Environment Protection Authority v Softwood Holdings Ltd

[2000] NSWLEC 201

Reported Decision: 110 LGERA 87

Land and Environment Court

of New South Wales

CITATION:

Environment Protection Authority v Softwood Holdings Ltd [2000] NSWLEC 201

PARTIES:

PROSECUTOR:
Environment Protection Authority

DEFENDANT:
Softwood Holdings Ltd

FILE NUMBER(S):

50066 of 1999

CORAM:

Bignold J

KEY ISSUES:

Environmental Offences :- breach of condition of Licence - Sentence - Mitigating factors - Defence submission for non-conviction rejected

LEGISLATION CITED:

Protection of the Environment Operations Act 1997
Crimes (Sentencing Procedure) Act 1999

CASES CITED:

Environment Protection Authority v Norco Co-Operative Limited (2000) 108 LGERA 137

DATES OF HEARING:

09/06/00

DATE OF JUDGMENT:

09/04/2000

LEGAL REPRESENTATIVES:

PROSECUTOR:
Mr M Kelly, Solicitor
SOLICITORS:
Solicitor for the EPA

DEFENDANT:
Mr P McClellan QC
SOLICITORS
Mallesons Stephen Jacques

JUDGMENT:

IN THE LAND AND Matter No . 50066 of 1999

ENVIRONMENT COURT OF Coram : Bignold J.

NEW SOUTH WALES 4 September 2000

ENVIRONMENT PROTECTION AUTHORITY

Prosecutor

v

SOFTWOOD HOLDINGS LIMITED

Defendant

JUDGMENT

Bignold J:

A. INTRODUCTION

1. The Defendant has pleaded guilty to a charge of an offence against the Environmental Offences and Penalties Act 1989 in that being the holder of a Licence granted under the Pollution Control Act 1970, it did contravene a condition of that Licence contrary to s 17D(9) of the Pollution Control Act 1970.

2. According to the particulars endorsed on the Summons, the condition that was contravened was condition W2 which imposed a quantity limit of 50 mg/L NFR (non-filtrable residues) on liquid waste discharged from the single discharge point authorised by the Licence and the extent of the breach was revealed by a sample that was collected from the authorised discharge point, the sample revealing upon analysis, NFR of 3,700 mg/L.

3. The Summons alleging the offence was filed in Court on 23 September 1999 at a time when the aforesaid Acts had been repealed by the Protection of the Environment Operations Act 1997 (Act No 156) s 324 (which Act came into force on 1 July 1999: vide Government Gazette No 178 of 24 December 1998).

4. The Protection of the Environment Operations Act 1997, s 326 enacts in Schedule 5 savings and transitional provisions which include cl 2 providing the power for Regulations to be made containing “provisions of a savings or transitional nature consequent upon the enactment of the Act” and cl 10 which is in the following terms:

10 . The regulations under this Schedule may extend Chapter 8 (with modifications if any) to proceedings in connection with any Act or regulation repealed by this Act (in respect of offences committed against the Act or regulation before its repeal or in respect of any other matter that continues to have any force or effect). Those regulations may also make provision for the continued operation of any such repealed Act or regulation to those proceedings. In this clause a reference to a repealed Act or regulation includes a reference to a repealed provision of an Act or regulation.

5. The following transitional provision is made in the Protection of the Environment Operations (Savings and Transitional) Regulation 1998:

17(1) Parts 8.2 and 8.4 of the Act extend (subject to this clause) to proceedings in connection with a repealed Act in respect of offences committed against a repealed Act or regulation under a repealed Act before its repeal or in respect of any related matter that continues to have force or effect. This subclause applies whether the proceedings were pending on the commencement of the Act or whether the proceedings are instituted after that commencement.

