Secretary, Department of Planning and Environment v Sell and Parker Pty Ltd (No 3)

[2020] NSWLEC 35

Land and Environment Court

New South Wales

Medium Neutral Citation:	Secretary, Department of Planning and Environment v Sell & Parker Pty Ltd (No 3) [2020] NSWLEC 35
Hearing dates:	4 September 2019
Date of orders:	23 April 2020
Decision date:	23 April 2020
Jurisdiction:	Class 5
Before:	Robson J
Decision:	See orders at [123]
Catchwords:	CRIMINAL PROCEDURE — Subpoena — Application to set aside — Legitimate forensic purpose — Documents sought relating to monetary benefits order — Application to set aside dismissed   ENVIRONMENT AND PLANNING — Land and Environment Court — Practice and procedure — Judgments and orders — Monetary benefits order
Legislation Cited:	Crimes (Sentencing Procedure) Act 1999 (NSW) s 21A Environmental Planning and Assessment Act 1979 (NSW) ss 9.47, 9.56(2A), 76A, 125 Protection of the Environment Operations Act 1997 (NSW) Pt 8.3, ss 248, 249, 250 Protection of the Environment Operations (General) Amendment (Calculating Amount of Monetary Benefits) Regulation 2019 (NSW) Protection of the Environment Operations (General) Regulation 2009 (NSW) cl 101A Water Management Act 2000 (NSW)
Cases Cited:	Alister v R (1984) 154 CLR 404; [1984] HCA 85 Attorney-General (NSW) v Chidgey [2008] NSWCCA 65; (2008) 182 A Crim R 536 Azar Building and Construction Services Pty Ltd v Transport Infrastructure Development Corporation [2010] NSWLEC 110 Director-General Department of Environment and Climate Change v Wilton [2008] NSWLEC 297 Environment Protection Authority v Signium Pty Ltd [2018] NSWLEC 126 Environment Protection Authority v Snowy Hydro Ltd (2008) 162 LGERA 273; [2008] NSWLEC 264 Harris v Harrison (2014) 86 NSWLR 422; [2014] NSWCCA 84 ICAP Pty Ltd v Moebes [2009] NSWSC 306 Jack Brabham Engines Limited v Beare [2010] FCA 35 National Employers' Mutual General Insurance Association Ltd v Waind and Hill [1978] 1 NSWLR 372 R v Barton [1981] 2 NSWLR 414 R v Booth (Court of Appeal (NSW), 12 November 1993, unrep)) R v De Simoni (1981) 147 CLR 383; [1981] HCA 31 R v Olbrich (1999) 199 CLR 270; [1999] HCA 54 R v Saleam (1989) 16 NSWLR 14 R v Saleam (1999) NSWCCA 342 Rinehart v Rinehart [2018] NSWSC 1102 Secretary, Department of Planning and Environment v Sell & Parker Pty Ltd (No 2) [2019] NSWLEC 73 Secretary, Department of Planning and Environment v Sell & Parker Pty Ltd [2019] NSWLEC 48 Sood v R [2006] NSWCCA 252 Verde Terra Pty Ltd v Central Coast Council [2019] NSWLEC 166
Texts Cited:	Land and Environment Court Practice Note – Class 5 Proceedings
Category:	Procedural and other rulings
Parties:	Secretary, Department of Planning and Environment (Prosecutor) Sell & Parker Pty Ltd (ACN 000 101 315) (Defendant)
Representation:	Counsel: A Rose (Prosecutor) T G Howard SC with J Johnson (Defendant)   Solicitors: Department of Planning and Environment (Prosecutor) Allens (Defendant)
File Number(s):	2018/00242442; 2018/00242443
Publication restriction:	Nil

Judgment

1. On 28 June 2019, Sell & Parker Pty Ltd (ACN 000 101 315) (‘Sell & Parker’) entered a plea of guilty in respect to two offences against s 125(1) of the Environmental Planning and Assessment Act 1979 (NSW) (‘EPA Act’) for carrying out development otherwise than in accordance with a development consent which had been obtained and was in force, contrary to s 76A(1)(b) of the EPA Act.

2. By notice of motion filed on 29 July 2019, Sell & Parker seeks an order in each of proceedings 2018/00242442 and 2018/00242443, that a subpoena issued by the Secretary, Department of Planning and Environment (‘prosecutor’) to Sell & Parker on 19 July 2019 (‘Subpoena’) be set aside.

3. The documentation sought by the prosecutor in the schedule to the Subpoena (‘Schedule’) relates to a possible order regarding monetary benefits (‘monetary benefits order’) pursuant to s 249 of the Protection of the Environment Operations Act 1997 (NSW) (‘POEO Act’).

4. The prosecutor opposes the orders sought in the motion.

5. The hearing of the motion proceeded on 4 September 2019. Ms A Rose of counsel appeared for the prosecutor, and Mr T G Howard of senior counsel appeared with Mr J Johnson of counsel for Sell & Parker. Each of the parties provided written and oral submissions.

6. For the reasons that follow, I find that, subject to the Subpoena being amended in accordance with Annexure A to this judgment, the motion should be dismissed.

Background

7. Sell & Parker is the operator of a metal recycling facility located at Lot 5 in DP 7086 known as 45 Tattersall Road, Kings Park and Lot 2 in DP 550522 known as 23-43 Tattersall Road, Kings Park. The breaches of the development consent specifically concerned Condition A8 of Development Consent SSD 5041 granted by the Minister for Planning on 12 November 2015 (‘Development Consent’), which restricted the amount of waste material that Sell & Parker was authorised to receive annually at the site to 90,000 tonnes until such time as an “Emissions Collection System” on the site had been commissioned and approved and a final occupation certificate had been issued. Proceeding 2018/00242443 concerns offending conduct which occurred in 2016 (‘2016 Charge’) whereas proceeding 2018/00242442 concerns offending conduct which occurred in 2017 (‘2017 Charge’). I note that a final occupation certificate has now been issued and an Emissions Collection System has been approved pursuant to the Development Consent.

8. In Secretary, Department of Planning and Environment v Sell & Parker Pty Ltd [2019] NSWLEC 48, I determined that the formulation of the charge in the amended summons filed on 1 November 2018 in each of the proceedings was duplicitous, and, on 12 April 2019, I allowed the prosecutor the opportunity to seek leave to amend the summonses.

9. In Secretary, Department of Planning and Environment v Sell & Parker Pty Ltd (No 2) [2019] NSWLEC 73, on 4 June 2019, I subsequently granted leave to the prosecutor to further amend the summons in relation to the 2016 Charge.

10. Each amended summons in relation to the 2016 Charge and in relation to the 2017 Charge (collectively, ‘Summons’), states that the prosecutor “seeks ... Such orders under Part 8.3 of the [POEO] Act as the Court sees fit to make.”

11. Following the entry of guilty pleas in each of the proceedings on 28 June 2019, I made orders that the prosecutor provide Sell & Parker with particulars of any orders the prosecutor would be seeking under Pt 8.3 of the POEO Act which applies, by operation of s 9.56(2A) of the EPA Act, by 19 July 2019.

12. By letter dated 19 July 2019, the prosecutor informed Sell & Parker’s solicitors that it would be seeking a publication order pursuant to s 250(1)(a) of the POEO Act; an order that Sell & Parker pay the “costs and expenses incurred” during the investigation of the offences pursuant to s 248(1) of the POEO Act; and, relevant to the present application, the letter stated:

“The Prosecutor is also considering whether to seek a monetary benefit order pursuant to s 249(1) of the POEO Act, which is an additional penalty of an amount the court is satisfied, on the balance of probabilities, represents the amount of any monetary benefits acquired by the Defendant, or accrued or accruing to the Defendant, as a result of the commission of the offences.

…

In order for the Prosecutor to determine whether it will seek a monetary benefit order, it needs to calculate whether the Defendant obtained any monetary benefits from the offending to which it has pleaded guilty.

To this end, the Prosecutor [has] caused the Court to issue a subpoena to produce on 19 July 2019 to the Defendant seeking the relevant information required to undertake those calculations, in accordance with the Protocol, Guidelines and the NEAT.

…

Once the Defendant has produced the documents sought by the subpoena, the Prosecutor will engage an expert to calculate whether the Defendant obtained any monetary benefits from the offending, and if so, the amount of the monetary benefits obtained. Once this exercise is completed, the Prosecutor will confirm whether it will be seeking a monetary benefit order against the Defendant pursuant to section 249(1) of the POEO Act.

The Prosecutor anticipates that it will be in a position to confirm its position on this issue between 4 to 6 weeks after receiving the documents produced in response to the subpoena.”

