snowy Hydro had an active role in the construction project. It dealt with regulators and members of the public. It had its own site office on the construction site. It normally had personnel present every working day except Sundays. There was constant communication and collaboration between Snowy Hydro and the contractor in relation to the construction program, including weekly progress meetings and day to day discussions. There were discussions between Snowy Hydro and its contractor in respect of the particular works which caused the pollution, and Snowy Hydro directed the contractor in respect of the carrying out of those works. The plunge pool outlet channel, which was the pollution conduit, was excavated by the contractor to the specifications of Snowy Hydro. Those specifications were not pre-determined by contract drawings but were dictated on site by Brian Mayhew (Snowy Hydro’s Structures and Dam Safety Manager and Construction Manager for this project) whilst the works were being carried out. Mr Mayhew reported to Brett Jones, Snowy Hydro’s Superintendent.

23 Snowy Hydro utilised the services of two or three full time site inspectors. The site inspectors spent most of their time on the site monitoring and inspecting the works carried out by the contractor in order to examine compliance with the contract and the environmental management plan. They had power to stop works and to direct FRH to carry out works in accordance with the contract – a power delegated by Mr Jones as Superintendent.

24 One of the site inspectors was Ian McCann, who gave evidence for the prosecution. Mr McCann was aware that the excavation of the coffer dams and haul road was to commence on 28 July 2006. His role in respect of that excavation was to ensure that the width and depth of the channel joining the plunge pool and the Snowy River was achieved. Mr McCann was not aware of any written plans or specifications for that task. It was his understanding that the works were to be completed to the satisfaction of himself and Mr Mayhew, to whom Mr McCann reported on a daily basis both verbally and in reports. It was Mr Mayhew who would give him direction in the works that he was to carry out.

Development application, assessment and approval

25 In 2003, Snowy Hydro submitted a development application to Snowy River Shire Council to carry out the spillway upgrade and outlet works. The development application was supported by two Statements of Environmental Effects (SEE). The SEE noted that the Snowy River Inquiry had identified the section of the Snowy River downstream from the Jindabyne Dam to the junction with the Delegate River as highly degraded (p 118). The SEE noted that potential adverse impacts would generally be restricted to the construction phase and included potential erosion and sedimentation during and immediately following activities that disturbed the land surface or were carried out within water bodies. The SEE stated that “These potential impacts are of particular importance” (p 119).

26 The development application proposed that a water quality guideline of less than or equal to 150 NTU be adopted for water discharged into the Snowy River. A water quality guideline of less than or equal to 50 NTU was proposed for 150 metres upstream of the construction activities on the surface of Lake Jindabyne.

27 Turbidity expressed as NTUs (nephelometric turbidity units) is a measurement derived from the degree to which light is able to penetrate the water column. It is relevant to note that the measurement of total suspended solids (TSS) is an alternative to the measurement of turbidity for the purpose of determining the degree or concentration of solids suspended in a water column. The concentration of TSS is expressed in milligrams per litre (mg/L) and is a measurement of the weight of solids in milligrams per litre of water.

28 In accordance with the scheme for integrated development under the Environmental Planning and Assessment Act 1979 (EPA Act), various approval bodies were forwarded copies of the development application and invited to provide general terms of approval to the council. One of the approval bodies was the Environment Protection Authority (EPA).

29 By letter dated 1 August 2003, the EPA requested additional information and expressed concerns about Snowy Hydro’s proposed water quality guidelines. Snowy Hydro replied by letter dated 18 September 2003.

30 On 7 October 2003, representatives of the EPA and Snowy Hydro met. They discussed Snowy Hydro’s proposed water quality guidelines. There was no agreement in respect of that issue. The parties agreed that the EPA would nevertheless issue its general terms of approval for the purposes of the assessment of the development application.

31 By letter to Snowy Hydro dated 3 December 2003, the EPA issued its general terms of approval. They were provided by the EPA in contemplation of like conditions being inserted in the environment protection licence by way of licence variation. In respect of discharges to downstream waters, conditions 2.1.2 and 3.2 of the general terms of approval specified discharge limit points to the Snowy River immediately downstream of each “pollution control structure that discharges” from the Jindabyne Dam and spillway premises, to which a discharge concentration limit of 30mg/L of TSS applied. That was a more stringent water quality criterion than Snowy Hydro’s previously proposed 150 NTU (see [26] above). I do not consider that the silt curtain (located downstream of the plunge pool and coffer dams) could be described as a “pollution control structure that discharges” from the premises.

32 By letter dated 20 January 2004, Snowy Hydro responded to the EPA’s general terms of approval and re-addressed the issue of the proposed turbidity guideline.

33 On or about 28 January 2004, representatives of the EPA and Snowy Hydro met to discuss outstanding issues with respect to the general terms of approval, including the issue of water quality. At the meeting, it was agreed that:

background

34 On or about 12 February 2004, EPA and Snowy Hydro representatives attended the area in the vicinity of the Jindabyne Dam and agreed on three sites to represent the ambient measurement of suspended solids for the purposes of condition 3.2 of the general terms of approval.

35 The EPA issued its final (amended) general terms of approval on 16 February 2004. They were relevantly in the same terms as the general terms of approval referred to above, although the discharge limit was stated to be 30mg/L of TSS “plus ambient background”.

36 On 17 February 2004, the council issued its development consent to Snowy Hydro for the spillway upgrade and outlet works. The EPA’s general terms of approval were incorporated in the consent.

Environment protection licence

37 In 2004, Snowy Hydro’s existing environment protection licence was amended so that it extended to, and imposed controls over, the carrying out of the spillway upgrade and outlet works. The definition of "premises" in the amended environment protection licence included the construction site downstream of the Jindabyne Dam wall where the plunge pool and the temporary coffer dams were to be constructed. The environment protection licence required the licensee to comply with s 120 of the POEO Act, except as may be expressly provided in any other condition of the licence.

38 The environment protection licence did not permit polluted waters to be discharged from the plunge pool outlet works into the Snowy River. The only point at which the licence permitted pollutants to be discharged to the Snowy River from the construction site was at Point 17, which was the final point for the treatment of stormwater retained on the site. Point 17 was located at the end of an erosion gully, flowing into the Snowy River from Sediment Basin No 3, a little downstream from the silt curtain. At Point 17 the licence permitted a 30 mg/L ambient percentile concentration of TSS.

39 As with condition 6.6 of the EPA's general terms of approval, the amended environment protection licence included a condition (E4) requiring Snowy Hydro to prepare a construction management plan for the Jindabyne Dam spillway premises, which had to be provided to and approved by an EPA Regional Manager prior to the commencement of construction. The construction management plan was required to include:

40 In June 2005, the environment protection licence was varied to remove condition E4, as the construction management plan had been submitted and approved by the EPA on 15 July 2004, as described below.

41 In May 2004 Snowy Hydro sent to the EPA a letter which enclosed what it described as an “Environmental (Construction) Management Plan as required under Consent Condition 6.6 of the EPA’s General Terms of Approval for the above project (and draft amendment to the Environment Protection Licence…)”.

42 That plan was in fact entitled “Environment Management Plan”. It had been prepared by Belmadar, as required under its contract with Snowy Hydro. Snowy Hydro required an environmental management plan for all of its projects to identify the potential environmental impacts of a project, to assess the risks associated with those impacts and to describe how the impacts will be avoided or minimised.

43 The environmental management plan included a “Water Control Plan”. The environmental management plan indicated that the contractor’s construction activities had “the potential to impact on water quality both directly and indirectly”, and that the plan’s objectives were to both “limit erosion and sedimentation” and “limit impacts on nearby receiving waters”. A safety measure which the environmental management plan required to be in place for the entirety of the project was as follows:

A silt curtain will be positioned within Jindabyne Lake during the construction activities adjacent to water. The silt curtain will be erected to prevent sediment runoff into the Lake… The design implemented for the project is based upon industry standard which has been found effective in similar applications. Results of monitoring will determine if more controls are required.

44 There was no pollution incident in Jindabyne Dam involving sediment. As part of “General Mitigation Measures”, the Water Control Plan also provided for “Silt curtaining [of] all the areas with a potential for receiving runoff” and “Constant risk assessment and taking pre-emptive actions to contain and address the risk of affecting the Water quality”. In relation to the rock coffer dam, the Water Control Plan provided that the following practices were to be put in place:

45 The environmental management plan, at section 4.3.1, included a table under the heading "Water Quality Management Plan, Key Performance Indicators" which comprised information under three columns: "Parameter", "Threshold" and "Measurement Location". The table included an entry identifying turbidity as the parameter, identifying <150 NTU as a threshold and identifying various measurement locations described as "Discharge points to stream and rivers (prior to mixing)”. The table also included an entry identifying total suspended solids as a parameter and identifying a threshold of <30mg/L plus ambient background at various measurement locations. The only relevant measurement location in both entries was “3B”. It was in the same location as Point 17 referred to in the environment protection licence (discussed at [38] above). The integrated development consent, including the EPA’s general terms of approval, was annexed to the environmental management plan.

46 By letter dated 9 June 2004 to Snowy Hydro, the EPA approved the commencement of project works conditional upon the supply of further information by 28 June 2004. The letter stated that:

The DEC considers that it would be appropriate to base turbidity performance criteria on the Australia and New Zealand Environment and Conservation Council (ANZECC) Guidelines (2000) rather than the trigger value of 150 NTU proposed by SHL. The ANZECC Guidelines recommend a turbidity level of 2-25 NTU for the protection of aquatic ecosystems in upland rivers. However, compliance with the Total Suspended Solids discharge limit of 30mg/L + ambient is the DEC's primary responsibility.