(2) Parts 8.2 and 8.4 of the Act apply with such modifications as are necessary for the purposes of applying those Parts to any such proceedings. In particular, the following references in those Parts are to be read as follows:

(a) a reference to an offence arising under Part 5.2 is to be read as including a reference to a Tier 1 offence under the Environmental Offences and Penalties Act 1989,

(b) a reference to a prescribed offence for the purposes of section 216 is to be read as including a reference to a prescribed offence within the meaning of section 12 of the Environmental Offences and Penalties Act 1989,

(c) a reference in section 218 to an authority or officer entitled to institute proceedings is to be read as including a reference to an authority or officer entitled under section 13 of the Environmental Offences and Penalties Act 1989 to institute the proceedings.

(3) The provisions of a repealed Act relating to the orders that a court may make when it finds an offence proved continue to have effect in respect of any such proceedings.

6. Part 8.2 of the Act contains a number of relevant provisions eg s 215 providing for proceedings for an offence to be dealt with summarily before this Court; s 216 prescribing the time within which such proceedings must be commenced; s 217 authorising the Environment Protection Authority (EPA) to institute such proceedings; and s 241 which provides as follows:
241. (1) In imposing a penalty for an offence against this Act or the regulations, the court is to take into consideration the following (so far as they are relevant):
(a) the extent of the harm caused or likely to be caused to the environment by the commission of the offence,
(b) the practical measures that may be taken to prevent, control, abate or mitigate that harm,
(c) the extent to which the person who committed the offence could reasonably have foreseen the harm caused or likely to be caused to the environment by the commission of the offence,
(d) the extent to which the person who committed the offence had control over the causes that gave rise to the offence,
(e) whether, in committing the offence, the person was complying with orders from an employer or supervising employee.
(2) The court may take into consideration other matters that it considers relevant.

7. It is to be noted that none of the savings or transitional provisions that I have referred to, actually preserves criminal liability created by any of the repealed Acts or authorises the institution of proceedings seeking to enforce such liability. Such preservation of liability and authorisation of such proceedings is to be found in the Interpretation Act 1987, s 30(1) which relevantly provides as follows:
(1) The amendment or repeal of an Act or statutory rule does not:

…………….


…………….

(c) affect any right, privilege, obligation or liability acquired, accrued or incurred under the Act or statutory rule, or

(d) affect any penalty incurred in respect of any offence arising under the Act or statutory rule, or

(e) affect any investigation, legal proceeding or remedy in respect of any such right, privilege, obligation, liability or penalty,

and any such penalty may be imposed and enforced, and any such investigation, legal proceeding or remedy may be instituted, continued or enforced, as if the Act or statutory rule had not been amended or repealed.

8. Accordingly, the Interpretation Act s 30(1) applies in the present cases so as to (i) authorise the institution of the present proceedings (which were commenced after the Protection of the Environment Operations Act 1997 came into force); (ii) preserve liability incurred by the Defendant under the repealed Acts; and (iii) authorise the imposition of the penalty incurred under the repealed Acts. In the present case, the relevant maximum penalty is $125,000 in the case of an offence committed by a corporation against the Environmental Offences and Penalties Act , s 8D . (This compares with the prescribed maximum penalty of $250,000 for the counterpart offence created by the Protection of the Environment Operations Act , s 64 )

9. The Defendant entered its plea of guilty on 25 February 2000.

B. THE FACTS PERTAINING TO THE ADMITTED OFFENCE

10. The parties have co-operated in the preparation of an Agreed Statement of Facts (Exhibit 1). The facts hereinafter recited are extracted from that statement.

11. At the time of the commission of the offence, the Defendant operated a log yard and timber products plant at Adelong Road, Tumut, being relevantly the “premises” to which the Licence granted under the Pollution Control Act applied.

12. Earlier this year, CSR limited, the parent company of the Defendant, sold the assets comprising the premises and the timber plant so that the Defendant no longer operates the plant.

