Port Stephens Council v Robinsons Anna Bay Sand Pty Limited

[2007] NSWLEC 240

Land and Environment Court

of New South Wales

CITATION:

Port Stephens Council v Robinsons Anna Bay Sand Pty Limited [2007] NSWLEC 240

PARTIES:

PROSECUTOR
Port Stephens Council

DEFENDANT
Robinsons Anna Bay Sands Pty Limited
ACN 002 360 947

FILE NUMBER(S):

50026 of 2006

CORAM:

Lloyd J

KEY ISSUES:

Prosecution :- carrying out of specified development without development consent - extractive industry - defendant in course of voluntary winding up

LEGISLATION CITED:

Criminal Procedure Act 1986 Div 4 of Pt 5
Environmental Planning and Assessment Act 1979 s 76A, s 94, s 100, s 125(1)
Fines Act 1996
Port Stephens Local Environmental Plan 2000

CASES CITED:

Axer Pty Limited v Environment Protection Authority (1993) 113 LGERA 357;
Environment Protection Authority v Capdate Pty Limited (1993) 78 LGERA 349;
Environment Protection Authority v Douglass (No. 2) [2002] NSWLEC 94;
Environment Protection Authority v Emerald Peat Pty Ltd (in liq) (1999) NSWLEC 147;
Fletcher Construction Australia Limited v WorkCover Authority of New South Wales (Inspector Fisher) (1999) 91 IR 66;
Lawrenson Diecasting Pty Ltd v WorkCover Authority of New South Wales (Inspector Ch’ng) (1999) 90 IR 464

DATES OF HEARING:

11 April 2007

EX TEMPORE JUDGMENT DATE:

11 April 2007

LEGAL REPRESENTATIVES:

PROSECUTOR:
Mr R C Pontello (barrister)
SOLICITORS:
Sparke Helmore

DEFENDANT:
No appearance

JUDGMENT:

- 1 -

IN THE LAND AND
ENVIRONMENT COURT
OF NEW SOUTH WALES

Lloyd J

Wednesday, 11 April 2007

LEC No. 50026 of 2006

PORT STEPHENS COUNCIL v ROBINSONS ANNA BAY SAND PTY LIMITED [2007] NSWLEC 240

EX TEMPORE JUDGMENT

1 HIS HONOUR: The defendant, Robinsons Anna Bay Sand Pty Limited ACN 002 360 947, is charged with an offence that between 7 December 2004 and 30 April 2005 at Anna Bay in the state of New South Wales, it committed an offence against s 125(1) of the Environmental Planning and Assessment Act 1979 (“EP&A Act”), in that it did a thing, namely carried out a specified development, that is, an extractive industry, being the winning of approximately 97,199 tonnes of sand from land known as lot 130 and lot 131 in deposited plan 7530204, without obtaining the development consent of the prosecutor under Pt 4 of the Act, the carrying out of such specified development without such an consent being a matter or thing forbidden to be done under the Act, namely, by s 76A(1) of that Act and an environmental planning instrument, the Port Stephens Local Environmental Plan 2000 (“the LEP”).

2 I should record the fact that the defendant has not appeared, although when the matter was set down for hearing it was represented and it is aware of the fact that the hearing is proceeding today.

3 On 15 December 2006, the defendant appeared before the court represented by counsel who indicated that he did not have instructions as to a plea. Accordingly, Talbot J entered a plea of not guilty on the defendant’s behalf.

4 The defendant is currently in the course of voluntary winding up and a liquidator was appointed on or about 5 December 2006. The proceedings today have thus proceeded ex parte.

5 The relevant facts are in a conveniently small compass. The subject land, lots 130 and 131 in deposited plan 7530204 are within the Port Stephens local government area and are subject to the LEP. According to the evidence the lots in question are within zone 1(a) Rural Agriculture, in which zone development for the purpose of an extractive industry is one which cannot be carried out without development consent. An extractive industry is relevantly defined in the LEP as follows:

(a) The winning of extractive material including sand, gravel, clay, turf, soil, rock, stone or similar substances, or

(b) An undertaking not being a mine which depends for its operations on the winning of extractive material from the land upon which it is carried on and includes any washing, crushing, grinding, milling or separating into different sizes of that extractive material on that land .

6 Section 76A(1) of the EP&A Act provides that if an environmental planning instrument provides that specified development may not be carried out except with development consent, a person must not carry out the development on the land to which the provision applies unless (a) such consent has been obtained and is in force and (b) the development is carried out in accordance with the consent and the instrument.

7 The evidence establishes the following facts. On Friday 8 April 2005, Mr Paul Douglas, a town planner employed by the prosecutor received a phone call from Mr Stuart Veitch of the Department of Lands in which Mr Veitch told him that he was concerned that there is unauthorised sand extraction taking place on the Crown land adjacent to the defendant company’s freehold land. I understand that both lot 130 and lot 131 in deposited plan 7530204 are Crown land.

8 On Monday 18 April 2005, Mr Douglas went to the land and spoke to Mr Geoffrey Robinson. Mr Geoffrey Robinson told Mr Douglas that his brother Peter was away but that he was authorised by him to deal with issues relating to the defendant company. The following conversation ensued:

Mr Douglas: But you’ve extracted sand without consent.

