Erector Group Pty Ltd v Burwood Council; Liverpool Developing Pty Ltd v Burwood Council

[2018] NSWCCA 56

Court of Criminal Appeal

Supreme Court

New South Wales

• Amendment notes

Medium Neutral Citation:

Erector Group Pty Ltd v Burwood Council; Liverpool Developing Pty Ltd v Burwood Council [2018] NSWCCA 56

Hearing dates:

16 November 2017

Date of orders:

06 April 2018

Decision date:

06 April 2018

Before:

Bathurst CJ at [1]; Hoeben CJ at CL at [134]; Button J at [135]

Decision:

(1)   Appeal allowed.

 

(2)   Set aside the orders made by the primary judge, save for the order as to the costs of the proceeding below, and in lieu thereof make the following orders:

 

(a)   In proceeding 2016/175841:

 

(i) Liverpool Developing Pty Ltd is convicted of the offence against s 125(1) of the Environmental Planning and Assessment Act 1979 (NSW) as charged.

 

(ii)   Liverpool Developing Pty Ltd is fined $20,000.

 

(b)   In proceeding 2016/175842:

 

(i) Liverpool Developing Pty Ltd is convicted of the offence against s 125(1) of the Environmental Planning and Assessment Act 1979 (NSW) as charged.

 

(ii)   Liverpool Developing Pty Ltd is fined $15,000.

 

(c)   In proceeding 2016/175925:

 

(i) Erector Group Pty Ltd is convicted of the offence against s 125(1) of the Environmental Planning and Assessment Act 1979 (NSW) as charged.

 

(ii)   Erector Group Pty Ltd is fined $20,000.

 

(d)   In proceeding 2016/175926:

 

(i) Erector Group Pty Ltd is convicted of the offence against s 125(1) of the Environmental Planning and Assessment Act 1979 (NSW) as charged.

 (ii)   Erector Group Pty Ltd is fined $15,000.

Catchwords:

SENTENCING – Aggravating factors – Substantial harm, injury, loss or damage – offenders carried out development without appointing a principal certifying authority or obtaining a construction certificate contrary to legislation – adjoining building collapsed after excavation occurred – whether damage to adjoining building was caused by contravention of legislation

  SENTENCING – Relevant factors on sentence – De Simoni double counting – offenders carried out development without appointing a principal certifying authority or obtaining a construction certificate contrary to legislation – adjoining building collapsed after excavation occurred – failing to protect and support or underpin adjoining buildings was also an offence under the legislation – whether taking into account damage caused was contrary to De Simoni

Legislation Cited:

Crimes (Sentencing Procedure) Act 1999 (NSW)
Criminal Appeal Act 1912 (NSW)
Environmental Planning and Assessment Act 1979 (NSW)
Environmental Planning and Assessment Regulation 2000 (NSW)

Cases Cited:

Axer Pty Ltd v Environment Protection Authority (1993) 113 LGERA 357
Bentley v BGP Properties Pty Ltd (2006) 145 LGERA 234; [2006] NSWLEC 34
Burns v The Queen (2012) 246 CLR 334; [2012] HCA 35
Cabonne Shire Council v Environment Protection Authority (2001) 115 LGERA 304; [2001] NSWCCA 280
Campbell v The Queen [1981] WAR 286
Campbelltown City Council v Mhanna [2010] NSWLEC 57
Cassidy v The Queen (2012) 220 A Crim R 420; [2012] NSWCCA 68
Hili v The Queen (2010) 242 CLR 520; [2010] HCA 45
La Fontaine v The Queen (1976) 136 CLR 62; [1976] HCA 52
Over Our Dead Body Society Inc v Byron Bay Community Association Inc (2001) 116 LGERA 158; [2001] NSWLEC 125
R v CLD [2015] NSWCCA 114
R v De Simoni (1980) 147 CLR 383; [1981] HCA 31
R v Dookheea (2017) 91 ALJR 960; [2017] HCA 36
R v Moffatt (2000) 112 A Crim R 201; [2000] NSWCCA 174
R v Olbrich (1999) 199 CLR 270; [1999] HCA 54
R v Pham (2015) 256 CLR 550; [2015] HCA 39
Royall v The Queen (1990) 172 CLR 378; [1991] HCA 27
Tiger Nominees Pty Ltd v State Pollution Control Commission (1991) 25 NSWLR 715

Category:

Principal judgment

Parties:

Erector Group Pty Ltd (first appellant)
Liverpool Developing Pty Ltd (second appellant)
Burwood Council (respondent)

Representation:

Counsel:
R O’Gorman-Hughes (appellants)
P McGuire SC with D New (respondent)

  Solicitors:
Zhang Shijing Lawyers (appellants)
Houston Dearn O’Connor (respondent)

File Number(s):

2017/153456; 2017/153485; 2017/153426; 2017/153136

Publication restriction:

Nil

 Decision under appeal 

Court or tribunal:

Land and Environment Court of New South Wales

Jurisdiction:

N/A

Citation:

[2017] NSWLEC 20

Date of Decision:

06 March 2017

Before:

Preston CJ

File Number(s):

2016/175841; 2016/175842; 2016/175925; 2016/175926

HEADNOTE

[This headnote is not to be read as part of the judgment]

Liverpool Developing Pty Ltd was the owner of land at 248-250 Liverpool Road, Enfield. Burwood Council had granted consent to a development application in respect of those premises on 18 December 2014. Erector Group Pty Ltd was appointed as the builder and head contractor for the development. Liverpool Developing and Erector Group were related companies. Mr Rong Feng Wang and his wife, Ms Bao Qing Zhang, were the only directors and shareholders of Liverpool Developing while Mr Wang was the only director and shareholder of Erector Group.

Section 81A(2) of the Environmental Planning and Assessment Act 1979 (NSW) required a principal certifying authority to be appointed and a construction certificate to be obtained prior to the commencement of the erection of a building. Condition 26 of the development consent required the Council to be notified of the appointment of a principal certifying authority and the “detailed plans and specifications” of the building to be endorsed with a construction certificate before development was carried out. Contravention of s 81A(2) or condition 26 of the development consent was an offence.

Initial demolition work was carried out at the premises during early 2016 which did not require compliance with the requirements of s 81A(2) or condition 26 of the development consent. However, on or about 29 February 2016, additional excavation work was carried out which did require compliance with the requirements of s 81A(2) and condition 26 of the development consent. None of those requirements had been fulfilled. Following the additional excavation work, an adjoining building collapsed and several other adjoining buildings were damaged on 1 March 2016.

Liverpool Developing and Erector Group pleaded guilty to charges alleging failures to comply with s 81A(2) and condition 26 of the development consent. The sentencing judge found that the damage to the adjoining buildings had “in all probability” been caused by the offending conduct and that this damage was “substantial” so that it was an aggravating factor under s 21A(2)(g) of the Crimes (Sentencing Procedure) Act 1999 (NSW). He rejected a submission that, in taking into account this damage, he was punishing Liverpool Developing and Erector Group for an offence with which they were not charged under cl 98E(1) of the Environmental Planning and Assessment Regulation 2000 (NSW) for failing to “protect and support” or “underpin” adjoining buildings.

The main issues on appeal were:

1.   Whether the sentencing judge erred in finding that the damage was caused by the additional excavation work (Grounds 1-2);

2.   Whether the sentencing judge, by taking into account the damage caused to the adjoining buildings, was punishing Liverpool Developing and Erector Group for an offence with which they were not charged (Ground 3);

The Court (Bathurst CJ, Hoeben CJ at CL and Button J) held, allowing the appeal:

Causation of damage (Grounds 1-2)

(i)   The sentencing judge did not apply the incorrect standard of proof in finding that the damage was “in all probability” caused by the offending conduct. While the phrase used is not desirable, the sentencing judge was using the phrase “in all probability” as a substitute for “beyond reasonable doubt”: [94] (Bathurst CJ); [134] (Hoeben CJ at CL); [135] (Button J).

R v Dookheea (2017) 91 ALJR 960; [2017] HCA 36, considered.

(ii) However, there was insufficient evidence to establish that the offending conduct was caused by the damage beyond reasonable doubt. There was no evidence which demonstrated that the initial demolition work had not caused the damage, or that complying with s 81A(2) or condition 26 of the development consent could have avoided the damage being caused: [97]-[101] (Bathurst CJ); [134] (Hoeben CJ at CL); [135] (Button J).

Punishment for an offence which was not charged (Ground 3)

(iii) The sentencing judge had not punished Liverpool Developing or Erector Group for a failure to comply with cl 98E(1) of the Environmental Planning and Assessment Regulation 2000 (NSW), but for a failure to comply with s 81A(2) and condition 26 of the development consent: [108] (Bathurst CJ); [134] (Hoeben CJ at CL); [135] (Button J).