13. Condition S1 of the Licence which is a standard type condition dealing with “pollution of waters”, provides as follows:

The licensee must not pollute waters except as expressly permitted by this licence. (That is, the defence in section 16(6) of the Clean Waters Act 1970 is available only if the licensee pollutes waters as expressly permitted by this licence.)

14. The Licence permitted the Licensee to “ discharge in accordance with the conditions of this Licence the volume, concentration or type of pollutants described below ” from the single authorised discharge point located on the premises, being the “ drain located along the north-western boundary, downstream of the interception structure ’.

15. The limits imposed by the conditions included the following:

W2. Liquid waste discharged from the following authorised discharge points must not exceed the quality limits specified for each authorised discharge point:

Quality limits applicable to liquid waste discharged from the stormwater treatment plant

Parameter	50 percent limit	90 percent limit	3DGM limit	100 percent limit
NFR	30	40	-	50

W3. The licensee is not taken to have exceeded a quality limits detailed above if:

(a) a wet weather by-pass was the sole cause of the exceedance; and

(b) the rainfall over the previous 24 hours at the site has exceeded 10mm.

16. The licensed discharge point drains into an overflow drain which itself connects to a section of the town drain (located near the Defendant’s plant) which directly drains into Gilmore Creek situate some 2 km distant from the Defendant’s premises and that Creek ultimately discharges into the Tumut River situate a further 2 km distant.

17. At the time of the commission of the offence, effluent arising from the operation of the plant including surface stormwater runoff from the log yard was collected and channelled to the filtration plant comprising two elements—
(i.) the primary treatment plant; and
(ii.) the secondary treatment plant

18. The primary treatment plant comprises: primary screens for the removal of large bark and chips which may be carried by effluent from the logyard; gravel filters for the removal of smaller bark, chips and sawdust; a silt pit for collection of sedimentation; a Spel 300/50 Stormceptor to remove oil and grease; and a pump pit to store effluent for treatment by the secondary treatment plant.

19. The secondary treatment plant is an adjunct to the primary treatment plant. It is designed to receive water which has already proceeded through the primary treatment plant and further purifies the water. The secondary treatment plant chemically treats the effluent and aims to produce an effluent free of colloidal solids and tannins with a reduction in COD levels.

20. The secondary treatment plant is designed to treat the first flush of rain. This regime was put in place because it was recognised that most contamination of watercourses surrounding the premises occurred during this first flush. The defendant and their contractor, Nu-Pumps, installed the secondary treatment plant. Nu-Pumps identified the first 10mm in any one 24 hour period as being the most likely cause of contamination of surrounding watercourses by stormwater runoff. As a result, the secondary treatment plant was designed to fully treat the first 10mm of rain in any 24 hour period - equivalent to treatment of up to 320,000 litres of water.

21. If there is greater than 10mm rainfall within a 24 hour period, then the collection pit fills with the excess stormwater which cannot be immediately treated by the secondary treatment plant. Once the collection pit is filled any excess may be directly discharged to an overflow drain without treatment by the secondary treatment plant.

22. On the date the offence was committed, officers of the Environment Protection Authority and an officer of the Tumut Shire Council attended the Defendant’s premises to inspect the log yard and the stormwater treatment plant. It was raining and the recorded rainfall at the Defendant’s premises for the 24 hour period which ended at 9.00 am that day was 23 mm. Heavy rainfall at the premises had also been experienced four days earlier when 18 mm were recorded and two days earlier, when 10.5 mm were recorded. (It is to be recalled that condition W3 of the License operates in circumstances where rainfall in a 24 hour period exceeds 10 mm).

23. The inspection revealed that the unconcreted surface areas of the log yard were saturated with mud and bark mixture and the inlet area of the primary treatment plant had a large quantity of mud and bark build-up against the screens.

24. The inspection also revealed a “foaming and brown colour” discharge emanating from the secondary treatment plant which was “significantly more turbid than the receiving waters creating a plume of discoloured water in the drain”.