13. On 4 July 2019, prior to issuing the Subpoena, the prosecutor sought advice from KPMG Australia (‘KPMG’), forensic accountants, “as an independent expert” as to “what financial and/or other documents are necessary to enable it, or an independent expert, to calculate any monetary benefits Sell & Parker may have acquired as a result of the commission of the offences it has pleaded guilty to, consistent with the EPA’s Guidelines on recovering benefits from environmental offenders, Protocol for calculating monetary benefits, NEAT, and NEAT Model User Guide.”

14. On 19 July 2019, KPMG provided advice which detailed the information KPMG considered was “required to assess the monetary benefit accrued or accruing to [Sell & Parker] as a result of the commission of the offences”. The information required by KPMG was listed under the following headings: “organisational structure”; “records from the weighbridge”; “records from the metal processing system”; “financial records of [Sell & Parker] and Relevant Entities”; “return on investment and cost of capital”; and, “information to assist with reconciliation”.

15. As noted above, the Subpoena was served on Sell & Parker on 19 July 2019.

16. I will briefly note the evidence called in support of the motion and the legislative framework before considering the parties’ respective positions.

Evidence

17. Sell & Parker relies upon a bundle of documents comprising an extract from the judgment referred to above concerning the claim that the earlier summons in each of the proceedings was duplicitous (Secretary, Department of Planning and Environment v Sell & Parker Pty Ltd [2019] NSWLEC 48); an extract from the prosecutor’s written submissions dated 1 March 2019 in relation to the duplicity argument; an extract of the transcript of submissions made by the prosecutor at hearing on 14 March 2019; an amended Schedule to the Subpoena drafted by Sell & Parker (‘Sell & Parker’s Proposed Amended Schedule’); correspondence from Sell & Parker’s solicitors dated 4 September 2018 (seeking particulars of the orders sought pursuant to Pt 8.3 of the POEO Act); and, correspondence from the prosecutor dated 14 September 2018 (stating that notice and details of orders pursuant to Pt 8.3 of the POEO Act will be provided should Sell & Parker enter pleas of guilty or be convicted of the charges).

18. The prosecutor proffers and relies upon a document styled “Further narrowed schedule to Subpoena” (‘Further Amended Schedule’); an earlier amended version of the Schedule with changes earlier proffered by the prosecutor; a document produced by the Environment Protection Authority (‘EPA’) styled “Protocol for calculating monetary benefits” (‘Protocol’); a document produced by the EPA styled “Guidelines on recovering monetary benefits from environmental offenders” (‘Guidelines’); a document produced by the EPA styled “Non-compliance Economic Assessment Tool (NEAT) Model User Guide” (‘NEAT User Guide’); a letter of instruction sent from the prosecutor to KPMG dated 4 July 2019; and a letter from KPMG to the prosecutor dated 19 July 2019. The prosecutor also relies upon an aide memoire (which became Exhibit 8) detailing the basis upon which the documents referred to in each paragraph in the Schedule are required by reference to the EPA documents (Protocol, Guidelines and NEAT User Guide) relied upon by the prosecutor.

19. The Subpoena sought the following documents:

“SCHEDULE

The documents or things you must produce (preferably in electronic format) are as follows:

1.   Any document detailing the organisational structure of:

a.   the Defendant in 2015, 2016 and 2017; and

b.   any other entity, trust, partnership or persons that may have been, or may be expected to be, financially impacted by the Defendant’s offending the subject of the current proceedings (“Related Entities”) in 2015, 2016 and 2017.

2.   Any document detailing the weighbridge records, or similar, from 2015, 2016 and 2017, showing:

a.   the volume of waste (per incoming load) entering the Defendant’s metal recycling facilities at 23-43 and 45 Tattersall Road, Kings Park, NSW (Kings Park Site); and

b.   the volume of waste, processed waste or otherwise (per outgoing load) leaving the Kings Park Site.

3.   Any document, in spreadsheet or delimited text file format, detailing the records from the metal processing system used by the Defendant at the Kings Park Site in 2015, 2016 and 2017, showing:

a.   the daily volume of waste (in tonnes) processed at the Kings Park Site;

b.   the amount of money received (in AUD) for each incoming load of waste; and

c.   the amount of money received (in AUD) for the sale of each outgoing load of waste, processed or otherwise.

4.   The following financial records of the Defendant and Related Entities from 2015, 2016 and 2017, as they relate to the Kings Park Site:

a.   the management accounts, including any workings made to the management accounts to prepare the statutory accounts;

b.   the income tax returns, including any workings to complete the income tax returns; and

c.   the depreciation workings.

5.   Any document explaining the method(s) used by the Defendant in 2015, 2016 and 2017 for reconciling the weighbridge records from the Kings Park Site (referred to in paragraph 2) with the management accounts (referred to in paragraph 4(a)).

6.   Any document explaining the method(s) used by the Defendant in 2015, 2016 and 2017 for reconciling records from the processing system used by the Defendant at the Kings Park Site (referred to in paragraph 3) with the management accounts (referred to in paragraph 4(a)) and the Defendant’s statutory accounts.

7.   The financial records, or any other documents, of the Defendant and Related Entities from 2015, 2016 and 2017 detailing:

a.   the costs associated with receiving and processing waste at the Kings Park Site;

b.   the gross profit associated with receiving and processing waste at the Kings Park Site;

c.   the other profit and loss accounts associated with receiving and processing waste at the Kings Park Site including, but not limited to:

i.    administrative expenses;

ii.   facilities maintenance;

iii.   yard maintenance;

iv.   transportation costs;

v.    machinery costs; and

vi.   employee costs.

d.   general ledger records and any manual journals for the financial records (referred to in paragraphs 7(a), (b) and (c)).

8.   Any document of the Defendant and Related Entities detailing:

a.   the return on investments (including bank deposits) of funds used outside of the Defendant’s business operations at the Kings Park Site in 2015, 2016 and 2017; and

b.   any debts associated with the Defendant’s business operations at the Kings Park Site in 2015, 2016 and 2017 including loan amounts, interest rates and payment terms.

9.   The statutory financial accounts of any Related Entities for 2015, 2016 and 2017.

In this Subpoena, references to ‘document’ includes, but is not limited to charts, tables, notes, records, reports, data, emails, letters, electronic messages, working notes, diary entries, memoranda, statements, ledgers, balance sheets and accounted records (whether they are in electronic format or not).”

20. As will be seen, at hearing, the Court received three further versions of the Schedule. The prosecutor amended its original Schedule prior to and again at hearing, with the final version being Exhibit 1 (the “Further Amended Schedule”) noting changes to each of the paragraphs in the Schedule. Sell & Parker proffered a version of the Schedule which, as will be seen, it submits would be appropriate if its primary argument in relation to the forensic purpose of the Subpoena was not accepted by the Court.

Legislative framework

21. In order to consider the parties’ respective positions, an understanding of the legislative framework is necessary.

22. Section 249 of the POEO Act provides:

Part 8.3 Court orders in connection with offences

…

249   Orders regarding monetary benefits

(1)   The court may order the offender to pay, as part of the penalty for committing the offence, an additional penalty of an amount the court is satisfied, on the balance of probabilities, represents the amount of any monetary benefits acquired by the offender, or accrued or accruing to the offender, as a result of the commission of the offence.

(2)   The amount of an additional penalty for an offence is not subject to any maximum amount of penalty provided elsewhere by or under this Act.

(2A) The regulations may prescribe a protocol to be used in determining the amount that represents the monetary benefit acquired by the offender or accrued or accruing to the offender.

(3)   In this section—

monetary benefits means monetary, financial or economic benefits.

the court does not include the Local Court.

23. I note that although monetary benefits orders have been available since the commencement of the POEO Act, no court in NSW has considered or imposed a monetary benefits order.

24. Apart from the POEO Act, I note that, at the time of this judgment, similar provisions for monetary benefits orders exist in other NSW legislation such as: Contaminated Land Management Act 1997 (NSW) s 95A; Dangerous Goods (Road and Rail Transport) Act 2008 (NSW) s 51; Pesticides Act 1999 (NSW) s 98; Radiation Control Act 1990 (NSW) s 23A; Biodiversity Conservation Act 2016 (NSW) s 13.24; Biosecurity Act 2015 (NSW) s 297; Crown Land Management Act 2016 (NSW) s 11.15; Local Government Act 1993 (NSW) s 490C; Mining Act 1992 (NSW) s 378ZD; National Parks and Wildlife Act 1974 (NSW) s 204; Petroleum Onshore Act 1991 (NSW) s 125ZG; and, Water Management Act 2000 (NSW) s 353F.

25. Part 8.3 of the POEO Act (which includes s 249) also applies to the EPA Act; Environmentally Hazardous Chemicals Act 1985 (NSW); Ozone Protection Act 1989 (NSW); and, Waste Avoidance and Resource Recovery Act 2001 (NSW).