47 By letter dated 15 July 2004 to Snowy Hydro, the EPA stated: "The DEC has reviewed the additional information for the [Construction Management Plan] and considers that this information, together with the CMP, satisfies the requirements of condition E4". The EPA requested that an updated environmental management plan containing the information provided in the letter of 28 June 2004 be forwarded to the EPA.

48 In September 2004, Snowy Hydro sent a consolidated version of the environmental management plan to the EPA. The plan was updated in March 2005. The table in section 4.3.1 (the Water Quality Management Plan) was the same for all versions of the environmental management plan. The development consent, including the EPA's general terms of approval, was also annexed to all versions of the environmental management plan.

WORKS PRIOR TO COMMISSIONING OF THE PLUNGE POOL

49 The spillway and upgrade outlet works included a new water intake channel and intake tower at the dam wall in Lake Jindabyne. In order to enable construction of the intake tower, the structure had to be kept dry. This was achieved by the emplacement of a temporary clay coffer dam in Lake Jindabyne at the entrance of the inlet channel (referred to as the intake channel coffer dam). This was separate to the temporary clay and rock coffer dams located downstream of the plunge pool. Upon completion of the construction of the intake tower, the intake channel coffer dam was removed to enable water to flow into the new intake water channel.

50 The outlet works were designed so that water from Lake Jindabyne entering the intake tower could discharge to the plunge pool either through two large cone valves or by a different route via the mini hydro building, which included a submerged discharge valve. They were designed so that water could also discharge into the plunge pool, if necessary, via the existing spillway when the water level permitted.

51 On or around 21 July 2006, commissioning works were commenced in which, for the first time, waters from the new intake tower were released into the plunge pool via the submerged discharge valve. This was done for the purpose of testing the transit of water via that route and, also, to commence filling the plunge pool. The filling of the plunge pool in this manner occurred intermittently over the period from 21 July to 1 August 2006 inclusive when the plunge pool was connected to the downstream waters of the Snowy River. Minutes of a progress meeting between FRH and Snowy Hydro personnel on 21 July 2006 recorded: “Plunge Pool Outlet Channel – FRH asked to what depth the channel needs to be excavated to. SHL confirmed that it needs to be to rock as discussed previously”.

52 The purpose of filling the plunge pool was to bring it up to a level which was fairly close to (but lower than) the level of the waters in the Snowy River downstream prior to completing the removal of the clay and rock coffer dams, which would connect the plunge pool to those downstream waters. This was to prevent a situation from arising where, if the level of water in the plunge pool was much lower than the level of the downstream water in the Snowy River at the time of connection (which it would have been had the plunge pool not been filled, having been excavated to a depth of 18 metres), the differential pressure (water pressure being higher where the water level is higher) would cause a rapid backflow of water from the downstream Snowy River into the plunge pool, possibly causing erosion. FRH initiated the filling of the plunge pool as part of the works under the contract. Snowy Hydro authorised and controlled the release of the water through the submerged discharge valve.

53 A significant volume of the water released into the plunge pool via the intake tower and mini hydro during the period from 21 July to 1 August 2006 was turbid, discoloured water. That water discharged from the submerged discharge valve. The presence of earthen material suspended in this water was, or was likely to have been, due to the fact that, during the removal of the intake channel coffer dam, clay and possibly other earthen material from the coffer dam was released and entered into and settled in the intake channel tower. This earthen material was then subsequently entrained and discharged through the submerged discharge valve into the plunge pool when the plunge pool was filled.

54 Additional sediment would have been entrained and discharged into the plunge pool during the same process by reason of the fact that the waters discharged from the submerged discharge valve flowed into the plunge pool via an earthen channel (lined with rock) and then cascaded down the wall of the plunge pool in a location where the wall comprised a considerable amount of earthen material in addition to rock.

55 At the time the plunge pool commission works were commenced there was a doubled over silt curtain in place across the Snowy River downstream of the rock coffer dam. This was the only sediment control in place.

CIRCUMSTANCES OF THE OFFENCE
Friday 28 July 2006

56 At a meeting on Friday 28 July 2006 between Snowy Hydro officers and FRH officers, the excavation of the plunge pool outlet channel was discussed. The Snowy Hydro officers present at the meeting were Brett Jones (Snowy Hydro’s Superintendent under the contract), Brian Mayhew (Structures and Dam Safety Manager and Construction Manager for this project) and Michael Thornton (Project Engineer for the FRH works). The FRH officers present were Scott Macklin (Construction Manager), Ken Casley (Project Manager), Michelle Rafferty (Project Engineer) and Vincent Moscolo. The minutes record: “Commence rehab and open up plunge pool outlet channel”.

57 It was the intention and understanding of Snowy Hydro and FRH that these works would be completed on or about 1 August 2006. However, there were no penalties payable if the works were not completed by that date.

58 Mr Jones understood that the majority of the excavation work would be done upstream, commencing at the plunge pool, and that a minimum amount of work would occur in the wet. More particularly, he understood that having started upstream next to the plunge pool, the works would progressively proceed downstream in the dry; that the most downstream area (the rock coffer dam) would be removed last in the wet; and that the plunge pool would be filled just prior to breaching the rock coffer dam and the water level in it would be slightly lower than the Snowy River. He was surprised later when he learned that outlet channel excavation work was carried out downstream before completion of the works upstream.

59 On Friday 28 July, FRH began the excavation of the proposed channel between the plunge pool and the downstream Snowy River on the plunge pool side of the clay coffer dam and haul road. The works included excavation of a channel to connect the plunge pool to the River. Scott Suthern, the FRH earthworks foreman, was present. There were two excavators (one 30 tonne and one 75 tonne) excavating earth and loading it into two large dump trucks, also driven by FRH personnel. The trucks dumped the earth in a stockpile location.

60 There were no environmental controls in place on the plunge pool side to control the migration of sediment into the waters of the plunge pool.

61 Ian McCann was present on site as a Snowy Hydro site inspector. His role was to ensure that the width and depth of the channel joining the plunge pool and the River were achieved.

Saturday 29 July 2006

62 The excavation of the plunge pool side of the haul road, including excavation of the channel to connect the plunge pool to the River, continued on Saturday 29 July 2006.

63 Brian Mayhew (Snowy Hydro) directed Scott Macklin (FRH) with respect to the depth, width and profile of the channel to conform to a profile determined by Snowy Hydro to be appropriate. Ian McCann had a number of conversations with Brian Mayhew, Scott Macklin and Scott Suthern (FRH). Mr McCann at one stage said to Mr Macklin: “The depth of the channel is too shallow. We need you to make it deeper." Mr Macklin replied: "We can make that deeper."

64 Ian McCann observed the depth and shape of the channel being excavated to connect the plunge pool to the Snowy River.

65 Other works that were conducted in relation to the removal of the coffer dams included the shaping/excavation of the banks of the Snowy River to provide a solid base from which the excavators could operate.

66 At the time that excavation of the outlet channel was carried out on 28 and 29 July 2006, there was discoloured water in the plunge pool.

67 Mr Mayhew and Mr McCann agreed at the end of the day that the earthworks on the plunge pool side had been completed to a satisfactory level; that is, that the channel’s width and depth had been achieved to the desired level.

68 Snowy Hydro knew FRH had commenced the process of removing the physical barriers between the plunge pool and the Snowy River, that this work would continue next day and would continue into and be completed the following week.

Sunday 30 July 2006

69 According to the evidence in this case, no-one from Snowy Hydro was on site on the Sunday and Snowy Hydro was unaware that day of the commission of a pollution offence. Snowy Hydro did not know on the Sunday that FRH would be removing the rock coffer dam on that date.

70 On Sunday morning FRH commenced excavation works within the River to remove the rock coffer dam to the level of the Snowy River bed. These were wet works - below the water line. These works were carried out by Scott Suthern (the sole FRH excavator operator) and two other FRH employees (who were operating trucks).

71 About one hour after commencing removal of the rock coffer dam, Mr Suthern observed discoloured water downstream of the silt curtain. It was a brown colour. He informed his immediate supervisor, Scott Macklin, who instructed him to continue digging. Mr Macklin also saw colloidal material downstream of the silt curtain.

72 Mr Suthern continued excavating the rock coffer dam until about 3:30pm, which was the scheduled knock-off time. Most, if not all, of the rock coffer dam had been removed by that time. Sediment continued to enter the Snowy River while Mr Suthern was carrying out these works.

Monday 31 July 2006

73 On Monday 31 July 2006 excavation works were carried out to remove the remainder of the rock coffer dam, and then to commence removal of further material from the clay coffer dam. Mr Macklin was present on and off supervising the works for FRH.

74 Ian McCann arrived on site at 7:30am. He noticed that excavation works had been carried out the previous day where the rock coffer dam had been and that most of it had been removed. He saw FRH personnel had already commenced works. The 75 tonne excavator was carrying out wet works in the Snowy River. Mr McCann observed discolouration of the Snowy River both within the silt curtain area and, to a lesser extent, downstream on the Snowy River side of the silt curtain. He became aware that there had been an incident involving the discoloured water entering the Snowy River the previous day. The sediment from the excavation works continued to build up during the course of the morning. He saw it as his role to report this type of incident to his immediate supervisor.

75 The plunge pool commissioning works continued the whole day. The sediment and discolouration downstream of the silt curtain continued to increase during the day. Later in the day, the colour in the water downstream of the silt curtain was consistent with the colour of the water between the coffer dam and the silt curtain.

76 A sample was taken by Elise Stone of FRH in the plunge pool and inside the silt curtain. The sample in the plunge pool had an in situ level of 108 NTU. The sample taken inside the silt curtain had a level of 405 NTU. During the morning she left two messages on the voicemail of Mr Endersby of Snowy Hydro, in which she reported on the turbidity of the plunge pool, but did not mention that there was pollution downstream of the silt curtain.