(iv)   It is unnecessary to decide whether an offence is “more serious” than another for the purposes of the principle in R v De Simoni (1980) 147 CLR 383; [1981] HCA 31 is determined by its maximum penalty or by the objective seriousness of the offence: [109] (Bathurst CJ); [134] (Hoeben CJ at CL); [135] (Button J).

Cassidy v The Queen (2012) 220 A Crim R 420; [2012] NSWCCA 68, referred to.

Judgment

1. BATHURST CJ: Erector Group Pty Ltd (Erector Group) and Liverpool Developing Pty Ltd (Liverpool Developing) (the appellants) each pleaded guilty to two charges arising out of development carried out at 248-250 Liverpool Street, Enfield (the premises). The premises were sometimes referred to in the evidence as 248-252 Liverpool Street, Enfield.

2. Liverpool Developing was the owner of the premises and Burwood Council (the respondent) had granted consent to a development application in respect of the premises on 18 December 2014 (the development consent). Erector Group was appointed by Liverpool Developing as the builder and head contractor to carry out development at the premises.

3. The appellants are related companies. Mr Rong Feng Wang was the only director and shareholder of Erector Group, whilst Mr Wang and his wife, Ms Bao Qing Zhang, were the only directors and shareholders of Liverpool Developing.

4. Condition 26 of the development consent imposed the following requirements:

“(26)   Prior to the commencement of building work, the following is to be carried out:-

a.   Submit to Council a “Notice of Intention to Commence Building Work and Appointment of a Principal Certifying Authority” form. Council’s “Notice of Intention to Commence Building Work and Appointment of a Principal Certifying Authority” form is to be used where application is made to Council.

b.   Ensure detailed plans and specifications of the building are endorsed with a Construction Certificate by Council or an Accredited Certifier. Council’s “Construction Certificate Application” form is to be used where application is made to Council. Copies are available on request.

5. The charges against the appellants relate to a failure to comply with condition 26 of the development consent contrary to s 76A(1) of the Environmental Planning and Assessment Act 1979 (NSW) (the EPA Act) and a failure to comply with s 81A(2) of the EPA Act. The charges were filed in the Land and Environment Court of New South Wales. As I have noted, the appellants pleaded guilty to both charges.

6. The first charge against Erector Group (First Erector Group Charge) was in the following terms:

“On or about 29 February 2016 at Enfield in the State of New South Wales, Erector Group Pty Ltd (ACN 095922357) (hereinafter ‘the First Defendant’) breached section 125(1) of the Environmental Planning and Assessment Act 1979 (‘the Act’) in that the First Defendant did a thing forbidden to be done by the Act, namely contrary to section 76A(1) of the Act the First Defendant carried out development otherwise than in accordance with a development consent that had been obtained and was in force and otherwise than in accordance with the Instrument.”

The First Erector Group Charge particularised a failure to comply with condition 26(a) of the development consent.

7. The second charge against Erector Group (Second Erector Group Charge) was in the following terms:

“On or about 29 February 2016 at Enfield in the State of New South Wales, Erector Group Pty Ltd (ACN 095922357) (hereinafter ‘the First Defendant’) breached section 125(1) of the Environmental Planning and Assessment Act 1979 (‘the Act’) in that the First Defendant did a thing forbidden to be done by the Act, namely contrary to section 81A(2)(a) of the Act, the First Defendant carried out the erection of a building without a construction certificate for the building having been issued.”

The Second Erector Group Charge particularised a failure to comply with s 81A(2)(a) of the EPA Act.

8. The first charge against Liverpool Developing (First Liverpool Developing Charge) was in the following terms:

“On or about 29 February 2016 at Enfield in the State of New South Wales, Liverpool Developing Pty Ltd (ACN 153414683) (hereinafter ‘the Second Defendant’) breached section 125(1) of the Environmental Planning and Assessment Act 1979 (‘the Act’) in that the Second Defendant did a thing forbidden to be done by the Act, namely contrary to Section 81A(2)(b) of the Act, the Second Defendant commenced the erection of a building prior to the appointment of a Principal Certifying Authority (‘PCA’).”

The First Liverpool Developing Charge particularised a failure to comply with s 81A(2)(b) of the EPA Act.

9. The second charge against Liverpool Developing (Second Liverpool Developing Charge) was in the following terms:

“On or about 29 February 2016 at Enfield in the State of New South Wales, Liverpool Developing Pty Ltd (ACN 153414683) (hereinafter ‘the Second Defendant’) breached section 125(1) of the Environmental Planning and Assessment Act 1979 (‘the Act’) in that the Second Defendant did a thing forbidden to be done by the Act, namely contrary to Section 76A(1) of the Act, the Second Defendant carried out development otherwise than in accordance with a development consent that had been obtained and was in force and otherwise than in accordance with the instrument.”

The Second Liverpool Developing Charge particularised a failure to comply with condition 26(b) of the development consent.

10. The First Erector Group Charge and the First Liverpool Developing Charge relate to the failure to appoint a principal certifying authority (PCA) for the development, while the Second Erector Group Charge and the Second Liverpool Developing Charge relate to the failure to obtain a construction certificate for the development.

11. The sentencing judge imposed penalties of $40,000 in respect of each of the charges.

The background facts

12. An Agreed Statement of Facts was tendered at the hearing before the sentencing judge. The summary below is taken from the Agreed Statement of Facts.

13. Erector Group was the company which had responsibility for “engaging subcontractors to undertake works associated with the development at [the premises] and was also responsible for providing documentation setting out any work required of subcontractors”.

14. In late June 2015 or early July 2015, Liverpool Developing approached Certified Building Specialists Pty Ltd (Certified), seeking it to act as the PCA and provide certification services in respect of the development at the premises. A fee proposal was sent by Certified for carrying out that work and was returned by Liverpool Developing with an additional three conditions.

15. The fee proposal was not signed by Certified, and the Agreed Statement of Facts records that “no contract for services as a PCA or to provide a construction or occupation certificate was entered into between the parties”. Notwithstanding, on 29 February 2016, Certified emailed Mr Wang and thanked him “for selecting [Certified] to complete your specified project” and attached an invoice for “stages 1-3 of the project”, including for services as a PCA. The Agreed Statement of Facts listed the following services for which the invoice was provided: “construction certificate, principal certifying authority and final occupation certificate”.

16. On 15 September 2015, Certified wrote to Mr Wang providing him with a list of consent conditions needing attention and other requirements prior to the issue of a construction certificate, while on 10 November 2015, it advised Mr Wang of the conditions which had to be addressed prior to the commencement of demolition. On 1 December 2015, Certified advised Mr Wang that he had complied with the requirements for demolition. On the same day, a separate letter was sent by Certified to Mr Wang providing a checklist outlining the development consent conditions and general requirements which had to be met before a construction certificate could be issued.

17. At no stage did Certified issue a construction certificate, and as at December 2015, no steps had been taken to address any of the issues raised in the checklists sent by Certified on 15 September 2015 and 1 December 2015 in relation to the construction certificate.

18. On 18 December 2015, Mr Wang lodged an “Application for Works on Council Property” with the respondent in which he advised that Certified was the “Private Certifier”. He provided the contact details for that company.

19. In late January 2016 or early February 2016, Erector Group engaged ADN Investments Pty Ltd (ADN) to undertake the following works at the premises: “demolition, bulk excavation, piling, capping beam, shotcrete and ground anchor”. Prior to 29 February 2016, the Agreed Statement of Facts appears to state that ADN carried out the demolition of the existing building at the premises (the demolition work). It also appears that this work involved “bulk excavation”.

20. On about 29 February 2016, ADN carried out additional work on the premises. This included “excavating the land to a level that was beyond what was required for demolition and levelling out the site so as to prepare it for the placement of piers” (the additional excavation work).

21. The Agreed Statement of Facts stated that the additional excavation work was “building work” and “work associated with the erection of a building”. It also stated that the additional excavation work carried out by ADN required a construction certificate and the appointment of a PCA prior to the work being carried out. Prior to the additional excavation work being carried out, no construction certificate had been issued.

22. As at 1 March 2016, no shoring or piling work had been undertaken despite the additional excavation work at the premises. On or about that day, “following the undertaking of bulk excavation” at the premises, the building immediately next to the premises collapsed and other buildings were damaged.

23. The respondent required the “defendant” to engage structural engineers and carry out work “necessary to restore stability to adjoining land”. The identity of the “defendant” for the purposes of this paragraph of the Agreed Statement of Facts is not clear. Mr Wang then engaged a structural engineer to ensure the “safety and structural integrity of the site and the excavation”.

