OneSteel Manufacturing P/L v Whyalla Red Dust Action Group Inc - [2006] SASC 212

SUPREME COURT OF SOUTH AUSTRALIA
(Full Court: Leave to Appeal in Private)
ONESTEEL MANUFACTURING P/L v WHYALLA RED DUST ACTION GROUP INC
[2006] SASC 212
Judgment of The Full Court
(The Honourable Justice Bleby, The Honourable Justice Anderson and The Honourable Justice White)
19 July 2006
ENVIRONMENT AND PLANNING - COURTS AND TRIBUNALS WITH ENVIRONMENT JURISDICTION - SOUTH AUSTRALIA - ENVIRONMENTAL, RESOURCES AND DEVELOPMENT COURT AND ITS PREDECESSORS
Application by applicant for orders under s 104 of the Environment Protection Act 1993 - Decision on appeal by respondent that the applicant was not a person whose interests are affected by the subject matter of the application and that the applicant had not demonstrated that the respondent had a case to answer - Application for leave to appeal to Full Court against decision of single Judge - Intended grounds of appeal include whether a case to answer, whether application was brought in a representative capacity pursuant to s 104(10) of the Environment Protection Act 1993, whether applicant has standing - Leave to appeal refused.
Environment Protection Act 1993 s 25, s 104; Supreme Court Rules r 94.03; Environment, Resources and Development Court Rules 2003 r 7, referred to.
OneSteel Manufacturing Pty Ltd v Whyalla Red Dust Action Group Inc [2005] SASC 135, applied.

ONESTEEL MANUFACTURING P/L v WHYALLA RED DUST ACTION GROUP INC
[2006] SASC 212
Full Court: Bleby, Anderson and White JJ

BLEBY J: This is an application for leave to appeal to the Full Court against the decision and order of a single Judge of the Court pursuant to r 94.02 of the Supreme Court Rules. It is being considered in private by the Full Court pursuant to r 94.03 of the Supreme Court Rules.
The matter has reached such a state of procedural complexity that it is necessary to analyse with some care what has happened to date in order to determine whether leave to appeal should be granted and, if so, on what grounds.
The applicant for leave to appeal, Whyalla Red Dust Action Group Inc (“the applicant”) was the respondent to a successful appeal to a single Judge of this Court brought by OneSteel Manufacturing Pty Ltd (“OneSteel”) against a decision of a single Judge of the Environment, Resources and Development Court (“the Environment Court”).
On 24 September 2004 the applicant filed in the Environment Court an application for the following orders:
1.A declaration that the applicant is a “person whose interests are affected by the subject matter of the application” within the meaning of s 104(7)(b) of the Environment Protection Act 1993 (SA);
2.In the alternative, an order that the applicant be granted leave of the Court under s 104(7)(c) of the Environment Protection Act 1993 to issue a summons attached to the application and to serve the issued summons on OneSteel; and
3.Relief in the form of the orders sought in a summons attached to the application.
The orders in the attached summons were various orders under s 104 of the Environment Protection Act against OneSteel in relation to the operation of a pellet plant at Whyalla and fugitive dust emissions from that plant.
Section 104(7) of the Environment Protection Act relevantly provides that an application under s 104 may be made by “any person whose interests are affected by the subject matter of the application”[1] or by “any other person with the leave of” the Environment Court.[2] Sub-section (8) provides:
Before the Court may grant leave for the purposes of subsection (7)(c), the Court must be satisfied that -
(a)     the proceedings on the application would not be an abuse of the process of the Court; and
(b)     there is a real or significant likelihood that the requirements for the making of an order under subsection (1) on the application would be satisfied; and
(c)     it is in the public interest that the proceedings should be brought.
[1] Section 104(7)(b).
[2] Section 104(7)(c).
