Upper Hunter Sustainable Industries Association Inc v MACH Energy Australia Pty Ltd (No 2)

[2017] NSWLEC 87

Land and Environment Court

New South Wales

Medium Neutral Citation:	Upper Hunter Sustainable Industries Association Inc v MACH Energy Australia Pty Ltd (No 2) [2017] NSWLEC 87
Hearing dates:	5-7, 16 June 2017
Date of orders:	19 July 2017
Decision date:	19 July 2017
Jurisdiction:	Class 4
Before:	Pain J
Decision:	(1) The Applicant’s summons dated 21 March 2017 is dismissed. (2) The Applicant is to pay the Respondent’s costs of the proceedings unless a notice of motion seeking a different costs order is filed within 14 days. (3) The exhibits may be returned.
Catchwords:	CIVIL ENFORCEMENT – lapsing of development consent for coal mine – whether engineering and construction work relating to development undertaken in time required by development consent – whether engineering and construction work undertaken in compliance with development consent – summons dismissed
Legislation Cited:	Dams Safety Act 1978 Environment Protection and Biodiversity Conservation Act 1999 (Cth) Environmental Planning and Assessment (Savings and Transitional) Regulation 1998 cll 11, 12, 15 Environmental Planning and Assessment Act 1979 ss 80, 81A, 95, 99, 123 Environmental Planning and Assessment Amendment Act 1997 Environmental Planning and Assessment Regulation 2000 National Parks and Wildlife Act 1974 s 90
Cases Cited:	Benedict Industries Pty Ltd v Minister for Planning [2016] NSWLEC 122 Burwood Council v Ralan Burwood Pty Ltd (No 3) (2014) 206 LGERA 40; [2014] NSWCA 404 Cariste Pty Ltd v Blue Mountains City Council [1996] NSWCA 92 Coalcliff Community Association Inc v Minister for Urban Affairs and Planning (1999) 106 LGERA 243; [1999] NSWCA 317 Driscoll v J Scott Pty Ltd (1976) 50 ALJR 528; 36 LGRA 159 Gosford Waterfront Alliance Inc v TO Gosford Pty Ltd (No 2) [2016] NSWLEC 162 Green v Kogarah Municipal Council (2001) 115 LGERA 231; [2001] NSWCA 123 House of Peace Pty Ltd v Bankstown City Council (2000) 48 NSWLR 498; [2000] NSWCA 44 Hunter Development Brokerage Pty Ltd v Cessnock City Council; Tovedale Pty Ltd v Shoalhaven City Council (2005) 63 NSWLR 124; [2005] NSWCA 169 JMS Capital Pty Ltd v Tweed Shire Council [2006] NSWLEC 535 K & M Prodanovski Pty Ltd v Wollongong City Council (2011) 195 LGERA 23; [2013] NSWCA 202 Marvan Properties Pty Ltd v Randwick City Council (2005) 138 LGERA 1; [2005] NSWLEC 9 Norlex Holdings Pty Ltd v Wingecarribee Shire Council (2010) 177 LGERA 261; [2010] NSWLEC 149 Rowlane Investments Pty Ltd v Leichhardt City Council (2013) 195 LGERA 9; [2013] NSWLEC 60 Westfield Management Ltd v Perpetual Trustee Co Ltd [2006] NSWCA 245 Zaymill Pty Ltd and Maskim Holdings Pty Ltd v Ryde City Council [2009] NSWLEC 86
Category:	Principal judgment
Parties:	Upper Hunter Sustainable Industries Association Inc (Applicant) MACH Energy Australia Pty Ltd (Respondent)
Representation:	COUNSEL: M Henry SC with T To (Applicant) J Kirk SC with J Davidson (Respondent)     SOLICITORS: Beatty Legal Pty Ltd (Applicant) Ashurst Australia (Respondent)
File Number(s):	17/86798

Judgment

Civil enforcement proceedings alleging development consent has lapsed

1. The Applicant Upper Hunter Sustainable Industries Association Inc (UHSIA) has commenced Class 4 proceedings by summons alleging that a development consent granted for the construction and operation of an open cut coal mine at Mount Pleasant, west of Muswellbrook in the upper Hunter Valley, in December 1999 has lapsed. The Respondent MACH Energy Australia Pty Ltd (MACH) purchased the land benefitting from the development consent in 2016.

2. On or about 22 December 1999 development consent (file no N95/00147) was granted to Coal & Allied Operations Pty Ltd (Coal & Allied), a Rio Tinto Group company, by the Minister for Urban Affairs and Planning for the construction and operation of an open cut coal mine, coal preparation plant, transport and rail loading facilities and associated facilities (the Consent), known generally as the Mt Pleasant Open Cut Coal Mine (the Mine). Coal & Allied and Rio Tinto can be treated as the same company for the purposes of this judgment. The Consent relates to land described in Appendix 1 of the Consent (the Land). UHSIA seeks a declaration that the Consent has lapsed, an order restraining MACH from acting upon the Consent and its costs of the proceedings. The summons refers to s 123 of the Environmental Planning and Assessment Act 1979 (EPA Act) whereby any person may bring proceedings in the Court for an order to remedy or restrain a breach of the EPA Act. It is common ground that the date on which the Consent lapsed, if not otherwise lawfully commenced, is no later than 15 February 2005.

3. The Points of Claim refer to MACH and other persons identified in a schedule to the Points of Claim as the present owners of the Land to which the Consent relates. The persons identified in the schedule (other than MACH), after notification, have either indicated no interest in the outcome of the proceedings or have not made contact with the solicitors for UHSIA.

4. The hearing of this matter was expedited due to the substantial financial implications for MACH if UHSIA’s case is successful. MACH paid many millions of dollars for the project in 2016 and has commenced development of the site, expending many more millions of dollars in doing so.

5. The issues and evidence relevant to the exercise of the Court’s discretion if a finding is made that the Consent has lapsed will be considered separately if this arises.

Environmental Planning and Assessment Act 1979

6. The EPA Act was extensively amended on 1 July 1998 by the Environmental Planning and Assessment Amendment Act 1997. The savings and transitional provisions including cll 11, 12 and 15 of the Environmental Planning and Assessment (Savings and Transitional) Regulation 1998 had the effect that the unamended EPA Act continued to apply to the development application for the Mine at the time the Consent was granted. The parties agree that s 99 of the unamended EPA Act is applicable to this case. It relevantly provided:

99 Lapsing of consent

(1)   A development consent lapses:

(a)   5 years after the date from which it operates...

...

(4)   Development consent for:

(a)   the erection of a building, or

(b)   the subdivision of land, or

(c)   the carrying out of a work,

does not lapse if building, engineering or construction work relating to the building, subdivision or work is physically commenced on the land to which the consent applies before the date on which the consent would otherwise lapse under this section.

...

7. The parties agree that the relevant authority in relation to physical commencement of development consent in the context of s 99(4) is Hunter Development Brokerage Pty Ltd v Cessnock City Council; Tovedale Pty Ltd v Shoalhaven City Council (2005) 63 NSWLR 124; [2005] NSWCA 169 (Hunter Brokerage) where Tobias JA held at [111] (Santow JA and Stein AJA agreeing) that three questions are relevant to whether works prevent a development consent from lapsing:

(a)   was the work relied on building, engineering or construction work; if so,

(b)   did it relate to the approved development; if so,

(c)   was it physically commenced on the land to which the consent applied prior to the relevant lapsing date?

Points of Claim (as amended)

8. The following extract from the Points of Claim are matters which UHSIA submitted at the hearing the proponent of the Mine, Coal & Allied, ought to have done but did not do prior to the lapsing date in non-compliance with the requirements of the Consent. Consequently no building, engineering or construction work relating to the Consent was physically commenced before 15 February 2005. Not all of the original Points of Claim were pressed.

Non-compliance with requirements of the Consent

6   Between 22 December 1999 and 15 February 2005:

(a)   the Compliance Report - pre-construction stage required by condition1.5(1)(a) was not submitted to the Director-General; and/or

(b)    the Waste Management Plan for the DA area required by condition 2.2 was not submitted to the Director-General; and/or

(c)(i)   the consultation with the Wonnarua Tribal Council and the NPWS required by condition 3.3(1)(a) was not undertaken; and/or

(c)(ii)   the Archaeology and Cultural Management Plan for the DA area prior to and during development required by condition 3.3(1)(a) was not submitted to the Director-General; and/or

(d)   the negotiations and agreement with the NPWS and the Wonnarua Tribal Council required by condition 3.3(3) were not undertaken and obtained; and/or

(e)(i)   the consultation with the Council required by condition 3.4(1) was not undertaken; and/or

(e)(ii)   the Flora and Fauna Management Plan for the management of flora and fauna issues in the DA area required by condition 3.4(1) was not submitted to the Director-General; and/or

(f)(i)   the consultation with DLWC required by condition 3.5(1) was not undertaken; and/or

(f)(ii)   the Erosion and Sediment Control Management Plan for the DA area as required by condition 3.5(1) was not submitted to the Director-General; and/or

(g)(i)   the consultation with DLWC required by condition 3.5(2) was not undertaken; and/or

(g)(ii)   the Soil Stripping Management Plan for the DA area as required by condition 3.5(2) was not submitted to the Director-General; and/or

(h)   the contribution to Muswellbrook Council required by condition 3.6(3) was not made; and/or

(i)   the Landscaping Management Plan as required by condition 3.7(1) was not submitted to Council; and/or

…

(k)(i)   the consultation with DLWC, NSW Agriculture and Council required by condition 3.10(1) was not undertaken; and/or

(k)(ii)   the Land Management Plan for all land holdings within the DA area required by condition 3.10(1) was not submitted to the Director-General; and/or

(l)(i)   the consultation with DLWC and Council required by condition 4.1(1) was not undertaken; and/or

(l)(ii)   the Water Management Plan for the management of the water impacts of the development required by condition 4.1(1) was not submitted to the Director-General; and/or

(m)(i)   the consultation with Council required by condition 6.1(2) was not undertaken; and/or

(m)(ii)   the Air Quality Management Plan required by condition 6.1(2) was not submitted to the Director-General; and/or

(n)(i)   the noise investigations at six monthly intervals required by condition 8.4(1) were not conducted; and/or

(n)(ii)   the identification of noise levels for various specified zones as required by condition 6.1(4) [sic, 6.4(4)] was not undertaken; and/or

(n)(iii)   the Noise Management Plan required by condition 8.4(2) was not submitted to the Director-General; and/or

(o)   the engineering report on on-site flood-lighting impacts and vehicular lights from the operation of the mine required by condition 6.5 was not submitted to Council; and/or

…

(t)   the first Annual Environmental Management Report was not submitted to the Director General within 12 months of the date of the Consent [condition 9.2].