77 During the removal of the coffer dams on Sunday 30 and Monday 31 July 2006, sediment laden water containing soil and earth or similar inorganic matter, and/or liquid that contained soil and earth or similar inorganic matter moved from that part of the Snowy River upstream of the silt curtain to that part of the Snowy River downstream of the silt curtain.

78 In cross-examination Mr Jones accepted that by the afternoon of Monday 31 July, Snowy Hydro had cause to be concerned that continuation of the works would cause further pollution of the Snowy River (although, he said, he was not personally aware of it).

Tuesday 1 August 2006

79 On Tuesday 1 August FRH employees continued the excavation and removal of the clay coffer dam. As yet, there was no connection between the plunge pool outlet channel and the Snowy River.

80 Between 10am and 10:50am, a Snowy Hydro employee or employees took a number of in-situ turbidity readings. The reading between the coffer dam and the silt curtain was 19 NTU. The reading in the plunge pool was 250 NTU. Readings at sites W2 and W3 (downstream from the silt curtain) were 7 NTU. At this time the Snowy River downstream of the silt curtain was light green.

81 At approximately 10:15am a local resident, Mr Bruce Hodges, contacted the Department of Environment and Climate Change (DECC) and reported a pollution incident. Mr Hodges was a local landowner whose property was located approximately 3km downstream from Jindabyne Dam. At around the same time, Mr Hodges also contacted Snowy Hydro and complained that there was mud in the Snowy River flowing past his property. The Snowy Hydro Construction Manager, Mr Mayhew, returned his call. Mr Hodges informed Mr Mayhew that he had contacted the EPA and Snowy River Shire Council. Mr Mayhew was not at the site at the time of this phone call but travelled to the site shortly afterwards.

82 Mr Mayhew contacted Mr Jones, the Snowy Hydro Superintendent, to discuss the matter. Mr Mayhew also contacted and informed an employee of the council of the complaint received by Snowy Hydro; that it was being investigated by Snowy Hydro; and that the environmental releases from Jindabyne Dam to the downstream part of the River may be temporarily stopped if needed to reduce any impacts. The council indicated that it would monitor for any issues at the water supply off take at Dalgety, which was downstream.

83 Between approximately 11am and noon, Mr Mayhew and other Snowy Hydro officers observed that the water downstream of the silt curtain was green with no obvious discolouration. Mr Mayhew kept Mr Jones informed of what was happening on the site throughout the day.

Connection of plunge pool to Snowy River on Tuesday 1 August 2006

84 At approximately midday on Tuesday 1 August, as a result of the continuing excavation works, FRH completed the excavation of all of the earthen and clay material between the plunge pool and the downstream waters of the Snowy River, breached the clay coffer dam/haul road and thereby connected the waters of the plunge pool with the downstream waters of the River. At the time that the plunge pool was connected to the Snowy River at around midday on Tuesday 1 August 2006, the water in the plunge pool was turbid and the plunge pool was close to being full.

85 Initially, upon the connection being effected, the water downstream of the plunge pool was higher than the water level in the plunge pool. As a result, the water from the River flowed upstream into the plunge pool.

86 At approximately 1:25pm Snowy Hydro took a reading of 11 NTU at site W3. At approximately 1:30pm, Snowy Hydro took a reading of 24 NTU at site W2. Sites W2 and W3 were some way downstream from the silt curtain.

87 At approximately 1:30 pm Messrs Endersby and Mayhew noticed slight discolouration immediately downstream of the silt curtain. Mr Endersby suggested to a FRH employee that the curtain be adjusted.

88 By approximately 3pm, after the level of the water in the plunge pool had equalised with the level of the water in the River, water from the plunge pool flowed downstream. The water downstream of the silt curtain became increasingly discoloured. This was due to the presence of suspended solids and/or water containing suspended solids, which had migrated from the upstream work site.

89 At around 3.30pm Snowy Hydro employees and FRH employees met and discussed options for improving controls for the work, including the following:

90 Samples were taken by Elise Stone in the plunge pool at approximately 4pm. They had an in situ level of 168 NTU.

91 Employees of Snowy Hydro took a number of photographs which show the excavation work to connect the plunge pool to the River, the initial upstream flow of the River into the plunge pool and the equalisation of the water level between the River and the plunge pool.

92 During the afternoon FRH adjusted the position and tightness of the silt curtain.

93 At about 4:15pm, DECC officers arrived at the Jindabyne Dam construction site. They inspected the site where works had been undertaken to excavate the coffer dams with representatives of FRH and Snowy Hydro. The DECC officers observed that the River was discoloured. They also observed a floating silt curtain, located about 10 metres downstream from where the excavation works were being undertaken. A number of water samples were collected by the DECC officers for analysis of TSS concentration and turbidity, as follows:

Wednesday 2 August 2006

94 During the morning of Wednesday 2 August, excavation work on the clay coffer dam recommenced, initially above the water level.

95 Between approximately 8am and 8:30am Snowy Hydro took samples of 15 NTU at W2 (downstream of the silt curtain), 32 NTU upstream of the silt curtain and 195 NTU in the plunge pool. By 9:30am discoloured water was observed downstream of the silt curtain.

96 At approximately 9:30am, following discussion between Snowy Hydro and FRH and at FRH's request, Snowy Hydro stopped the environmental releases from the siphon outlet. This was done so that FRH could adjust the silt curtain to improve its effectiveness.

97 Between approximately 9:30am and 10am, after the environmental releases were stopped, there was a slow movement of water from the plunge pool into the River downstream of the silt curtain, with a corresponding increase in discolouration downstream of the silt curtain.

98 Between 10am and 10:20am, Snowy Hydro took samples of 350 NTU between the coffer dam and the silt curtain and 84 NTU at W2 (downstream of the silt curtain). At 10:30am Elise Stone took a sample in the plunge pool at an in situ level of 116 NTU and again at 11:45am at an in situ level of 122 NTU.

99 At approximately 10am, Brian Mayhew (Snowy Hydro) directed FRH to stop all work below water level as the silt curtain did not appear to be effective. The direction was made because it was considered that FRH were not meeting the requirement under their contract to do their work specifically without harm to the River. The channel below water remains the same today as when work ceased.

100 Between 9am and 12:25pm, FRH moved and then installed an additional silt curtain downstream from the existing silt curtain. This was still occurring at approximately 12:25pm when the colour of the water upstream and downstream of the silt curtain was similar.

101 At approximately 12:30pm, DECC officers returned to the works site. They observed that the River was discoloured with no discernable colour difference upstream and downstream of the silt curtains. They took the following water samples, which were later analysed and found to have the following properties:

102 Between approximately 1pm and 1:20pm, Snowy Hydro took a sample of 190 NTU between the coffer dam and the silt curtain, 250 NTU at W2 and

103 Later that day, DECC officers undertook an aerial investigation of the Snowy River by helicopter. They observed discoloured water in areas of the River up to approximately 15km downstream of the Jindabyne Dam wall.

Events after Wednesday 2 August 2006

104 From Thursday 3 August to 17 October 2006 (with the exception of some Sundays) Snowy Hydro carried out water testing in the plunge pool and at various locations along the Snowy River. Snowy Hydro also conducted inspections of the Snowy River by helicopter.

105 On Thursday 3 August, Snowy Hydro took a sample of 93 NTU in the plunge pool (lab results 35 NTU; 24 mg/L TSS) and samples from various locations downstream of the silt curtains, as follows:

106 Mr Jones was on site and was aware from other Snowy Hydro employees that turbidity was elevated for a long way down the River.

107 On Friday 4 August 2006, DECC issued Snowy Hydro with a clean-up notice pursuant to s 91 of the POEO Act (Clean-Up Notice No. 1). The notice required Snowy Hydro to prepare a mitigation report in respect of the impact caused by the pollution incident, to provide a copy of the report to DECC by 7 August 2006 and not to release water from the plunge pool and the area of soil disturbance associated with the removal of the coffer dam unless its turbidity value was less than 20 NTU. Mr Jones was on site and continued to collect as much information as he could as to the causes of the incident and what could be done in response. Minutes of a progress meeting record FRH stating that it would be preparing an incident report and submitting it to Snowy Hydro as soon as possible. Although Mr Jones later followed up the provision of an incident report with FRH, FRH has never supplied an incident report.

108 On Saturday 5 August, Snowy Hydro installed sediment control near the Dalgety Water supply off take point about 27 kilometres downstream. Around this time, Mr Jones took a helicopter flight down the Snowy River and was surprised at the extent of the discolouration.

109 On Monday 7 August 2006, Snowy Hydro submitted a mitigation report to DECC as required by Clean Up Notice No. 1. The mitigation report detailed what had occurred and advised DECC that ongoing investigation and assessment of possible mitigation measures was continuing. The report favoured continuation of the release of water through the environmental release siphon at the maximum rate of 96 ML/day. A summary of the water quality data obtained by Snowy Hydro was also provided to DECC.

110 Commencing on 8 August 2006, a number of consultants retained by Snowy Hydro began to investigate and provide advice as to the best way of dealing with the sediment in the River, the effects of the pollution of the River and the best way of mitigating those effects. One was Dr Chris Gippel, a fluvial geomorphologist. He was engaged to inspect the site and the River and to provide advice. He inspected the area on 8 August and provided his advice on 11 August 2006.

111 On 8 August 2006 Snowy Hydro responded in writing to a suggestion by DECC that one potential mitigation option may be the release of a flushing flow from Lake Jindabyne. Snowy Hydro confirmed that the release of water from Lake Jindabyne had been considered but had not been implemented because the dam release valves were upstream of the plunge pool and that such a flushing flow would cause further suspended material to be released from the plunge pool. Snowy Hydro indicated that it was prepared to release such a flow if required by DECC, subject to various matters being resolved, and that it was continuing to consider other mitigation options. The letter also noted that as at midday on 8 August there was some remaining turbidity but no discernable slug of discoloured water in the River.