The application was treated by the Environment Court as an ex parte application pursuant to s 104(11) of the Environment Protection Act. That provides that, if the court is satisfied on the application that the respondent has a case to answer, it may grant leave to the applicant to serve a summons requiring the respondent to appear before the Court to show cause why an order should not be made under the section. The procedure adopted by the Environment Court, which seemed to follow Rule 7 of the Environment, Resources and Development Court Rules 2003, was not questioned in this Court.
On 29 September 2004 the Environment Court determined, as it subsequently described the action, as no order was actually drawn up:
1.The applicant is a person whose interests are affected by the subject matter of the application and therefore falls within a category of persons who can apply to the Court;
2.That based on the affidavits filed in the Court … the respondent (OneSteel) has a case to answer; and
3.That a summons issue in the form of that which has been filed.
It will be noted that the Court did not consider it necessary to consider the alternative claim for leave under s 104(7)(c).
The summons was served on OneSteel, and on 13 December 2004 OneSteel issued an application seeking the following orders:
1.An order revoking the declaratory order made on 29 September 2004 that the applicant is a person whose interests are affected by the subject matter of the application …;
2.An order revoking the order made on 29 September 2004 granting leave to the applicant to serve the summons filed herein and dated 24 September 2004.
On 22 December 2004 the Environment Court dismissed that application because it considered that it had no power to revoke the previous order.
OneSteel appealed to a single Judge of this Court against that decision.
In his decision on that appeal[3] Besanko J considered that the “declaration” made by the Environment Court was no more than a decision that on the face of it the applicant brought itself within s 104(7)(b) of the Environment Protection Act; that it was not a final determination of that question; and that that was an appropriate approach for the Environment Court to take.[4] In other words, for the purpose of deciding the application for leave to serve the summons, the Environment Court Judge decided, on the face of the application, that the applicant brought itself within s 104(7)(b) as a person whose interests are affected by the subject matter of the application.
[3] OneSteel Manufacturing Pty Ltd v Whyalla Red Dust Action Group Inc [2005] SASC 135.
[4] Ibid at [14].
On the appeal Besanko J decided that the Environment Court did have power to revoke the order. The order dismissing OneSteel’s application was therefore set aside. The matter was remitted to the Environment Court to determine OneSteel’s application to revoke the ex parte order for leave to serve the summons.
What was required to be heard by the Environment Court was therefore OneSteel’s application to revoke the previous order made by the Environment Court that the applicant is a person whose interests are affected and to revoke leave to serve the application on the basis that OneSteel had no case to answer.
On 6 October 2005 the Environment Court decided that it was reasonably arguable that the applicant’s interests were affected. In other words, it treated that question as if it were rehearing the ex parte application. It decided that there was a case to answer. It did not revoke the leave to serve.
It is important to realise that the Environment Court did not then decide that the applicant complied with s 104(7)(b) but that for the purposes of leave to serve the application, it was reasonably arguable that it did. It was thus a finding incidental to refusing to set aside leave to serve. It is also important to note that at no stage has the Environment Court been called upon to determine whether leave should be granted as a matter of discretion under s 104(7)(c) of the Environment Protection Act, which is one of the forms of relief originally sought by the applicant. It must be conceded, however, that if the Court were to conclude that the respondent had no case to answer, leave would not normally be given.
I pause to observe at this stage that by its decision on 6 October 2005 that it was reasonably arguable that the applicant’s interests were affected by the subject matter of the application, the Environment Court misconceived its function. The application by OneSteel to revoke the order for leave to serve called into question the ability of the applicant to comply with s 104(7)(b) of the Environment Protection Act. It was on the hearing of that application that that issue was required to be decided by the Environment Court, and not merely that the question was arguable. It was no longer an ex parte application before the Court. If the Environment Court had followed that course and had decided that the applicant did not comply with s 104(7)(b), it would, of necessity, then have to have considered the question of leave under s 104(7)(c).
OneSteel again appealed to a single Judge of this Court against the decision of the Environment Court. It is the decision on that appeal which is now the subject of this application for leave to appeal to the Full Court.