26. Unlike a number of the above acts in [24]-[25] above, the POEO Act provides an additional layer of control by specifically prescribing a methodology for the calculation of monetary benefits pursuant to s 249(2A).

27. Clause 101A of the Protection of the Environment Operations (General) Regulation 2009 (NSW) (‘Regulation’), as enacted by the Protection of the Environment Operations (General) Amendment (Calculating Amount of Monetary Benefits) Regulation 2019 (NSW) on 25 January 2019, provides:

101A    Protocol for determining amount representing monetary benefits

For the purposes of section 249(2A) of the Act, the document entitled Protocol for calculating monetary benefits, prepared by the EPA and published in the Gazette, as in force from time to time, is prescribed.

28. Thus, on 25 January 2019 the EPA’s Protocol, which had been gazetted on 7 September 2018, was prescribed as the relevant protocol for determining the amount representing monetary benefits pursuant to cl 101A of the Regulation. According to the Protocol’s “Purpose and introduction”, the Protocol contains “a calculation method which outlines step-by-step the equations and relationships to be applied to complete a calculation of a monetary benefit” and that the Protocol outlines the principles underpinning this calculation method.

29. The EPA has also prepared the Guidelines as gazetted on 7 September 2018 and, the NEAT User Guide. The introduction to the Guidelines states that the document addresses, inter alia, why monetary benefits should be recovered; how the EPA investigates and calculates monetary benefits; and, how non-accountants can calculate monetary benefits. Clause 1.1 of the NEAT User Guide states that it is an “analytical tool” designed to quantify economic benefits that may accrue from non-compliance with environmental laws such that it may be presented as evidence to a court or judicial body regarding the basis of calculation of those benefits.

Sell & Parker’s submissions

30. Sell & Parker makes a global objection to the entirety of the Subpoena and submits that it amounts to a “fishing expedition” and is therefore without a legitimate forensic purpose.

31. Sell & Parker relies on the analysis of Nicholas J in ICAP Pty Ltd v Moebes [2009] NSWSC 306 (‘ICAP v Moebes’), where at [33] his Honour stated:

“Demonstration of the legitimate forensic purpose of a subpoena necessarily depends upon identification of the case for which it is likely the documentation will assist. It is, therefore, necessary that the issue be clearly identified in the pleadings or particulars as it is the point of reference by which the legitimacy of the subpoena is to be determined. The task in meeting the test will become difficult where the issue relied upon cannot be identified because either it has not been included in the pleading or particulars, or the terms in which it has been expressed are obscure and imprecise.”

32. Sell & Parker submits that a monetary benefits order was not an issue identified in the pleadings. Sell & Parker further submits that the prosecutor by its own admission has not decided whether a monetary benefits order is in issue, but instead is seeking documents in order to decide whether to make it an issue in the proceedings. Sell & Parker also notes the fact that the prosecutor seeks orders under Pt 8.3 of the POEO Act in the Summons, does not raise monetary benefits as an issue in each of the proceedings.

33. Sell & Parker further submits that the Subpoena seeks documents on the premise that Sell & Parker has been charged with offences of processing when it has not been. Sell & Parker notes that the charges advanced by the prosecutor were specifically in relation to the receipt, but not the processing, of waste and, therefore, submits that the prosecutor cannot now use a subpoena to fish for documents relating to the processing of waste, having made the forensic decision to not include that aspect in the charges.

34. In advancing this submission, Sell & Parker relies on the De Simoni principle (from R v De Simoni (1981) 147 CLR 383; [1981] HCA 31), which it submits stands for the proposition that an offender should not be punished for an offence of which the person has not been convicted. As such, Sell & Parker submits that it should not be punished for what it submits is the separate offence of processing waste in breach of a development consent, as opposed to the offence of receiving waste with which it has been charged and to which it has pleaded guilty. Sell & Parker submits that, irrespective of the fact that the obligations of “receiving” and “processing” are found within the same condition of the Development Consent, they are nonetheless separate obligations and may therefore be considered as two separate offences.

35. Sell & Parker further submits that the Subpoena seeks material relating to actions which took place after the receipt of waste, including the processing of waste, and does not relate to the monetary benefits obtained from receiving the waste. As such, Sell & Parker submits that an “artificial barrier” has been created between the two offences such that, although there can be monetary benefits from the receipt of waste, there must be a legal severance of any monetary benefits arising from the processing of waste.

36. Sell & Parker draws a comparison between the present case and the circumstances in R v Olbrich (1999) 199 CLR 270; [1999] HCA 54, where the majority (Gleeson CJ, Gaudron, Hayne and Callinan JJ) distinguished the act of importing prohibited drugs from the sale of drugs following importation, noting that the offender could not be sentenced in relation to the sale of the prohibited drugs as this amounted to the commission of other offences with which the offender had not been charged. Sell & Parker also relies on the comments of Simpson J in Harris v Harrison (2014) 86 NSWLR 422; [2014] NSWCCA 84 (‘Harris v Harrison’) at [81]-[82] to support the proposition that consequences flowing from the commission of a separate offence must be artificially severed from the offence charged.

37. Sell & Parker submits that the De Simoni principle is grounded upon notions of fairness and, in light of the fact that pleas may be decided on the basis of prospective penalties and may therefore have been different if the defendant was aware that it could be subject to a penalty associated with a higher charge, the principle cannot be derogated from as to do otherwise would therefore result in the punishment of an offender for an offence which they have neither been convicted of or charged with: Environment Protection Authority v Snowy Hydro Ltd (2008) 162 LGERA 273; [2008] NSWLEC 264 at [145]-[146] (citing Kirby P (with which Carruthers and Sully JJ agreed) in R v Booth (Court of Appeal (NSW), 12 November 1993, unrep)).

38. In addition to its global objection to the Subpoena, Sell & Parker makes the following submissions in relation to various paragraphs in the Schedule.

39. First, in relation to all paragraphs, documents from 2015 have no relevance to any issue in either proceeding. Sell & Parker submits that, as 2015 falls outside the charge periods identified in each of the Summons, there is no forensic purpose for this information and the request constitutes an abuse of process.

40. Second, the definition of “Related Entities” (in pars 1(b), 4, 7, 8 and 9) is so widely and imprecisely framed that no person in the position of Sell & Parker could reasonably be expected to make evaluative judgments in relation to the scope of documents required to be produced. Further, Sell & Parker submits that it should not be required to produce the financial records of related entities and, further, it is not evident that the return on investments of related entities will have any bearing and is therefore a matter of speculation.

41. Third, in relation to pars 2 and 5, material relating to “weighbridge records” for 2016 and 2017 has already been provided to the prosecutor and the request is therefore an abuse of process. The material already provided is extensive and there is no suggestion that the material is not accurate or comprehensive and to request this information again would place an unnecessary burden on Sell & Parker.

42. Fourth, Sell & Parker repeats its submissions above in relation to the lack of a forensic purpose for documents relating to the “processing” of waste, specifically in relation to pars 2, 3, 6 and 7.

43. Fifth, the production of records “detailing” financial matters pertaining to return on investments and debts in par 8 is framed so widely and imprecisely that compliance would be oppressive and, further, would serve no forensic purpose.

44. Sell & Parker disputes the prosecutor’s submission that Parliament clearly intends for monetary benefits orders to be available. Sell & Parker submits that the actions of Parliament in relation to monetary benefits orders only extended to enacting s 249 of the POEO Act and s 9.47 of the EPA Act and that Parliament did not promulgate any regulations, protocols, guidelines or the NEAT model. Further, Sell & Parker submits that the only document that has been prescribed is the Protocol, and that the act of gazettal is not an action taken by Parliament but instead an administrative action of the Executive.

45. Sell & Parker notes that the prosecutor is effectively now seeking the Court’s leave to issue or amend the Subpoena in the form proffered by the prosecutor at hearing. Similarly, Sell & Parker provides to the Court a proposed amended Schedule to the Subpoena (“Sell & Parker’s Proposed Amended Schedule”) which, it submits would be accepted if Sell & Parker’s global objection was not accepted by the Court.

Prosecutor’s submissions

46. The prosecutor submits that as each Summons specifically refers to the prosecutor seeking such orders pursuant to Pt 8.3 of the POEO Act “as the Court sees fit to make”, Sell & Parker’s submission that the pleadings did not refer to an order under s 249 is inaccurate.

47. The prosecutor accepts that it holds the onus of identifying the legitimate forensic purpose for which the access to the documents is sought.

48. The prosecutor notes the comments of Craig J in Azar Building and Construction Services Pty Ltd v Transport Infrastructure Development Corporation [2010] NSWLEC 110 (‘Azar’) in submitting that an issue in the proceedings must first be identified and that the documents sought must be relevant to that issue in order for a legitimate forensic purpose to be found.