112 Snowy Hydro continued to investigate possible treatment of the plunge pool, including the use of flocculation and sand filtration.

113 On 10 August, Snowy Hydro received and reviewed a letter from DECC indicating that DECC was anxious to see a flushing flow delivered to the River downstream of Jindabyne Dam as a matter of urgency. DECC requested that Snowy Hydro provide a strategic flushing flow package and plunge pool treatment plan by Tuesday 15 August 2006.

114 On 15 August, Snowy Hydro forwarded a "Report on Strategic Flushing Flow Package And Plunge Pool Treatment Plan For Jindabyne Dam Outlet Works" to DECC examining options and making recommendations for:

115 Photographic evidence shows that by 17 August, three separated silt curtains were in place downstream of the plunge pool. The placement of multiple silt curtains appears to have been effective as a control to prevent the migration of sediment downstream from the plunge pool. Mr Jones agreed with that proposition in cross-excavation. He also agreed that with hindsight that sort of system could have been put in place prior to connection of the plunge pool to the Snowy River.

116 On 18 August DECC issued a second Clean-Up Notice pursuant to s 91 of the POEO Act (Clean-Up Notice No. 2). Clean-Up Notice No. 2 required Snowy Hydro to treat all the water in the plunge pool in such a manner as to ensure that from 11 September 2006 the plunge pool could be put into regular operation without polluting waters.

117 On 29 August, Snowy Hydro responded to Clean Up Notice No. 2. While noting that it had been Snowy Hydro's preferred option to allow the plunge pool to settle without the use of flocculant, Snowy Hydro submitted a proposal to dose the plunge pool with a low-toxicity polymer flocculent. An application to vary the environment protection licence was also submitted to permit the addition of the flocculent to the plunge pool.

118 On 1 and 6 September, telephone conferences were held between Snowy Hydro and various government departments in order to develop a whole-of-government response to the turbidity events. On or around 16 September 2006 FRH commenced commissioning of the cone valves.

119 On 18 September, an amended environment protection licence was issued by DECC. The amendment required the monitoring of turbidity three times per day within a given time period at both a new plunge pool discharge point and an ambient point in Lake Jindabyne from 18 September 2006 to 31 October 2006. Turbidity limits were established at the discharge point from the plunge pool of either 20 NTU, or background plus 5 NTU, whichever was greater.

120 On 20 September, the former Department of Natural Resources, as owner of the water within Jindabyne Dam, issued Snowy Hydro a formal notice about revised September and October environmental release regimes from Jindabyne Dam. The terms of this notice were agreed to by Snowy Hydro prior to the issuance of the notice.

121 On 22 September, Snowy Hydro monitored turbidity results in the Jindabyne Dam and plunge pool including the results of the Cone Valve Tests and Water Quality Tests. Maximum turbidity levels at the new discharge point of the plunge pool into the River was 15 NTU. This was within the new environment protection licence threshold of 20 NTU.

122 The SEE did not expressly refer to the potential for the waters of the Snowy River to be polluted during the process of connection to the plunge pool. However, FRH was required to carry out a risk assessment pursuant to the environmental management plan. Snowy Hydro admits that:

(a) it did not receive from FRH any written specific method statement, risk assessment or turbidity management plan for the plunge pool commissioning works (i.e. the removal of the clay coffer dam/haul road and the rock coffer dam, and the excavation of the channel to connect the plunge pool to the waters of the Snowy River); and

(b) so far as it is aware, FRH did not prepare any such document.

123 Prior to carrying out the plunge pool commissioning works, FRH personnel (Mr Macklin and Mr Suthern) discussed how the works were to be carried out. FRH personnel (Mr Macklin, Mr Casley and Ms Rafferty) also met and attempted to identify risks and a minimisation of risks approach. Snowy Hydro admits that, so far as it is aware, no record was made of either the discussion between Mr Macklin and Mr Suthern, nor of the discussion which occurred at the meeting Mr Macklin attended with Mr Casley and Ms Rafferty.

124 At the time the plunge pool commissioning works commenced, there were no environmental controls in place other than the silt curtain downstream of the coffer dams and the riparian flow. Snowy Hydro admits that:

(a) apart from observing that it was in place, it did not check or assess the silt curtain before any works were done to remove the temporary coffer dams and connect the plunge pool to the Snowy River; and
(b) so far as it is aware, apart from observing that it was in place, FRH did not check or assess the silt curtain before any works were done to remove the temporary coffer dams and connect the plunge pool to the Snowy River.

125 Snowy Hydro did not request from the contractor and did not receive a method statement or risk assessment for the plunge pool commissioning works and did not undertake its own risk assessment of the plunge pool commissioning works.

126 Snowy Hydro employees observed some of the excavation works on 28, 29 and 31 July and 1 and 2 August 2006.

127 Snowy Hydro had the following procedures in place or took the following steps in order to check that the contractor complied with the contract in relation to environmental compliance obligations, in particular, and that environmental matters were being appropriately managed:

(a) Snowy Hydro retained a third party to draft the Environmental Management and Safety Plan Framework and attached that to the Contract;
(b) Snowy Hydro retained the contractor on the basis of its experience in large scale civil construction projects, including work in and around water, and relied on that contractor’s expertise;
(c) through the contract, Snowy Hydro required the contractor to prepare the environmental management plan and carry out the works in an environmentally responsible manner and in accordance with the development approval, the environmental management plan and all relevant law;
(d) Snowy Hydro reviewed drafts of the environmental management plan;
(e) Snowy Hydro received safe work method statements from the contractor;
(f) Snowy Hydro reviewed monthly progress reports from the contractor dealing with environmental issues, including water quality monitoring;
(g) Snowy Hydro representatives attended progress meetings at which the environment was a standing agenda item and it raised or discussed any environmental issues as appropriate.

128 In summary, Snowy Hydro’s case is as follows:

(a) it is liable by force of s 257 of the POEO Act which deems an occupier to be guilty of an offence against the Act committed by a person with which the occupier is associated. It submits that is should not be sentenced on the basis that it bears a greater degree of responsibility than this. The pollution was caused not by Snowy Hydro but by FRH when it removed the coffer dams and failed to implement effective pollution controls, by way of silt curtain or otherwise;
(b) in hindsight, and with the benefit of provisions of its contract with FRH, Snowy Hydro had the power to demand a method statement for the works relating to removal of the coffer dams and a risk assessment for the works, including as to the efficacy of the silt curtain. However, at the time, Snowy Hydro was busy with other important permanent works and, on the basis of its previous experience with the successful removal of a clay coffer dam in Jindabyne Lake around the intake tower, Snowy Hydro had faith in the ability of FRH to remove coffer dams without adverse effect upon the Snowy River;
(c) Snowy Hydro had no reason to think that FRH would adopt the risky method it did or that its control (the silt curtain) would not be effective;
(d) when, on Tuesday 1 August, senior management in Snowy Hydro became aware of what was happening, it engaged with FRH to remedy the situation, advising that the scope of works could be modified if it became apparent that there was a risk of sending turbidity downstream. Once it became clear on the morning of Wednesday 2 August that FRH could not complete the works without continuing pollution, Snowy Hydro stopped the works;
(e) Snowy Hydro recognised that it should have had more rigorous systems in place to ensure it had greater control over the way FRH excavated the outlet channel and over the way FRH intended to prevent the turbidity ultimately generated, and emanating from the plunge pool, from passing down the Snowy River. These failings extended to a lack of a sufficiently rigorous system to ensure that the discolouration observed on 31 July was reported immediately to senior management (Mr Mayhew, the Snowy Hydro construction manager). The failure of FRH to report the commencement of the offence on Sunday 31 July, however, was contrary to FRH’s obligations;
(f) having regard to the length of time that Snowy Hydro and FRH had cooperatively worked on this substantial project, Snowy Hydro was not able, as a matter of practical reality, to foresee and control the way FRH would, at the very end of the contract, go about this aspect of its work. That relative lack of foreseeability and practical control are mitigating factors;
(g) because the coffer dams were temporary works, Snowy Hydro paid less attention to them than it did to the permanent works.

129 The objects of the POEO Act include the following (s 3(1)):

130 Snowy Hydro has acted, as it concedes, so as to compromise the objects of the Act by failing to protect the quality of the environment to the extent that the sediment travelled the 15km stretch of the Snowy River, the subject of the charge. However, as will be discussed below, Snowy Hydro submits that those objects have not been greatly compromised by the commission of the offence having regard to the evidence of expert witnesses. In particular, there is no suggestion that the incident caused a risk to human health or permanently degraded the environment.

131 A stern policy against pollution lies behind the legislation. In Axer Pty Ltd v Environment Protection Authority (1993) 113 LGERA 357 at 359 Mahoney JA held:

The community has adopted a stern policy against pollution. The legislative scheme requires that proper, and strict, precautions be taken by those whose activities may cause proscribed pollution. The quantum of the fines which may be imposed evidences this: for the present offence, a maximum fine of $125,000 [now $1 million] was available. The quantum of the fines which the legislation allows to be imposed has no doubt been fixed not merely to indicate the seriousness with which such pollution is regarded but also to deter those engaged in such activities and to procure that they will take the precautions necessary to ensure that it does not occur.
…
The legislation does not seek merely to prevent deliberate or negligent pollution. It envisages that, at least in many cases, proper precautions must be taken to ensure that pollution does not occur. Experience has shown that it is not enough merely to take care: accidents will happen. The legislation envisages that in many cases care must be supplemented by positive precautions; business must be arranged and precautions taken so as to ensure that pollution will not occur.

