Morrison v Peers [1995] Nswlec 77 (12 May 1995)

[1995] NSWLEC 77

Land and Environment Court

of New South Wales

CITATION:	MORRISON v. PEERS [1995] NSWLEC 77 (12 May 1995) [1995] NSWLEC 2
PARTIES:	MORRISON v. PEERS
FILE NUMBER(S):	50021 and 50022 of 1995
CORAM:	Bignold J
KEY ISSUES:	:- Discharge of oil from ship into waters. ·Master and ship owner each charged with offence against s8(1) of Act. ·Each defendant pleads guilty. ·Mitigating circumstances - s556A of the Crimes Act 1900.
LEGISLATION CITED:	Marine Pollution Act 1987 Navigable Waters Act 1955 Crimes Act 1900 Marine Pollution (Penalties) Amendment Act 1993 Clean Air Act 1961 Environmental Planning and Assessment Act 1979
CASES CITED:	Federal Steam Navigation Co v Department of Trade (1974) 2 All ER 97 ; Halverson v Port Waratah Coal Services Ltd (unreported 9 January 1987) ; Border v David Brown Corporation of Australia and Anor (unreported 19 February 1988) ; Hall v Narrabri Shire Council (unreported 10 January 1992) ; cf Walden-Hensler (1987) 75 ALR 173 at 179 per Brennan J
DATES OF HEARING:	11 May 1995
DATE OF JUDGMENT:	05/12/1995
LEGAL REPRESENTATIVES:	Mr A L Hill (Barrister) Mr S Liddy (Solicitor)

JUDGMENT:

Bignold J.: These are two Class 5 proceedings, which by consent have been heard together in which the two Defendants, the shipowner and master respectively, of the ship "Australia Star" have each been charged with an offence against s8(1) of the Marine Pollution Act 1987 (the Act).

Each of the Defendants has pleaded guilty to the charge.

Section 8(1) of the Act which creates the relevant offences, provides as follows:

" 8. (1) Subject to subsections (2) and (4), if any discharge of oil or of an oily mixture occurs from a ship into State waters, the master and the owner of the ship, and any other person whose act caused the discharge, are each guilty of an offence punishable, upon conviction, by a fine not exceeding -

(a) if the offender is a natural person - 2,000 penalty units; or
(b) if the offender is a body corporate - 100,000 penalty units.

( Subsections (2) and (4) provide certain statutory defences which have not been raised in the present proceedings.)

It is to be noted that the offence created by s8(1) of the Act is based upon the occurrence of an event, namely the discharge of oil from a ship into State waters, whereupon the master and the owner of the ship are each declared to be each guilty of an offence.

Speaking of an almost identical provision contained in s1(1) of the Navigable Waters Act 1955 , Lord Morris in Federal Steam Navigation Co v Department of Trade (1974) 2 All ER 97 described the statutory offence as having "a special nature" which perhaps is explained by what fell from Lord Wilberforce in the same case at 111 when his Lordship said:

"...the Act evidently creates an absolute offence. In many, if not most, cases it is impossible to find out who caused, or was responsible for, the discharge of the oil: that is why the section is written in the form "if any oil is discharged". There is absolute liability, subject only to certain statutory defences. So liability cannot depend on responsibility."

It is conceded by each of the Defendants that s8(1) of the Act creates offences of strict liability at least so far as concerns the liability of the master and the owner of a ship.

The circumstances in which the offences were committed as revealed in the affidavits filed by the Prosecutor, are as follows:

(1) On 12 February 1994 the "Australia Star" was moored at No 3 Berth, Kurnell (the Caltex Wharf) transferring a cargo of oil, via a hose connection, to the Caltex refinery pipeline.

(2) Soon after 1:00 pm during the cargo transfer operation, a spray of oil appeared from the ship's manifold connected to the Caltex hose which was transferring the oil to the Caltex pipeline.

(3) The spray of oil was observed by Prosecution witnesses to fall upon the ship's deck and also to be blown by a wind across the ship's deck down the port side of the ship and into the waters of Botany Bay.