49. The prosecutor submits that, although evidence may be required to show a legitimate forensic purpose, a formal exposition of that purpose is not necessary in every case where the judge is able to see clearly the legitimate forensic purpose. The prosecutor submits that it is obvious that Sell & Parker obtained monetary benefits from its offending by reference to the nature of its business, and that the issue in proceedings is instead the extent of the monetary benefits which Sell & Parker obtained from its offending. The prosecutor submits this issue is relevant to both whether the offences were committed for financial gain pursuant to s 21A(2) of the Crimes (Sentencing Procedure) Act 1999 (NSW) and, further, whether the Court is empowered to make a monetary benefits order pursuant to s 249 of the POEO Act. The Court is entitled to take into account a likely financial advantage: Director-General Department of Environment and Climate Change v Wilton [2008] NSWLEC 297 at [76].

50. The prosecutor submits that the Subpoena is not a fishing expedition for the following reasons: first, it is clearly the intention of Parliament that monetary benefits orders should be available to regulators pursuant to s 249 of the POEO Act, especially in the light of recent clarification in relation to calculation methodology; second, the prosecutor has been attempting to obtain financial information from Sell & Parker since January 2018 to determine whether it would pursue a monetary benefits order, and therefore, the material requested in the Subpoena should not come as a surprise and, in any event, is being sought in the most economic, accurate and transparent way possible; third, the Schedule has been drafted as narrowly as possible given the advice received from KPMG, which is familiar with the calculations required in relation to monetary benefits; and fourth, it is “on the cards” that the documents sought, which the prosecutor knows Sell & Parker has, will materially assist in determining the extent of any monetary benefits derived from the receipt of waste.

51. Sell & Parker submits that the Subpoena has been drafted strictly in accordance with the expert advice received from KMPG which is before the Court and points to both the aide memoire prepared by the prosecutor (Exhibit 8) which it submits demonstrates the necessity of each paragraph in the Schedule by reference to the requirements in the Guidelines, Protocol and NEAT User Guide; as well as a letter from KMPG to the prosecutor dated 19 July 2019 (Exhibit 7), which details the information KPMG requires to conduct an assessment of monetary benefits accrued or accruing.

52. The prosecutor submits that it knows that Sell & Parker has the documents which have been outlined in the Subpoena, and submits that the fact that the prosecutor does not know the contents of those documents is not a requirement of an issuing party. For example, the prosecutor submits that it knows that Sell & Parker has weighbridge records because these have been provided to the prosecutor previously.

53. The prosecutor also submits that Sell & Parker’s website contains information regarding a particular accounting program (referred to as “Scrap Assist”) which can, in the words of the prosecutor, “generate every conceivable report a company may require to monitor its scrap production and control the revenue in either printouts or as an Excel file” (Tcpt, 4 September 2019, p 43(21-23)).

54. The prosecutor submits that, bearing in mind that this case is the first occasion upon which a monetary benefits order has been sought by a prosecutor, and considering the efforts of Parliament to establish protocols for calculating monetary benefits, that these factors support the submission that there is a legitimate forensic purpose for seeking the documents.

55. The prosecutor further submits that it would set an unfair precedent to dismiss the Subpoena on the basis that a decision had not been made by the prosecutor as to whether to pursue a monetary benefits order. To set aside the Subpoena would lead to a result where, the prosecutor submits, in future cases: the prosecutor would be required to state it is seeking a monetary benefits order, undoubtedly causing a defendant stress; issue the necessary subpoenas; run the monetary benefits calculations; exercise prosecutorial discretion as to whether to continue to seek the order; and then, after the many months which the aforementioned process would take, either then pursue that on a sentence hearing or have the order fall away. Whilst this occurs, a defendant would no doubt be expending money to collect data, possibly engage experts, and run their own monetary benefits calculations in preparation for what they would therefore anticipate the order to be at sentence. The prosecutor submits that requiring the prosecutor to comply with such a process when seeking a monetary benefits order would be prejudicial.

56. In addition, the prosecutor submits that the public interest in allowing the pursuit of a monetary benefits order through the issuing of the Subpoena outweighs any burden compliance placed upon Sell & Parker. Such an order would ensure that operators who do not comply with the law do not gain a competitive advantage or treat fines imposed by the Court as a cost of business.

57. In accepting that Sell & Parker has been charged with the receipt, but not the processing, of waste, the prosecutor submits that it is not seeking the documents in an attempt to have Sell & Parker punished for an act with which it has not been charged. Rather, the prosecutor submits that it is seeking the material in order to consider whether to seek an order under s 249 of the POEO Act, which are “additional penalties” and, as such, a monetary benefits order can be made even when there is no primary penalty imposed.

58. The prosecutor submits that the De Simoni principle is not applicable as there is no separate offence in relation to the processing of waste, and that the distinction between receipt and processing was instead contained within a specific condition of the Development Consent. Instead, the distinction between receiving and processing of waste is a matter which affects the objective seriousness of the offences as it only had the quality of “receiving”. Irrespective of this distinction, the prosecutor notes that it nonetheless needs Sell & Parker to provide material beyond simply information about the waste it received, as it is necessary to follow what happened to the waste after its receipt in order to determine, by way of example, whether the waste was stockpiled (or otherwise not sold), whether it was sold unprocessed, or whether it was sold in the 2018 financial year.

59. In relation to Sell & Parker’s submissions regarding the discrete paragraphs in the Schedule, the prosecutor submits that, first, although weighbridge records have already been provided by Sell & Parker and include information relating to the weight of scrap metal and the vehicle, the records provided do not include the amount of money Sell & Parker paid or received for the incoming or outgoing loads.

60. Second, the prosecutor submits that the term “Related Entities” does not have the meaning to which Sell & Parker refers. The prosecutor submits that it is clear that Sell & Parker is part of a group of companies and therefore such a request has a legitimate forensic purpose; and, further, that the Further Amended Schedule is not seeking financial documents from every related entity, but only those which have benefited from Sell & Parker’s offending. Further, the prosecutor submits it is necessary to trace what happened to the unlicensed tonnage and any profits made from it.

61. Third, in relation to Sell & Parker’s submission that documents relating to 2015 are irrelevant, the prosecutor notes that 2015 was included so as encompass any variation in financial year ends across Related Entities but has nonetheless now narrowed the date references where possible in the Further Amended Schedule.

62. Fourth, the prosecutor clarifies that its reference to the “metal processing system” relates to the computer program/system used by Sell & Parker to record profits for each load of incoming and outgoing waste. Regardless, the prosecutor submits that the Further Amended Schedule has narrowed paragraph 3 by deleting reference to the metal processing system. The prosecutor maintains that this information is relevant to the identification of profits which would not have otherwise been made but for the commission of the offences.

63. Fifth, the prosecutor submits that requesting records “detailing” financial matters pertaining to debts and return on investments is not framed so widely that it is oppressive or does not serve a forensic purpose. The prosecutor notes that this information is relevant to the identification and assessment of incremental profits and is a required component of the relevant monetary benefits calculations, and without this information assumptions will need to be made about the rate of return which would be less accurate. As such, the prosecutor submits that there is a clear forensic purpose.

64. Sixth, the prosecutor submits that the Subpoena would not be oppressive to Sell & Parker because it has the necessary capacity to comply with the Subpoena as a large private company which already prepares financial statements. Further, the prosecutor notes that no evidence has been marshalled by Sell & Parker indicating the extent to which the Subpoena would be oppressive.

Consideration

65. As Sell & Parker submits that the Subpoena (and each paragraph contained therein) lacks a legitimate forensic purpose, it is necessary to consider, first, whether the Subpoena relates to an issue in the proceedings; and, second, whether the documents sought in the Schedule have a sufficient connection to that issue. It is then necessary to consider Sell & Parker’s objections to the paragraphs in the Schedule.

Legitimate forensic purpose

66. The relevant legal principles which I keep in mind in dealing with the respective submissions were succinctly stated by Ward CJ in Eq in Rinehart v Rinehart [2018] NSWSC 1102 (‘Rinehart’) at [43]-[48]:

“[43] As to what is a legitimate forensic purpose for the issue of compulsory process of this kind (subpoenas or, as considered in some of the cases, notices to produce), the Court of Appeal in ICAP Australia Pty Ltd v BGC Partners (Australia) Pty Ltd [2009] NSWCA 307, held that the primary judge had not erred by stating that, for a notice to produce to have a legitimate forensic purpose:

… it must be shown that it is likely the documentation will materially assist on an identified issue, or there is a reasonable basis beyond speculation that it is likely the documentation will.

[44] Determining whether there is a legitimate forensic purpose requires reference to the particular case, or identified issue, that the documentation sought is reasonably expected to be likely to assist, as observed by Nicholas J in ICAP Pty Ltd v Moebes [2009] NSWSC 306 (at [33]):

… the legitimate forensic purpose of a subpoena necessarily depends upon identification of the case which is likely the documentation will assist. The task in meeting the test will become difficult where the issue relied upon cannot be identified because either it has not been included in the pleadings or particulars, or the terms in which it has been expressed are obscure and imprecise.