Precautions may be costly. The cost of precautions to avoid pollution will no doubt become accepted, in due course, as an ordinary cost of operating in an industry where, absent precautions, pollution may occur… The fine should be such as will make it worthwhile that the cost of precautions be undertaken. As the learned judge indicated, in the present case, in order to prevent pollution of the river, it was necessary, inter alia, that the company delay spraying until the conditions were appropriate for it. No doubt that delay cost money. Ordinarily, the fine to be imposed should be such as to make it worthwhile that costs of this kind be incurred.

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

3A Purposes of sentencing

133 Section 21A(1) provides:

General

134 Section 21A(2) and (3) list aggravating and mitigating factors which the Court is required to take into account. The aggravating factors are inapplicable in the present case and are mostly inapplicable to environmental offences (apart from whether the offender has a record of previous convictions). A number of the mitigating factors are applicable in the present case.

135 Section 241 of the POEO Act requires the Court to consider five objective gravity matters (so far as they are relevant), of which all but the fifth are relevant in this case:

241 Matters to be considered in imposing penalty

136 The sentence must reflect both the objective circumstances and the 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], [66] and [73].

137 There are two components to the assessment of the objective gravity of an offence: an examination of the precise acts or omissions or the offender; and the consequences of those acts or omissions: R v Carroll [2008] NSWCCA 218 at [39]. The objective gravity of the offence fixes the upper limit of proportionate punishment: Hoare v The Queen (1989) 167 CLR 348 at 354, cited in R v McNaughton (2006) 66 NSWLR 566 (CCA) at [15] (see also [25]) and Bentley v BGP Properties Pty Ltd (2006) 145 LGERA 234 at 258 [162] per Preston CJ. The Court of Criminal Appeal has held that the objective gravity of the offence also fixes the lower limit of proportionate punishment: R v McNaughton at [15]; R v Whyte (2002) 55 NSWLR 252 at [156] – [158]; see also Environment Protection Authority v Waste Recycling and Processing Corp (2006) 148 LGERA 299 at 324 – 325 [139] – [140] (Preston CJ). This appears to indicate that the role of subjective factors lies between the upper and lower limits dictated by the objective gravity of the offence. The seminal authority cited in McNaughton and Whyte for the proposition that the objective gravity of the offence also fixes the lower limit of proportionate punishment is R v Dodd (1991) 57 A Crim R 349 at 354 where in a joint judgment Gleeson CJ, Lee CJ at CL and Hunt J said (omitting some citations):

Veen (No 2)

138 The first quoted sentence concerns the fixing of the maximum sentence by reference to the objective gravity. As to the last quoted sentence, the observation may be ventured that it falls short of saying that the objective gravity of the offence fixes the lower limit of the sentence. However, the contrary is authoritatively established by McNaughton and Whyte.

Defendant cannot be sentenced for more serious offence: negligence

139 A strict liability offence that was committed negligently or intentionally will be objectively more serious than one committed non-negligently or unintentionally: Camilleri’s Stock Feeds Pty Ltd v Environment Protection Authority (1993) 32 NSWLR 683 (CCA) at 700; Environment Protection Authority v Lithgow City Council [2007] NSWLEC 695 at [35].

140 The prosecutor’s written submission is that Snowy Hydro’s conduct was negligent in that it caused the pollution of waters by:

(a) causing and permitting the plunge pool to be connected with the Snowy River on 1 August 2006;
(b) causing and permitting excavation in the waters (wet works) to continue in the period from 31 July 2006 through to 2 August 2006; and
(c) failing to ensure that the sediment control measures were adequate to prevent pollution of the downstream waters of the Snowy River.

141 The prosecutor also submits orally that Snowy Hydro’s conduct was reckless: I reject that submission which, in my opinion, finds insufficient support in the evidence.

142 Snowy Hydro submits that it would be an error of law to take negligence into consideration as an aggravating factor because that would be to sentence it for an offence with which it has not been charged: The Queen v De Simoni (1981) 147 CLR 383 at 389 per Gibbs CJ. The offence with which it has not been charged is said to be the offence under s 116(1) of the POEO Act of negligently causing a substance to escape in a manner likely to cause harm to the environment. For that offence to be committed, there must have been a risk of harm that was foreseeable to a reasonable person in the position of the defendant: NSW Sugar Milling Co-Operative Ltd v Environmental Protection Agency (1992) 59 A Crim R 6 (CCA) at 7, 11.

143 In reply, the prosecutor submits that, as a matter of statutory construction, in sentencing for an offence under s 120 of the POEO Act, the Court may take into account that the offender’s conduct was negligent, even where it could arguably constitute conduct satisfying the elements of the more serious offence under s 116(1).

144 Snowy Hydro has pleaded guilty to a charge under s 120 of the POEO Act, (set out at [1] above). Section 116(1) provides:

116 Leaks, spillages and other escapes

145 There is a rule against punishment for a higher offence. It is often euphemistically referred to as the De Simoni principle after the leading case, The Queen v De Simoni (1981) 147 CLR 383. Gibbs CJ (Mason, Murphy JJ agreeing) expressed the principle as follows at 389:

…the general principle that the sentence imposed on an offender should take account of all the circumstances of the offence is subject to a more fundamental and important principle, that no one should be punished for an offence of which he has not been convicted. Section 582 reflects this principle. The combined effect of the two principles, so far as it is relevant for present purposes, is that a judge, in imposing sentence, is entitled to consider all the conduct of the accused, including that which would aggravate the offence, but cannot take into account circumstances of aggravation which would have warranted a conviction for a more serious offence.

146 The central idea behind the De Simoni principle is one of fairness. In R v Booth (unreported, 12 November 1993, NSWCCA) Kirby P said:

The point of fairness, which reinforces and underlies the rule of legal principle can be stated briefly. It is a commonplace that the statutes establishing punishable criminal offences frequently contain alternative offences, arranged in an ascending hierarchy of seriousness. Reflecting that hierarchy, Parliament has typically provided an ascending range of punishments. Those punishments set the maximum to which the person accused is exposed upon conviction. Obviously, in considering whether to plead guilty or not guilty, the maximum and the likely penalty to which the accused is exposed is in the forefront of the mind of the accused and of those advising him or her. Had the accused been charged with the higher offence, carrying the heavier penalty, a plea of not guilty might have been entered. The Crown might then have been put to the proof, with the chance that the accused would walk away without conviction or penalty at all. It is that chance which the accused surrendered by pleading guilty to the lesser offence with the lower maximum punishment. Similarly, the Crown forfeits the chance of securing a conviction of an aggravated offence, carrying a heavier penalty, by electing to present an indictment with a count, or to prosecute a charge, of a lesser offence carrying a lower maximum punishment.

(b) defer the connection of the plunge pool to the Snowy River until such time as steps had been taken to:

(i) significantly reduce the level of turbidity in the plunge pool; and
(ii) ensure that controls were in place downstream which would prevent pollution of the downstream waters of Snowy River;

(c) direct the contractor not to carry out work until such time as there had been a proper risk assessment as was required under the contract and method statement provided by the contractor in respect of the works, and until such time as Snowy Hydro could be properly confident that controls were in place downstream which would prevent pollution of the downstream waters of the Snowy River. A proper risk assessment should have included an assessment of the risks associated with the earlier task of filling the plunge pool with waters discharged from the intake tower via the submerged discharge valve.

171 The sole sediment control measure downstream was a silt curtain, which was demonstrably ineffective. It should have been apparent on inspection that it was not properly installed or secured to the river banks so as to prevent sediment migration. This is apparent from the photos taken of it on 1 August 2006. Indeed, it was adjusted on 1 and 2 August 2006. Only one silt curtain was in place until 2 August when a second curtain was installed which, with the readjustment of the first curtain, was effective to contain the sediment. As discussed earlier, multiple silt curtains, properly secured, are highly effective to reduce migration of sediment downstream.

172 Snowy Hydro’s failure to take practical measures and to exercise control over the causes (see below) sits unhappily with its declaration in the contract that pollution in the Snowy River was a “major concern” to Snowy Hydro and that its Superintendent would rigorously enforce soil conservation and erosion controls.

Foreseeability of risk of harm

173 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 offence: s 241(1)(c) POEO Act.

174 There was actual harm to the environment by the commission of the offence, albeit minor, short term and over a relatively short distance of the Snowy River: see [158] – [163] above. As Mr Jones agreed in cross-examination, there was no more crucial time in the life of this project in terms of potential for pollution of the downstream Snowy River than the time of connection of the plunge pool to the Snowy River. Although Mr Jones added the rider “in hindsight”, in my view Snowy Hydro could and should have foreseen that the removal of the coffer dams could result in the release of sediment into the Snowy River below the silt curtain, thus causing harm to the environment. The absent prior risk assessment should have identified the risk, which eventuated. By 29 July 2006, it was obvious that the plunge pool was turbid and virtually full. By that date there was a high risk that the connection of the plunge pool to the downstream river would have the consequence that turbid water in the plunge pool would migrate downstream. It was also apparent prior to the connection of the plunge pool to the Snowy River that the silt curtain was not working in such a way as to prevent the downstream migration of suspended sediment.

175 Snowy Hydro submits that it reasonably relied on FRH to prevent the risk eventuating. I have earlier expressed the opinion that it should not have placed such reliance on FRH and should have exercised greater control and supervision. The potential for this type of harm was identified by the SEE which accompanied the development application. That potential was expressed in the specifications to the contract to be of major concern to Snowy Hydro such that the contractor was put on notice that the Superintendent would rigorously enforce the requirements for soil conservation and erosion control.

Control over the causes

176 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) POEO Act.