9. In its Points of Defence MACH denied that the Consent has lapsed. The construction of environmental dam ED1 and grading of the road leading to ED1 commenced prior to 15 February 2005. Engineering work consisting of survey work relevant to the development the subject of the Consent was carried out between June and August 2003 and in November 2004 in relation to ED1. Geotechnical work was carried out in August to September 2003 and August 2004 in relation to ED1.

10. In response UHSIA submitted this work could not be relied on by MACH to argue the Consent had not lapsed as it was not carried out in compliance with the conditions of Consent. Therefore, it did not relate to the development as required by s 99(4) of the EPA Act.

Chronology

11. The parties agreed the following chronology:

DATE	EVENT
24 October 1997	Application for consent for DA 92/97 including Environmental Impact Statement (EIS) lodged for construction and operation of a coal mine at Mt Pleasant (Project Site)
29 June 1998	Mt Pleasant Mine Commission of Inquiry – Proponent's Primary Submission
March 1999	Mt Pleasant Mine Commission of Inquiry – Proponent's Submission in Reply
May 1999	Report of the Mt Pleasant Mine Commission of Inquiry to the Minister for Urban Affairs and Planning
22 December 1999	Development Consent (file no. N95/00147) granted for the construction and operation of an open cut coal mine, coal preparation plan, transport and rail loading facilities and associated facilities (Consent), known generally as the Mt Pleasant Open Cut Coal Mine
Prior to 15 February 2000	Proponent notified of the grant of development consent
Mid-late June 2003	Survey work undertaken by G Boardman & Associates
Early July 2003	G Boardman & Associates prepared and provided additional survey data to Parsons Brinckerhoff
11 July 2003	Parsons Brinckerhoff produced Figure entitled “Conceptual Design Environmental Dam (ED1) Mt Pleasant Mine Test Pit and Borehole Locations”, Revision A dated 11 July 2003
Mid-late July 2003 to 20 August 2003 (inclusive)	Additional survey work undertaken by G Boardman & Associates
20-22 August 2003	Parsons Brinckerhoff undertook the drilling of boreholes (x4) and test pitting (x17)
26 May 2004	Coal & Allied letter to DPI [Department of Primary Industries] indicating intention to undertake construction of a dam and an associated access road
30 July 2004	Hansen Consulting document entitled “Mt Pleasant Environmental Management Plan” (EMP) (although note that all pages, other than the cover page, are dated 20 August 2004)
20 August 2004	Letter from Hansen Consulting to the Department of Infrastructure, Planning and Natural Resources (DIPNR) providing formal notification of intention to physically commence works
27 August 2004	Parsons Brinckerhoff undertook further test pitting (x3)
1 October 2004	Parsons Brinckerhoff undertook further test pitting (x13)
15 October 2004	Letter DIPNR to Hansen Consulting communicating the Director-General's conditional approval of the EMP and Pre-construction Compliance Report
17 November 2004	Parsons Brinckerhoff produced Figure entitled “Final Design Environmental Dam (ED1) Mt Pleasant Mine Test Pit and Borehole Locations”, Revision E Construction Issue, dated 17 November 2004
17 November 2004	First meeting of Mt Pleasant Consultative Committee
On or around 30 November 2004 – March 2005	Construction of dam known as ED1 at Project Site under supervision of Parsons Brinckerhoff
15 February 2005	Agreed 5 years from when Consent granted
8 September 2005	Construction Certificate for the construction and operation of dam known as ED1 – provided to Rio Tinto under cover of letter from the Department of Planning and Environment (DPE) dated 8 September 2005
September/October 2005	Second Spillway added to dam known as ED1 at Project Site, based on Revision F drawings prepared by Parsons Brinckerhoff prior to 26 August 2005
October 2005	Parsons Brinckerhoff prepare Figure entitled “Final Design Environmental Dam (ED1) Mt Pleasant Mine for Coal & Allied Operations”, Revision Z Construction Issue, dated October 2005
7 December 2005	Occupation Certificate for the construction and operation of dam known as ED1 – provided to Rio Tinto under cover of letter from DPE dated 21 December 2005
2 November 2006	Mt Pleasant Annual Environmental Management Report 2005 provided to various government agencies
17 December 2010	Grant of Mining Lease No 1645
19 September 2011	Mt Pleasant Coal Mine – Modification 1, determination made DA92/97 MOD 1
23 December 2011	Delegate of the Chief Executive Officer of the Office of Environment and Heritage grants Aboriginal Heritage Impact Permit No 1131247 under s 90 of the National Parks and Wildlife Act 1974 (NPW Act)
29 February 2012	Delegate of the Federal Environment Minister grants approval under the Environment Protection and Biodiversity Conservation Act 1999 (Cth) in respect of actions associated with the Mt Pleasant Coal Project, after a public consultation process (EPBC Approval)
21 February 2013	EPBC Approval varied
22 May 2014	EPBC Approval varied
2 February 2015	Grant of Mining Lease Nos 1708, 1709 and 1713
18 June 2015	EPBC Approval varied
26 January 2016	MACH Energy enters into binding agreement with Coal & Allied to purchase the Mt Pleasant Coal Project, subject to conditions precedent being satisfied
10 May 2016	Beatty Legal letter to DPE, on behalf of its client the Hunter Thoroughbred Breeders Association, re lapsing of Consent
12 May 2016	EPBC Approval varied
4 August 2016	Closure of the binding agreement between MACH Energy and Coal & Allied Operations Pty Ltd to purchase the Mt Pleasant Coal Project upon the satisfaction of all conditions precedent
25 August 2016	Delegate of the Chief Executive Officer of the Office of Environment and Heritage grants Aboriginal Heritage Impact Permit No C0002503 under s 90 of the NPW Act
21 October 2016	Mining Operations Plan lodged by MACH Energy approved by delegate of the Minister for Industry, Resources and Energy
24 November 2016	NSW Environment Protection Authority issues Environment Protection Licence No 20850 to MACH Energy in respect of scheduled activities carried out as part of the Mt Pleasant Coal Project
23 February 2017	EPBC Approval varied
3 March 2017	Grant of Mining Lease No 1750
21 March 2017	Proceedings commenced
29 March 2017	Mt Pleasant Coal Mine - Modification 2 South Pit Haul Road, Determination made DA92/97 MOD 2

12. UHSIA bears the onus of proof of establishing that the Consent had lapsed by 15 February 2005. Coalcliff Community Association Inc v Minister for Urban Affairs and Planning (1999) 106 LGERA 243; [1999] NSWCA 317 at [99] which UHSIA relied on to assert that MACH bore the onus of proof of establishing that the Consent had not lapsed did not address the same factual circumstance as here. It does not support UHSIA’s submission.

13. As apparent from the chronology, the work relied on by MACH was undertaken between 2003 and 2005. MACH has no direct relationship with the companies and individuals who undertook the work, it having acquired the Land many years later. The difficulty posed to MACH in proving that certain work was undertaken needs to be borne in mind in light of this substantial passage of time. In one instance the relevant company SCE Mining Services (SCE) is no longer in business. Another example of the difficulty of obtaining evidence is that no documents in relation to the project were provided pursuant to a subpoena issued to the NSW Dams Safety Committee (DSC) by UHSIA’s solicitor. Other evidence I have admitted establishes that the DSC was approached about the project and would be expected to have records.

Conditions of 1999 Consent

14. The term “DA area” is defined in the Consent as “Development Application area which includes the Mine site and rail loop and coal loader, as shown on Figure 66 of Volume 2 of the EIS”. Figure 66 depicts an area of about 3,800 ha.

15. The relevant conditions of Consent follow:

GENERAL

Condition 1.1 – Adherence to terms of EIS, DA, etc.

The Applicant shall carry out the development of the Mount Pleasant open cut coal mine generally in accordance with the Environmental Impact Statement (EIS) prepared by ERM Mitchell McCotter and certified by Robert McCotter on 5 September 1997, the Applicant’s Primary Submission and Submission in Reply to the Commission of Inquiry, and any other relevant documentation submitted by the Applicant for the purposes of the determination of this DA, as may be modified by the conditions set out herein.

Condition 1.2 – Period of Approval

1.   Consent shall operate for a period of 21 years from the date of the granting of the development consent.

2.   The date of commencement of construction works, mining and commencement of coal processing operations are to be notified to the Director-General and Muswellbrook Shire Council, at least four weeks prior to commencement of construction works, mining and coal processing operations respectively.

Condition 1.5 – General Administrative Conditions

1.   Compliance Report – pre-construction stage:

(a)   At least one month prior to the commencement of construction (or within such period as agreed to by the Director-General), the Applicant shall submit for the satisfaction of the Director-General, a Compliance Report detailing compliance with all the relevant conditions that applied prior to the commencement of construction.

...

MINE MANAGEMENT

Condition 2.2 – Waste

Prior to the commencement of construction works, including the Coal Preparation Plan (CPP), roads, rail line and loading facilities or earthworks, the Applicant shall prepare and implement a Waste Management Plan for the DA area to the satisfaction of the Director-General. The plan shall facilitate waste management on the site and ensure compliance with the Applicant’s obligations under the Waste Minimisation and Management Act. The Applicant shall make copies of the Waste Management Plan available to Council and the CCC within fourteen days of approval by the Director-General.

LAND AND SITE ENVIRONMENTAL MANAGEMENT

Condition 3.2 – Environmental Management Plans

1.   The Applicant shall prepare the following environmental management plans:

Mining Operations Plan – Condition 2.1

Waste Management Plan – Condition 2.2

Archaeology and Cultural Management Plan – Condition 3.3

Flora and Fauna Management Plan – Condition 3.4

Erosion and Sediment Control Management Plan – Condition 3.5

Soil Stripping Management Plan – Condition 3.5

Final Void Management Plan – Condition 3.6

Landscaping and Revegetation Management Plan – Condition 3.8 [sic, 3.7]

Land Management Plan – Condition 3.10

Water Management Plan – Condition 4.1

Air Quality Management Plan – Condition 6.1

Blast Management Plan – Condition 6.3

Noise Management Plans – Condition 8.4

2.   The management plans are to be revised or updated at least every five years, or as otherwise specified in these conditions, or directed by the Director-General, in consultation with the relevant government authorities. They will reflect changing environmental requirements or changes in technology or operational practices. Changes shall be made and approved in the same manner as the initial environmental management plan. The plans shall also be made publicly available at Council within two weeks of approval of the relevant government agency.