(4) The cargo operations were immediately stopped and clean-up operations were commenced by the ship's crew, including the arrival at the scene of a vessel owned by the Maritime Services Board (the Board) which used propeller action to break up the small traces of oil on the surface of the waters.

(5) Prosecution witnesses estimated that the total amount of oil that was discharged into the waters of Botany Bay was between five to ten litres . The Board's clean-up operation was satisfactorily completed within ½ hour and the clean up bill was only for some $464 .

(6) The source of the discharge of oil was apparently traced to a gasket which had become loose in the cam-locks which connected the Caltex hose to the ship's manifold.

(7) The master when interviewed by the Board's Duty Harbour Master concerning the oil incident was entirely co-operative and explained what he understood to have been the cause of the discharge, namely, from the seal of the ship's manifold during the oil transfer cargo operation. However on account of the master's understanding of Caltex's policy he declined to furnish the Board's Duty Harbour Master with (i) his report on the incident and (ii) the gasket (the "O" ring) from which the oil discharge apparently occurred.

Mr Liddy, Solicitor who appeared on behalf of each Defendant, made submissions in mitigation of the admitted offences and without objection from the Prosecutor related additional facts as follows:

(1) The cam-lock method of connecting the Caltex hoses to ship's manifolds for the purpose of oil cargo handling transfer operations had been in use at the Caltex wharf for the past 20 years without any pollution incident and that system had been consistently employed, again without incident, on the "Australia Star" during its nine year's existence whenever at the Kurnell wharf.

(2) However since the oil incident the subject of the present charges, the system had been changed and the connection between the ship's manifold and the hose is now secured by bolting rather than by the cam-locks.

(3) On the day of the oil discharge, the cargo transfer operations, including the connection between the hose and manifold, were undertaken under the required scrutiny of the Board's Inspector and cargo/transfer operations began at 10:45 am and continued, without incident until 12:30pm and recommenced at 12:52 pm without incident until at 1:00 pm the when the oil spray occurred from the connection with the ship's manifold.

(4) Very little oil escaped and was only carried into the Port waters by the existence of a strong wind and resulted in no environmental damage to the waters.

(5) The ship's crew had responded promptly and efficiently, immediately following the oil spray.

(6) The master had entirely co-operated with the Board's investigation of the incident.

(7) The ship owner had likewise co-operated with the Board and had informed the Board of its ownership of the ship, after the Board had originally mistakenly commenced proceedings against another company which did not own the ship.

(8) Each defendant had entered a plea of guilty early in the proceedings.

(9) Neither Defendant had any prior convictions in respect of an environmental offence. In this respect the owner had operated the "Australia Star" in Australian waters for the past nine years without any pollution incident and the master had been at sea since 1961, had become a qualified master in 1982 and had captained ships since 1991.

(10) A conviction of the master would be likely to prejudice his professional career and especially present problems for him being in USA waters.

In the light of all the foregoing mitigating circumstances, Mr Liddy submitted that the appropriate response from the Court in the present cases would be to enter a conviction against the ship owner and impose an appropriately lenient penalty but to discharge the master by the favourable exercise of the judicial discretion conferred by s556A of the Crimes Act 1900.

Mr Hill, Counsel for the Prosecutor submitted that s556A of the Crimes Act "did not belong" to this particular area of statutory liability and that in any event the Defendant had not fully explained how and why the particular oil discharge had occurred in the present case and that in any event the master of the ship had ultimate responsibility for the oil discharge that had occurred.

The Court was informed that this is the first case to come before the Court for sentencing in which both the master and shipowner had been charged in respect of the one oil discharge incident.

Having regard to all that has been put to the Court by the Prosecutor and by the Defendant, I have reached the firm conclusion that the circumstances of the case call for a conviction to be recorded against the ship owner and for a reasonably lenient penalty to be imposed having regard to the circumstances in which the oil discharge occurred, the insignificant environmental consequences of the discharge and to the fact that this is the first environmental offence committed by the ship owner and also that the ship owner totally co-operated with the investigation by the Prosecutor and readily entered a plea of guilty. Although I am not entirely sure just how the failure occurred in the connection between the ship's manifold and the Caltex hose. I am satisfied that the failure did not occur as a result of defective equipment, or inefficient cargo handling procedures or negligence or carelessness on the part of the ship's master or crew. I am also satisfied that having regard to the fact that the cargo handling operation was under strict supervision, there was little prospect of potential environmental harm, in addition to the fact that there was no actual harm that was not immediately remedied.