24. On 31 March 2016, AE&D Pty Ltd (AED) issued a construction certificate in respect of the site. On or about the same day, Liverpool Developing submitted a “Notice to Commence Building Work and Appointment of a Principal Certifying Authority” form to the respondent. After receiving this notice, the respondent informed AED that construction work should not commence until the “structural integrity of the adjoining building was certified by a structural engineer”.

25. The Agreed Statement of Facts stated that the “Notice to Commence Building Work and Appointment of a Principal Certifying Authority” form and the issue of the construction certificate by AED both occurred after the commencement of “building works” and “work associated with the erection of a building”.

26. In April 2016, AED notified Mr Wang that the respondent “should take over the role of certifying authority”. Mr Wang then attempted to lodge a construction certificate application with the respondent. On 6 July 2016, the respondent advised Mr Wang that it was not prepared to issue a construction certificate or allow work to commence until “it was established that the structural integrity of adjoining properties was stabilised”. The respondent advised that “documentation prepared by a suitably qualified person detailing a concrete methodology of how the proposed excavation and shoring work would not impact on the adjoining properties was to be submitted”.

The relevant legislation

27. Prior to dealing with the sentencing judgment and the submissions of the parties, it is convenient to set out the relevant legislation. The relevant version of the legislation is that in force from February to March 2016. All references to legislation are references to the provisions in force at that time.

28. Section 76A of the EPA Act deals with development that needs consent. It is in the following terms:

“76A   Development that needs consent

(1)   General

If an environmental planning instrument provides that specified development may not be carried out except with development consent, a person must not carry the development out on land to which the provision applies unless:

(a)   such a consent has been obtained and is in force, and

(b)   the development is carried out in accordance with the consent and the instrument.”

29. In addition to the express conditions to which a development consent may be subject, s 80A(11) provides that a development consent “is subject to such conditions as may be prescribed by the regulations”. Clause 98E(1) of the Environmental Planning and Assessment Regulation2000 (NSW) (the EPA Regulation) makes provision for the protection of buildings or lands adjoining the development. Relevantly, it provides as follows:

“98E   Condition relating to shoring and adequacy of adjoining property

(1) For the purposes of section 80A (11) of the Act, it is a prescribed condition of development consent that if the development involves an excavation that extends below the level of the base of the footings of a building, structure or work (including any structure or work within a road or rail corridor) on adjoining land, the person having the benefit of the development consent must, at the person’s own expense:

(a)   protect and support the building, structure or work from possible damage from the excavation, and

(b)   where necessary, underpin the building, structure or work to prevent any such damage.”

30. Section 81A imposes certain restrictions on the commencement of building work which are distinct from those which may be imposed by the express or prescribed conditions of a development consent. Relevantly, s 81A(2) provides as follows:

“81A   Effects of development consents and commencement of development

…

(2)   The erection of a building in accordance with a development consent must not be commenced until:

(a)   a construction certificate for the building work has been issued by the consent authority, the council (if the council is not the consent authority) or an accredited certifier, and

(b)   the person having the benefit of the development consent has:

(i)   appointed a principal certifying authority for the building work …”

31. Section 109E provides for the appointment of a PCA. Relevantly, it is in the following terms:

“109E   Principal certifying authorities

(1)   The person having the benefit of a development consent or complying development certificate for development:

(a)   is to appoint a principal certifying authority in respect of building work involved in the development and a principal certifying authority in respect of subdivision work involved in the development, and

(b)   may appoint only the consent authority, the council or an accredited certifier as the principal certifying authority for the building work or subdivision work, and

(c)   may appoint the same principal certifying authority for both types of work or different certifying authorities.

…

(3)   A principal certifying authority for building work or subdivision work to be carried out on a site is required to be satisfied:

(a)   that a construction certificate or complying development certificate has been issued for such of the building work or subdivision work as requires development consent and over which the principal certifying authority has control, before the work commences on the site, and

…

(d)   that building work or subdivision work on the site has been inspected by the principal certifying authority or another certifying authority on such occasions (if any) as are prescribed by the regulations and on such other occasions as may be required by the principal certifying authority, before the principal certifying authority issues an occupation certificate or subdivision certificate for the building or work …”

32. Clause 145 of the EPA Regulation obliges a “certifying authority” to be satisfied as to certain matters concerning the design and construction of the building. So far as relevant, it provides as follows:

“145   Compliance with development consent and Building Code of Australia

(1)   A certifying authority must not issue a construction certificate for building work unless:

…

(a)   the design and construction of the building (as depicted in the plans and specifications and as described in any other information furnished to the certifying authority under clause 140) are not inconsistent with the development consent, and

(b)   the proposed building (not being a temporary building) will comply with the relevant requirements of the Building Code of Australia (as in force at the time the application for the construction certificate was made).”

33. Clause 162A of the EPA Regulation provides for the times when “critical stage inspections” for the purpose of s 109E(3)(d) of the EPA Act must occur. One of the times prescribed is “after excavation for, and prior to the placement of, any footings”.

34. Clause 162A(7A) is relevantly in the following terms:

“(7A)   Inspections of building work must be made on the following occasions in addition to those required by the other provisions of this clause for the building work:

…

(b)   in the case of a class 2, 3, 4, 5, 6, 7, 8 or 9 building, after the commencement of the excavation for, and before the placement of, the first footing.”

The development consent granted by the respondent in the present case appears to have been for a building in classes 2, 6 and 7.

35. Clause 162B(1) requires a record to be made of each “critical stage inspection”, which must include a statement of “whether or not the inspection was satisfactory in the opinion of the certifying authority who carried it out”.

36. Clause 6 in Part 3 of Schedule 1 to the EPA Regulation provides for certain information to be included in the application for a construction certificate. Relevantly, it provides as follows:

“6   Documents to accompany application for construction certificate

(1)   An application for a construction certificate must be accompanied by the following documents:

(a)   if the development involves building work (including work in relation to a dwelling-house or a building or structure that is ancillary to a dwelling-house):

(i)   a detailed description of the development, and

(ii)   appropriate building work plans and specifications,

(b)   if the development involves building work (other than work in relation to a dwelling-house or a building or structure that is ancillary to a dwelling-house):

(i)   a list of any existing fire safety measures provided in relation to the land or any existing building on the land, and

(ii)   a list of the proposed fire safety measures to be provided in relation to the land and any building on the land as a consequence of the building work,

(c)   if the development involves subdivision work, appropriate subdivision work plans and specifications …

…

(3)   Appropriate building work plans and specifications referred to in subclause (1)(a)(ii) include the following:

(a)   detailed plans, drawn to a suitable scale and consisting of a block plan and a general plan, that show:

(i)   a plan of each floor section, and

(ii)   a plan of each elevation of the building, and

(iii)   the levels of the lowest floor and of any yard or unbuilt on area belonging to that floor and the levels of the adjacent ground, and

(iv)   the height, design, construction and provision for fire safety and fire resistance (if any) …

…

(4)   Appropriate subdivision work plans and specifications referred to in subclause (1)(c) include the following:

(a)   details of the existing and proposed subdivision pattern (including the number of lots and the location of roads),

(b)   details as to which public authorities have been consulted with as to the provision of utility services to the land concerned,

(c)   detailed engineering plans as to the following matters:

(i)   earthworks

(ii)   roadworks,

(iii)   road pavement,

(iv)   road furnishings,

(v)   stormwater drainage,

(vi)   water supply works,

(vii)   sewerage works,

(viii)   landscaping works,

(ix)   erosion control works,

(d)   copies of any compliance certificates to be relied on.”

37. Section 109L of the EPA Act confers certain powers on the PCA. Section 109L(1) provides as follows:

“(1)   An accredited certifier who is the principal certifying authority for any development may, by notice served on a person on whom an order under section 121B may be served, direct that person to do anything that the consent authority could require that person to do by means of such an order.”

38. The types of orders which may be made under s 109L(1) are contained in s 121B. Relevantly, they include an order that a person comply with the terms of a development consent.

39. Section 125 of the EPA Act provides that a “person offending against” a “direction or prohibition” of the EPA Act or the EPA Regulation is guilty of an offence. Section 125A describes “Tier 1” offences as offences which were committed intentionally and “likely to cause significant harm to the environment” or cause “the death of or serious injury or illness to a person”. The maximum penalty in the case of a corporation is $5 million with a further penalty of $50,000 for each day the offence continues. By contrast, “Tier 2” offences under s 125B carry a maximum penalty of $2 million with a further penalty of $20,000 for each day the offence continues. A “Tier 2” offence is an offence which is not a “Tier 1” offence or a “Tier 3” offence.