Condition 3.3 – Aboriginal Heritage

1.   The Applicant shall, prior to commencement of construction works:

(a) prepare an Archaeology and Cultural Management Plan to identify future salvage, excavation, monitoring and protection of any archaeological sites within the DA area prior to and during development, and to address cultural heritage issues. The plan shall be prepared to the satisfaction of the Director-General, in consultation with the Wonnarua Tribal Council and the NPWS addressing the NPWS requirements for the section 90 consent process under the National Parks and Wildlife Act 1974;

…

3. Prior to the commencement of any construction works within the DA area and prior to the lodgement of any application under section 90 of the National Parks and Wildlife Act 1974, the Applicant shall (unless otherwise determined by the Director-General) enter into negotiations with the NPWS and the Wonnarua Tribal Council to identify and reach an agreement on off-site conservation options of comparable biodiversity and archaeological values. The future ownership, management and acquisition, where relevant, of any suitable area identified shall be agreed between the relevant parties. If an agreement cannot be reached between the relevant parties, the matter shall be referred to the Director-General for determination. The decision of the Director-General shall be final.

Condition 3.4 – Flora and Fauna Assessment and Management

1.   Prior to the commencement of construction, the Applicant shall prepare and implement a Flora and Fauna Management Plan for the management of flora and fauna issues in the DA area during mining operations. The Plan shall be prepared by a suitably qualified expert in consultation with Council and to the satisfaction of the Director-General. The Applicant shall make copies of the Flora and Fauna Management Plan available to NPWS, Council and the Community Consultative Committee within fourteen (14) days of approval by the Director-General.

2.   The Flora and Fauna Management Plan shall include, but not be limited to:

(a)   strategies to adequately manage plant and animal communities within the DA area which will be undisturbed by mining operations;

(b)   a programme for utilisation as animal habitat, some of the timber required to be cut down for mining purposes;

(c)   strategies to manage the impact of surface water management and sediment control measures on flora and fauna, including the impact of heavy machinery;

(d)   control of feral species; and

(e)   weed management.

…

Condition 3.5 – Prevention of Soil Erosion

The Applicant shall prepare the following plans prior to the commencement of construction, in consultation with DLWC and to the satisfaction of the Director-General:

1.   An Erosion and Sediment Control Management Plan for the DA area which meets the requirements of the DLWC. The plan shall include, but not be limited to:

(a)   details of temporary and permanent sediment and erosion control systems to be used during both mine construction and operation;

(b)   a programme for reporting on the effectiveness of the sediment and erosion control systems and performance against objectives contained in the approved Erosion and Sediment Control Management Plan, and EIS; and

(c)   details of the installation of sedimentation dams, erosion control and stormwater diversions, as required, to ensure the rail line and balloon loop do not become a source of potential water pollution by stormwater runoff likely to contaminate the Hunter River with coal dust, oil and other pollutants.

2.   A Soil Stripping Management Plan for the DA area to the requirements of DLWC which shall include, but not be limited to:

(a)   details of the management of soil stockpiles; and

(b)   a programme for reporting on the effectiveness of the soil stripping methods and performance against objectives contained in the soil stripping management plan.

…

Condition 3.7 – Visual Amenity and Landscaping

1.   The Applicant shall, prior to commencement of construction works, or within such other period as the Council may require, submit for Council’s approval a detailed Landscaping Management Plan prepared by a suitably qualified person. The plan shall include where appropriate, but not be limited to:

(a)   provision for the establishment of trees and shrubs and/or the construction of mounding or bunding:

(i)   along the access road to the mine site;

(ii)   around the water storage dams and coal preparation plant;

(iii)   at other agreed areas identified as necessary by Council including for the maintenance of satisfactory visual amenity,

(b)   appropriate erosion control and sediment control practices for earthworks associated with the required landscaping.

(c)   details of the visual appearance of all buildings, structures, facilities or works (including paint colours and specifications). Buildings and structures shall be designed and constructed and/or renovated so as to blend as far as possible with the surrounding landscape.

(d)   details, specifications and staged work programmes to be undertaken, maintenance of all landscape works and maintenance of building materials and cladding.

...

Condition 3.10 – Land Management

1.   Prior to commencement of construction works, the Applicant shall prepare a Land Management Plan for all its land holdings within the DA area to provide for proper land management in consultation with DLWC, NSW Agriculture and Council and to the satisfaction of the Director-General. The plan shall include, but not be limited to:

(a)   pastures and remnant vegetation management;

(b)   eradication of vermin and noxious weeks as required by the Rural Lands Protection Authority and any other relevant authorities;

(c)   control of weed infestation on stockpiled material;

(d)   feral animal control;

(e)   assessment of the potential for commercial harvesting of standing timber removed from the mine site.

2.   The Plan shall be prepared by a technically qualified person(s) within six months of the date of this consent, or as otherwise agreed by the Director-General and updated annually. The Applicant shall make copies of the Land Management Plan available to Council and the Community Consultative Committee within fourteen days of completion.

…

WATER MANAGEMENT

Condition 4.1 – Management Plan

1.   The Applicant shall prepare a Water Management Plan for the management of water impacts of the development to the satisfaction of the Director-General, in consultation with DLWC and Council. The Plan shall be prepared prior to the commencement of construction or road or earthworks and implemented as required. The Water Management Plan shall include, but not be limited to, the following matters:

(a)   management of the impacts of the development on the quality and quantity of surface water and groundwater within and around the DA area, including water in dirty water dams and clean water diversion dams, including flooding impacts;

(b)   a strategy to ensure that the quality and quantity of water in Sandy Creek is not significantly affected by the Mount Pleasant mining operation. The strategy shall be approved by DLWC;

(c)   identification of any possible adverse effects on water supply sources of surrounding downstream land holders as a result of the mining operations, and strategies for the implementation of mitigation measures as necessary;

(d)   management of the impacts of the development on the quality and quantity of groundwater within two (2) kilometres of the boundary of the DA area, with particular attention to mobilisation of salts and contingency plans for managing any adverse impacts.

(e)   a programme for reporting on the effectiveness of the water management systems and performance against objectives contained in the approved site water management plan, and EIS;

(f)   detailed calculations in regard to any works proposed within the flood plain. This calculation shall details the effect of afflux within the 1 in 100 year flood interval for any properties upstream. A report is to be presented to Council and DLWC within twelve months of commencement of construction;

(g)   development of a strategy for the decommissioning of water management structures, including dirty water dams and clean water diversion dams, and long term management of the final voids. The strategy for the final voids shall be prepared in accordance with Condition 3.6.

…

AIR QUALITY, BLAST, NOISE AND LIGHT MANAGEMENT

Condition 6.1 – Air Quality Management

…

2.   The Applicant shall prepare and implement an Air Quality Management Plan containing strategies to manage and monitor the mine’s contribution to TSP, dust deposition, PM10 and PM2.5 in consultation with Council, and to the satisfaction of the Director-General, prior to the commencement of construction. The Applicant shall make copies of the Air Quality Management Plan available to the EPA, Council and the CCC within fourteen days of approval by the Director-General...

Condition 6.4 – Noise control

...

Noise Limits

4.   As part of the Noise Management Plan(s) to be prepared prior to the commencement of construction (under condition 8.4), the Applicant shall identify the predicted noise levels for the various zones around the DA area. The Noise Management Plan’s predicted noise levels shall be generally consistent with those predicted in the EIS or the Applicant’s Primary Submission to the Commission of Inquiry. These zones to include: Location A representing the zone covering the Kayuga Village; Location B representing the zone covering the Racecourse Road area; Location C representing the zone covering Muswellbrook; Location D representing the zone covering South Muswellbrook; Location E (eg RJ Wingett property) representing the zone covering the area east of the mine; Location F (eg T O’Brien properly) representing the zone covering the area north east of the mine; Location G (eg JB Moore properly) representing the zone covering the area south west of the mine. It is emphasised that these zones are mutually exclusive.

Condition 6.5 – Light Emissions

The Applicant shall, prepare an engineering report on on-site flood-lighting impacts and vehicular lights from the operation of the mine. The report shall be submitted for Council’s approval prior to the commencement of construction. The report shall identify:

(a)   all potential light sources and their impacts upon residences in the vicinity of the mine operations;

(b)   technical measures and work practices necessary to minimise the spillage of light from immediate areas to be illuminated, and to minimise the total night time glow from the operations.

...

MONITORING/AUDITING

Condition 8.4 – Noise Investigations and Management

1.   The Applicant shall, prior to construction, conduct noise investigations at six monthly intervals (unless otherwise agreed by the Director-General) to evaluate, assess and report the LA10 (15 minute) noise emission levels of the mine under adverse weather conditions, except during rain and/or wind speeds greater than 3m/s. The Applicant shall outline the methodologies, including establishing the mine’s operating configuration, determining survey intervals, weather conditions, seasonal variations, selecting variations, selecting locations, periods and times of measurements, the design of any noise modelling or other studies, including the means for determining the noise levels emitted by the mining operations.

2.   The Applicant shall, prior to construction and commencement of mining operations on the site, develop a Noise Management Plan to the satisfaction of the Director-General, with particular attention to night-time noise (10:00pm to 7:00am). The Noise Management Plan shall:

(a)   identify noise affected properties and the relevant noise limits consistent with the EIS and any subsequent submissions by the Applicant to the Commission of Inquiry;

…

REPORTING

Condition 9.2 – Annual Environmental Management Report (AEMR)

1.   The Applicant shall, throughout the life of the mine and for a period of at least five years after the completion of coal processing operations, prepare and submit an Annual Environmental Management Report (AEMR) to the Director-General. The AEMR shall review the performance of the mine against the environmental management plans, the Mining Operations Plan, the conditions of this consent, and other licences and approvals relating to the mine. To enable ready comparison with EIS predictions, diagrams and tables, the report shall include, but not be limited to, the following matters:

(a)   an annual review of the performance of the project against compliance with the conditions of this consent and statutory approvals;

(b)   a review of the effectiveness of the environmental management of the mine in terms of EPA, DLWC, DMR, NPWS, NSW Agriculture and Council, requirements;

(c)   results of all environmental monitoring required under this consent or other approvals, which includes interpretation and discussion by a suitably qualified person;

(d)   a listing of any variations obtained to approvals applicable to the subject area during the previous year;

(e)   the outcome of the water budget for the year and the quantity of water used form water storages;

(f)   rehabilitation report;

(g)   environmental management targets and strategies for the next year.