[45] In Portal Software International Pty Ltd v Bodsworth [2005] NSWSC 1115, Brereton J described the relevant test (in considering whether to set aside the notice to produce that had there been issued) as being (see at [24]) whether the documents sought have “a sufficient apparent connection to justify their production or inspection” (citing White v Tulloch (1995) 127 FLR 105; 19 Fam LR 696). His Honour said that the test of adjectival relevance (i.e., as distinct from substantive relevance) will be satisfied if the material has apparent relevance and is established if the documents called for “could possibly throw light on the issues in the main case” (at [24]), citing Trade Practices Commission v Arnotts Ltd (No 2) [1989] FCA 340; 21 FCR 306).

[46] More recently, Gleeson JA, in In the matter of Force Corp Pty Ltd (Recs and Mgrs Apptd) (in liq) [2018] NSWSC 896 described the permissible scope of a subpoena for production of documents as directing attention to the apparent relevance of the documents sought (see at [22]).

[47] Whether the formulation of the test in civil proceedings is best expressed as an “on the cards” test (i.e., that it is on the cards that the documents sought will materially assist on an identified issue) (see the use of that expression in criminal proceedings in Alister v R (1984) 154 CLR 404; [1984] HCA 85; R v Saleam (1989) 16 NSWLR 14, at 18; Attorney-General (NSW) v Chidgey [2008] NSWCCA 65), or that the material could “possibly throw light on” an identified issue (see Trade Practices Commission v Arnotts Ltd (No 2); or as formulated by Nicholas J in ICAP Pty Ltd v Moebes at [30] (namely, that “it must be shown that it is likely the documentation will materially assist on an identified issue, or there is a reasonable basis beyond speculation that it is likely that the documentation will [materially assist]”), what is ultimately required is an assessment as to the relevance of the documents sought by reference to the issues in the proceedings (see Cosco Holdings Pty Ltd v Federal Commissioner of Taxation (Cth) [1997] FCA 1504; 37 ATR 432 at 439-440 per Spender J; Nicholls v Michael Wilson and Partners Limited [2010] NSWCA 100 per Young JA).

[48] Where there is no legitimate forensic purpose, in that sense, for the issue of a subpoena then it may readily be seen to be a fishing expedition. As to what is meant by a “fishing expedition”, in Associated Dominions Assurance Society Pty Ltd v John Fairfax & Sons Pty Ltd (1952) 72 WN (NSW) 250, at 254, it was said:

A “fishing expedition”, in the sense in which the phrase has been used in the law, means, as I understand it, that a person who has no evidence that fish of a particular kind are in a pool desires to be at liberty to drag it for the purpose of finding out whether there are any there or not. If, however, there is material before the Court pointing to the probability that a party to litigation has in his possession documents tending to destroy his case or to support the case of his opponent and that privilege from inspection of such documents has been wrongly claimed, an application by that opponent to be allowed to inspect them cannot properly be described as a mere “fishing expedition”.

…”

67. While I respectfully adopt the analysis of Ward CJ in Eq in Rinehart and note that the principles have been frequently considered and applied (including by this Court in Azar at [20] and recently in Verde Terra Pty Ltd v Central Coast Council [2019] NSWLEC 166 at [71]), on the basis as considered below that there is an identified issue, the relevant test can be formulated as whether it is “on the cards” the documents would materially assist in relation to the identified issue; whether the material “could possible throw light on” the identified issue; or whether it can be shown that there is a likelihood (or a reasonable basis beyond speculation that there is a likelihood) that the documentation will materially assist on that identified issue.

68. The two-step process, that is the establishment of a legitimate forensic purpose and that it is “on the cards” that the document will materially assist a party’s case, is now well established in both civil and criminal proceedings: R v Saleam (1989) 16 NSWLR 14 at 18, Alistair v R (1984) 154 CLR 404 at 414; [1984] HCA 85, Attorney-General (NSW) v Chidgey (2008) 182 A Crim R 536; [2008] NSWCCA 65 at [64].

69. In applications to set aside subpoenas the usual course is that the Court requires the articulation of the legitimate forensic purpose for which the challenged documentation is sought. In some cases, the purpose does not become apparent until the trial has been underway: R v Saleam (1989) 16 NSWLR 14; (1989) 39 A Crim R 406 at 18, National Employers' Mutual General Insurance Association Ltd v Waind and Hill [1978] 1 NSWLR 372 at 385.

70. With respect to the detailed submissions made, the essential matter for consideration is whether there is, or has been, an identified “issue” in circumstances where Sell & Parker does not accept that the identification of the prosecutor’s intention to seek an order pursuant to Pt 8.3 of the POEO Act in each Summons (and/or the correspondence that has taken place between the parties) satisfies the identification requirement.

71. I note that in the Summons in each proceeding, the prosecutor sought relief which relevantly included:

“Such orders under Part 8.3 of the Protection of the Environment Operations Act 1997 as the Court sees fit to make.”

72. Part 8.3 of the POEO Act contains various categories of order which become available to the Court once a conviction has been recorded against an offender. This includes orders regarding monetary benefits pursuant to s 249.

73. I have formed the view that, for the reasons to follow, the Summons and the intercourse between the parties at least raised an issue that the prosecutor was, albeit subject to further action and consideration, contemplating seeking a discrete monetary benefits order pursuant to pt 8.3 of the POEO Act. As such, and contrary to Sell & Parker’s position, I consider that in the circumstances, that the issue has been sufficiently identified.

74. As the prosecutor submits, not only was relief of this nature mentioned in the Summons, but related information was also the subject of two notices issued to Sell & Parker (on 23 October 2017 and 30 January 2018) pursuant to s 119J (now s 9.22) of the EPA Act (albeit that such notices were at the time disputed by Sell & Parker). These notices related to information that was required to be produced in connection with an investigation (including information regarding financial records and revenue received for the processing of waste), and was specifically referred to in correspondence between the parties both prior to and following Sell & Parker’s guilty plea in each proceedings.

75. In Sell & Parker’s solicitors’ letter to the prosecutors’ solicitors of 4 September 2018, “further and better particulars” were sought of the “particular orders” that the prosecutor was seeking pursuant to Pt 8.3 of the POEO Act.

76. By letter of 14 September 2018, the prosecutor’s solicitors declined to provide details on the basis that “Particulars do not extend to the identification of specific orders that might be sought upon conviction” and directed Sell & Parker’s solicitors to par 34(f) of the Land and Environment Court Practice Note relating to Class 5 proceedings dated 29 March 2018 (‘Class 5 Practice Note’), which provided, inter alia, that upon the entering of a plea of guilty, the Court may direct “the prosecutor to give to the defendant notice and details of any orders in connection with the offence that the prosecutor will be seeking for the Court to make (such as orders under Part 8.3 of the Protection of the Environment Operations Act 1997) if the Court finds the offence proved”.

77. By letter of 19 September 2018 to the prosecutor’s solicitors, Sell & Parker’s solicitors indicated that their client would be “significantly prejudiced” if it was required to enter a plea in the proceedings without knowing the specific orders in Pt 8.3 of the POEO Act and that par 34(f) of the Class 5 Practice Note did not provide a basis for the prosecutor to withhold particulars. In the circumstances, the solicitors indicated that Sell & Parker would not be in a position to enter a plea at the first mention of the proceedings on 21 September 2018.

78. By letter to Sell & Parker’s solicitors of 20 September 2018, the prosecutor’s solicitors responded:

“We note that the Prosecutor will not be in a position to specify the orders it will seek, until such time as there has been a plea of guilty (or a finding of guilt), and it is able to properly consider all material relevant to any such orders ... In this respect, we remind you that your client still has not complied with the notice issued to Sell & Parker Pty Ltd, pursuant to section 119J of the Environmental Planning and Assessment Act1979 and dated 30 January 2018 (Notice). It is likely that the Defendant’s response to the Notice will be relevant to orders that may be sought by the prosecutor.

...

Whether any further orders are sought by the Prosecutor pursuant to Part 8.3 of the Protection of the Environment Operations Act 1997 on entry of a guilty plea will be [sic] depend, in part, on information not yet available to the prosecutor, but which may be in the future, whether through your client’s eventual response to the Notice, or other processes of the Court.”

79. Shortly before the entering of the plea of guilty in each matter, by further letter dated 26 June 2019 from the prosecutor’s solicitors to Sell & Parker’s solicitors, the prosecutor’s solicitors stated:

“The Prosecutor is considering its position in relation to the orders it will seek under Part 8.3 of the Protection of the Environment Operations Act 1997 (POEO Act) in these proceedings. In particular, the Prosecutor may consider seeking a monetary benefit order pursuant to s249 of POEO Act in these proceedings.