40. The charges in the present case are based on contraventions of the EPA Act which are made offences by s 125. The First Erector Group Charge and the Second Liverpool Developing Charge allege failures to comply with condition 26 of the development consent which constitute “offending against” s 76A(1) of the EPA Act. The Second Erector Group Charge and the First Liverpool Developing Charge allege conduct which constitutes “offending against” s 81A(2) of the EPA Act. All these offences are “Tier 2” offences.

The sentencing judgment

41. The sentencing judge described the objective circumstances which were of relevance to the offences as including: the maximum penalty; the objective harmfulness of the offenders’ conduct; the foreseeability of the risk of environmental damage; whether practical measures to avoid such damage could have been taken; the control over the causes of the offences; the offenders’ reasons for committing the offence; and whether the offences were part of a planned or organised activity.

42. The sentencing judge pointed out that the maximum penalty for a “Tier 2” offence had been increased from $1.1 million to the present amount of $2 million on 31 July 2015 by legislative amendment. He stated that the increased penalty recognised the seriousness with which the legislature viewed the offences, and that this ought to be reflected in the sentences which courts impose.

43. The sentencing judge, referring to the provisions of s 81A(2) of the EPA Act and condition 26 of the development consent, pointed out that the requirements of these two provisions “enable a person with the requisite qualifications and expertise”, namely, the PCA, “to carry out inspections before building work commences and at critical stages of the building work”. He stated that one of the key responsibilities of a PCA is “to undertake all of the critical stage inspections before issuing an occupation certificate”, and that the first critical stage inspection occurs “after excavation of, and prior to the placement of, any footings”.

44. The sentencing judge noted that the respondent submitted that, if a construction certificate had been issued and if a PCA had been appointed, “there would have been a critical stage inspection by a suitably qualified certifier after the completion of the excavation”. He noted that it was submitted that the inspection would have “checked the excavation against the construction certificate and the development consent and would have resulted in the identification by that person of the undermining of the adjoining buildings”. He noted that it was submitted that this, in turn, “would have given rise to recommendations and remedial action to shore up the excavation so as to prevent a collapse of adjoining buildings”.

45. The sentencing judge noted that the respondent also referred to the prescribed condition in cl 98E of the EPA Regulation that, if the development involved excavation, “the person having the benefit of the development consent must protect and support any building on adjoining land from possible damage from the excavation, and where necessary underpin the building to prevent any such damage”. He noted that, in these circumstances, the respondent submitted that there was a “causal connection” between the commission of the offences by the appellants and “the environmental harm of the damage to and partial collapse of the buildings on the adjoining land”. He noted that the damage was submitted to be “substantial” and thus an aggravating factor within the meaning of s 21A(2)(g) of the Crimes (Sentencing Procedure) Act 1999 (NSW).

46. The sentencing judge rejected the submission by the appellants that “the evidence does not establish that the commission of the offences was ‘quite likely’ or ‘in all probability’ the cause of the damage”.

47. The conclusion of the sentencing judge on whether the damage was caused by the commission of the offences was in the following terms at [26]-[28]:

“[26] I find that there is a sufficient causal connection between the defendants’ commission of the offences and the damage to the adjoining buildings so that it can be said that the damage was caused by the commission of the offences. I also find that the damage was sufficiently great so as to be ‘substantial’ and an aggravating factor under s 21A(2)(g) of the Sentencing Act.

[27] As the Council has submitted, the requirements of s 81A(2) of the EPA Act and condition 26 of the development consent serve a purpose in ensuring the issue of proper construction documents to regulate, and the appointment of a qualified certifier to inspect and certify, the carrying out of the building work in accordance with the development consent (including the express and the prescribed conditions of the development consent) and in a manner and to an extent that minimises the risk of damage to the land and adjoining land.

[28] If the defendants had ensured, prior to the commencement of building work, the issue of the construction certificate for the building work (including the additional excavation) and the endorsement of the detailed plans and specifications of the building work with the construction certificate; the appointment of a principal certifying authority; the notification of the appointment of the principal certifying authority to the Council; and the notification of the intention to commence building work to the Council and to the principal certifying authority, in all probability, the additional excavation would have been carried out differently (in accordance with the construction certificate, the detailed plans and specifications for the building work endorsed with the construction certificate and the development consent, including the prescribed condition in cl 98E(1) of the EPA Regulation) and any undermining of or risk of damage to the buildings on adjoining land would have been observed by the principal certifying authority in the first critical stage inspection after the additional excavation had been carried out and directions would have been given to protect and support and, if necessary, underpin the adjoining buildings. The damage to the adjoining buildings that actually occurred was the likely consequence of the defendants failing to do the things that were required to be done by s 81A(2) of the EPA Act and condition 26 of the development consent.”

48. The sentencing judge also rejected the submission by the appellants that, in taking this “substantial” damage into account as an aggravating factor, the appellants were being punished for an offence for which they were not charged, namely, a contravention of cl 98E(1) of the EPA Regulation. In rejecting this submission, the sentencing judge made the following remarks at [30]:

“[30] In so finding that the offences committed by the defendants caused damage that was substantial, the defendants are not being punished for an offence for which they are not charged of breaching the prescribed condition in cl 98E(1) of the EPA Regulation. The causal link is between the offences in which the defendants are charged, concerning the breaches of s 81A(2) of the EPA Act and condition 26 of the development consent, and the damage to the adjoining buildings that occurred. The causal link is established because compliance with the requirements of s 81A(2) and condition 26 would, in all probability, have led to the defendants carrying out the additional excavation differently (and thereby not creating the risk of damage to the adjoining buildings) or have led to an inspection of the additional excavation by a suitably qualified person, being the principal certifying authority, who would have observed and directed the remedying of the risk of damage to the adjoining buildings. The causal link is not between a breach of the prescribed condition in cl 98E(1) of the EPA Regulation, by failing to protect and support the adjoining buildings, and the damage that occurred to those buildings.”

49. I have set out the submissions of the parties before the sentencing judge and the reasons of the sentencing judge on this issue in detail for two reasons. First, it is important to note the manner in which the causal connection between the offences and the damage was sought to be established by the respondent and the manner in which the sentencing judge found it had been established. It was not simply that the damage was caused by the unauthorised additional excavation work, but rather, that if the necessary certificate had been obtained and the requisite inspections had taken place, the excavation would have occurred in a different fashion and the damage would not have resulted. Second, in considering the issue, the sentencing judge used the phrase “in all probability” in finding the causal connection.

50. The sentencing judge rejected the submission that the appellants committed the offences “to avoid their legal responsibilities”. He found that a “mistake” was made in commencing the building work before the appellants had complied with s 81A(2) of the EPA Act and condition 26 of the development consent, but that it was not due to an attempt by the appellants to avoid their obligations. He accepted the appellants’ evidence that they believed that they had notified the respondent of the appointment of Certified as the PCA. The sentencing judge also found that the offences were not part of any “planned or organised criminal activity”.

51. In these circumstances, the sentencing judge found that the overall objective seriousness of the offence was at the “low end of the range” for the types of offences in question.

52. In dealing with the appellants’ subjective circumstances, the sentencing judge found that neither appellant had any prior conviction for environmental offences.

53. So far as the question of a discount for the utilitarian value of the appellants’ guilty pleas was concerned, the sentencing judge found that there was a delay of three months before the entry of the pleas. In the circumstances, he determined a discount of 22%.

54. The sentencing judge found that each of the appellants was remorseful for the offences, had taken responsibility for their actions, and acknowledged the damage caused to the adjoining buildings. He found that the appellants had taken some steps which had partially remedied the damage. Although the sentencing judge noted that further work needed to be done, he did not suggest that this was due to any default by the appellants. The sentencing judge also found that the appellants were unlikely to reoffend. He also found that they provided some assistance to the prosecution in agreeing to a statement of facts and not requiring any of the witnesses to be cross-examined.

49. In dealing with the purposes of sentencing, the sentencing judge emphasised the need for offenders to be “adequately punished”. He said that although he had found that the appellants were “unlikely to reoffend”, this did not mean that there was “no need for the sentence to include any component for specific deterrence”.

50. The sentencing judge stated that, most importantly, the sentences needed to operate as “a powerful factor in preventing the commission of similar crimes by persons who might be tempted to do so by the prospect that, if they are caught, only light punishment will be imposed”. He said that, for environmental offences, “general deterrence is of central importance”, stating that there was a “need for the upholding of the integrity of the system of planning and development control”. He stated that general deterrence is of particular importance where the offender is “in a business or industry that undertakes development or action that is regulated by the system of planning and development control”.