2.   In preparing the AEMR, the Applicant shall:

(a)   consult with the Director-General during preparation of each report for any additional requirements;

(b)   comply with any requirements of the Director-General or other relevant government agency under this consent; and

…

4.   The Applicant shall ensure that the first report is completed and submitted within twelve (12) months of this consent, or at a date determined by the Director-General in consultation with the DMR and annually thereafter.

Evidence

Summary of documentary evidence

16. UHSIA’s tender bundle became Exhibit A. It relevantly contained the EIS, Environmental Management Plan (EMP) prepared by Hansen Consulting engaged by Coal & Allied dated 30 July 2004 and Annual Environmental Management Report 2005 dated 2 November 2006. Exhibit A also contained a letter from Mr Kitto delegate for the Director-General to Hansen Consulting dated 15 October 2004.

17. Exhibit B was UHSIA’s supplementary tender bundle. It relevantly contained a letter from Hansen Consulting to the Department of Infrastructure, Planning and Natural Resources (DIPNR) dated 20 August 2004 formally notifying DIPNR of the intention to physically commence construction works on 27 September 2004. It also contained a letter from the National Parks and Wildlife Service (NPWS) to Rio Tinto dated 12 August 2004 concerning Aboriginal heritage issues, a letter from the Department of Environment and Conservation (DEC) to Rio Tinto dated 8 September 2004 also concerning Aboriginal heritage and a letter from Coal & Allied to DEC responding to these issues with reference to ongoing negotiations with the Wonnarua Tribal Council. Exhibit B also included a construction certificate in respect of ED1 dated 8 September 2005.

18. Exhibit C UHSIA’s bundle of additional documents included calculation sheets by Parsons Brinckerhoff engineers dated 26 May 2003 showing the estimated catchment area and sizing of ED1. Mr Droop’s expert hydrologist report dated 19 May 2017 became Exhibit D. Mr Droop and Mr Gilbert hydrologist prepared a joint expert report dated 5 June 2017 which became Exhibit G.

19. MACH tendered the Court Book which became Exhibit 1. Exhibits 2, 3, 4 and 6 were correspondence in August 2004 between Hansen Consulting and various government agencies concerning the preparation of a draft EMP. Exhibit 10 was Mr Gilbert’s expert report dated 1 June 2017. Exhibit 11 was a letter from DIPNR dated 30 September 2003 regarding the final design of ED1. Modifications to the Consent were made on 19 September 2011 and 29 March 2017. An updated version of the Consent showing these amendments became Exhibit 12.

20. Exhibit 13 MACH’s supplementary bundle of additional documents relevantly included the Pre-construction Compliance Report dated 18 August 2004, correspondence between stakeholders concerning the Mine and minutes of a meeting on 13 July 2004 between members of the Wonnarua Tribal Council and consultants of Coal & Allied. MACH’s bundle of additional documents became Exhibit 14. It relevantly contained a professional services agreement between Coal & Allied and Mr Boardman’s company (see below par 70) dated 9 September 2003 outlining the scope of work sought in respect of “ED1 Dam & West Link Road Survey”, Parsons Brinckerhoff’s proposal for the conceptual and detailed design of ED1 dated 2 June 2003, calculation sheets of Parsons Brinckerhoff dated 10 August 2003 in relation to the concept design of ED1, and the Construction Report prepared by Parsons Brinckerhoff concerning ED1 dated 8 December 2005. Exhibit 14 also contained the original conditions of Consent as approved by the Minister for Urban Affairs and Planning on 22 December 1999.

Extracts/summaries of key documents

Mount Pleasant Mine Environmental Impact Statement (5 September 1997)

21. Condition 1.1 of the Consent requires the development of the Mine generally in accordance with the Environmental Impact Statement (EIS) prepared by ERM Mitchell McCotter Pty Ltd and certified by Robert McCotter dated 5 September 1997. Section 6.1.3 of the EIS envisages the development of the Mine over 21 years of operation. Section 6.2.1 proposes a nominal two year construction program before regular coal production begins in the third year. Plans showing the project at years 2, 5, 10, 15 and 20 include changes in the positioning of ED1 anticipated during the operation of the Mine.

21. Section 6.3.5 states that fine rejects (non-marketable by-products of coal preparation) are to be pumped to a series of stepped emplacements near the south-west corner of the site. Two catchments were investigated as fine rejects emplacement areas with the northern catchment likely to be used as the primary area. An environmental dam (ED1) will be placed in the centre of the catchment to capture water from upstream areas disturbed by fine rejects emplacement operations to minimise potential impacts on downstream water quality. Some catchment runoff will be lost due to the redirection of runoff into the mine water system. The expected quantity of runoff lost is outlined in section 9.4.1 of the EIS.

22. Section 6.4 describes the water management system proposed for the Mine. The system consists of two separate water circuits. The clean water circuit comprises all runoff undisturbed by mining operations to be directed to local watercourses or natural drainage channels. Sediment dams feature in this circuit. The mine or “dirty” water circuit involves all water disturbed by mining operations which is to be captured and reused for other project requirements. Environmental dams are to receive fine rejects and form part of the dirty water circuit.

23. Section 6.4.3(vii) provides more detail about the environmental dams. The dams were designed according to advice from the DSC to contain 50% of probable maximum precipitation (PMP) from the upstream catchment. Nominal sizes of the environmental dams are stated to be 50 ML. A dam ED1 at the centre of the northern catchment will be enlarged at about Year 10 to facilitate continued fines emplacement while a new dam ED2 will be built at the lower end of the catchment.

24. Several technical studies were undertaken for the purposes of preparing the EIS. These reports are included in Volumes 3 and 4 of the EIS. Parts of the reports were relevant to the issues that arose in these proceedings.

25. Concerning “water management” a report was prepared by PPK Environment & Infrastructure Pty Ltd dated August 1997 (PPK Report). Appendix G of the PPK Report stated that dams were to be designed “in accordance with established engineering design principles and Dam Safety Committee requirements”. Dams located in the fine rejects emplacement areas were intended to capture and “contain runoff from disturbed areas within the Mine water [management] system”. ED1 was stated as having a minimum volume of 30 ML and design volume of 524 ML.

26. Concerning a “fine rejects storage facility” a report was prepared by CMPS&F Pty Ltd (CMPS&F Report) dated 20 June 1997. The CMPS&F Report gave preliminary consideration to a fine rejects disposal area focussing on two gullies to the west of the Mine site as topographically and geotechnically appropriate locations for the required volume of fine rejects. An “earthfill dam” was to be constructed at the base of each gully “to contain stormwater runoff from the area of fine reject deposition and surrounding catchment”. The sizing of environmental dams at the mine site was discussed:

Based on the assessed probable hazard and preliminary advice from the NSW Dams Safety Committee, the environmental dams have been provisionally designed to store without discharge 50% of Probable Maximum Precipitation (½ PMP) assuming 100% yield from their respective discharges.

...

More detailed and specific advice will be obtained from the NSW Dams Safety Committee during detailed design to finalise acceptance criteria. NSW Dams Safety Committee are able to provide no clearer advice until further details are officially submitted.

28. A report of Earthtech Laboratories dated June 1997 (Earthtech Report) providing specialist geotechnical input was attached to the CMPS&F Report. The Earthtech Report proposed that ED1 would be approximately 13.5 m in height with storage capacity of 520 ML. Further, “[a]ll structures will be designed as zero release structures based on the half Probable Maximum Precipitation storm event”.

29. The Earthtech Report considered the potential hazard rating of ED1 having regard to the DSC’s “Hazard Ratings for Dams” guidelines (DSC13). At the time when the EIS was prepared DSC13 provided three categories of “hazard”: high, significant and low. The Earthtech Report concluded that it was likely that ED1 would be assessed to have a “low” hazard rating but that it would be prudent to anticipate that the DSC would ultimately assign a “significant” rating and to plan accordingly. A “significant” hazard rating would require ED1 to be designed to cope with a 50% PMP event. The Earthtech Report later stated that “[f]urther detailed investigation at time of final design is recommenced to develop site specific design parameters and to refine conceptual design”.

Mount Pleasant Mine Environmental Management Plan 30 July 2004

30. The Mount Pleasant Mine Environmental Management Plan (EMP) (Exhibit A, Tab 4) was prepared by Hansen Consulting for Coal & Allied dated 30 July 2004. The EMP addressed “Stage 1 development activities only”. In the introduction to the EMP this was described as follows:

The primary focus of this version of the Environmental Management Plan is to address the Stage 1 development activities only. These are limited to the construction of a sedimentation earth dam (Environmental Dam ED1) and the upgrade of an existing access track to the dam site (Figure 2). The function of the Environmental Dam will be to intercept stormwater runoff and any surface seepage from the future tailings impoundment area. The Tailings impoundment area will be constructed in a later stage of project development and is not addressed by this management plan. The Environmental Management Plan will be supplemented as subsequent stages of the mine development works commence.

Stage 1 construction work is scheduled to commence in the 3rd quarter of 2004 and is expected to be completed within eight to twelve weeks. The Stage 1 construction works will specifically involve:

•   Grading of existing farm access track (approximately 1km long) and placement of gravel;

•   Clearing, grubbing and stripping of topsoil form the dam borrow and stockpiling areas;

•   Excavating, conditioning, placement and compaction of rock and clay material to construct the dam embankment and rockfill toe drain;

•   Construction of the dam spillway including placement of geotextile and rock scour protection;

•   Cut-to-fill earthworks for construction of small drainage diversion drains;

•   Topsoiling, seeding and fertilizing of the downstream dam embankment batter, spillway, drains and other areas disturbed during construction; and

•   Demobilisation and site cleanup.

31. The EMP was a collection of individual environmental management plans which were required to be prepared by condition 3.2 of the Consent. Plans that were prepared, included in the EMP and submitted to the Director-General for approval, concerned the following topics: waste, archaeology and cultural heritage, flora and fauna, erosion and sediment control, topsoil stripping, landscape, land, water, air quality and noise.

Letter from Hansen Consulting to Muswellbrook Shire Council 2 August 2004

32. A letter was sent from Hansen Consulting to Muswellbrook Shire Council (the Council) dated 2 August 2004 (Exhibit 3). The letter notified the Council that construction of Stage 1 development activities, “limited to the construction of a sedimentation dam and the upgrade of an existing access track to the dam site”, were scheduled to commence in the third quarter of 2004.