177 Snowy Hydro submits that in the following circumstances its control over the causes of the offence should be assessed at the lowest end of the scale:

(a) FRH had control of the construction site, it had prepared the environmental management plan (which Snowy Hydro understands contained a risk assessment), and it was responsible for supplying and maintaining environmental controls, including the silt curtain or curtains, as an effective environmental control;
(b) FRH was contractually responsible for ensuring compliance with regulatory requirements and for performing the works in an environmentally responsible manner;
(c) it follows that Snowy Hydro, as a matter of contractual obligation and fact, had no control over the procurement, deployment and maintenance of the silt curtain;
(d) the coffer dams being temporary work, FRH was responsible for their design, construction and removal;
(e) on the other hand, Snowy Hydro acknowledges that it had relatively unfettered access to the site, it approved the environmental management plan, it had the contractual power to approve proposals for temporary works and the contractor was obliged to prepare method statements;
(f) in practice, however (i) Belmadar/FRH was retained because of its experience and skills in performing construction works; (ii) the incident occurred at the very end of a productive and successful principal – contractor relationship such that by the time of the incident Snowy Hydro was directive only to the extent that it was necessary to achieve the required dimensions of the outlet channel; (iii) the temporary work likely to be considered in detail by Snowy Hydro were those with a potential to impact on the quality of the permanent works; (iv) Snowy Hydro never received proposals for the construction of the coffer dams; (v) Snowy Hydro never requested nor received a written proposal for the removal of the coffer dams, nor a work method statement or risk assessment; (vi) Snowy Hydro was not informed that FRH would remove the rock coffer dam before the clay coffer dam;
(g) Snowy Hydro should have obtained a contractor’s risk assessment which addressed the risk of sediment going downstream from the excavation works and the plunge pool, as well as the controls needed to prevent pollution from either source;
(h) there is a distinction between control which in hindsight it could have exercised over FRH under the contract, and control which as a matter of practical reality it was able to exercise having regard to the scale of the project and the relationship with the contractor which had evolved over the life of the project. The quality of the relationship was informed by a previous, successful experience in which FRH deconstructed a temporary clay coffer dam in Lake Jindabyne. Snowy Hydro’s failure to request FRH to provide a detailed methodology for the removal of the subject coffer dams was a measure of its confidence in FRH;
(i) in light of the relationship between Snowy Hydro and FRH, Snowy Hydro had little, if any, practical control over the removal of the coffer dam;
(j) Snowy Hydro accepts that it became aware on Monday 31 July 2006 of discoloured water downstream of the silt curtain and that it was a failing in its system for that knowledge not to have been transmitted to its construction manager, Mr Mayhew. However, inspections and sampling showed no real cause for concern. It was not until 3pm on Tuesday 1 August that increasing discolouration downstream became apparent to senior Snowy Hydro personnel. From this time Snowy Hydro increased its supervision. That evening Mr Jones directed that works were to continue in a way that did not send turbidity down the Snowy River and that the scope of the work could be modified if it became apparent that there was a risk that that would occur. That was reasonable;
(k) when, on the morning of 2 August 2006 it because apparent that the additional controls implemented by FRH were ineffective, Snowy Hydro acted properly to stop all work below water.

178 In my opinion, Snowy Hydro had adequate control, both as a contractual right and as a practical reality, to prevent works from being carried out that caused pollution to the Snowy River. Its contractual powers are summarised at [19] – [21] above. Its Superintendent had power to require a method statement and risk assessment, to suspend works and to give directions. Its contract with FRH noted that pollution was of “major concern” to it and that the Superintendent would enforce the requirements for soil conservation and erosion controls “rigidly”. The plunge pool commissioning works posed an obvious pollution risk which required close attention by Snowy Hydro.

179 Having regard to (a) Snowy Hydro’s obligations under its environmental protection licence not to pollute the Snowy River; (b) its express contractual declaration that pollution was of major concern to it; (c) the degree of contractual control which Snowy Hydro was able to exercise; (d) its degree of involvement in relation to the works; and (e) the critical importance of the plunge pool commissioning works in terms of the pollution risk that it posed, I consider that Snowy Hydro should have exercised close supervisory control over the design, methodology, risk assessment and implementation of the works. At discussed earlier, that includes obtaining and approving a method statement and risk assessment before the work was carried out. It is not a sufficient answer to say that Snowy Hydro’s prior experiences with FRH, including the earlier removal of another coffer dam to the intake channel in Lake Jindabyne, had engendered confidence. That earlier removal was different because on that occasion there was nothing equivalent to the riparian flow, the turbid waters of the plunge pool and the connection to the Snowy River. Moreover, the removal of the clay coffer dam in Lake Jindabyne was not as uneventful as Snowy Hydro has suggested in that the turbidity of the plunge pool was, or was likely to have been, due to that removal (see [53] above).

Reasons for commission of offence

180 The objective seriousness of an offence may also be measured by reference to the reasons for its occurrence: Axer Pty Ltd v Environment Protection Authority (1993) 113 LGERA 357 at 366 per Badgery-Parker J. There were no deliberate, commercial reasons for the commission of the offence. The systems which Snowy Hydro had in place at the time in relation to its supervision of FRH were deficient.

Conclusion

181 Overall, I conclude that Snowy Hydro’s offence is of moderate objective seriousness.

SUBJECTIVE FACTORS
State of mind of offender

182 A relevant subjective factor in a strict liability offence such as this is the state of mind of the offender: Bentley v BGP Properties Pty Ltd (2006) 145 LGERA 234 at [201] – [208]; Hardt v Environment Protection Authority (2007) 156 LGERA 337 at [53]. Snowy Hydro did not intend to pollute the Snowy River. Ironically, it was engaged in the tasks of rejuvenating the degraded Snowy River, in respect of which it was otherwise successful. It thought that there were adequate environmental controls in place and the polluting event took it by surprise.

Awareness of its contractual powers

183 Snowy Hydro was aware of its contractual powers, which are analysed at [20] – [21] above.

184 Snowy Hydro submits that FRH caused the pollution, that it expected FRH to adopt best practice in its removal of the coffer dams and reasonably relied on FRH not to pollute the Snowy River. Snowy Hydro submits that FRH did not adopt best practice because (a) contrary to Snowy Hydro’s expectation, FRH worked from downstream of the coffer dams which increased rather than minimised the time works were being conducted in water, thus generating turbidity; and (b) FRH failed to ensure that the silt curtain being relied upon as the environmental control (with the riparian flow) would be effective. As indicated earlier, in my opinion Snowy Hydro should have exercised considerably greater supervisory power over FRH and it was not reasonable for it to have placed such a degree of reliance on FRH.

Awareness of terms of environment protection licence

185 Snowy Hydro’s environment protection licence did not permit discharge of pollutants into the Snowy River (save for permitting discharge of treated water from Point 17, being a point located downstream of the construction site at the end of an erosion gully flowing into the Snowy River from Sediment Basin No 3).

186 At the time of the offence, Snowy Hydro, via its Environmental Officer, had a mistaken belief that there was no specific water quality limit downstream of the silt curtain and that a turbidity limit of 150 NTU applied internally on sites including the waters of the Snowy River upstream of the silt curtain. He understood, correctly, that a 30 mg/L TSS plus background limit applied to stormwater discharging from Sediment Basin 3 to the bottom of the erosion gully downstream from the silt curtain. In cross-examination, Mr Jones indicated that his belief at the time was that there could be a release to the Snowy River of sediment laden water up to a concentration of 150 NTU. He agreed that was a very fundamental misunderstanding of Snowy Hydro’s environmental protection licence. Snowy Hydro attributes its mistaken belief, in part, to confusion and lack of clarity as to parameter and threshold between 150 NTU and 30 mg/L TSS and, in part, to a belief that the EPA provided that best practice was to apply to works in the River. Snowy Hydro points out that in 2004 and 2005 EPA officers inspected the rock coffer dam, made no adverse comment and reported that the pollution control structures appeared to be operating consistently with the licence.

187 However, in my opinion, Snowy Hydro should have understood the terms of its environmental protection licence. Indeed, in correspondence in 2003 the EPA had declined to accede to Snowy Hydro’s proposal that there should be a discharge limit to the Snowy River of 150 NTU. I do not go so far as to accept the prosecutor’s submission that its mistaken belief was capricious. However, in the circumstances, I do not consider that a mistake such as this by a large, well resourced entity such as Snowy Hydro is excusable. It is not a mitigating factor.

188 The SEE accompanying the development application referred to, and Snowy Hydro was therefore aware of, the following:

to control soil loss at the construction site and minimise any associated increases in water turbidity downstream – blanketing sediments can be particularly harmful to aquatic invertebrates (an important food source for the platypus)

Awareness of requirements for plunge pool connection

189 Snowy Hydro was aware that the connection of the plunge pool to the Snowy River would necessitate the removal of the coffer dams and earthen material. It was aware that this was a critical time in respect of potential pollution for the Snowy River because the connection would create a conduit between the construction site and downstream waters after a long period of physical separation. Despite this, there was apparently no plan prepared in relation to the plunge pool outlet channel.

190 Snowy Hydro was aware that (a) no detailed design had been prepared in respect of the permanent outlet channel connecting the plunge pool and the Snowy River; (b) the contractor had not submitted a method statement or construction procedure for the removal of the coffer dams and the connecting channel; and (c) no written risk assessment had been carried out in relation to those works.

191 Snowy Hydro was also aware that it had the contractual powers, through its Superintendent, to demand from FRH a method statement and a risk assessment for the works relating to the removal of the coffer dams and that it did not exercise that power. It was also aware that it had power to give directions to FRH in relation to those works including in relation to prevention and control of pollution. It did not exercise that power until Wednesday 1 August.

Awareness of turbidity of plunge pool waters

192 Between 21 and 29 July 2006 Snowy Hydro operated the submerged discharge valve and thereby released a large volume of highly turbid water into the plunge pool. This changed the colour of the plunge pool from light green to a muddy brown. That was obvious to Snowy Hydro who knew the pool would soon be connected to the downstream river.