In order to determine if such an order will be sought, the Prosecutor requires the information sought in the outstanding notice issued to Sell & Parker Pty Ltd pursuant to s119J of the Environmental Planning and Assessment Act 1979 dated 30 January 2018 (Outstanding Notice). As provided in our letter of 20 September 2018, it is likely that the Defendant’s response to the Outstanding Notice will be relevant to orders that may be sought by the Prosecutor on sentence.”

80. The further letter of 19 July 2019 detailing the prosecutor’s position from the prosecutor’s solicitors to Sell & Parker’s solicitors is noted above at [12].

81. As I understand the position, it is accepted by Sell & Parker that the correspondence provided particulars that the prosecutor was seeking a publication order and recovery of investigation costs, however Sell & Parker raises a concern in relation to the monetary benefits order. As stated by senior counsel for the prosecutor (Tcpt, 4 September 2019, p 23(27-35)):

“On 19 July, your Honour having made the direction that the prosecutor indicate what orders it would be seeking, the prosecutor did indicate for example that it would be seeking publication order and recovery of investigation costs. If there were a subpoena issued that had a material connection to those identified issues we couldn’t argue on the question of forensic purpose. And that rather highlights the distinction between those two issues which were identified by reason of the prosecutor seeking the orders and this one which, because of the way the prosecutor has carried the matter, is really in the category of they would like to know whether to make it an issue.”

82. The comment in the second sentence above is important. Publication orders and orders for recovery of investigation costs, like monetary benefits orders, are contained within Pt 8.3 of the POEO Act. As there is no specific reference to a publication order or recovery of investigation costs order in the Summons, the basis for requesting these orders must, like the monetary benefits order, be derived from the request for “Such orders under Part 8.3 of the [POEO] Act as the Court sees fit to make”. As such, while I understand that Sell & Parker may be concerned with indecision on the part of the prosecutor, the only point of difference between the manner in which the publication order and monetary benefits order have been dealt with in the proceedings is how the orders sought has been expressed in correspondence between the parties.

83. While I note Sell & Parker’s submission, based on the comments of Nicholas J in ICAP v Moebes at [33], that the expression of the order and/or relief is “obscure and imprecise”, I do not consider that a reference to “such orders under Part 8.3 of the Protection of the Environment Operations Act 1997 as the Court sees fit to make” is so obscure or imprecise that a discernible issue has not been identified. In forming this view, I am conscious that the prosecutor, in correspondence between the parties both prior to and following the entry of guilty pleas on 28 June 2019, maintained that in order to determine whether it should seek a monetary benefits order, it “needs to calculate whether [Sell & Parker] obtained any monetary benefits from the offending to which it has pleaded guilty”.

84. In summary, while Sell & Parker maintains its submission that the fact that the prosecutor, by its own admission, has not decided whether a monetary benefits order is to be sought, but it is simply seeking documents in order to so decide, is indicative, if not decisive, that an “issue” has not been raised, I do not consider that this is determinative. Again, apart from the matters above, and accepting that there is little judicial consideration of s 249 of the POEO Act, it is difficult to see how a prosecutor could, at the time of a summons, determine whether a monetary benefits order will be sought. In this regard, the position is not dissimilar to the seeking of a publication order or indeed an order to recoup investigation costs. It is obvious that the type of order now being considered by its very nature requires information, primarily of a financial nature, that relates to the offending. Furthermore, and again not determinative in my view, the specific type of information required would likely only reside with an offender.

85. While Sell & Parker emphasise, and again the prosecutor accepts, that the prosecutor has not decided whether it will seek a monetary benefits order and that this circumstance itself renders the Subpoena piscatorial, I do not consider this to be the case. While in some circumstances an acceptance of the fact that a party has not decided to seek a specific order (such as a monetary benefits order) may be significant, I do not consider that it is determinative that the request for the production of certain material does not constitute a legitimate forensic purpose. On the facts before the Court, in particular the fact that an indication had been given that an order under Pt 8.3 of the POEO Act (even without further identification) will be sought, does in my view sufficiently identify the issue.

86. The above analysis requires consideration of the weight to be given to the Protocol, as prescribed by cl 101A of the Regulation. Both parties made submissions in relation to the extent to which the prescription of the Protocol (and the gazettal of the Guidelines) reflected the public interest and intentions of Parliament (and/or the Executive), and the consequential weight to be attributed to these actions.

87. I accept that the Protocol must be given some weight as it is, in effect, subordinate legislation, however I do not consider that this aspect should obfuscate the otherwise well-settled requirements that documents sought under a subpoena must nonetheless have a legitimate forensic purpose, be sufficiently connected to that purpose, and not be oppressive in the circumstances. Where the Protocol is of some assistance, however, is in the fact that the Protocol stipulates the formula which the prosecutor will use to base its claim (if any) for a monetary benefits order. This, in turn, makes clear the forensic purpose of documents sought under the Subpoena on the basis that they are required by the Protocol to complete the calculations which will form the basis of the prosecutor’s claim. However, these considerations should not, in my view, override the requirements noted above that a subpoena should not be oppressive in the circumstances.

Application of De Simoni principle

88. Although, as accepted by the prosecutor, Sell & Parker has only been charged with offences in relation to the receiving, and not the processing, of waste, I do not consider the De Simoni principle to be applicable at this stage of the proceedings.

89. The primary question is whether the Subpoena was issued for a legitimate forensic purpose and, as I have noted above, the legal tests to be applied are relatively well settled. Although I accept that the De Simoni principle may have application at the time of sentencing, as the intended purpose of the principle is to prevent an offender from being punished for offences with which they have not been charged, I do not consider that the principle has discrete application when considering whether a subpoena should be set aside.

90. Sell & Parker relies on certain comments of Simpson J in Harris v Harrison at [81], where her Honour stated:

“... It is true that it is almost impossible to disentangle the offence of tampering with the meter from its consequences in the taking of unmetered water. The seriousness of those consequences depends upon the extent (if any) to which the appellant in fact used the water for irrigation rather than for domestic or stock purposes. Actual environmental harm cannot be caused by a mere intention to do something, whether lawful or unlawful. Nor can the equitable sharing system be upset by an intention to do something unlawful. These consequences, if they existed, would have resulted from an offence different from that with which the appellant was charged. What he in fact did with the water formed no part of the prosecution case...”

91. Her Honour continued at [82]:

“Moreover, to treat the consequences of the offence as including the unlawful taking of water comes dangerously close to contravening the rule in The Queen v de Simoni [1981] HCA 31; 147 CLR 383. I accept, as was pointed out by senior counsel for the respondent, that any additional offence that might be applicable such as, for example, offences against s 91A (unauthorised taking of water), s 91B (unauthorised use of a water supply work) and s 91H (failure to install or maintain metering equipment as required) are all "Tier 2" offences, and therefore of lesser gravity than a s 91K offence, and not strictly within the de Simoni principle. However, care must be taken to ensure that an offender is not punished for an offence which is not charged.”

92. I do not consider that her Honour’s comments are apposite to the present application. Her Honour was considering an appeal against orders made on sentence which required consideration of a number of provisions under the Water Management Act 2000 (NSW) and she was addressing a concern that the trial judge had wrongly taken into account the consequences of an offence which involved the unlawful tampering with a water meter. In considering the trial judge’s findings with respect to objective gravity, her Honour accepted that the trial judge had treated the offence not as one of tampering with a water meter but of taking water unlawfully, and as such, resulted in the offender being sentenced for an offence “different” from that which the offender was charged. The situation here is quite different. The prosecutor is seeking the material in order to determine the extent of any monetary benefits which accrued from the excess tonnage and, further, how the waste received in excess of the 90,000 tonne limit was used.

92. Further, I do not consider that the De Simoni principle is properly applied at this stage in the proceedings on the basis that the Subpoena may call for documents that could possibly prove or go to an offence for which Sell & Parker has not been charged. The correct test to be applied in determining whether documents sought by a subpoena are relevant to a legitimate forensic purpose, as noted above, is whether material sought is reasonably expected to be likely to assist.

93. It is particularly important to note that the mere fact that documents may be sought in a subpoena does not bear upon on their admissibility at a later stage in proceedings. While it is trite to note that it is a matter for the Court in conducting the sentence hearing to determine what material is to be admitted, care must be taken not to conflate these independent considerations.