25. An officer of the Environment Protection Authority collected a sample of the discharge from the authorised discharge point which when analysed, revealed 3,700 mg/L total suspended solids (greatly in excess of the licensed maximum level of 50 mg/L).

26. This result was compared with a comparison sample collected at the same time from the drain at a point upstream the discharge point which sample, when analysed, revealed 27 mg/L total suspended solids.

27. The explanation tendered by the parties for the high level of NFR in the sample collected from the discharge point of the discharge emanating from the secondary treatment plant is that that plant failed to function efficiently because of the overload of the system caused by the significant amount of rainfall generating a large amount of surface stormwater runoff which collected mud from the log yard.

28. A similarly high level of NFR (3250 mg/L) had been reported to the Environment Protection Authority by the Defendant in fulfilment of its Licence obligations in respect of sampling of the discharged waste waters that had occurred on 23 April 1998. Although this reported incident apparently was not the subject of any charge, the Environment Protection Authority in its letter to the Defendant on 19 May 1998 (in respect of a proposal to expand the plant) had advised as follows:

Water Impacts

During a recent site visit, the existing treatment plant was unable to handle the highly turbid and sediment laden stormwater runoff. With increased activity in the log yard this problem is expected to be further exacerbated. Further attention to controlling stormwater impacts is required.

29. Subsequent to the commission of the offence, the Defendant has taken action to prevent a recurrence of the incident. In December 1998, it cleared the log yard of all bark and debris and then excavated the log yard to a depth of 2 m and topped it with crushed compacted rock, thereby producing a very solid base for the log yard with good drainage which has the effect of reducing the flow of mud and debris into the filtration plant. The cost of the works was $235,000 . A further $33,000 was expended in December 199 on recapping parts of the log yard.

30. Additionally, prior to the sale of the Defendant’s assets earlier this year, the Defendant had implemented a plan for continuous monitoring of the water discharge locations at the premises, together with improved control of chemical inputs into the secondary treatment plant.

31. Additionally, the Defendant had engaged water treatment specialists to recommend possible improvements to the chemical process of the secondary treatment plant.

32. The Defendant also arranged from October 1998 fortnightly independent monitoring of the filtration plant.

33. Finally, the Defendant had entered into negotiations with recycling companies for ongoing cleaning and recycling of wood debris from the log yard.

C. THE DEFENCE SUBMISSION THAT NO CONVICTION SHOULD BE RECORDED

34. Senior Counsel for the Defendant submitted that in this case the Court should exercise the statutory discretion not to record a conviction against the Defendant. The relevant statutory discretion was conferred by the Crimes Act 1900 s 556A prior to its repeal and re-enactment as the Crimes (Sentencing Procedure) Act 1999 s 10, that section relevantly providing:
(1) Without proceeding to conviction, a court that finds a person guilty of an offence may make either of the following orders:
(a) an order directing that the relevant charge be dismissed,
(b) an order discharging the person on condition that the person enter into good behaviour bond
(2) An order referred to in subsection (1)(b) may be made if the court is satisfied:
(a) that it is inexpedient to inflict any punishment (other than nominal punishment) on the person, or
(b) that it is expedient to release the person on a good behaviour bond
(3) In deciding whether to make an order referred to in subsection (1), the court is to have regard to the following factors:
(a) the person’s character, antecedents, age, health and mental condition,
(b) the trivial nature of the offence,
(c) the extenuating circumstances in which the offence was committed,
(d) any other matter that the court thinks proper to consider.

35. In Penrith City Council v Re-Gen Industries Pty Ltd (2000) 107 LGERA 331, Talbot J at 336 expressed the opinion that the effect of s 10 was relevantly the same as s 556A of the Crimes Act. I respectfully agree.