Awareness of sediment control – one silt curtain

193 For a considerable period prior to connection of the plunge pool waters and the downstream river, Snowy Hydro was aware that the only sediment control in place was one silt curtain (which was doubled over).

194 An email of 15 September 2004 from Mr Endersby (Snowy Hydro) to Mr Macklin (then of Belmadar, now of FRH) indicates that Snowy Hydro was aware that there had been problems with respect to water quality downstream of the rock coffer dam in September 2004 and had at that time agreed with Belmadar for the installation of an additional silt curtain. A photograph taken in August 2004 in that location appears to show only one silt curtain in that location. A photograph taken on 22 September 2004 appears to show two silt curtains in that location. The prosecutor submits that there should be imputed to Snowy Hydro a perception in 2004 that one silt curtain was inadequate. On the evidence, this appears to be correct.

195 On Saturday 29 July 2006, Snowy Hydro knew that FRH had commenced the process of removing the physical barriers between the plunge pool and the Snowy River, that this process would continue into, and be completed, the following week, and that FRH would continue the works on the following day. On Sunday 30 July, because Snowy Hydro had no one on site, it was not aware of the commission of the offence on that date and did not know that the contractor would be removing the rock coffer dam on that date. By the morning of Monday 31 July 2006, Snowy Hydro, at least through its site inspector Ian McCann, was aware:

(a) that most of the rock coffer dam had been removed;
(b) that works had already commenced that morning by the time Mr McCann arrived at 7.30am and wet works were underway (i.e. excavation within the Snowy River channel at the point where the rock coffer dam was located);
(c) that this work had been carried out on the previous day;
(d) that there had been an incident involving discoloured water entering the Snowy River on Sunday 30 July; and
(e) that there was discolouration of the Snowy River both upstream of the silt curtain and, to a lesser extent, downstream of the silt curtain.

196 By the afternoon of Monday 31 July Snowy Hydro was aware that: (a) excavation works continued all that day, with discolouration downstream continuing to increase as the day progressed – later in the day becoming quite turbid; (b) the silt curtain was not preventing the migration of turbid waters from the construction site into the waters of the Snowy River downstream of the silt curtain.

197 By the morning of Tuesday 1 August, Snowy Hydro knew that the rock coffer dam had been removed and excavation works, including wet works, were continuing with the expectation that the plunge pool would be connected to the Snowy River. It was aware from early morning that there was slight discolouration in the water of the Snowy River downstream of the silt curtain. It knew that the only control in place in the Snowy River was a single silt curtain. By around 9:30 or 10:00am, Snowy Hydro was aware of a complaint from Mr Hodges, a property owner with Snowy River frontage some 3 kilometres downstream of the construction site that there was muddy water in the Snowy River at that location, and had cause to believe that this was a consequence of the works. By 10:50am, Snowy Hydro knew that the waters in the plunge pool – soon to be connected to the downstream waters of Snowy River – had a turbidity reading of 250 NTU.

198 It is clear, therefore, that prior to the completion of the excavation of the plunge pool outlet channel, and while the plunge pool and downstream river were still separated, Snowy Hydro knew that the silt curtain was not adequately controlling the migration of sediment downstream. It must have been aware that the continuation of excavation and the connection of the plunge pool to the Snowy River would be likely to cause further pollution of waters. Nevertheless, it continued with the plan of connecting the plunge pool to the river. After the plunge pool was connected to the Snowy River at about midday on 1 August, and the water levels of the Snowy River and plunge pool had equalised, it was aware that the downstream waters of the Snowy River became progressively more polluted. Nevertheless, it permitted excavation works to continue.

199 By Wednesday 2 August, Snowy Hydro was aware that there had been a serious pollution incident. But works continued for some hours that morning. Eventually, Mr Mayhew, the Snowy Hydro Construction Manager, directed FRH to stop works at approximately 10:00am. This direction was made because it was considered by Snowy Hydro that the contractor was not meeting its requirement under the contract to do its work without harm to the Snowy River. It was a tardy direction given that the harm being caused to the Snowy River by the works was apparent by 31 July 2006 and was obvious by 1 August 2006. The direction appears to have coincided with the works having been completed.

Prior good character

200 Snowy Hydro’s lack of prior convictions and good character are mitigating factors: Crimes (Sentencing Procedure) Act 1999, s 21A(3)(e) and (f); Bentley v BGP Properties Pty Ltd (2006) 145 LGERA 234 at 271 [251]. Snowy Hydro is a good corporate citizen and has made a substantial contribution to the local communities in which it operates and the environment of the Snowy Mountains region.

Plea of guilty

201 Snowy Hydro’s guilty plea is a mitigating factor: Crimes (Sentencing Procedure) Act 1999, s 21A(3)(k). It was entered at the earliest possible moment. It is common ground that this should be reflected by discounting the penalty it would otherwise incur by the full amount of 25 percent allowed for early pleas: R v Thompson; R v Houlton (2000) 49 NSWLR 383.

202 Remorse is a mitigating factor to be taken into account in accordance with s 21A(3)(i) of the Crimes (Sentencing Procedure) Act 1999, which provides:

(3) The mitigating factors to be taken into account in determining the appropriate sentence for an offence are as follows:…

203 Snowy Hydro has expressed remorse which demonstrates that it has genuine insight into how it came to offend, has provided evidence that it has accepted responsibility for its actions and has acknowledged the damage caused. Its remorse in these circumstances is a mitigating factor under s 21A(3)(i). Its expressions of remorse have weight given that they were expressed to all employees by the chief executive officer of Snowy Hydro who told them that the incident was totally unacceptable, and were expressed in evidence by a senior executive officer, Mr Jones, who with other executive officers were present during the sentencing hearing: Environment Protection Authority v Waste Recycling and Processing Corp (2006) 148 LGERA 299 at 338 [214]. The early guilty plea is also a demonstration of remorse. Snowy Hydro has also demonstrated remorse by its conduct in response to the incident. It adopted a pro-active approach to the EPA’s clean up notices and dedicated substantial resources to mitigating the effect of the pollution on the Snowy River. It has made efforts to analyse what went wrong, what can be done to prevent the offence recurring and has implemented the lessons learnt in its programs and procedures. These matters should be reflected in a significant discount on penalty.

Cooperation with authorities

204 Snowy Hydro cooperated to a high degree with the investigation of the offence and its own prosecution. This should be reflected in a significant discount on penalty: Crimes (Sentencing Procedure) Act 1999, s 23(1).

Hardship already suffered

205 Hardship suffered by an offender as a result of an offence may be taken into account: R v Daetz (2003) 139 A Crim R 398; R v Webb (2004) 149 A Crim R 167. Snowy Hydro submits that it has incurred considerable costs and devoted significant time and energy to addressing this matter. I would not characterise that as “hardship”, given Snowy Hydro’s size and resources, but I think it should be taken into account.

206 The purposes for which a court may impose a sentence includes deterring others from committing similar offences: s 3A(b) Crimes (Sentencing Procedure) Act 1999. In Bentley v BGP Properties Pty Ltd (2006) 145 LGERA 234 at [139] – [140] Preston CJ said (citations omitted):

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.

207 A fine needs to be large enough to make it worthwhile that the cost of precautions be taken, to outweigh any gains and so as not to appear as a mere licence fee for illegal activity: Axer Pty Ltd v Environment Protection Authority (1993) 113 LGERA 357 at 359-360; Environment Protection Authority v Waste Recycling and Processing Corp (2006) 148 LGERA 299 at 341 [229]; Environment Protection Authority v Sell & Parker (2006) 149 LGERA 209 at 215 [26].

208 Snowy Hydro submits that general deterrence is of limited relevance because the nature of its business is, and the infrastructure in this case was, unusual.

209 In my opinion there is still a need for a firm general deterrent. The penalty should act as a general deterrent for others who are involved in earthen and construction activities with potential water pollution consequences, even if their activities are of a different nature and scale.

INDIVIDUAL DETERRENCE

210 The purposes for which a court may impose a sentence includes deterring the defendant from committing similar offences: s 3A(b) Crimes (Sentencing Procedure) Act 1999. The conduct of Snowy Hydro, particularly after the incident, satisfies me that individual deterrence is not a particularly weighty consideration. It has gone to considerable efforts to analyse what went wrong and to ensure that nothing like this happens again. It has demonstrated considerable insight into its offending.

211 Since the incident, Snowy Hydro has amended its written procedures (which will be applied to new projects), inter alia, to ensure that contractors conduct risk assessments; that Snowy Hydro reviews safe work method statements for all high risk activities and other activities such as preventing pollution to a water course; that it regularly reviews risks during the life of the project; and that its employees have an adequate understanding of environmental consent conditions (such as the turbidity limits applying to the Snowy River).

212 I do not take into account that FRH gave Snowy Hydro contractual indemnities and that Snowy Hydro has claimed on FRH under the indemnities arising from this incident. That is because (assuming that this would otherwise be a permissible consideration) I do not know whether FRH is able to successfully dispute any claim by Snowy Hydro under the indemnities: cf Environment Protection Authority v Cleary Bros (Bombo) Pty Ltd [2007] NSWLEC 466 at [165] (Lloyd J).

DAILY PENALTY

213 As noted above at [154], the prosecutor does not press for and I do not propose to impose a daily penalty. The penalty should, however, take into account that the offending occurred on all four days during which the pollution event occurred.