94. In Sood v R [2006] NSWCCA 252 McClellan CJ at CL (with whom Adams and Latham JJ agreed), in dismissing an application to set aside a subpoena for lack of a legitimate forensic purpose, noted at [16]-[17] that the admissibility of the documents sought in the subpoena was not relevant to determining whether a subpoena ought to be set aside:

“[16] ... Although it is correct that the full facts of the previous events are not known, the essence of the allegations are such that the subpoena can, in my view, be justified. Whether the material revealed from the Australasian Medical Insurance file will justify its admission at the trial, as going to the applicant’s character, assuming that is in issue, will depend upon the documents which are produced. However, from the material presently available, his Honour was correct, in my view, to conclude that it was on the cards that the file would contain material of assistance to the Crown case.

[17] I am also satisfied that the file may contain material which demonstrates from the history of the prior events that the applicant knew of the risks involved in administering Prostaglandin drugs, and the precautions which should be taken in relation to the health of the patient. Whether the material will be admissible at the trial is not a matter for this Court.”

96. In this respect, I consider that some similarity may be drawn between the present case and the comments of Jagot J in Jack Brabham Engines Limited v Beare [2010] FCA 35 where her Honour stated at [27]:

“I accept, however, that there might be other issues upon which I will have to rule. I have in mind that orders for access are capable of being framed to ameliorate potential prejudice to a person or party, some of which have been raised by the respondents. Further, nothing I have said about refusing to set aside the subpoena may be taken as involving any determination of the admissibility of documents produced in answer (should any such documents exist). Nor can the validity of the subpoena bear upon the propriety of the asking of any question in cross-examination which might not meet the tests for admissibility of evidence relating only to credit or only for a tendency or propensity purpose.”

97. Thus, for the reasons above, in relation to Sell & Parker’s global objection, I find that the documents sought (subject to matters below) in the prosecutor’s Further Amended Schedule to the Subpoena are reasonably expected to be likely to assist in determining an order under Pt 8.3 of the POEO Act.

98. Before considering the remaining issues, I pause to make some comment regarding the evidence presently before the Court. I note that the prosecutor submits, but did not marshal any evidence demonstrating, that the “website” (and reference to a “Scrap Assist” accounting program) of Sell & Parker, to which it refers to in submissions, provides information indicating Sell & Parker’s ability to produce financial documents. Although there was no evidence in relation to the website, the submissions of the prosecutor were not denied by Sell & Parker. In this regard, the following discussion took place (Tcpt, 4 September 2019, p 48(32-47)):

"ROSE: We have tried very carefully to particularise the subpoena so it doesn’t place an undue burden on the defendant to comply with it. As we’ve said before, the defendant is a large private company that already prepares audited financial statements. We say it will have the capacity to provide the material sought. We know that the defendant has a finance team because it says so on its website. We know the defendant has a chief financial officer.

HIS HONOUR: Have I seen the website?

ROSE: No.

HOWARD: Just a technicality, your Honour.

ROSE: There is a reference to it in my submissions.

HIS HONOUR: I understand that."

99. Further, although Sell & Parker made detailed submissions, it did not produce evidence to substantiate either that it had already provided weighbridge records to the prosecutor or the likely burden that would flow from attending to the production of the material sought.

100. As noted above, in relation to Sell & Parker’s primary concern which I have noted as the global objection, apart from the submission that there has been no “identified issue”, reliance is placed upon the entry of the pleas only in relation to receiving (and not processing) which was an aspect conceded by the prosecutor. While I accept that there is a demarcation between receiving and processing which may raise the principle of fairness (otherwise articulated in De Simoni and considered above), I consider that on the limited knowledge the Court has of the operations of Sell & Parker it is, contrary to Sell & Parker’s submission, artificial to separate, at this stage, material discretely relating to the receipt as opposed to the processing of waste material.

101. In this regard, I accept the prosecutor’s submission that it may be necessary to “follow” any monetary benefits associated with the receipt of material which may necessarily involve the processing. To this extent, I am comforted in the fact, as noted above, that the admission into evidence of material which may be produced pursuant to the Subpoena is a matter for separate consideration at a later stage by the Court.

Specific objections

102. Having determined Sell & Parker’s global objection to the Subpoena, it is necessary to consider Sell & Parker’s further objections to specific paragraphs in the Schedule. The following consideration relates to the form of the Further Amended Schedule now pressed by the prosecutor which has made not immaterial changes to the original Schedule.

103. As noted above, on the basis of the Court not accepting its global objection, Sell & Parker proffered its Proposed Amended Schedule (Exhibit C) on the basis that it reflects the wording (and documents) that Sell & Parker would be prepared to accept by way of a schedule to a subpoena (Tcpt, 4 September 2019, p 15(10-14)).

104. Given that there are four versions of the Schedule before the Court (the first of which is set out at [19] above), it is convenient to set out Sell & Parker’s Proposed Amended Schedule as it is a modified and marked-up version (by Sell & Parker) of the prosecutor’s Further Amended Schedule, which, importantly, I note was itself a further amended version of the Schedule at [19] above. For clarity, the struck through wording remains the subject of objection by Sell & Parker and the underlined wording reflects proposed wording acceptable to Sell & Parker. As submitted by the parties, this marked-up version allows the essential remaining differences between the parties to be understood. Sell & Parker’s Proposed Amended Schedule is in the following form:

“Defendant’s Proposed Amended Schedule to Subpoena

SCHEDULE

The documents or things you must produce (preferably in electronic format) are as follows:

1.   Any document detailing the organisational structure of:

a.   the Defendant in the 2015/16, 2016/17 and 2017/18 financial years; and

b.   any other company in the Defendant’s group, or any other company the Defendant, or any of the other companies in the Defendant’s group, have has a direct financial interest in and that has benefitted from the Defendant’s offending (“Related Entities”) in 2015, 2016 and 2017.

2.   Any document detailing the weighbridge records, or similar, from the 2015/16, 2016/17 and 2017/18 financial 2016 and 2017 calendar years, showing:

a.   the amount of waste (in tonnes) that the Defendant received or processed (per load) at its metal recycling facilities at 23-43 and 45 Tattersall Road, Kings Park, NSW (Kings Park Site); and

b.   the amount of waste (in tonnes), processed or otherwise, that left the Kings Park Site (per load)

3.   Any document, in spreadsheet or delimited text file format, detailing the records from the accounting program or computer system used by the Defendant (be it Scrap AssistTM or another program) at the Kings Park Site in the 2015/16, 2016/17 and 2017/18 financial 2016 and 2017 calendar years, showing:

a.   the amount of money it received or paid out (in AUD) for each incoming load of waste received at the Kings Park Site; and

b.   the amount of money received (in AUD) for the sale of each outgoing load of waste, (processed or otherwise).

4.   The following financial records of the Defendant from the 2015/16, 2016/17 and 2017/18 financial years and of the Related Entities from 2015, 2016 and 2017, as they relate to the Kings Park Site:

a.   the management accounts, including any workings made to the management accounts to prepare the statutory accounts;

b.   the income tax returns, including any workings to complete the income tax returns; and

c.   the depreciation workings.

5.   Any document explaining the method(s) used by the Defendant in the 2015/16, 2016/17 and 2017/18 financial years for reconciling the weighbridge records from the Kings Park Site (referred to in paragraph 2) with the management accounts (referred to in paragraph 4(a)).

6.   Any document explaining the method(s) used by the Defendant in the 2015/16, 2016/17 and 2017/18 financial years for reconciling records from the accounting program or computer system used by the Defendant (be it Scrap AssistTM or another program) at the Kings Park Site (referred to in paragraph 3) with the management accounts (referred to in paragraph 4(a)) and the Defendant’s statutory accounts.

7.   The financial records, or any other documents, of the Defendant from the 2015/16, 2016/17 and 2017/18 financial years and of the Related Entities from 2015, 2016 and 2017 detailing:

a.   the costs associated with receiving and processing waste at the Kings Park Site;

b.   the gross profit associated with receiving and processing waste at the Kings Park Site;

c.   the other profit and loss accounts associated with receiving and processing waste at the Kings Park Site including, but not limited to:

i.    administrative expenses;

ii.   facilities maintenance;

iii.   yard maintenance;

iv.   transportation costs;

v.    machinery costs; and

vi.   employee costs.

d.   general ledger records and any manual journals for the financial records (referred to in paragraphs 7(a), (b) and (c)).

8.   Any document of the Defendant and Related Entities detailing:

a.   the return on investments (including bank deposits) of funds used outside of the Defendant’s business operations at the Kings Park Site in the 2015/16, 2016/17 and 2017/18 financial years; and

b.   any debts associated with the Defendant’s business operations at the Kings Park Site in the 2015/16, 2016/17 and 2017/18 financial years including loan amounts, interest rates and payment terms.

9.   The statutory financial accounts of any Related Entities for 2015, 2016 and 2017.

In this Subpoena, references to ‘document’ includes, but is not limited to charts, tables, notes, records, reports, data, emails, letters, electronic messages, working notes, diary entries, memoranda, statements, ledgers, balance sheets and accounted records (whether they are in electronic format or not).”