33. Hansen Consulting requested the Council provide feedback on certain sections of the “draft” EMP before its submission to DIPNR. These sections included the following management plans which were to be prepared in consultation with the Council according to the Consent: flora and fauna, land, water and air quality. A landscape management plan was to be prepared to the satisfaction of the Council prior to the commencement of construction as required by condition 3.7(1) of the Consent. The Council was requested to provide feedback on and approve this plan.

Letter from NPWS to Rio Tinto 12 August 2004

34. A letter was sent from NPWS to Rio Tinto dated 12 August 2004 (Exhibit B, Tab 11). The letter provided “preliminary comments” on Aboriginal heritage issues pursuant to Rio Tinto’s request that DEC review the draft EMP. The NPWS office identified a number of concerns with the EMP as drafted. These relevantly included:

1.   The Applicant is required under the consent conditions to enter into negotiations with DEC to identify and reach an agreement on off-site conservation options prior to the commencement of any construction works. This has not occurred to date, though I acknowledge your recent attempt to set up a face to face meeting Development Consent condition 3.3-3 needs to be satisfied before any impacts in the development area take place. [emphasis in original]

2. The Archaeology and Cultural Heritage Management Plan presented in the Draft Stage 1 Environmental Management Plan is pre-emptive. A plan is required from the on-set which covers the entire development area in order that consideration is given to how the proposed access road and environmental dam fit within the overall context of Aboriginal heritage conservation areas, off-sets and archaeological salvage work relevant to s 90 consent(s). The DEC supports the development of an Archaeology and Cultural Heritage Management Plan for the whole development area rather than through a staged approach.

3.   ... consultation with only the Upper Hunter Wonnarua Council is not considered to be a fulfilment of the Development Consent conditions.

...

Email from Hansen Consulting to DIPNR 13 August 2004

35. An email was sent from Hansen Consulting to DIPNR dated 13 August 2004 (Exhibit 2). The letter was addressed to Mr Kitto of DIPNR and stated “[a]s you suggested I submitted “the draft MTP Mgt Plan to DIPNR to fulfill [sic] the requirement to consult with DLWC [the Department of Land and Water Conservation]”.

Letter from Muswellbrook Shire Council to Hansen Consulting 17 August 2004

36. A letter was sent from the Council to Hansen Consulting dated 17 August 2004 (Exhibit 4). The letter recorded the Council’s response to the draft EMP provided to the Council on 2 August 2004, see par 32 above. It stated that “Stage 1 operations have been noted”. In relation to the landscape management plan which was to be prepared to the satisfaction of the Council prior to construction commencing the Council responded “Satisfactory. How long will monitoring be undertaken?”

37. The Council’s feedback was recorded and commented on in part 1, Table 1 of the letter to DIPNR dated 20 August 2004 extracted at par 42 below.

Pre-construction Compliance Report 18 August 2004

38. A Pre-construction Compliance Report (Exhibit 13, Tab 9) was prepared by Hansen Consulting for Coal & Allied dated 18 August 2004. The Report purported to be prepared in accordance with condition 1.5(1)(a) of the Consent and provided “an assessment of the pre-construction status of compliance with the development consent conditions”.

39. Table 1 in the Report included a summary of all conditions and indicated the compliance status with each condition. The following environmental management plans were indicated as having been “prepared and submitted to DIPNR for approval”: waste, archaeology and cultural, flora and fauna, erosion and sediment control, soil stripping, landscaping and revegetation, land, water, air quality and noise. These are the plans included in the EMP, see par 31 above. The report indicated that negotiations were underway with NPWS and the Wonnarua Tribal Council (condition 3.3(3)).

40. The Report was limited in scope to “Stage 1 construction works... the construction of a sedimentation dam (Environmental Dam ED1) and an associated gravel access track”. The environmental management plans deemed “not yet applicable” related to the management of mining operations, final void and blast. The engineering report on on-site flood-lighting impacts (condition 6.5), which is raised in UHSIA’s Points of Claim, was indicated as having not been prepared as “Stage 1 activities [were] to be performed in daylight hours only”.

41. The Report also referred to condition 3.6(3) requiring a $10,000 contribution to the Council for site rehabilitation management. A first instalment of $5,000 was paid on 22 February 2000 with the second to be made upon the issuance of the mining lease for the project.

Letter from Hansen Consulting to DIPNR 20 August 2004

42. A letter from Hansen Consulting to Mr Kitto of DIPNR dated 20 August 2004 (Exhibit B, Tab 12) provided formal notification to DIPNR of Coal & Allied’s intention to physically commence construction works on 27 September 2004. The EMP and Pre-construction Compliance Report were attached. It stated that the EMP was “prepared commensurate with the required Stage 1 construction works and will be supplemented prior to the commencement of all future stages of the project”. The letter provided detail on the consultation processes that had occurred to date. It relevantly stated:

Where required by the MTP Development Consent, both consultation and negotiation have been instigated by the proponent. The responses received from the consulted regulatory bodies are attached. Wherever practicable, the suggestions and comments resulting from our consultation and negotiation efforts have been included in the plan.

A summary of the comments received and where they have been addressed in the plan is included in Table 1 below:

Table 1

Consultation Comments and How/Where Addressed In the Plan

Comments

How/Where Addressed in the Plan

1. Muswellbrook Shire Council

1.1 Introduction

1.1.1 Flora & Fauna Mgt Plan should be complete prior to commencement of operations.

Plan completed prior to operations. See Section 4 of The Plan.

1.1.2 No reference to the protection of identified threatened species and the result of any Part 8 tests.

Protection of threatened species addressed in Section 4 of the Plan. No 8 Part tests required.

1.2 Waste management – onsite sewage disposal has not been addressed.

Section 2.1 of The Plan highlights that there will be no on site sewage. Standard portaloo pump out toilet facilities will be utilised.

1.3 Cultural Heritage

1.3.1 Consultation of all relevant Tribal Councils will be required.

There is only one Tribal Council represented in the Upper Hunter Valley. This Tribal Council, the Wonnarua Tribal Council, has been extensively consulted over the development and is fully supportive of The Plan.

1.3.2. ...

...

1.4 Flora and Fauna – Relevant threatened species should be identified and managed.

Addressed in Section 4 of The Plan.

1.5 Topsoil Stripping – Consideration of 2 m high Stockpiles.

Section 6.2 modified to reflect this suggestion.

1.6 Landscaping – Will monitoring of landscaping be undertaken.

Section 14 of The Plan requires that the MER undertakes extensive monitoring including monitoring of housekeeping and works.

1.7 Land Management – Advice required as to disposal of waste water from truck wash down areas.

Section 8 of The Plan states that “prior to arrival on the site” If necessary, plant and equipment will be washed to ensure no weeds are transferred to the site. There will be no truck wash water to contend with on the site.

1.8 …

...

1.9 ...

...

2. Department of Environment and Conservation

2.1 Applicant required to undertake negotiations.

Pursuant to Condition 3.3(3) of the MTP development consent, the proponent has held extensive “face to face” negotiations with the Wonnarua Tribal Council. As the NPWS has declined to meet face to face with the proponent, negotiations have commenced via correspondence. Our advice confirms that negotiations have commenced prior to the commencement of construction with both specified parties.

2.2 The DEC supports the development of an Archaeology and Cultural Management Plan for the whole development area rather than a staged approach.

Section 3 of The Plan includes an Archaeology and Cultural Heritage Management Plan which refers to the whole of the MTP area. It is intended to supplement this plan as the development plans for MTP unfold.

2.3 Consultation with only the Upper Hunter Wonnarua Council is not considered to be a fulfilment of the Development Consent conditions.

Condition 3.3.1(a) of the MTP Consent requires the Applicant to consult with both the NPWS and the Wonnarua Tribal Council over the preparation of an Archaeological and Cultural Management Plan for the site.

We have held the required consultations and been advised we have met the requirements of Condition 3.3.1(a).

2.4 ...

...

3. Department of Primary Industry

3.1 …

...

3.2 Whether the work would be separately fenced or stock restricted to other areas?

Section 8 of The Plan has been modified to state that it is not our intention to restrict stock from the area during the construction period and that procedures will be put in place to ensure their safety.

3.3 Alternative water provision for livestock whilst the dam is constructed and stabilised?

Section 8 of The Plan has been modified to state that construction activities will not impact on livestock water access.

We have followed your instruction not to pursue comment on various aspects of The Plan from the water arm of DIPNR during our consultation process.

We trust that our responses resulting from our consultation and negotiation process meet with your approval.

...

43. A further letter from Hansen Consulting to DIPNR dated 6 September 2004 (Exhibit 6) provided DIPNR copies of the feedback received as a result of consultation with the Council (Exhibit 4, see par 36 above) and NPWS (Exhibit B, Tab 11, see par 34 above).

Letter from DEC to Rio Tinto 8 September 2004

44. A letter was sent from DEC to Rio Tinto dated 8 September 2004 (Exhibit B, Tab 13). The letter outlined DEC’s concerns with Rio Tinto’s approach to the conditions of Consent concerning Aboriginal heritage management. Of particular concern was the interpretation of condition 3.3(3) relating to conservation offsets. The DEC indicated that Rio Tinto’s proposed establishment of a “keeping place” did not reflect community consultation outcomes or DEC requirements for an appropriate offset.

45. The letter noted that since the granting of the Consent the Wonnarua Tribal Council had ceased to be the main community group representing Aboriginal interests in the area and that this should be considered in the development of current management options.

46. The DEC expressed reservations with the archaeology and cultural heritage management plan contained in the EMP particularly as it indicated that there were no recorded “sites” in the proposed location of ED1. The DEC considered on the basis of the relevant study undertaken in the EIS that there was a high probability that Aboriginal heritage items would be found within this area. The DEC indicated its preference that a plan of management be developed for the entire mine area prior to the commencement of construction works to ensure that all relevant management procedures and consents were in place.

Letter from Coal & Allied to DEC 20 September 2004

47. A letter was sent from Coal & Allied to DEC dated 20 September 2004 (Exhibit B, Tab 14) responding to issues raised by DEC concerning Aboriginal heritage management.