Mr Robinson: Yes.

Mr Douglas: Development consent should have been sought before extraction was carried out.

Mr Robinson: We were unable to lodge a development application as [the defendant] had not received owner’s consent from Lands.

9 I note that lot 130 has an area of 6.9 hectares and lot 131 has an area of 8.2 hectares. According to Mr Douglas, no development consent exists for any extractive industry on the two lots in question, he having conducted a search of the register of development consents kept by the prosecutor pursuant to s 100 of the EP&A Act. Moreover, he did not find any development consents for those lots for any purpose.

10 On 26 April 2005, Mr Douglas attended a meeting with Mr Geoffrey Robinson and the General Manager of the prosecutor, Mr Peter Gesling. A company search, which is in evidence, shows that Mr Geoffrey Robinson is not a director, but Mr Peter Robinson and Ms Sylvia Robinson are directors, having been appointed directors of the defendant company in 1982. During the course of the meeting on 26 April 2005, the following conversation occurred:

Mr Robinson said: [The defendant company] has applied for a licence over lots 130 and 131 from the Department of Lands. However as this was never received a development application could not be submitted”.

Mr Douglas: The extraction should not have taken place without development consent regardless of the status of your licence.

Mr Robinson: I understand. However, this is the reason why we never applied for development consent.

11 On 10 May 2005, there was a meeting at Port Stephens council between Mr Douglas, Mr Gesling and Mr Peter Robinson, who as I have noted is a director of the defendant company. During the course of that meeting Mr Peter Robinson said:

We have been extracting sand from lot 130 and 131 and I assumed all operations were lawful. RABS had sought a licence from the Department of Lands, no licence has been granted but because there was no objection to the extraction of sand from lots 130 and 131, we continued to extract sand.

12 On 1 August 2005, Mr Geoffrey Robinson and Mr Peter Robinson attended and gave a record of interview with Mr Anthony Signor of the Department of Lands. During the course of that interview, a number of admissions were made by Mr Peter Robinson. The admissions included the fact that the defendant company extracted sand from the land in question between 2002 and 2004 in an amount of approximately 90,000 tonnes in circumstances where an application for development consent was never lodged. The quantity of sand removed is confirmed by the affidavit of Mr Peter Murray, an officer of the prosecutor, who says that the defendant company supplied to the prosecutor some 97,199 tonnes of sand between September 2004 and 14 February 2005.

13 The evidence also includes some correspondence including, in particular, a letter from Mr Geoffrey Robinson to the prosecutor dated 28 April 2005, in which he states that the sand removed from lots 130 and 131 was for use in the development of Koala Estate, Mallabula, by Landcom and recently in the rehabilitation of the Salamander Bay waste disposal landfill site. This removal of the sand was carried out in line with the aim of continuing the frontal dune management over lots 130 and 131.

14 In an email dated 8 June 2005 from Mr Geoffrey Robinson to Mr Douglas, Mr Robinson states that a development application “was made and is still awaiting the Lands Department signature”. And he again states that the removal of sand was supplied to Landcom Koala Estate and recently to Salamander Bay Waste Rehabilitation.

15 The evidence therefore satisfies me that the elements of the offence have been made out. Namely that there was something forbidden to be done under s 125(1) of the EP&A Act and the thing forbidden done was that specified development was carried out without consent contrary to s 76A(1) of the Act.

16 It is next necessary to consider the question of what penalty should be imposed. There is evidence of some environmental harm that is partly contained in a letter to the defendant from Mr Douglas on behalf of the prosecutor dated 27 May 2005, who points out that material had been removed below the original pre-dune ground level and that a considerable amount of waste material had been placed on the land. This material comprised trees, timber, soil and a wide range of building construction and household refuse.

17 There are other aspects of environmental harm that may be briefly described. Quite apart from the fact that a significant amount of sand was removed from the land, nearly 98,000 tonnes, the actual area extracted was approximately 2.04 hectares and about 0.59 hectares has been filled with the kind of rubbish that I have described. The fact is that there is a residential housing estate nearby and the extracted area is an eyesore and can easily be seen from a distance. It will also be difficult to restore the land to its pre-extracted condition.

18 There are a number of factors that must be taken into consideration on the question of penalty. The primary consideration is the objective gravity or seriousness of the offence, see Fletcher Construction Australia Limited v WorkCover Authority of New South Wales (Inspector Fisher) (1999) 91 IR 66 at 77-81 and Lawrenson Diecasting Pty Ltd v WorkCover Authority of New South Wales (Inspector Ch’ng) (1999) 90 IR 464 at 474. There are a number of factors which indicate the seriousness of the offence in question here. The first is the maximum penalty prescribed by the legislature for offences of this nature. The maximum penalty in this case is $1.1 million. As I have said that is a reflection of the seriousness with which the legislature views offences of this nature. It is an important factor, in fixing a penalty, that provisions which exist to control the use and development of land should be observed and if persons are allowed to carry out development without consent then the whole system of development control would be set at nought.