By his decision the single Judge decided that the applicant was not a person whose interests are affected by the subject matter of the application and that the applicant had not demonstrated that OneSteel had a case to answer. Accordingly, he considered that leave should not be granted under s 104(7)(c).
He ordered that the appeal be allowed, that the decision of the Environment Court made on 6 October 2005 be set aside and that the original application by the applicant to the Environment Court dated 24 September 2004 be dismissed.
Notwithstanding that the Environment Court had merely held that it was reasonably arguable that the applicant’s interests were affected by the subject matter of the application, the matter of the applicant’s standing and the question of leave to make the application appear to have been fully argued on the appeal. One of the intended grounds of appeal challenges the conclusion as to the applicant’s standing by the single Judge. If leave to appeal against that decision were granted, it could only be upon the footing that, as in the case of the appeal before the single Judge, the outcome would decide the applicant’s standing in the proceedings once and for all.
There is one further procedural complication. By its summons the applicant seeks orders in the nature of an injunction to restrain certain conduct on the part of OneSteel and certain mandatory orders in relation to dust emissions and the monitoring of dust emission levels. Those orders are all prospective. There is also relief sought by way of payment to “persons (whether members of the applicant association or not) who have suffered injury or loss or damage to property, including property maintenance or cleaning costs and health costs incurred as a result of dust pollution caused by the respondent. The identity of those to be compensated and the amount and method of compensation to be ascertained in a manner to be determined by the Court”. There is also a claim for exemplary damages pursuant to s 104(1)(f) of the Environment Protection Act which damages, if awarded, must be paid to the credit of the Consolidated Account.
The relief claimed in the summons is sought by reference to a licence issued to OneSteel in 2000 pursuant to Schedule 1 of the Environment Protection Act. Relief can only be claimed under s 104 of the Environment Protection Act in relation to an alleged contravention of the Act. After the Environment Court made its most recent decision and before the hearing of the appeal the subject of this application for leave, the South Australian Parliament enacted the Broken Hill Proprietary Company’s Steel Works Indenture (Environmental Authorisation) Amendment Act 2005 which came into force on 3 November 2005. That Act amended the Broken Hill Proprietary Company’s Steel Works Indenture Act 1958. Its purpose is to grant environmental authorisation under the Environment Protection Act. As the Judge pointed out in his reasons for decision, the amendment Act changes substantially the conditions under which OneSteel may operate. The licence contained in that Act provides that compliance with certain conditions of the licence will satisfy OneSteel’s general environmental duty under s 25 of the Environment Protection Act in relation to the form of air pollution in respect of which the conditions of the licence are concerned, and that compliance with other conditions will satisfy OneSteel’s general environmental duty under s 25 of the Act in relation to the form of solid, liquid or gaseous waste discharge pollution in respect of which the conditions are concerned.
In relation to past conduct there is not alleged in the summons any contravention of the Environment Protection Act or any alleged failure to comply with the conditions of the licence granted in 2000. There is such an unparticularised assertion in the application for leave to serve the summons. However, it is the summons itself and the affidavits in support by which compliance with ss 104(7) and (8) must be judged. The affidavits filed in support of the summons do not make any such allegation. In any event, whether OneSteel is now acting in contravention of the Act will largely depend on whether there is a breach of the conditions of the licence provided for in the amending Indenture Act. As the Judge observed, the absence of any allegation that OneSteel has failed to comply with the provisions of the licence raises a real barrier for the applicant. On that basis the Judge considered that the applicant could not establish that the respondent has a case to answer. For that reason he held that leave could also not be granted under s 104(7)(c) of the Act.
It should also be added that, insofar as the applicant seeks payment of compensation in respect of past conduct, the application faces similar difficulties. I would merely add that s 104(10) provides that such an application may be made in a representative capacity but that the consent of all persons on whose behalf the application is made must be obtained. There is no evidence of anyone having consented to such an application.