36. In advancing this submission, Senior Counsel for the Defendant relied upon the following facts:
(i.) the Defendant’s unblemished environmental record;
(ii.) the filtration plant in operation at the Defendant’s premises had been designed and installed with the best available professional advice and skill;
(iii.) the Defendant, in operating the plant had obtained all requisite licences and pollution control approvals under the Pollution Control Act 1970;
(iv.) the expectations of the parties to the Licence as to the capacity of the filtration plant to cope with stormwater runoff had not been fulfilled;
(v.) the rainfall experienced on the time of the offence was particularly heavy;
(vi.) the breach of the Licence condition was technical; and
(vii.) the Defendant had agreed to pay the Prosecutor’s costs of the proceedings in the sum of $8,000.

37. In my judgment, the Defence submission for the favourable exercise of the discretion conferred by the Crimes (Sentencing Procedure) Act 1999 s 10 is not sustainable, for the fundamental reason that it fails to give due recognition to (i) the precise nature of the offence that the Defendant has admitted and (ii) the true nature of the obligation cast upon the Licencee by the Pollution Control Licence to observe the conditions of Licence. In my judgment, both these matters are of significant relevance to the question of sentence in the present case.

38. I recently dealt with both these matters in Environment Protection Authority v Norco Co-Operative Limited (2000) 108 LGERA 137, a case involving a charge of the same offence as that involved in the present proceedings, in the following passages at par 40 - par 48:

Although I shall presently come to consider the factors stipulated in the Protection of the Environment Operations Act s 241(1) (these replicate the factors previously contained in the Environmental Offences and Penalties Act s 9(1) which is the point of reference addressed by the parties in the present case), it is to be noted that those factors generally are directed to the issue of environmental harm, which is not an essential element of the offence created by the Environmental Offences and Penalties Act s 8D . The essential element of such offence is a contravention of a condition of a pollution control licence.

In respect of such an offence, the Court has long held the view that a contravention of a condition of licence involves a sense of breach of public trust: see State Pollution Control Commission v CSR Ltd (1989) 75 LGRA 1 and State Pollution Control Commission v Broken Hill Pty Co Ltd No 2 (1991) 74LGRA 358.

In the earlier case, Cripps CJ, in the context of sentencing a defendant, convicted of multiple offences involving (i) the pollution of waters; and (ii) related contraventions of licence conditions (by virtue of exceedances of limits imposed on the nature of waste waters permitted to be discharged to waters) considered the offence of pollution of waters to be the significant offence.

His Honour immediately continued:

This does not mean, however, that penalties under the State Pollution Control Commission Act for breach of licence conditions should be nominal only (otherwise than in respect of different conditions of the licence). CSR Ltd was given a licence to pollute. Its licence was conditional upon it not polluting any more than permitted and maintaining certain standards to ensure that its limit was not exceeded. Its licence placed it in a special category over and above other persons and corporations and consequently imposed on it certain obligations. In effect, CSR was trusted so to conduct its operations that it would not pollute the water more than that for which permission was given.

More recently, Talbot J in Environment Protection Authority v ADI Ltd (1999) NSWLEC 14, a case involving the offence of polluting waters, has observed, in the context of rejecting a submission that some allowance should be accorded to the defendant because of the existence of a licence to pollute the waters:-

In the Court’s opinion, the fact that the Company held a licence heightened its responsibility to keep the level of discharge from the premises within the parameters set by the licence.

I would regard this well established approach by the Court to sentencing for convictions of offences involving contravention of licence conditions to be a more relevant consideration in terms of the Protection of the Environment Operations Act s 241(2), than are the considerations stipulated in s 241(1) concerning the issue of any environmental harm involved in the offence.

This is not to say that the considerations stipulated in s 241(1) are not relevant in the present case. Long before the enactment of the Environmental Offences and Penalties Act 1989 s 9, the Court, in sentencing for a conviction of an offence of contravening a licence condition would generally consider the question whether environmental harm had been occasioned. This approach is reflected in the two earlier decisions I have cited.

In the present cases both charges of exceedances of the BOD permissible limits were, in particular, considerable and those offences must be regarded as serious conformably to the established jurisprudence in this Court on sentencing for such an offence.