EVEN–HANDEDNESS AND PARITY

214 Consistency in sentencing is an important objective in a rational and fair system of criminal justice: R v Henry (1999) 46 NSWLR 346 at [12] per Spigelman CJ. In Markarian v The Queen (2005) 228 CLR 357 at 371 the High Court held that: “[T]here is no single correct sentence. And judges at first instance are to be allowed as much flexibility in sentencing as is consonant with consistency of approach and as accords with the statutory regime that applies” (footnotes omitted). Regard should be had to comparable cases to see if they disclose a general pattern of sentencing: Camilleri’s Stock Feeds Pty Ltd v Environment Protection Authority (1993) 32 NSWLR 683 (CCA) at 701-702. However, it is sometimes 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 factual circumstances comprising environmental offences and the need to tailor sentences to the individual circumstances of the case. In that context, in Cabonne Shire Council v Environment Protection Authority (2001) 115 LGERA 304 at 312 [35] the Court of Criminal Appeal held that: “Even discriminating reference [to other cases] is likely to be of no utility because the facts in cases such as the present will almost always be peculiar to the individual case”.

215 An additional complicating factor when comparing other decisions in the case of environmental crime is the frequency with which the maximum sentences have increased. In R v Hoerler (2004) 147 A Crim R 520 at 529 [35] Spigelman CJ said:

Prior cases and Judicial Commission statistics do not often determine a range appropriate for a particular offence. They reflect what was regarded as appropriate in the wide variety of circumstances of those particular prior cases. Whether or not a sentencing pattern can be said to have emerged requires consideration of the whole body of sentences. It is unlikely that any such pattern can be said to have been established unless there have been a significant number of cases covering a wide variety of objective circumstances. Unless that is so, the cases would not encompass the relevant range of objective criminality.

216 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 have been referred to JIRS statistics for offences against s 120(1) of the POEO Act in 35 cases between 2002 and 2008. Eighty percent of the fines were in the range of $10,000 to $60,000, with the mid-point about $30,000. I was also referred to JIRS statistics for 17 cases in that period where the levels of environmental harm were found to be low: 80 percent of those fines were in the range of $20,000 to $60,000. However, in both sets of statistics most of the fines were imposed before the maximum penalty was increased fourfold on 1 May 2006.

217 The JIRS database was interrogated as to cases with the following characteristics: co-operation, contrition, prior good character, costs awarded, early guilty plea, low objective seriousness, foreseeable harm to the environment, practical measures, control over causes, negligence and low environmental harm. The result yielded only one case, which was Environment Protection Authority v Nalco Australia Pty Ltd [2007] NSWLEC 831, in which a s 250(1)(e) order of $50,000 was imposed. That case was discussed at [156] above, as were Environment Protection Authority v Nowra Chemical Manufacturers Pty Ltd [2008] NSWLEC 187 (s 250(1)(e) order of $100,000) and Environment Protection Authority v CSR Building Products Limited [2008] NSWLEC 224 (fine of $280,000). All were cases of tier 2 offences where the sentences were imposed after the maximum penalties were increased in 2006. The circumstances of these cases were so different that they provide little assistance in the present case.

218 I was referred to a number of other cases of pollution of waters caused by introduction of soil or sediment from construction activities decided between 1994 and 2006: Environment Protection Authority v G. Pezzimenti & Sons Pty Ltd [1994] NSWLEC 6 (Pearlman J); Environment Protection Authority vGosford City Council (1997) 95 LGERA 338 (Pearlman J); Environment Protection Authority v Taylor Woodrow (Australia) Pty Ltd (No 2) (1997) 97 LGERA 368 (Lloyd J); Environment Protection Authority v Barclay Mowlem Construction Ltd [1998] NSWLEC 304 (Talbot J); Environment Protection Authority v Daryl McCarthy Constructions Pty Ltd [2000] NSWLEC 223 (Bignold J); Environment Protection Authority v Duke Eastern Gas Pipeline Pty Limited [2002] NSWLEC 84 (Cowdroy J); Environment Protection Authority v Centennial Newstan Pty Ltd [2006] NSWLEC 732 (Preston CJ). In about half, the penalty imposed was 10 percent or more of the maximum penalty. These cases have been of limited assistance given the different and unusual circumstances of the present case and the need to tailor sentences to individual circumstances.

219 I have had regard to the sentence which I am concurrently imposing on FRH in my separate judgment. After allowing for differing circumstances and the differences in the evidence, I have concluded that the same sentence should be imposed on both Snowy Hydro and FRH.

CONCLUSION

220 In my opinion, in all the circumstances, and after discounting for all mitigating factors including a 25 percent discount for the early plea, the appropriate sentence is a fine of $100,000. Snowy Hydro has agreed to pay the prosecutor’s costs of the proceedings in the agreed sum of $84,289.00 and the prosecutor’s investigations costs under s 248 of the POEA Act in the agreed sum of $1,897.50.

221 The orders of the Court are as follows:

Protection of the Environment Operations Act 1997

Citations

Environment Protection Authority v Snowy Hydro Ltd [2008] NSWLEC 264

Most Recent Citation

Cases Citing This Decision

49

Environment Protection Authority v Appleton [2025] NSWLEC 62

Environment Protection Authority v Pullinger (No 3) [2025] NSWLEC 59

Cases Cited

36

Statutory Material Cited

6

Environment Protection Authority v Fulton Hogan Pty Ltd [2008] NSWLEC 268

Veen v The Queen [1979] HCA 7

Markarian v The Queen [2005] HCA 25

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CITATION:	Environment Protection Authority v Snowy Hydro Ltd [2008] NSWLEC 264
PARTIES:	PROSECUTOR: Environment Protection Authority DEFENDANT: Snowy Hydro Ltd
FILE NUMBER(S):	50039 of 2007
CORAM:	Biscoe J
KEY ISSUES:	Environmental Offences :- sentence - polluting waters of river during connection of dam to river at the end of dam upgrade works - pollutant sediment laden waters containing soil, earth, clay or similar inorganic matter - factors to be taken into account on sentencing - principle that an offender cannot be sentenced for a more serious offence.
LEGISLATION CITED:	Crimes (Sentencing Procedure) Act 1999 (NSW), ss 3A, 21A, 23(1) Environmental Planning and Assessment Act 1979 (NSW) Protection of the Environment Operations Act 1997 (NSW), ss 3(1), 91, 114, 116(1), 119, 120, 123, 241, 246, 248, 250(1)(e), 257 Snowy Hydro Corporatisation Act 1997 (Cth) Snowy Hydro Corporatisation Act 1997 (NSW) Snowy Hydro Corporatisation Act 1997 (Vic)
CASES CITED:	Alphacell Ltd v Woodward [1972] AC 824 Axer Pty Ltd v Environment Protection Authority (1993) 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 of Public Prosecutions (Cth) v Said Khodor El Karhani (1990) 21 NSWLR 270 Environment Agency (formerly National Rivers Authority) v Empress Car Co. (Arbertillery) Ltd [1999] 2 AC 22 Environment Protection Authority v Ballina Shire Council (2006) 148 LGERA 278 Environment Protection Authority v Barclay Mowlem Construction Ltd [1998] NSWLEC 304 Environment Protection Authority v Centennial Newstan Pty Ltd [2006] NSWLEC 732 Environment Protection Authority v Cleary Bros (Bombo) Pty Ltd [2007] NSWLEC 466 Environment Protection Authority v CSR Building Products Limited [2008] NSWLEC 224 Environment Protection Authority v Daryl McCarthy Constructions Pty Ltd [2000] NSWLEC 223 Environment Protection Authority v Duke Eastern Gas Pipeline Pty Limited [2002] NSWLEC 84 Environment Protection Authority v Fulton Hogan Pty Ltd [2008] NSWLEC 268 Environment Protection Authority v G. Pezzimenti & Sons Pty Ltd [1994] NSWLEC 6 Environment Protection Authority v Gosford City Council (1997) 95 LGERA 338 Environment Protection Authority v Hochtief AG and Thiess Pty Limited [2007] NSWLEC 177 Environment Protection Authority v Integral Energy Australia Pty Ltd [2006] NSWLEC 141 Environment Protection Authority v Lithgow City Council [2007] NSWLEC 695 Environment Protection Authority v Nalco Australia Pty Ltd [2007] NSWLEC 831 Environment Protection Authority v Nowra Chemical Manufacturers Pty Ltd [2008] NSWLEC 187 Environment Protection Authority v Sell & Parker (2006) 149 LGERA 209 Environment Protection Authority v Taylor Woodrow (Australia) Pty Ltd (No 2) (1997) 97 LGERA 368 Environment Protection Authority v Timber Industries Ltd [2001] NSWLEC 25 Environment Protection Authority v Waste Recycling and Processing Corp (2006) 148 LGERA 299 Hardt v Environment Protection Authority (2007) 156 LGERA 337 Hoare v The Queen (1989) 167 CLR 348 Lovegrove v The Queen [1961] Tas S.R. 206 Markarian v The Queen (2005) 228 CLR 357 NSW Sugar Milling Co-Operative Ltd v Environmental Protection Agency (1992) 59 A Crim R 6 R v Booth (unreported, 12 November 1993, NSWCCA) R v Carroll [2008] NSWCCA 218 R v Channells (unreported, 30 September 1997, NSWCCA) R v Daetz (2003) 139 A Crim R 398 R v Dodd (1991) 57 A Crim R 349 R v Henry (1999) 46 NSWLR 346 R v JB; R v RJH [1999] NSWCCA 93 R v McNaughton (2006) 66 NSWLR 566 R v Slattery (1996) 90 A Crim R 519 R v Thompson; R v Houlton (2000) 49 NSWLR 383 R v Webb (2004) 149 A Crim R 167 R v Whyte (2002) 55 NSWLR 252 The Queen v De Simoni (1981) 147 CLR 383 Veen v The Queen (1979) 143 CLR 458
DATES OF HEARING:	10-13/06/08, 23/06/08 and 30/06/08 (written submissions)
DATE OF JUDGMENT:	22 September 2008
LEGAL REPRESENTATIVES:	PROSECUTOR: Mr T. Howard SOLICITORS: Department of Environment & Climate Change DEFENDANT: Mr D. Buchanan SC and Mr D. Jordan SOLICITORS: Baker & McKenzie