19 Another factor indicating the seriousness or objective gravity of the offence in this case is that the period of offending behaviour lasted in excess of seven months, that is from 7 December 2004 to 30 April 2005, and the offence was committed as part of a plan or organised activity.

20 I have referred to the environmental harm which is also indicative of the objective gravity or seriousness of the offence in this case. I accept the fact that the defendant knew that what it was doing was wrong, that is it knew that it required development consent and it knew that development consent had not been applied for or obtained, and the defendant could and should have refrained from extracting the sand until such time as it had the necessary development consent.

21 Another factor relevant to the question of penalty is the practical measures which may be taken to control or to limit the harm that had been caused. Obviously if development consent had been granted it would have been granted subject to conditions designed to mitigate any environmental harm.

22 The fact of the need for a general deterrent is a major consideration in prosecutions of this nature. As I have indicated, if persons were to go about carrying out development of land without consent then the whole system of planning control would be set at nought. There is therefore a need to send a strong warning to others who may be minded to breach the law that such actions will be visited with significant consequences: see, in particular, Axer Pty Limited v Environment Protection Authority (1993) 113 LGERA 357 to 359.

23 I have noted that in the present case the company is in voluntary winding up and that the defendant has not appeared. Nothing is known about the defendant’s financial state. The Fines Act 1996 requires the court in fixing a penalty to have regard to the defendant’s means to pay. The defendant has not chosen to appear and put forward anything by way of evidence or submissions as to its ability to pay. I can only assume that its ability to pay is one which will not affect the penalty in this case. Where a liquidator has been appointed, the court has nevertheless not been dissuaded from imposing a significant penalty where the circumstances otherwise require. In Environment Protection Authority v Emerald Peat Pty Ltd (in liq) (1999) NSWLEC 147, the corporate defendant in that case was a company in liquidation. Talbot J held (at [77]):

The evidence discloses that the offence must be regarded, as I have said, as extremely serious, and that notwithstanding the present impecunious state of the company's financial affairs and the apparent lack of liquidity in so far as the ability to meet the commitment to a substantial fine is concerned, nevertheless a significant penalty for the offence and a further penalty for each of the 44 days during which the offence continued, is justified.

24 In that case Talbot J ordered the defendant to pay a total fine of $217,000. Similarly, in Environment Protection Authority v Douglass (No. 2) [2002] NSWLEC 94 I imposed a substantial fine on an impecunious defendant, mainly to reinforce the element of general deterrence; that is, to discourage others who might be minded to commit similar or like offences in the future.

25 In Environment Protection Authority v Capdate Pty Limited (1993) 78 LGERA 349, Stein J noted that the corporate defendant in that case had ceased to trade. His Honour said (at 353):

So far as the company is concerned all I know is that it is no longer trading. It is difficult to see how its largely indefinite financial circumstances should mitigate the fine to any appreciable extent.

26 I agree, and I do not intend to mitigate any fine which will be imposed to any appreciable extent.

27 A further factor to be taken into consideration is the fact that the defendant carried out what it did for the purpose of making money. There is evidence before me that not only did it make money but it also saved money through not having to obtain the development consent that the work that would have required. There is evidence from Mr Douglas that in his experience the cost of preparing an environmental impact statement for sand extraction to support a development application would be in the range of $150,000 to $200,000. In addition to that there would be costs associated with the assessment process including consulting with, and responding to the council and relevant government agencies. It is also likely that there would have been conditions of consent imposed on any consent issued including monitoring and reporting conditions which would involve ongoing costs. It is also likely, in Mr Douglas’ opinion, that a condition pursuant to s 94 of the EP&A Act would have been imposed. That would have required the payment to the prosecutor of four cents per tonne per kilometre of sand. On an assumption that sand would be transported an average of five kilometres and the quantity of sand extracted was 97,199 tonnes, those s 94 contributions would have amounted to some $19,439.

28 The sand was also sold, apparently, to Landcom and the total income generated from the sale of sand and blended material, again based upon the same quantities, was probably in the order of $292,000. In Axer, Mahoney JA said that by providing a fine the legislature did not see the payment of a fine as a licence to pollute, or in this case to carry out development without consent.

29 In my view the fine to be imposed in the present case should take account of the profit likely to have been made and, as I have noted, although the total value of sand and blended material sold was some $292,000, there, was also the saving of the expenses of preparing a development application, including the environmental impact statement. Of course, the defendant would have had to meet its overheads, the cost of transportation, wages and the like out of any profit that it made. In my view having regard to the likely profit together with an element of general deterrence and all the circumstances in this case, an appropriate penalty is $100,000.

30 It follows that the formal orders of the Court are as follows:

(1) The defendant is convicted of the offence as charged.

(2) The defendant must pay a penalty in the sum of $100,000.

(3) The defendant must pay the prosecutor’s costs in accordance with Div 4 of Pt 5 of the Criminal Procedure Act 1986.

(4) The exhibits may be returned.

I hereby certify that the preceding 30 paragraphs are a true copy of the reasons for judgment herein of the Honourable Mr Justice D H Lloyd.

Associate

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