The fact that the maximum penalty for such an offence was increased in 1990 from $40,000 to $125,000 only serves to heighten the seriousness of such an offence that was recognised in the Court’s earlier decisions, including the two I have cited.

39. The Defence submission sits very uncomfortably, if not incongruously, alongside the analysis in Norco of the true nature of the offence with which it is charged, and of the true nature of the obligations of a Licensee to observe the conditions of Licence where a failure to do so necessarily involves the pollution of waters.

40. In particular, the Defence submission that the breach of the condition should be regarded as a “technical” breach must be rejected out of hand as not only offending the notion of “public trust” upon which a Licensee operates under the Licence, but on the proven facts themselves, which reveal a very significant exceedance of the relevant limit condition of the Licence fixed in respect of the level of total suspended solids in wastewaters, namely 50mg/L when the sample of discharged wastewaters revealed a level of 3,700 mg/L.

41. Moreover, the Defence submission that the relevant limit conditions of the Licence merely reflect the bargain struck between the parties to the Licence, in my respectful opinion must be regarded as totally misconceiving the nature of the Licence granted under the Pollution Control Act.

42. In so concluding, I am prepared to accept that the Licence limit condition was probably imposed by the Environment Protection Authority in recognition of the expected capacity of the wastewater secondary treatment plant to process contaminated runoff which the Defendant, relying upon its professional advisers, had represented to the Environment Protection Authority. However, this fact does not support the Defence submission which breaks down at the very next step, namely in its suggestion that because that expected capacity was not subsequently realised, the Licence limit condition is in some fashion to be set aside (as if it were affected by some form of common mistake entertained by parties to a private contract). The attempted analogy sought to be drawn by Defence Counsel between the statutory Licence granted under the Pollution Control Act and a private bargain or contract between the parties to the Licence, in my respectful opinion, is wholly misconceived.

43. For all the foregoing reasons, I am of the emphatic opinion that this is not a case for the exercise in favour of the Defendant of the statutory discretion now conferred by s 10 of the Crimes (Sentencing Procedure) Act 1999. In particular, I find that the offence is not trivial in nature and there were no extenuating circumstances in the commission of the offence. The Defence submission is accordingly rejected.

D. SENTENCE

44. This brings me finally to consider the appropriate sentence to impose in respect of the admitted offence. In this respect, there are a number of mitigating factors that operate in favour of the Defendant in reduction of the penalty to be imposed, that should immediately be noted, namely:
(i.) this is the Defendant’s first environmental offence;
(ii.) the Defendant’s early entry of a plea of guilty to the charge;
(iii.) the Defendant’s co-operation with the Environment Protection Authority in the investigation of the offence and in the presentation of the Prosecution case (in the production of the Statement of Agreed Facts);
(iv.) the Defendant’s contrition as expressed to the Court;
(v.) the remedial action taken by the Defendant at its plant at considerable cost, subsequent to the commission of the offence, which action is designed to prevent a recurrence of the offence.

45. These mitigating factors justify a significant reduction in penalty in the order of 40 per cent.

46. In determining the appropriate level of penalty in the present case, I proceed (as I did in Norco) by regarding as most relevant the matters that I have already discussed in rejecting the Defence submission not to record a conviction. These matters are relevant by virtue of the Protection of the Environment Operations Act 1997 s 241(2). As I have said, it is well established in this Court that a breach by a Licensee of a condition of Licence which breach results in the pollution of waters is objectively regarded as a serious offence. On this basis, the factors stipulated in the Protection of the Environment Operation Act 1997 Act s 241(1), particularly those related to environmental harm, will generally operate by way of aggravation if findings adverse to the Defendant are made but if no such findings are made, the effect of s 241(1) will generally not affect my conclusions based upon s 241(2): cf Norco at par 54.