51. The sentencing judge noted that the parties were unable to find any sentence imposed for a breach of s 81A(2)(b) or of a condition of a development consent comparable to condition 26. He noted that he was referred to decisions for breaches of s 81A(2)(a) by commencing the erection of a building without a construction certificate. He noted that the penalties imposed ranged from $3,000 to $20,000, but said that they were imposed before the almost twofold increase in the maximum penalty to which I have referred at [42] above.

52. In the circumstances, he came to the view that the appropriate penalty was $60,000 for each offence, reduced to $46,800 for the utilitarian value of the appellants’ guilty pleas.

53. The sentencing judge considered that the totality principle required some adjustment of the penalties imposed. He stated that the first area of overlap concerned the failure to obtain a construction certificate, and noted that Erector Group committed an offence under s 81A(2)(a) of the EPA Act by commencing the building work without obtaining a construction certificate, while Liverpool Developing committed the offence by commencing the building work without ensuring the “detailed plans and specifications” of the building were endorsed with a construction certificate, which was a breach of condition 26(b) of the development consent.

54. The sentencing judge stated that the second area of overlap concerned the failure to appoint a PCA, and noted that Erector Group committed an offence by commencing the building work without first submitting to the respondent a form notifying it of the appointment of a PCA, which was a breach of condition 26(a) of the development consent, whilst Liverpool Developing committed an offence under s 81A(2)(b) of the EPA Act by commencing the building work prior to the appointment of a PCA.

55. The sentencing judge also noted that each of the offenders was an “alter ego” of Mr Wang, and, in the circumstances, the “multiplicity of offenders is, in reality, accidental and unrelated to the merits of the case”.

56. In the circumstances, the sentencing judge determined that the appropriate penalty should be $80,000 for each appellant, apportioned equally between the two offences for which each appellant was convicted.

The appeal

63. The appeal is brought pursuant to s 5AB of the Criminal Appeal Act 1912 (NSW). That section confers the same right of appeal on a person who is convicted of an offence by the Land and Environment Court of New South Wales in its summary jurisdiction as is conferred on a person in respect of an appeal from a conviction by the Supreme Court of New South Wales in its summary jurisdiction under s 5AA of the Criminal Appeal Act 1912 (NSW). Unlike an appeal against sentence brought under s 5 of that Act, an appeal against sentence brought pursuant to s 5AA does not require leave.

64. The appellants relied on the following grounds of appeal:

“1   His Honour erred in finding that damage to the adjoining buildings was caused by the commission of the offences.

2 His Honour erred in finding that the damage was an aggravating factor under s.21A(2)(g) of the Crimes (Sentencing Procedure) Act.

3   His Honour erred in punishing the appellants for an offence for which they were not charged.

4   His Honour erred in imposing sentences that were manifestly excessive.”

Grounds 1 and 2 – Whether damage was caused by the offences so that it was an aggravating factor

65. It is convenient to deal with these grounds together.

a   The appellants’ submissions

66. The appellants submitted that, while it was an agreed fact that damage occurred following the excavation of the land, there was no agreement that the commission of the offences caused the damage to the adjoining buildings.

67. The appellants submitted that the primary judge could only take the fact that the commission of the offences caused the damage to the adjoining buildings into account as an aggravating factor if he was satisfied beyond reasonable doubt that this fact was established: R v Olbrich (1999) 199 CLR 270; [1999] HCA 54 at [27].

68. The appellants referred to the conclusion of the sentencing judge at [28], which I have set out at [47] above, and his finding that a PCA would have observed “any undermining of or risk of damage to he buildings” while carrying out the first critical stage inspection “after the commencement of the excavation for, and before the placement of, the first footing”, with the result that “directions would have been given to protect and support and, if necessary, underpin adjoining buildings”.

69. The appellants referred to cl 162A(7A) of the EPA Regulation, and pointed to the fact that there was no requirement for a PCA “to be present during the excavation work, nor supervise the manner in which it was carried out”.

70. The appellants pointed out that the additional excavation work took place on 28 February 2016 (although the Agreed Statement of Facts stated that it took place “on or about 29 February 2016”), and that the damage occurred on 1 March 2016. They submitted that there was no evidence that the PCA would have inspected the premises before the damage occurred, or that, if it had, then any directions which might have been given would have been given in time to prevent the damage, or that the directions would have been complied with in time to prevent such damage. They submitted that there was no evidence that the additional excavation work beyond that which was required for demolition caused the damage. They also submitted that the failure to appoint a PCA was only relevant to the First Liverpool Developing Charge.

71. So far as the First Erector Group Charge was concerned, the appellants submitted that the evidence was insufficient to enable a finding that the failure to submit “a notice of the intention to commence work and the appointment of a [PCA]” to the respondent caused damage to the adjoining buildings. In relation to the Second Erector Group Charge, namely, the commencement of the erection of a building without a construction certificate, they submitted that there was no evidence as to whether the damage occurred because of “some defect in design, or a failure in the execution of the work”.

72. In relation to the Second Liverpool Developing Charge, the appellant asserted that there was no evidence that “the failure to ‘endorse’ the plans with a construction certificate led to the damage”.

73. Counsel for the appellants submitted that there was nothing in the material required to be included in the application for a construction certificate which demonstrated that the damage would have been avoided if the certificate had been supplied. Further, he submitted that there was no evidence of how the requirements of the Building Code of Australia might have affected the contents of the construction certificate.

74. In relation to the appointment of a PCA, counsel for the appellants noted that there was nothing in the Agreed Statement of Facts or the sentencing judgment to the effect that the demolition itself was carried out unlawfully. He submitted that, in that context, for the sentencing judge to find that the appointment of a PCA would have prevented the damage, the PCA would need to have inspected the works “just at the right point in time, to have noticed that there was a problem in that corner of the [premises], to have issues [sic] a direction to the contractor to prop up the building next door and then for that remedial step to take place before the damage to the building occurred”.

75. Counsel for the appellants accepted that the primary judge could have concluded beyond reasonable doubt that the building work was a “substantial cause” of the damage, but he submitted that this did not mean that the offences themselves were the cause. He submitted that the offences contained a number of different elements, and were not confined to the additional excavation work itself.

b   The respondent’s submissions

76. The respondent submitted that the conclusion the damage to the adjoining building could be considered as harm caused by the offending conduct was “available and appropriate on the basis of the statutory regime of checks and safeguards intended to prevent building work from being carried out without appropriate inspections and certifications”.

77. The respondent submitted that, notwithstanding that the obligations imposed by s 81A(2) do not directly relate to the undertaking of demolition New South Wales that, “if demolition is part of the overall commencement of the erection of an existing building then the demolition work would require a construction certificate and the appointment of a PCA”: Over Our Dead Body Society Inc v Byron Bay Community Association Inc (2001) 116 LGERA 158; [2001] NSWLEC 125. The difficulty with that submission is that, first, it was not contended in the Court below that the demolition work occurring prior to 29 February 2016 was in itself illegal, rather, it was contended that only the additional excavation work was unlawful, and second, the demolition work did not relate to the erection of an existing building, as it did in the case cited by the respondent, but rather, it was preparatory to an entirely new development.

78. The respondent submitted that the rationale behind the requirements in s 81A(2) is to “provide a system of checks and balances whereby the Council and the PCA are placed on notice about construction work … and so that works are not merely commenced, but are commenced in a manner whereby all interested stakeholders have the requisite notice and can ensure structural integrity of the relevant building”. They submitted that the provisions for inspection in the EPA Act are to “ensure that the works are commenced in a proper, safe and workmanlike manner”. It was submitted that what was of importance in the present case was the “failure of [sic] conduct critical stage inspections at the very start of the works”.

79. The respondent submitted that a failure to shore up the adjoining buildings was a failure to comply with the prescribed condition in cl 98E(1) of the EPA Regulation. It stated that a “failure to appoint a PCA results in a failure to undertake relevant inspections that would give rise to the enforcement” of that prescribed condition.

80. The respondent submitted, referring to the Agreed Statement of Facts, that the letter from Certified to Mr Wang of 1 December 2015 outlined the development consent conditions and general requirements that had to be satisfied before “a construction certificate for the early works, bulk excavation, shoring and piling could be issued” and that it was an agreed fact that none of the conditions or requirements identified in the letter had been fulfilled. The letter is not in evidence and the Agreed Statement of Facts does not refer to its contents in any further detail.

81. The respondent emphasised that it was an agreed fact that, “following the undertaking of further excavation work on the land, part of the immediately adjoining building collapsed”, and the appellants were “required to restore and ensure stability to the adjoining buildings before construction certificates could be issued”.