105. In relation to Sell & Parker’s specific objections and in the light of my earlier findings above in relation to references to “processing”, I accept the amendment proffered by Sell & Parker in relation to par 1(b) and, in part, to par 8, but otherwise find that the Further Amended Schedule proffered by the prosecutor, having materially narrowed the (original) Schedule, is appropriate. My reasons in relation to the specific objections follow.

The timeframe over which documents are sought

106. In response to Sell & Parker’s concerns regarding documents from “2015”, the prosecutor accepts the argument made by Sell & Parker, and has narrowed the date references in its Further Amended Schedule. The remaining dispute in relation to the timeframe now expressed in pars 2 and 3 (with the prosecutor seeking records from the 2015/16, 2016/17 and 2017/18 financial years whereas Sell & Parker proffers the 2016 and 2017 calendar years only), is not without some nicety given that the charge periods appear to coincide with each parties’ position.

107. In the circumstances, subject to the concern in relation to information sought regarding waste that was “processed” dealt with above and further below, I am satisfied that it is appropriate that the documents pertaining to the relevant financial years (as opposed to calendar years) be provided, given that the prosecutor submits that there may be a difference between Sell & Parker’s financial year and an ordinary calendar year. On the evidence before the Court, I do not consider requiring Sell & Parker to produce those documents on the basis of the financial years which cover the charge periods is oppressive: R v Barton [1981] 2 NSWLR 414 at 428. As such, I do not consider that requiring documents for those financial years as opposed to calendar years is an abuse of process. In consequence, I find the wording now contained in the Prosecutor’s Further Amended Schedule in relation to this aspect is appropriate.

Related Entities

108. In relation to the concern regarding the definition of “Related Entities” in par 1(b), while I accept the prosecutor’s submission that it has now narrowed the definition of Related Entities in the Schedule; that Sell & Parker is part of a group of companies; and, that the Subpoena does not seek financial documents from every related entity but now only those which have benefited from the offending, subject to other rulings I make, as noted above I accept that the wording of par 1(b) should be modified as suggested by Sell & Parker.

109. I note that pars 4, 7, 8 and 9 require the production of documents of Related Entities (as now defined) and, to the extent that it is submitted that the requirement to produce documents on behalf of entities that may be related to Sell & Parker is oppressive, I accept the prosecutor’s submission that the test is not whether there will be a burden upon Sell & Parker, but whether the burden is reasonable in the circumstances. Further, I accept the prosecutor’s submission that Sell & Parker has not adduced evidence as to the nature and extent of the burden.

110. The evidence in relation to Sell & Parker’s financial position and its relationship with other entities consists solely of commentary in the KPMG letter of 19 July 2019 which states, based upon documents filed with the Australian Securities and Investments Commission, that Sell & Parker’s financial report of 2017 shows revenue of $196.7 million and profit before tax of $15.5 million along with net assets of $62.9 million, and that Sell & Parker and its subsidiaries have 226 employees. This commentary was not the subject of adverse comment or denial by Sell & Parker. KPMG also provided a summary of the consolidated results of Sell & Parker for 2015 to 2017. In any event, I take some note of the fact that based upon the material before the Court, Sell & Parker is neither a small nor unsophisticated operator. In light of the above, with the exception of par 8 dealt with below, I do not consider that requiring documents to be produced in relation to Related Entities (as now defined) is oppressive and, as such, that the references to Related Entities in pars 4, 7 and 9 are appropriate.

111. Given my finding in relation to references to Related Entities, it is therefore appropriate that the statutory financial accounts be made available in accordance with par 9 of the prosecutor’s Further Amended Schedule albeit without reference to “2015” as this change was accepted by both parties.

Weighbridge records

112. While I repeat my concern expressed above that neither party has produced evidence as to the nature and extent of the “weighbridge records” which have earlier been provided, given that Sell & Parker submits that the weighbridge records for 2016/17 have already been provided, the Court is simply left with the submission that the material earlier provided “does not include the amount of money [Sell & Parker] paid (or received) for the incoming loads”. Again, absent evidence of the burden of compliance, I consider that the records relate to the issue otherwise identified and I do not consider that requiring the production of these documents is oppressive.

Processing

113. In relation to references to the amount of waste “processed” in par 2 and “processing” in par 7, Sell & Parker repeats its submissions made above in relation to the lack of a forensic purpose in seeking documents relating to the “processing” of waste. In reply, the prosecutor repeats its submissions outlined at [57] above, and maintains that it seeks material beyond simply that relating to waste received by Sell & Parker as it is necessary to follow what happened to the waste after its receipt in order to determine the extent and manner of any monetary benefits associated with the received waste.

114. In the circumstances, I repeat my finding above and although I consider it a matter of some nicety, I find that the prosecutor is entitled to this material and, as noted above, whether it be ultimately admissible is not a matter for consideration at this stage. Further, given the reasons above, I repeat that it is “on the cards” that the information sought in relation to processing may assist in determining the monetary benefits associated with the receipt of waste or, more particularly, the receipt of waste in excess of that which was otherwise permitted. In those circumstances, I consider that the prosecutor is entitled to seek that documentation.

Paragraph 8

115. As noted above, Sell & Parker maintains that par 8 is framed so widely and imprecisely that compliance would be oppressive.

116. The prosecutor submits that the information in par 8 is relevant to the identification and assessment of incremental profits and is an “integral” requirement of the relevant monetary benefits calculations and points to p 9 of the Protocol which, under the heading “The rate of return”, provides for a detailed mathematical formula which is used to calculate monetary benefits. In order to utilise this method, the prosecutor says that the Protocol therefore requires the material sought in par 8, and that the “detailing” of financial matters pertaining to return on investments and debts in par 8 is relevant and not framed so widely that it is oppressive.

117. Noting that ultimately the admission of material that may be used or created in accordance with the Protocol is a matter for another day, and absent specific evidence detailing the likely burden that is caused to Sell & Parker in producing the documents pursuant to this paragraph, I consider that, in relation to Sell & Parker, the request for the material is not oppressive and is sufficiently connected to the issue of monetary benefits as it is apparently required by the methodology adopted in the Protocol.

118. Although I accept the submissions of the prosecutor in so far as they relate to Sell & Parker, I am not persuaded that seeking the detailed material described in par 8 from Related Entities (even as now defined) is not oppressive. I therefore accept the submissions of Sell & Parker in relation to par 8 to the extent to that it relates to Related Entities.

115. I have therefore drawn a distinction between the position of Sell & Parker and the Related Entities because, while I accept that Sell & Parker is likely to be in a position to provide the material otherwise sought, and that there is no evidence to the contrary, I am unable to find that, given the wide and somewhat imprecise nature of the material sought under par 8 (in that it seeks any document of a related entity detailing, inter alia, the return on investments (including bank deposits) of funds used outside of the Sell & Parker’s business operations and debts associated with Sell & Parker’s business operations including loan amounts, interest rates and payment terms), it would not be oppressive for a related entity, who has not been identified and is, in effect, a stranger to the proceedings, to comply with that requirement. Again, the fact that the material may be relevant to the methodology contained within the Protocol and the terms of the advice received by the prosecutor from KPMG, does not negate the well-established requirements of a subpoena as I have identified above at [87].

116. As such, I consider that par 8 should be amended to remove the words “and Related Entities”.

Conclusion

121. For the reasons above and noting that the prosecutor has proffered, in effect, an amended Schedule at hearing, subject to the amendments to the Subpoena which I have considered appropriate, I do not find that there is a basis to set aside the Subpoena and that the notice of motion should otherwise be dismissed.

122. For convenience, Annexure A to this judgment is a copy of the Schedule amended to reflect my findings.

Orders

123. The orders of the Court are:

In proceedings 2018/00242442:

1. The Subpoena issued by the Secretary, Department of Planning and Environment on 19 July 2019 to Sell & Parker Pty Ltd is varied in accordance with Annexure A.

2. The notice of motion filed 29 July 2019 by Sell & Parker Pty Ltd is otherwise dismissed.

3. The proceedings are set down for further directions on Thursday 7 May 2020.

4. The parties are directed to confer and seek to reach agreement in relation to further directions and are granted liberty to restore on seven days’ notice.

5. Costs are reserved.

In proceedings 2018/00242443:

1. The Subpoena issued by the Secretary, Department of Planning and Environment on 19 July 2019 to Sell & Parker Pty Ltd is varied in accordance with Annexure A.

2. The notice of motion filed 29 July 2019 by Sell & Parker Pty Ltd is otherwise dismissed.

3. The proceedings are set down for further directions on Thursday 7 May 2020.

4. The parties are directed to confer and seek to reach agreement in relation to further directions and are granted liberty to restore on seven days’ notice.

5. Costs are reserved.

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Annexure A (70.4 KB, pdf)

Decision last updated: 24 April 2020