48. In relation to the consultation required under condition 3.3(3) of the Consent, the letter stated that Coal & Allied had held extensive “face to face” negotiations with the Wonnarua Tribal Council and had commenced negotiation via correspondence with DEC. These consultations also satisfied condition 3.3(1)(a) as they addressed the preparation of the archaeology and cultural heritage management plan. Coal & Allied’s legal advice indicated that these negotiations did not need to be concluded prior to the commencement of construction works. Coal & Allied stated that it would be inappropriate to conclude such discussions before the formalisation of a detailed final plan of the Mine. When this occurred an “all inclusive Aboriginal stakeholder consultation strategy” would be put in place.

47. In relation to DEC’s criticism of the draft archaeology and cultural heritage management plan as “pre-emptive” and not addressing the entire development area, Coal & Allied stated that it would be impractical to do so. Rio Tinto did not yet own or have access to all the land required for the construction of the Mine and the final design of the Mine had not been finalised. The letter stated that “the initial Stage one construction works have been carefully designed with the assistance of a qualified archaeologist to ensure that no archaeological sites are impacted by construction activities”. The archaeology and cultural heritage management plan would be supplemented prior to the commencement of any further construction activities.

Letter from DEC to Coal & Allied 14 October 2004

50. A letter was sent from DEC to Coal & Allied dated 14 October 2004 (Exhibit 13, Tab 19) in response to the letter of 20 September 2004 which had raised “four points for discussion regarding the preferred approach to progressing the Aboriginal cultural issues”. The reply letter stated “[t]he future actions and commitments you propose against each of the four points is noted and supported”.

Letter from DIPNR to Hansen Consulting 15 October 2004

51. A letter from Mr Kitto of DIPNR delegate for the Director-General to Hansen Consulting dated 15 October 2004 (Exhibit A, Tab 5) stated:

Dear James

Mount Pleasant Coal Mine

 Environmental Management Plans

I refer to your email of 14 October 2004 seeking approval for the Environmental Management Plan, Pre-Construction Compliance Report and the Stakeholder Consultation Strategy prepared to satisfy the requirements of the Mount Pleasant Coal Mine development consent (DA 92/97).

It is noted that these plans address the requirements of the development consent as they relate to the proposed Sediment Dam ED1, and that these plans will need to be revised and resubmitted to the Department for approval prior to mining activities commencing on the site.

The Department has reviewed these plans and is generally satisfied that they address the requirements set out in the development consent, as they apply to the proposed Sedimentation Dam ED1, provided the following matters are addressed:

•   a copy of the Environmental Management Plan is provided to the Mount Pleasant Community Consultative Committee at its first meeting;

•   evidence is provided to the Department that the Environmental Contact Line for the Mount Pleasant development has been established and advertised in accordance with the development consent (Condition 10.1(1) and 10.1(4)); and

•   water carts and trucks are made available to the Bush Fire Service and Emergency Service when required in cases of emergencies, such as bushfires (Condition 3.8(2)).

Provided these requirements are complied with, you may consider these plans approved by the Director-General.

In addition, you are advised that the Department requires that the Mount Pleasant Community Consultative Committee be established and have its first meeting, prior to construction commencing, in accordance with Condition 8.8(1a).

...

Yours Sincerely

David Kitto

Manager

Mining & Extractive Industries

As delegate for the Director-General

Affidavit of Mr Beatty

52. Mr Beatty solicitor for UHSIA swore an affidavit dated 30 May 2017. Mr Beatty caused letters to be sent regarding informal requests for information in connection with these proceedings to several government agencies in 2016. On 19 April 2017 subpoenas to produce were issued to the following government departments and agencies: Department of Planning and Environment (DPE), Department of Primary Industries (DPI), NSW Environment Protection Authority (EPA) and the Council.

53. The subpoenas all sought documents recording engineering or other physical works at the Mine between 22 December 1999 and 19 January 2005 and evidence of the construction of ED1 or any road prior to 19 January 2005. The subpoenas also sought additional documents for the same period specific to each subpoenaed party. The DPE was required to produce a land management plan required under condition 3.10(1) of the Consent. The DPI was required to produce documents recording consultation with DLWC or NSW Agriculture in respect of various management plans. The EPA was required to produce documents recording the provision of a flora and fauna management plan to NPWS and any relevant communications relating to this plan. The Council was required to produce documents recording consultation with Coal & Allied concerning various management plans and any record of payments made by Coal & Allied required under condition 3.6(3).

54. Documents returned pursuant to these subpoenas were attached to Mr Beatty’s affidavit. The EPA produced the Annual Environmental Management Report 2005 (Exhibit A) and the Council produced documents evincing the payment by Coal & Allied of $5,000 to the Council pursuant to condition 3.6(3).

55. A subpoena to produce was issued to the DSC on 10 May 2017. Following correspondence the DSC advised that it had nothing to produce in response to this subpoena.

56. Mr Beatty stated that no documents were produced in relation to various matters concerning various conditions of Consent, particularly those which related to the preparation of environmental management plans for “the DA area”, in the period up to 15 February 2005.

Cross-examination of Mr Beatty

57. It was put to Mr Beatty that he took an overly restrictive view in reviewing material produced by the Council in response to their subpoena. He agreed that he took a restrictive view but not that it was overly so. Mr Beatty agreed that a document which became Exhibit 2 suggested a subpoena addressed to DPI intended for DLWC was sent to the wrong department.

58. Mr Beatty conceded that the period the subject of the subpoenas was up to 19 January 2005, not 15 February 2005 as stated in his affidavit. He agreed that DPE was not able to produce the cover letter for the Consent very likely to have been sent in 1999. He agreed that a letter to the Council from Hansen Consulting dated 2 August 2004 (Exhibit 3) enclosing a copy of the draft EMP should have been disclosed in his affidavit.

59. I do not intend to further summarise the documents produced and Mr Beatty’s statements about what was not produced. Mr Beatty sought to establish certain negative propositions based on what documents were not contained in the subpoenaed material. MACH did not dispute that documents required by the conditions of the Consent for the DA area did not exist.

Evidence of MACH

60. MACH read a number of affidavits addressing the engineering and construction work relied on to establish that the Consent had not lapsed.

Affidavit of Mr Witherdin

61. Mr Witherdin engineering executive swore an affidavit dated 9 May 2017 recalling his involvement in the design and construction of ED1 while working for his employer Parsons Brinckerhoff as a senior civil engineer. He reviewed relevant archived documents from Parsons Brinckerhoff to assist in the preparation of his affidavit.

62. Mr Witherdin deposed that he was involved in the preparation of a proposal for the conceptual and detailed design of ED1 from May 2003. That proposal was attached to his affidavit at PW-10. Mr Witherdin recalled work that was performed in both the conceptual design and detailed design phases. Mr Witherdin attended a site inspection of the proposed location of ED1 in mid-June 2003 after which time it was determined that the location should be shifted slightly downstream to make better use of the natural topography. A conceptual design plan for ED1 dated 11 July 2003 was produced showing the location of the proposed dam and embankment and proposed test pit and borehole sites for geotechnical investigations to be undertaken. This plan was attached to Mr Witherdin’s affidavit at PW-14.

63. Mr Witherdin recalled that a hazard assessment of ED1 was undertaken by Parsons Brinckerhoff based on the dam having a nominal capacity of 50 ML. This was submitted to the DSC which concluded that ED1 was not “prescribed”.

64. An updated proposal for design services dated 8 October 2003 was attached at PW-18. This document recorded that four engineering design jobs at the Mine were being carried out by Parsons Brinckerhoff at this time. They were the conceptual design of ED1, final design of ED1, additional geotechnical work for ED1 and conceptual design of West Link Road. Mr Witherdin deposed that all work required to be carried out by Parsons Brinckerhoff associated with ED1 had been completed by 8 October 2003.

65. Mr Witherdin deposed that Coal & Allied made a decision in August 2004 to shift the location of ED1 slightly westwards of the location proposed in Parsons Brinckerhoff’s final design. This change was intended to avoid impacting any Aboriginal artefacts. A drawing reflecting the new location was attached at PW-19. An invoice to Coal & Allied attached at PW-20 noted six variations to the design and documentation of ED1. These entries included “relocation of embankment alignment” and “geotechnical investigation associated with relocated embankment”.

Affidavit of Mr Anderson

66. Mr Anderson senior engineering geologist affirmed an affidavit dated 5 May 2017. Mr Anderson attested to his involvement through his employer Parsons Brinckerhoff with the design and construction of ED1 between July 2003 and August 2005. Mr Anderson refreshed his memory in the preparation of this affidavit by reviewing relevant archived documents of Parsons Brinckerhoff.

67. Mr Anderson attested to having undertaken a first set of geotechnical work between 20-22 August 2003. This work involved the drilling of four boreholes and excavation of 17 test pits. Mr Anderson recalled observing at the site survey pegs indicating the locations of the centreline of the embankment for ED1, boreholes and test pits. He stated that he would not have been able to accurately undertake his geotechnical investigation work in the correct locations without these areas having been pegged. Mr Anderson produced written logs of this work and took photos of the rock cores he recovered. These were attached to his affidavit at JA-11, JA-12, JA-13 and JA-16. Mr Anderson understood that the purpose of this work was to provide information about the geotechnical suitability of the proposed location of ED1 that would inform the dam’s final design, layout and location. It would also produce information about subsurface conditions so that contractors tendering for the construction of ED1 had sufficient information to accurately price the work.

68. Mr Anderson attested to having undertaken a second set of geotechnical investigations on 27 August 2004 concerning the new location of ED1. Mr Anderson supervised the excavation of three test pits for this work. He did so for at least another 13 test pits in the location of ED1 on 1 October 2004. Test pit engineering logs showing the results of this work were attached to Mr Anderson’s affidavit at JA-25 and JA-28. Mr Anderson understood the purpose of this work to be the provision of more information to contractors for pricing of construction works for ED1.

69. Mr Anderson attested to monitoring the construction of ED1 which commenced on or about 30 November 2004 through weekly or biweekly inspections of the site and ongoing earthworks testing. This continued until the end of the construction period for ED1 in March 2005. A construction report was produced as a result of this work dated December 2005 and was attached at JA-30.

Affidavit of Mr Boardman

70. Mr Boardman registered mine surveyor swore an affidavit dated 9 May 2017. Mr Boardman deposed that his company G Boardman & Associates (GBA) was engaged by Coal & Allied in June 2003 to carry out survey work at the Mine. The works concerned ED1 and the location of archaeological artefacts located within the project boundary. Mr Boardman was the main point of contact for this work and managed administrative matters such as billing. Mr Boardman was assisted in his recollection by several documents which were attached to his affidavit. He recalled having involvement in the works associated with ED1 but not those associated with the artefacts. Mr Boardman is currently subcontracted to do construction surveying work at the Mine.