82. The respondent submitted that, in those circumstances, a “temporal connection” arose between the carrying out of the additional excavation work and the collapse and damage. The respondent submitted that, even if “the damage was not properly to be taken into account as an aggravating factor” under s 21A(2)(g) of the Crimes (Sentencing Procedure) Act 1999 (NSW), “the sentencing judge was entitled to take it into account as part of the objective circumstances adding to the objective seriousness of the conduct”. It submitted that the “damage caused by the offending conduct has been held to be relevant to a determination of the objective circumstances in the context of environmental offences”.

83. In dealing with the use of the phrase “in all probability” in the sentencing judgment, senior counsel for the respondent submitted that, having regard to the exchanges in the transcript, the sentencing judge applied the right test. He submitted that, for environmental prosecutions, it is sufficient to show that a “risk of damage” resulted from the offending conduct, rather than actual damage.

84. Senior counsel for the respondent submitted that the gravamen of each charge against the appellants was the “carrying out of the development” or the “commencing of the erection of a building” in circumstances where the requirements in condition 26 of the development consent or s 81A(2) had not been fulfilled. In other words, the offence was said to be the act of commencing the additional excavation work, not simply the failure to comply with the requirements in condition 26 and s 81A(2) when the work commenced. He accepted that this was not the manner in which the sentencing judge characterised the relevant conduct for the purpose of determining the causal connection, nor the manner in which the case was put at the sentencing hearing. However, he nevertheless submitted that this Court should find that it was “open, available and appropriate” for the sentencing judge to have found beyond reasonable doubt that a causal connection was established because “the work should never have started”.

85. Senior counsel for the respondent also referred to cl 6 in Part 3 of Schedule 1 of the EPA Regulation, which I have set out at [36] above, which refers to the documents required to accompany an application for a construction certificate. In particular, he drew attention to cl 6(4)(c), which requires “detailed engineering plans” in respect of certain matters, including “earthworks”. He submitted that, if these plans had been prepared before the work commenced, which he said would have involved an engineer looking at the premises, then “none of this would have happened”. The difficulty with this submission is that cl 6(4) relates to “appropriate subdivision work plans and specifications”, which are only necessary under cl 6(1)(c) if the development involves “subdivision work”. There is no suggestion that a subdivision was involved in the present case.

86. Senior counsel for the respondent also submitted that it could be inferred that there were no “engineering plans” in existence from what followed after the collapse of the adjoining building. He referred to the fact that the Agreed Statement of Facts showed that, after the collapse, Mr Wang engaged an engineer to do “work including in relation to the structural integrity of the [premises] and the excavation”. He submitted that this demonstrated that no engineer had previously been engaged.

87. Senior counsel for the respondent submitted, referring to the decision of the Land and Environment Court in Bentley v BGP Properties Pty Ltd (2006) 145 LGERA 234; [2006] NSWLEC 34 at [175] and the decision of the New South Wales Court of Criminal Appeal in Axer Pty Ltd v Environment Protection Authority (1993) 113 LGERA 357, that environmental harm can include a “risk of harm” or “potential for harm”, and that if such harm is “substantial”, it can be an aggravating factor under s 21A(2)(g) of the Crimes (Sentencing Procedure) Act 1999 (NSW). The difficulty with that submission is that the harm found by the sentencing judge to have been caused in the present case was actual harm.

c   Consideration

88. It is important in considering this issue that, as the respondent properly conceded, the sentencing judge did not find that the damage to the adjoining buildings was caused by the commencement of the additional excavation work, as I have outlined at [84] above. Rather, as the sentencing judge stated at [28], the damage was found to have been caused by the failure to comply with condition 26 of the development consent and s 81A(2) of the EPA Act, which required the issue of a construction certificate and the appointment of a PCA. In other words, it was found to have been caused by a failure to comply with what the respondent described as “the checks and balances” in the EPA Act.

89. This is also clear from the comments made by the sentencing judge in dealing with the question of whether, in treating the damage to the adjoining buildings as an aggravating factor, the appellants were being punished for a contravention of the prescribed condition in cl 98E(1) of the EPA Regulation. I have set out the reasons of the sentencing judge for rejecting this submission at [48] above. The sentencing judge specifically stated that the “causal link is not between a breach of the prescribed condition in cl 98E(1) of the EPA Regulation, by failing to protect and support the adjoining buildings, and the damage that occurred to those buildings”.

90. Therefore, in relation to Liverpool Developing, the question raised by these grounds is whether the conduct of Liverpool Developing in failing to appoint a PCA prior to the commencement of the erection of a building (First Liverpool Developing Charge) and in failing to ensure that the “detailed plans and specifications” were endorsed with a construction certificate prior to the carrying out of development (Second Liverpool Developing Charge) caused the damage to the adjoining buildings.

91. Similarly, in relation to Erector Group, the question raised by these grounds is whether the conduct of Erector Group in failing to submit the “Notice of Intention to Commence Building Work and Appointment of a Project Certifying Authority” form required by condition 26(a) of the development consent prior to carrying out development (First Erector Group Charge) and in failing to obtain a construction certificate prior to the commencement of the erection of a building (Second Erector Group Charge) caused the damage to the adjoining buildings.

92. For the damage to the adjoining buildings to be treated as an aggravating factor under s 21A(2)(g) of the Crimes (Sentencing Procedure) Act 1999 (NSW), it was necessary for the sentencing judge to be satisfied of the causal connection beyond reasonable doubt: R v Olbrich (1999) 199 CLR 270; [1999] HCA 54 at [27]. If the relevant causal connection existed, there was no dispute on this appeal that the damage was “substantial” for the purpose of s 21A(2)(g).

93. The sentencing judge concluded that, if the steps required by condition 26 of the development consent and s 81A(2) of the EPA Act had been taken, then the damage would “in all probability” not have occurred. On one view of the matter, this imports the civil standard of proof “on the balance of probabilities” rather than the criminal standard of proof “beyond reasonable doubt”.

94. However, while the words used by the sentencing judge do raise some doubt as to whether the appropriate standard of proof was applied, I am prepared to accept that a judge with the experience of the sentencing judge in criminal matters relating to environmental offences did not apply the civil standard of proof. Using the phrase “in all probability” may be taken to be referring to “probability bordering so near upon certainty as to form the basis of human conduct”: see the discussion by the High Court of Australia in R v Dookheea (2017) 91 ALJR 960; [2017] HCA 36 at [33]-[34]. It seems to me that the sentencing judge was using the phrase “in all probability” as a substitute for the expression “beyond reasonable doubt” without intending in any way to lessen the standard of proof required. However, this is not to say that it is desirable for a sentencing judge to use such an expression, just as it is undesirable to direct a jury by the use of alternative expressions to “beyond reasonable doubt”: R v Dookheea (2017) 91 ALJR 960; [2017] HCA 36 at [41]; La Fontaine v The Queen (1976) 136 CLR 62 at 80-81; [1976] HCA 52.

88. For the causal connection to be established in the present case, it must be shown that the contraventions of condition 26 of the development consent and s 81A(2) were a “substantial cause” of the damage to the adjoining buildings. The question is to be determined by applying commonsense to the underlying facts as found, “appreciating that the purpose of the inquiry is to attribute legal responsibility in a criminal matter”: Campbell v The Queen [1981] WAR 286 at 290, approved in Royall v The Queen (1990) 172 CLR 378 at 387-388, 398-399, 411-412, 423, 441-442; [1991] HCA 27; Burns v The Queen (2012) 246 CLR 334; [2012] HCA 35 at [9]; R v CLD [2015] NSWCCA 114 at [28] [38]. In R v Moffatt (2000) 112 A Crim R 201; [2000] NSWCCA 174 at [69]-[71], Wood CJ at CL stated that the act of the accused must have “more than a coincidental or insignificant effect”.

89. In the present case, I am prepared to proceed on the basis that the causation question can be dealt with by considering the effect of the contraventions as a whole, as did the sentencing judge, rather than by considering it with reference to the individual contraventions

90. However, with respect to the learned sentencing judge, I do not think that the necessary causal connection has been established, at least beyond reasonable doubt. There was no evidence which identified the cause of the collapse of the adjoining building and the damage to the other buildings. For the causal connection to be established, it would at least be necessary to be satisfied beyond reasonable doubt that the demolition work which took place prior to the additional excavation work on 29 February 2016 and which did not require compliance with condition 26 of the development consent and s 81A(2) of the EPA Act was not the cause of the damage.