The applicant’s intended grounds of appeal are as follows:
1.His Honour erred in law by failing to conclude that the respondent may have a case to answer with respect to possible contraventions of the Environment Protection Act 1993 which occurred on or after the 3 November 2005, the operative date of the Broken Hill Proprietary Company’s Steel Works Indenture (Environmental Authorisation) Amendment Act (“the Indenture Act”). His Honour erred in failing to refer the appellant’s application back to the Environment, Resources and Development Court in order that the appellant may have the opportunity to amend its pleadings to allege any contraventions by the respondent of the licence granted pursuant to the Indenture Act.
2.His Honour erred in law by failing to conclude that the appellant’s application was brought in a representative capacity pursuant to Section 104(10) of the Environment Protection Act 1993. (paragraph 34 of Debelle J’s judgment 18 April 2006).
3.His Honour erred in law by failing to conclude that the respondent did have a case to answer with respect to the appellant’s claims for payment by the respondent for injury or loss or damage to property, which claims are based on contraventions of the Environment Protection Act 1993 committed by the respondent in the three years prior to the operation of the Indenture Act. His Honour erred in failing to conclude that these claims are not affected by the operation of the Indenture Act and on the evidence presented by the appellant the respondent has a clear case to answer in respect of this aspect of the appellant’s case. His Honour therefore erred in finding that the appellant was not entitled to have leave to serve its proceedings pursuant to Section 104(7)(c) of the Environment Protection Act 1993. (paragraphs 36-50 inclusive of Debelle J’s judgment 18 April 2006)
4.His Honour erred in law by finding that the appellant was not a person whose interests are affected by the subject matter of the application within the meaning of Section 104(7)(b) of the Environment Protection Act 1993. (paragraphs 4-33 inclusive of Debelle J’s judgment 18 April 2006)
I would refuse leave on ground 1. I agree, for reasons given by the single Judge, that the foundation for any of the orders sought in the summons is not apparent either from the summons or from the affidavits. It is not a matter of referring the summons back to the Environment Court to allow an opportunity to amend the pleading. The pleading as it stands effectively discloses no cause of action.
As for ground 2, it is not necessary to decide whether the applicant has the capacity to bring a representative action pursuant to s 104(10) of the Environment Protection Act. The necessary conditions of that sub-section have not been complied with.
What I have said is also sufficient to dispose of intended ground 3.
Ground 4 raises the question of the applicant’s standing. That is an issue of some importance and plainly raises an arguable question. However, given the refusal of leave on the other grounds, even if the applicant did have standing, there is no arguable case. This case would therefore be an inappropriate vehicle in which to decide the applicant’s standing to seek relief of this nature, and I would refuse leave on this ground also. That refusal says nothing, however, about the correctness or otherwise of the Judge’s decision on the standing of the applicant if there were otherwise a case to answer.
For these reasons I would refuse leave to appeal.
It is unfortunate that the applicant has had to follow a somewhat tortuous route to be told that its application does not clear the first hurdle. However, the applicant only has itself to blame for what appear to be obvious defects in the summons. The proceedings taken by OneSteel are similar to an application to strike out proceedings on the ground that the statement of claim discloses no cause of action. Usually a party will be given an opportunity to amend the proceeding to cure the defects. However, the defects in respect of both the past and prospective relief claimed are so fundamental that the relief cannot be supported without a radical recasting of the summons and the affidavits which would be needed to support it.
This is not to say that the applicant cannot devise a pleading which discloses a case to answer and for which the Environment Court might grant leave. Nor does it preclude any future argument in this Court that the applicant has standing to bring such proceedings.
ANDERSON J: I have read the draft reasons prepared by Bleby J and I agree that leave to appeal should be refused for the reasons expressed by Bleby J.
WHITE J: I agree that the application for leave to appeal should be refused. I agree with the reasons of Bleby J.