71. Mr Boardman deposed that GBA obtained GPS coordinates from Coal & Allied to peg out ED1 as depicted in Figure 8 of the EIS and the archaeological artefacts in or around June 2003. He pegged the perimeter of ED1 and the proposed centreline of its embankment around the same time. Mr Boardman undertook an inspection of the site in May 2017 where he observed that the original star pickets used to peg the proposed centreline were still in place. Photographs of these star pickets were attached to Mr Boardman’s affidavit at AB-13 and AB-14. A cover letter to a tax invoice both dated 30 June 2003 from GBA to Coal & Allied annexed at AB-6 referred to the pegging of sites for artefacts and the proposed centreline of a 50 ML dam as having been undertaken per instructions. A similar cover letter and tax invoice both dated 31 August 2003 (AB-7) also referred to “pegging of the preliminary dam location”. Mr Boardman deposed that although the survey work was done in or around June 2003 it was invoiced at a later date. The August letter and tax invoice indicated that a centreline for a proposed road or track to provide access to ED1 was pegged on 23 June 2003 although Mr Boardman did not recall being involved in this work.

72. Mr Boardman deposed that he carried out a topographical detailed survey of land within and adjoining the proposed ED1 area in early July 2003. The purpose of this survey was to physically gather data for Parsons Brinckerhoff to enable an accurate engineering design of ED1. On 20 August 2003 Mr Boardman pegged a new dam site for ED1 as well as the locations of four boreholes and 17 test pits.

Cross-examination of Mr Boardman

73. Mr Boardman was asked about the process by which GBA generated invoices for the work performed in relation to ED1. A surveyor would fill out a time sheet on-site noting the work that was done on that day which was then provided to a company secretary at the office who would enter this information on electronic accounting software that produced invoices. Therefore, the information contained in the invoices reflected contemporaneous descriptions of the work performed on-site. Mr Boardman stated that sometimes he relied on the descriptions included in the invoices when drafting cover letters for invoices. The letter and invoice from GDA to Coal & Allied dated 30 June 2003 which referred to the pegging of artefact sites and “the proposed centreline of the 50 mega litre dam for field inspection” did not refer to pegging of the perimeter of the dam. Mr Boardman disagreed that the perimeter was never pegged and this is why the work was not recorded in any invoices. He recalled having physically pegged the perimeter at the same time as the centreline. He also recalled standing with a senior employee of Coal & Allied in June 2003 and indicating the two centreline pegs and the pegs marking the perimeter of ED1 further up the hill.

74. Mr Boardman agreed that when he visited the site in May 2017 he saw pegs marking each end of the dam embankment but did not see any pegs marking the perimeter of ED1. He recalled that these pegs would have been further up the hill from the embankment pegs and behind thick scrub.

Affidavit of Mr Webber

75. Mr Webber construction superintendent swore an affidavit dated 5 May 2017. Mr Webber was employed as project supervisor for the construction of ED1 from November 2004 until the completion of its construction in around March 2005. He spent a number of hours each day on-site during this period. In his affidavit Mr Webber attested to his recollection of the survey work related to ED1 that had been done in late 2004. Mr Webber had regard to daily site reports and photographs contained within the construction report annexed to the affidavit of Mr Anderson to assist his recollection of events in the preparation of this affidavit.

76. Mr Webber deposed that the construction work for ED1 and a related access track was performed by SCE. As project supervisor Mr Webber was required to ensure that SCE carried out the work in a safe manner and in accordance with the relevant plans.

77. The survey work in relation to ED1 was carried out by a surveyor retained by SCE. Mr Webber does not independently recall the areas that would have been pegged by the surveyor prior to the commencement of construction. He stated that he has knowledge and experience in the practices required of contractors for Coal & Allied having worked on over 10 construction projects for coal mines operated by Coal & Allied since 2003. Based on this knowledge and experience he believed that three areas would have been surveyed and pegged: the total area that could be disturbed during the construction of ED1 and which was the subject of a “ground disturbance permit”, the footprint of the embankment of ED1 and the footprint of the inundation area of ED1.

78. Mr Webber also deposed that he believed a key-trench within the embankment would have been surveyed and pegged almost immediately after the removal of topsoil from the embankment footprint. Mr Webber believed that the topsoil was removed on 30 November 2004 based on a daily site report contained in the affidavit of Mr Anderson. He stated that the construction of the key-trench would have commenced no later than 10 December 2004 having seen a photograph depicting this work contained in Mr Anderson’s affidavit which was recorded as having been taken on this date.

Cross-examination of Mr Webber

79. Mr Webber was asked about the surveying work that would have been carried out in relation to ED1 in late 2004. He confirmed that he did not know who the surveyor was that did this work, who instructed them or what instructions were given. Mr Webber was nevertheless confident that he knew or was able to infer what this surveyor's practices were based on evidence of surveying pegs in documents annexed to his affidavit and his experience working on jobs for Coal & Allied. On this basis Mr Webber thought that the footprint of the inundation area of ED1 was pegged prior to construction. Mr Webber identified photographs in Appendix D of the construction report prepared by Parsons Brinckerhoff which showed a number of survey pegs in situ during the construction of ED1. Although Mr Webber did not refer to this report in his affidavit he had seen extracts of it previously.

80. In re-examination Mr Webber clarified that practice within Coal & Allied dictated that a job would not commence without a ground disturbance permit. This document prescribed the total area that could be disturbed, which contractors relied on to define the area that needed to be stripped of soil. As contractors did not get paid for stripping an extra quantity of soil, customarily the area that needed to be stripped would be pegged to define their work area.

Hydrology experts

81. Mr Droop employed by UHSIA prepared an expert report dated 19 May 2017. He was instructed to provide his opinion on the intended function of ED1 and whether that function could be fulfilled by the dam as designed or constructed. Mr Gilbert employed by MACH prepared a report in response to Mr Droop’s report dated 1 June 2017. Both experts prepared a joint report dated 5 June 2017.

82. In Mr Droop’s opinion based on reviewing the EIS including technical reports ED1 was intended to form an important component of the mine water system ensuring that all runoff from the fine rejects emplacement area caused by a rainfall event of size equal to 50% PMP was to be captured and maintained on-site unless intentionally released. The EIS states that a capacity greater than 520 ML was required to meet this design criterion. Mr Droop performed calculations that supported this size. ED1 as constructed has an estimated capacity of 50 ML and is not capable of meeting the intended function as set out in the EIS. Its size and characteristics including an open pipe and low level spillway suggest that ED1 is better characterised as a “sediment dam”.

120. A further overriding issue to consider is whether the engineering work can be considered discretely from the construction work for ED1. As MACH submitted s 99(4) differentiates between engineering and construction work (the subsection refers to “or”). As identified in K & M Prodanovski at [14] citing Green at [70], the relationship of the words “relating to” is between work which is physically carried out on the land and the development or undertaking which has been consented to. The building or work the subject of the Consent is separate, if related. Survey and geotechnical work assists in planning the future building and construction work. Green does not support UHSIA’s submission that the engineering work is unlawful because ED1 is unlawful. Hunter Brokerage identifies that describing work as preparatory as occurred at first instance in Green does not preclude it being work which satisfies s 99(4). Provided the engineering work relied on is not itself illegal under a consent, and there is no basis for so finding in this case (there are no conditions as in Green and Coalcliff which require things to be done before any work could commence on-site), it can satisfy s 99(4). That what is supported by the engineering work (the construction of ED1 in this case) requires other conditions to be met is a separate and distinct question. This conclusion is also supported by K & M Prodanovski at [32], [34]-[35] per Meagher JA (Leeming JA, Sackville AJA agreeing).

Third limb of Hunter Brokerage

123. Whether the survey and geotechnical work physically commenced on the Land satisfies the third limb of Hunter Brokerage will next be considered.

124. There is no dispute that some surveying and geotechnical work physically occurred on the Land before 15 February 2005. Considering the evidence adduced by MACH, set out above in pars 61-80, Mr Witherdin in his capacity as senior civil engineer at Parsons Brinckerhoff began working on the design and construction of ED1 in May 2003. He was involved in the preparation of a proposal for the conceptual design of ED1 in June 2003. The proposal divided work into two phases: the conceptual design phase and detailed design phase. Mr Witherdin recalled work that was performed in both phases but his personal involvement in this work was limited. He attended a site inspection in mid-June 2003 after which time it was discovered that the location of ED1 could be improved upon. A conceptual design plan showing borehole and test pit locations dated 11 July 2003 was prepared.

125. Mr Anderson, an engineering geologist with Parsons Brinckerhoff, worked on the detailed design phase. He carried out physical geotechnical investigations (boreholes and test pits) according to the locations identified on the 11 July 2003 conceptual design plan on 20-22 August 2003. Mr Anderson recalled seeing pegs at the site but did not know at the time who had placed those pegs there. Mr Witherdin recalled that Coal & Allied had contracted the survey work proposed in the detailed design phase to another company.

126. Mr Boardman deposed that his firm GBA was contracted by Coal & Allied in June 2003 to do survey works associated with ED1 and archaeological artefacts. He pegged the perimeter of ED1 and the proposed centreline of the embankment as depicted in Figure 8 of the EIS in June 2003. Mr Boardman also carried out a “topographical detailed survey” of the Land in early July 2003. The purpose of this work was to gather data for Parsons Brinckerhoff to enable an accurate engineering design of ED1. Mr Boardman pegged the new dam site including boreholes and test pits based on Parsons Brinckerhoff’s conceptual design plan on 20 August 2003.

127. Mr Anderson did further geotechnical investigations on 27 August and 1 October 2004 in a new location for ED1. Construction of ED1 began on 30 November 2004 and continued until March 2005. Mr Anderson monitored the construction work and a construction report was produced in August 2005.

128. There is no dispute that Mr Boardman conducted a topographical detailed survey of a substantial area on 5 July 2003 including ED1 and adjoining land. Nor is there dispute that Mr Boardman pegged a new dam site and the locations of 17 test pits and four boreholes on 20 August 2003, see par 72 above. The pegging of Aboriginal artefact sites in the vicinity of ED1 in July 2003 was also not disputed. Although not undertaken by Mr Boardman this work was clearly recorded in an invoice as having taken place on 25 July 2003, see par 71 above.