91. Even if the temporal connection between the additional excavation work and the collapse of the adjoining building and damage to the other buildings could lead to the inference that the damage resulted from the additional excavation work, it still remains to be satisfied beyond reasonable doubt that compliance with condition 26 of the development consent and s 81A(2) would have prevented the damage, such that the failure to do so amounted to a “substantial cause” of the damage occurring. The conduct said to give rise to the breach essentially comprises acts of omission, namely, a failure to submit a “Notice of Intention to Commence Building Work and Appointment of a Principal Certifying Authority” form to the respondent under condition 26(a), a failure to appoint a PCA under s 81A(2)(b), a failure to obtain a construction certificate prior to the commencement of the additional excavation work under s 81A(2)(a), and a failure to ensure that the “detailed plans and specifications” were endorsed with a construction certificate under condition 26(b). The difficulty is that there was no evidence to establish beyond reasonable doubt that taking those steps would have avoided the damage.

92. Even if it were possible to infer, on the balance of probabilities, that the preparation of the construction certificate would have revealed the risk of the collapse of the adjoining building and the damage to the other buildings and led to steps being taken to avoid that risk, the absence of any evidence of what information could be ascertained from the construction certificate, and in particular, whether it would have identified the problem which resulted in the damage, means that, in my view, it cannot be said beyond reasonable doubt that failure to obtain the construction certificate and comply with condition 26(b) or s 81A(2)(a) was a cause of the damage.

93. There is more force in the proposition that the appointment of a PCA, who would have undertaken a “critical stage inspection” after the “commencement of the excavation for, and before the placement of, the first footing” under cl 162A(7A) of the EPA Regulation, would have identified the problem and enabled steps to have been taken to avoid it. However, although it can be accepted that a “critical stage inspection” would have taken place after “the commencement of the excavation for, and before the placement of, the first footing”, there is no evidence to suggest that the inspection would have taken place before the damage occurred or would have identified the risk to the adjoining buildings and that there was a need to shore up the adjoining buildings. Absent such evidence, it cannot be concluded that the omission to appoint a PCA was the cause of the damage.

94. In these circumstances, in my opinion, there is insufficient evidence to conclude beyond reasonable doubt that the failure to comply with condition 26 of the development consent or s 81A(2) of the EPA Act caused the damage and was thus an aggravating factor under s 21A(2)(g) of the Crimes (Sentencing Procedure) Act 1999 (NSW).

95. It remains to be considered whether the necessary causal connection can be inferred simply from the fact that damage to the adjoining buildings resulted from the commencement of the additional excavation work, as submitted by the respondent, rather than from the failure to comply with condition 26 of the development consent and s 81A(2) of the EPA Act. I have outlined the submissions of the respondent on this point at [84] above.

96. Irrespective of whether this conclusion could be reached beyond reasonable doubt in the absence of the evidence which I have outlined at [97] above, it is not open, in my opinion, for the respondent to put its case this way on this appeal. In dealing with the submission that his approach involved a finding of a contravention of cl 98E(1) of the EPA Regulation, the sentencing judge, as I have indicated at [48] above, rejected the proposition that there was a causal connection between a breach of that condition by “failing to protect and support the adjoining buildings, and the damage that occurred to those buildings”. Irrespective of whether a contrary conclusion would have infringed the principle in R v De Simoni (1981) 147 CLR 383; [1981] HCA 31, which I discuss further at [108] below, in my opinion, it would be unjust to the appellants to find the causal connection on a basis expressly rejected by the sentencing judge.

97. In these circumstances, grounds 1 and 2 of the appeal have been made out.

Ground 3 – Whether the appellants were punished for a different offence

a   The submissions

105. The appellants noted that they were not charged with a failure to comply with the prescribed condition in cl 98E(1) of the EPA Regulation. They submitted that the conclusion of the sentencing judge that they were not being punished for that offence, which I have extracted at [48] above, was incorrect, as the failure to “support” and “underpin” the adjoining buildings was treated as an aggravating factor. Counsel for the appellant submitted that, if the sentencing judge was correct in his conclusion that the damage to the adjoining buildings was caused by the failure to comply with condition 26 of the development consent and s 81A(2) of the EPA Act, he was not permitted to find that the damage aggravated the seriousness of the offence.

106. Counsel for the appellants accepted that a contravention of the prescribed condition in cl 98E of the EPA Regulation carried the same maximum penalty as that imposed on the offences for which they were charged. He accepted that, in those circumstances, the case did not fall squarely within the principle articulated in R v De Simoni (1981) 147 CLR 383; [1981] HCA 31 (De Simoni). However, he submitted that, referring to the judgment of Basten JA in Cassidy v The Queen (2012) 220 A Crim R 420; [2012] NSWCCA 68 (Cassidy), for the purpose of the principle in De Simoni, the seriousness of an offence did not just depend on the maximum penalty, and that a failure to comply with the condition in cl 98E(1) could be considered objectively more serious than the offences for which the appellants were charged. However, he stated that it was not necessary for the offence to be objectively more serious to attract the operation of the principle in De Simoni.

107. The respondent submitted that the failure to comply with the prescribed condition in cl 98E(1) was not a more serious offence. It submitted that, if charged as a breach of the EPA Regulation, the maximum penalty would be $110,000, while if charged as a failure to comply with a prescribed condition under s 76A(1) of the EPA Act, the maximum penalty would be $2 million, the same as that imposed for the offences charged. It also submitted that, merely because the damage in the present case could be causally connected to another possible offence, it was not precluded from consideration under the principle in De Simoni.

b   Consideration

108. I do not think that the conclusion of the sentencing judge on whether the damage could be taken into account as an aggravating factor under s 21A(2)(g) was contrary to De Simoni, having regard to his approach to that question. The appellants were punished, not for failing to “protect and support” or “underpin” the adjoining buildings, but for a failure to comply with condition 26 of the development consent and s 81A(2) of the EPA Act. If such a failure to comply led to damage to the adjoining buildings, that would be an aggravating factor. It does not mean that the appellants were being punished for a failure to comply with cl 98E(1) so as to offend the principle in De Simoni.

109. In these circumstances, it is unnecessary to decide whether, if the appellants were in fact sentenced on the basis that the commencement of the additional excavation work caused the damage, contrary to what I have outlined at [103] above, then this would have contravened the principle in De Simoni on the basis that the appellants would have been sentenced for a failure to comply with cl 98E(1). Whether this would in fact contravene the principle in De Simoni depends on whether the appellants were being punished for a “more serious offence” than that for which they were charged: De Simoni at 389. It also depends upon whether the “seriousness” of the offence for this purpose is measured by a liability to a higher maximum penalty or a greater standard non-parole period, as stated in Cassidy at [26] by Blanch J with the agreement of Beech-Jones J, in which case, taking the damage in the present case into account as an aggravating factor would not offend the principle, or whether, at least in a case such as the present where the same maximum penalty is prescribed for a wide-range of offences, the application of the principle depends on the objective seriousness of the offence rather than the maximum penalty, as stated in Cassidy at [7] by Basten JA. Because of my conclusion that punishment was not imposed for what would be a failure to comply with the prescribed condition in cl 98E(1), there is no need to determine this issue.

110. This ground of appeal has not been made out.

Ground 4 – Whether the sentence was manifestly excessive

111. Because it is necessary to resentence the appellants, having regard to my conclusion on grounds 1 and 2, it is unnecessary to deal with this ground. However, the submissions made in respect of this ground provide assistance on the question of resentence.

a   The appellants’ submissions

112. The appellants pointed to the findings of the sentencing judge to which I have referred at [50]-[56] above. In relation to the First Erector Group Charge, they noted that condition 26(a) of the development consent required the submission of a “Notice of Intention to Commence Building Works and Appointment of a Principal Certifying Authority” form to the respondent. The appellants submitted that Mr Wang had advised the respondent that Certified was the “Private Certifier” both on 18 December 2015 and 22 January 2016. In relation to the First Liverpool Developing Charge, the appellants emphasised that Mr Wang believed that a PCA had been appointed.

113. The appellants submitted that this was not a case where they benefited financially from the offences. The consequence of the offences was that work on the development was halted at least until February 2017.

114. The appellants referred to sentencing statistics which showed that penalties of between $3,000 and $20,000 had been imposed by the Land and Environment Court for commencing the erection of a building without a construction certificate. The maximum penalty for the offences in those cases ranged from $33,000 to $1.1 million. The appellants attached a summary of these cases and pointed out that, in the two cases where fines above $10,000 had been imposed, the defendants had been warned not to proceed with the work.

115. The appellants also pointed to the fact that statistics published on the Judicial Information Research System by the Judicial Commission of New South Wales revealed only one conviction in the Local Court of New South Wales for a failure to comply with s 81A(2)(b)(i) of the EPA Act, for which a fine of $3,000 was imposed. The maximum penalty was $110,000.