All these mitigating factors weigh heavily in favour of the ship's owner. However I am also very conscious of the substantial maximum fine of $1M that is imposed by s8(1) of the Act upon the ship owner, reflecting the Legislature's concern on behalf of the community to fully protect our marine environment. This concern is reflected in the Marine Pollution (Penalties) Amendment Act 1993 which substantially increased by four hundred precent the prevailing maximum penalties prescribed by s8(1) of the Act.

In all the circumstances, I consider a fine of $40,000 to be an appropriate penalty and I impose it.

I have also come to the firm conclusion that in the circumstances of this case, the master should obtain the benefit of the favourable exercise of the judicial discretion conferred by s556A of the Crimes Act 1900.

Although this Court has often suggested that it will be a fairly rare case for s556A to be applied to a person guilty of an environmental offence it has never foreclosed the availability of that judicial discretion, and has, on occasions, exercised it in favour of a defendant for example:

(1) Halverson v Port Waratah Coal Services Ltd (unreported 9 January 1987) a case involving an offence under the Clean Air Act 1961;

(2) Border v David Brown Corporation of Australia and Anor (unreported 19 February 1988) a case involving an offence under the Environmental Planning and Assessment Act 1979; and

(3) Hall v Narrabri Shire Council (unreported 10 January 1992) a case involving an offence under the Pesticides Act 1978.

The judicial discretion conferred by s556A is exercisable where the Court forms the opinion, having regard to a number of stated matters ( including (i) the character and antecedents of the accused (ii) the extenuating circumstances under which the offence was committed and (iii) "any other matter which the Court thinks it proper to consider") that it is inexpedient to inflict any punishment other than a nominal punishment.

In forming the necessary opinion in the present case I not only rely upon the mitigating circumstances outlined in Mr Liddy's submission on behalf of the Defendant that I have earlier summarised but also upon the fact that I have already convicted and imposed an appropriate fine upon the shipowner of its offence arising out of the same oil discharge incident , which also constitutes the basis for the master's liability under s8(1) of the Act. The facts of that conviction and that fine in my judgment are proper matters to consider in the exercise of the discretion conferred by s556A in favour of the master. Those facts, in my judgment, adequately vindicate the Act and the Prosecution's enforcement of it. To go further and punish the master for the same oil discharge incident, would in my judgment be excessive and involve "the risk of a double penalty in respect of the one event" (per Lord Morris at 107 in Federal Steam Navigation Co ). The conviction and fining of the shipowner for the oil discharge incident is, in my judgment, an appropriate curial response on behalf of the community and is a sufficient fulfilment of the deterrent purpose of the criminal law cf Walden-Hensler (1987) 75 ALR 173 at 179 per Brennan J. This is not to criticise the Prosecutor for charging both the Master and the shipowner. Nor is it to say that there may not be cases in the future where punishment of both the master and shipowner is called for. It is simply to say that in my judgment the present circumstances do not require the conviction and punishment of the master in addition to the shipowner.

In the circumstances I make the following orders:

In proceedings No 50021 of 1995 :

1. The charge is dismissed pursuant to s556A of the Crimes Act 1900.

2. The Defendant is ordered to pay the Prosecutor's reasonable costs in the sum agreed or failing agreement as assessed.

3. Exhibits my be returned.

In proceedings No 50022 of 1995 :

1. The Defendant is convicted of the offence charged.

2. A fine of $40,000 is imposed in respect of the conviction referred to in Order No 1 - such amount to be paid to the Registrar within 28 days.

3. The Defendant is ordered to pay the Prosecutor's reasonable costs in the sum agreed, or failing agreement as assessed.

4. Exhibits may be returned.