47. Factors (a), (b) and (c) of s 241(1) concern the issue of environmental harm. In relation to that issue, the Statement of Agreed Facts records that “there is no evidence of actual environmental harm but that there is potential harm caused by the discharge into waters of wastewaters containing high concentrations of suspended solids by virtue of the reduction in the degree of light penetration into the water column, possible mortality of aquatic organisms, siltation and a decrease in aesthetics value”: par 15 and 16.

48. The Agreed Statement notes the state of the scientific literature on the effects on aquatic organisms of waste matters with high levels of suspended solids discharging into receiving waters, noting that the level of suspended solids in the sample of discharged wastewaters in the present case was considerably greater than the concentrations which, according to the scientific literature, are known to have adverse effects. However, because of two unknown factors in the present case—(i) the dilution rate obtained from the receiving waters and (ii) the rate at which the suspended solids in the discharged wastewaters would settle, “it is difficult to draw conclusions as to the likely scale of any impact on them”: par 17 and par 18.

49. To these facts, there should be added the facts already noted that (i) the immediately receiving waters were the town drain and that Gilmore Creek and the Tumut River were situate downstream from the Defendant’s premises 2 and 4 km respectively and (ii) the heavy rainfall on the date of the commission of the offence and on the preceding four days would have generated large volumes of stormwater runoff entering the town drain, thereby increasing the rate of dilution of the suspended solids.

50. Another fact relevant at this point is the potential operation of condition W3 of the Licence. Its effect was potentially enlivened by virtue of the extent of rainfall experienced at the Defendant’s premises. Had the discharge of wastewaters not emanated from the Defendant’s secondary treatment plant but simply exited the Defendant’s premises via the wet weather by-pass, Condition W3 would have been enlivened and would have operated to deem the resultant discharge in the present case as not exceeding the quality limits fixed by Condition W2.

51. In the light of these facts, there can be no finding on environmental harm that is adverse to the Defendant. Accordingly no aggravated circumstances arise from my consideration of s 241(1)(a), (b) and (c).

52. The only other relevant factor in s 241(1) is par (d) “the extent to which the person who committed the offence had control over the causes that gave rise to the offence”.

53. Obviously the Defendant had no control over the heavy rainfall experienced at the premises. However, it did have some control over the state of the log yard and its vulnerability to heavy storm runoff collecting mud and debris from the workings of the timber processing. In particular, the Defendant had been called upon by the Environment Protection Authority in its letter some four months prior to the commission of the offence to take remedial action to decrease the “highly turbid and sediment laden stormwater runoff from the log yard”.

54. I accept the Defence submission that the intervening period was winter and remedial action may have been more difficult to undertake at that time. However, there is no precise evidence to this effect, other than the fact that the Defendant was warned by the Environment Protection Authority to take remedial action and the fact that a very high level of suspended solids was detected in the routine sampling process undertaken by the Defendant on 23 April 1998.

55. From these facts, the inevitable inference which I draw is that the Defendant was in the position to take some remedial action which if taken, may well have prevented the commission of the offence.

56. However, I do not think this finding is particularly adverse to the Defendant, in the sense of establishing an aggravated offence, although it obviously contributes to the Defendant’s culpability in committing the offence of breaching its Licence obligation.

E. CONCLUSION AND ORDERS

57. For all the foregoing reasons, I am of the opinion that it is appropriate to record a conviction for the admitted offence and it is appropriate to impose a penalty reflecting the lower end of the spectrum of gravity (that result being achieved by virtue of the mitigating circumstances significantly reducing the penalty that would otherwise have been appropriate to be imposed). A penalty of $20,000 shall be imposed (being 16 per cent of the prescribed maximum penalty of $125,000).

58. Accordingly, I make the following orders:
1. The Defendant is convicted of the offence charged.
2. A penalty of $20,000 is imposed in respect of that conviction.
3. The Defendant shall pay the Prosecutor’s costs in the agreed sum of $8,000.
4. Exhibits be returned.