116. The appellants pointed out that the maximum penalty for a “Tier 2” offence under s 125B applied to most offences under the EPA Act. They submitted that many offences were more serious than those the subject of these proceedings, including carrying out development work without any consent at all. They referred to the judgment of Giles JA in Cabonne Shire Council v Environment Protection Authority (2001) 115 LGERA 304; [2001] NSWCCA 280 at [37], and said that it stood for the proposition that “increases in the maximum penalty did not necessarily result in a proportionate increase in the penalty payable for offences of low criminality”.

117. Counsel for the appellants referred in that context to the dicta of Biscoe J in Campbelltown City Council v Mhanna [2010] NSWLEC 57, where his Honour pointed out, while noting that the erection of a building without a construction certificate undermines one of the objects of the EPA Act, namely, “encouraging the promotion and co-ordination of the orderly and economic use and development of land”, that the carrying out of work without a development consent is more serious than doing so without a construction certificate: at [45]-[46]. In that case, the defendant was aware that a construction certificate was required and did not obtain one: at [12]. The defendant was fined $3,000 at a time when the maximum penalty was $33,000.

118. The appellants submitted that it was necessary to ensure that the aggregation of the sentence was a “just and appropriate” measure of the total criminality. They submitted that any penalty imposed on both appellants “should have reflected the fact that [the amount payable] would come from the same pocket”. They submitted that the reduction in the penalty imposed which was allowed by the sentencing judge was well below what was required to achieve a “just and appropriate” result.

b   The respondent’s submissions

119. The respondent submitted that there was no suggestion by the sentencing judge that he applied a proportionate increase to the penalty he imposed to take into account the increase to the maximum penalty.

120. The respondent also submitted that the sentencing judge did not err in finding that the appellants “could reasonably have foreseen” that the offending “would be likely to cause damage” to the adjoining buildings. There is some tension between this conclusion and the acceptance by the sentencing judge that a “mistake” was made in commencing the work before compliance with the requirements of condition 26 of the development consent and s 81A(2) of the EPA Act, which I have noted at [50] above. The respondent also referred to the finding of the sentencing judge that compliance with the requirements of the EPA Act would have been a “practical measure” to avoid causing the damage and that the appellants had control over the causes of the offences.

121. The respondent also referred to its submission before the sentencing judge that the “environmental harm caused by the offences was not limited to the damage to the adjoining properties but extended to the consequences that flowed from that damage”, including the “closure of the footpath, closure (for many hours) of Liverpool Road to traffic in both directions” and the “substantial loss and inconvenience to the owners and occupiers of the adjoining properties”.

122. The respondent emphasised that it was necessary for the penalties to reflect the need for general deterrence to indicate that “a Council’s powers should not be rendered invalid by developers who ignore Council’s functions and determinations, to send a clear message to other developers and builders that avoidance of the legislative checks and balances associated with the functions of PCAs and the issuance of construction certificates will be met with harsh punishment”.

123. The respondent also referred to the limitation of the use which could be used of statistics and comparable cases, referring to the decisions of the High Court in Hili v The Queen (2010) 242 CLR 520; [2010] HCA 45 at [54] and R v Pham (2015) 256 CLR 550; [2015] HCA 39 at [28].

Resentencing

124. I agree with the sentencing judge that, taking all the circumstances into account, the overall objective seriousness of the offence was at the low end of the range. The sentencing judge concluded that the offences were committed inadvertently and this was not challenged on appeal. However, the sentencing judge reached the conclusion that the damage to the adjoining buildings was an aggravating factor, which I have concluded was an erroneous approach.

125. I agree with the sentencing judge that general deterrence is of great importance in this area. Planning laws that govern the conduct the subject of the present offences” are designed to ensure orderly and safe development of the land consistent with overall planning needs and environmental concerns. The importance of compliance is demonstrated by the significant maximum penalty of $2 million for most offences under the EPA Act and the higher maximum penalty for “Tier 1” offences, which must be committed intentionally and must be “likely to cause significant harm to the environment” or “death of or serious illness or injury to a person”.

126. The fact that what might be described as an “unintentional” or “mistaken” offence attracts a significant maximum penalty shows that the object of the legislation is not only to deter deliberate offences against the EPA Act, but also to ensure that proper regard is paid to its requirements. Property developers, such as the appellants, need to be aware that, if they are not punctilious in their compliance with the requirements of the EPA Act, then they may be liable to stringent penalties.

127. Further, although I have rejected the conclusion that the damage to the adjoining buildings can be treated as an aggravating factor in the present case, the fact remains that a failure to comply with the conditions of a development consent or a requirement of the EPA Act often involves a risk of harm. The object of the provisions is not only to ensure that development complies with the terms of a development consent, but also that injury is avoided both to adjoining properties and members of the public.

128. I agree with the conclusion of the primary judge that, although the appellants were unlikely to reoffend, there is some need for specific deterrence. I also agree with his conclusions that the appellants were remorseful and had taken responsibility for their actions. I agree with his assessment of the utilitarian value of the guilty pleas.

129. Although the Court was supplied with the range of cases dealing with penalties imposed for the erection of a building without a construction certificate and details of one conviction in the Local Court for a contravention of s 81A(2)(b)(i), having regard to the varying nature of the offences and the differences in the maximum penalties which were applicable when those cases were decided, it is not possible to determine any range of sentences which would be of assistance in the present case.

124. The offenders are related companies. This is a case where the fact that there is more than one offender is “accidental and quite unrelated to the merits of the case”: Tiger Nominees Pty Ltd v State Pollution Control Commission (1991) 25 NSWLR 715 at 722. Further, the offences all rise out of the same incident, and indeed, the First Erector Group Charge and the Second Liverpool Developing Charge were in identical terms. It is necessary to take these factors into account when applying the principle of totality to ensure that the penalty reflects the overall criminality of the offending conduct. This is the same approach as that accepted by the sentencing judge.

125. In my opinion, the conduct which is the subject of the First Liverpool Developing Charge and the Second Erector Group Charge, dealing with a failure to appoint a PCA and obtain a construction certificate under s 81A(2) of the EPA Act respectively, is more serious than the charges of failing to comply with condition 26 of the development consent. Prior to taking into account the principle of totality and the fact that the number of offenders is “unrelated to the merits of the case”, and after a reduction of 22% for the utilitarian value of the guilty pleas, I would impose a penalty of $40,000 for each of those offences. For the offences the subject of the Second Liverpool Developing Charge and the First Erector Group Charge, after a reduction of 22% for the utilitarian value of the guilty pleas, I would impose a penalty of $30,000 for each offence.

126. Taking into account the principle of totality and the fact that the number of offenders is “accidental and unrelated to the merits of the case”, I would reduce each penalty by 50%. This results in an overall penalty of $70,000 which, in my opinion, properly reflects the criminality of the conduct, taking into account the objective seriousness of the offending and the subjective circumstances of the appellants.

Conclusion

133. In the result, I would make the following orders:

1. Appeal allowed.

2. Set aside the orders made by the primary judge, save for the order as to the costs of the proceeding below, and in lieu thereof make the following orders:

1. In proceeding 2016/175841:

1. Liverpool Developing Pty Ltd is convicted of the offence against s 125(1) of the Environmental Planning and Assessment Act 1979 (NSW) as charged.

2. Liverpool Developing Pty Ltd is fined $20,000.

2. In proceeding 2016/175842:

1. Liverpool Developing Pty Ltd is convicted of the offence against s 125(1) of the Environmental Planning and Assessment Act 1979 (NSW) as charged.

2. Liverpool Developing Pty Ltd is fined $15,000.

3. In proceeding 2016/175925:

1. Erector Group Pty Ltd is convicted of the offence against s 125(1) of the Environmental Planning and Assessment Act 1979 (NSW) as charged.

2. Erector Group Pty Ltd is fined $20,000.

4. In proceeding 2016/175926:

1. Erector Group Pty Ltd is convicted of the offence against s 125(1) of the Environmental Planning and Assessment Act 1979 (NSW) as charged.

2. Erector Group Pty Ltd is fined $15,000.

134. HOEBEN CJ at CL: I agree with the Chief Justice and the orders which he proposes.

135. BUTTON J: I agree with the Chief Justice.

Amendments

06 April 2018 - Coversheet - change "Development" to "Developing"

[97] - change "2018" to "2016"

[103] - change "1980" to "1981"

[106] - change "1980" to "1981"

[116] - change "offencees" to "offences"

[113] - change "Development" to "Developing"

Decision last updated: 06 April 2018