129. The evidence of geotechnical work relied on by MACH was not challenged by UHSIA. In August 2003 Mr Anderson supervised the drilling of four boreholes and digging of 17 test pits, see par 67 above. Three further test pits were dug on 27 August 2004, see par 68 above. Details of the tests that were performed as a result of these investigations were provided in Mr Anderson’s affidavit. The results assisted Parsons Brinckerhoff to determine the final design and location of ED1.

130. As I understand UHSIA’s case two instances of survey work are disputed. The first is that Mr Boardman did not peg the perimeter of ED1 in June 2003 because there was no explicit reference to this work in the invoices supplied to Coal & Allied, see par 71 above. There is also no photographic evidence of the survey pegs said to mark the perimeter of ED1. The proposed centreline of the embankment of ED1 was pegged in June 2003 for which there is photographic evidence and entries recording this are in the invoices dated 30 June 2003 and 31 August 2003.

131. The June 2003 survey work is established by the evidence of Mr Boardman, which was not undermined by cross-examination highlighting that no description of pegging the perimeter of the dam was contained in the June and August 2003 invoices, see pars 73-74 above. He gave clear oral evidence of his recollection of standing with a senior employee of Coal & Allied in June 2003 and referring to the two centreline pegs and the pegs outlining ED1 further up the hill (TS 151 ln 50 – TS 152 ln 7). That no photograph can be provided of the pegs some 14 years later given their location in thick scrub according to Mr Boardman does not weigh against MACH. I find that this work has been proven by MACH on the balance of probabilities.

132. The second item of disputed survey work relied on by MACH was undertaken in November 2004. Mr Webber was the project supervisor for the construction of ED1 from November 2004 to around March 2005. His recollection of events according to his affidavit summarised above in pars 75-78 relied predominantly on site reports and the 2005 construction report annexed to Mr Anderson’s affidavit. He recalled that surveying in connection with ED1 was performed in November 2004 but did not recall the individual who did this work. Mr Webber deposed that this work was performed by an independent contractor SCE, a company no longer in business. He did not recall any specific details as to who the surveyor was or what their instructions were, see pars 77, 79 above. Mr Webber’s evidence based on his considerable experience of the usual practice of Coal & Allied was that the area covered by a “ground disturbance permit” would have been pegged before any soil was removed, see pars 77, 80 above. Contractors relied on these markings to define the area within which they worked. It is relatively easy to infer that excavation would not occur until the relevant area had been pegged in order to ensure the amount of excavation undertaken was accurate. MACH has established on the balance of probabilities that the survey work in November 2004 was undertaken prior to the construction of ED1.

133. No argument that the engineering work is a sham has been made by UHSIA and the work performed was not “merely notional or equivocal” per Hunter Brokerage at [86]. The first and third limbs of Hunter Brokerage are satisfied in relation to engineering work, it having been physically commenced on the Land before 15 February 2005.

Second limb of Hunter Brokerage

134. At issue is whether the second limb of Hunter Brokerage was met, namely whether the engineering work undertaken related to the development. UHSIA submitted that because the conditions of Consent were not complied with none of the engineering (or construction) work satisfies the second limb.

135. Construction of conditions of development consent requires that their meaning be determined objectively having regard to the context in which the consent was issued, taking into account that the consent operates in rem for the benefit of subsequent owners as well as an applicant, see K & M Prodanovski at [23] citing House of Peace Pty Ltd v Bankstown City Council (2000) 48 NSWLR 498; [2000] NSWCA 44 at [23], [37]-[41] per Mason P (Stein and Giles JJA agreeing). A development consent must be construed in order to give it practical effect and to avoid uncertainty, Gosford Waterfront Alliance Inc v TO Gosford Pty Ltd (No 2) [2016] NSWLEC 162 at [47] citing Driscoll v J Scott Pty Ltd (1976) 50 ALJR 528; 36 LGRA 159 at 163-164 per Murphy J (Stephen and Jacobs JJ agreeing) and Westfield Management Ltd v Perpetual Trustee Co Ltd [2006] NSWCA 245 at [40] per Hodgson JA (Tobias and Basten JJA agreeing). It is useful to further quote Hodgson JA at [36]:

[36]   Certainty as such was not a requirement for validity, though uncertainty could be an element of unreasonableness: Cann’s Pty Ltd v The Commonwealth (1946) 71 CLR 210 at 227–8; Genkem Pty Ltd v Environment Protection Authority (1994) 35 NSWLR 33 at 42. In any event, [Counsel for the appellant] submitted, as part of upholding the effectiveness of instruments, the Court would try to give them practical effect by avoiding uncertainty. Instruments such as consents and conditions of consent are to be construed, not as documents drafted with legal expertise, but to achieve practical results: Gill v Donald Humberstone & Co Ltd [1963] 1 WLR 929 at 933–4; Driscoll v J. Scott Pty Ltd (1976) 50 ALJR 528 at 531; Hecar Investments & Co Pty Ltd v Lake Macquarie Municipal Council (1984) 53 LGRA 322 at 323.

136. UHSIA’s case as articulated in the Points of Claim identified conditions which it argued were not met because environmental management plans were required to address the DA area and no such plans were produced. That no such plans for the DA area were produced before February 2005 is not disputed by MACH. Several conditions relied on by UHSIA specify plans which must be prepared for the DA area before the commencement of construction, namely 2.2, 3.3(1)(a), 3.4(1), 3.5(1), 3.5(2), 3.10(1), and 4.1(1).

137. UHSIA alleged that the preparation of numerous plans for the Stage 1 area (limited to the construction of ED1 and upgrade of an access track to the dam site according to the description in the EMP extracted at par 30 above), a much smaller area than the DA area, did not comply with the Consent. The extensive summary of evidence including reference to the EMP, Pre-construction Compliance Report and correspondence between Coal & Allied, Hansen Consulting and various government bodies including the Council extracted above in pars 30-51 identifies that the relevant matters required before the commencement of construction by the conditions were covered for the substantially smaller Stage 1 area expressly in the context of building a sediment dam called ED1. Correspondence with the Council identified those matters the conditions required to be notified to the Council, see pars 32-33, 36 above. The Director-General’s delegate accepted “the proposed Sediment Dam ED1” as complying with the Consent in the letter of 15 October 2004 set out in par 51 above.

138. As MACH submitted a number of the same conditions identify that compliance with the condition is expressed as including “to the satisfaction of the Director-General” or as “agreed by the Director-General…” No reason based on principles of construction of consents for not giving these words their full import was provided by UHSIA. In other words, there is no hierarchy of compliance with different aspects of a condition. If a condition provides for the Director-General to have such a role it has full force and effect, including if this means the condition is therefore varied in its effect.

139. The answer to much of UHSIA’s case is the acceptance of Stage 1 as physical commencement of the Consent by the Director-General’s delegate in the letter dated 15 October 2014 set out in par 51 above. All of the necessary conditions of Consent required to be complied with before construction could commence (1.5(1)(a), 2.2, 3.3(1)(a), 3.3(3), 3.4(1), 3.5(1), 3.5(2), 3.10(1), 4.1(1), 6.1(2), 8.4(1) and 8.4(2)) were satisfied according to the delegate. The conditions of Consent allowed for such an approach in that variation to the Consent was possible if the Director-General agreed.

140. UHSIA relied on the fact that DEC was critical of Coal & Allied for not considering the whole of the DA area for the purposes of condition 3.3(3) requiring archaeological and heritage assessment across the whole of the site, as its representative made clear in the letter dated 8 September 2004 summarised in pars 44-46 above. This critical view was identified by Coal & Allied to DIPNR in the letter dated 20 August 2004 (see part 2, Table 1) extracted at par 42 above. Ultimately that critical view did not prevail and does not assist UHSIA’s case in the absence of a legal challenge to the Director-General’s delegate’s approval in the 15 October 2004 letter.

141. I will now consider the balance of the alleged breaches of development consent in the Points of Claim. Several conditions said by UHSIA to have been breached required consultation with various bodies in the preparation of environment management plans. The evidence produced by MACH confirms that the necessary consultation did occur for Stage 1.

142. Conditions 3.4(1), 3.10(1), 4.1(1) and 6.1(2) required consultation with the Council. A “draft” EMP was sent to the Council requesting feedback on 2 August 2004 (Exhibit 3, pars 32-33 above), to which it responded on 17 August 2004 (Exhibit 4, par 36 above). Hansen Consulting addressed the Council’s feedback in a letter to DIPNR dated 20 August 2004 (Exhibit B, Tab 12, par 42 above).

143. Conditions 3.5(1), 3.5(2), 3.10(1) and 4.1(1) required consultation with DLWC. The email from Hanson Consulting dated 13 August 2004 extracted in par 35 above confirms this occurred. MACH also relied on a letter to DIPNR dated 20 August 2004 (Exhibit B, Tab 12, par 42 above) as evidence of this consultation. The letter does not make any express reference to DLWC. It states that “[w]here required by the MTP Development Consent, both consultation and negotiation have been instigated by the proponent”. The letter was also relied upon to show consultation with NSW Agriculture as required by condition 3.10(1).

144. Condition 3.3(1)(a) required consultation with the Wonnarua Tribal Council and NPWS in relation to the preparation of an archaeology and cultural management plan. The Mine proponent was also required to “enter into negotiations” with the same parties concerning conservation offsets per condition 3.3(3). The necessary consultation was demonstrated by the evidence adduced by MACH. The NPWS (and DEC) evinced concerns with the proponent’s approach to Aboriginal heritage issues in letters dated 12 August 2004 (Exhibit B, Tab 11, par 34 above) and 8 September 2004 (Exhibit B, Tab 13, par 44 above). These concerns were noted in a letter to DIPNR dated 20 August 2004 (Exhibit B, Tab 12, par 42 above). Coal & Allied responded to these concerns in a letter dated 20 September 2004 (Exhibit B, Tab 14, par 47 above) and received a supportive reply on 14 October 2004 (Exhibit 13, Tab 19, par 50 above). At all relevant times NPWS was part of DEC as indicated in the letter of 12 August 2004. Evidence of “face to face” negotiations with the Wonnarua Tribal Council was also supported by the table in the letter of 20 August 2004, the letter of 20 September 2004 and minutes of a meeting on 13 July 2004 between members of the Council and Hansen Consulting (Exhibit 13, Tab 5, par 20 above).

145. I am presently considering engineering work which I have found above can be considered separately to construction work. Two conditions relied on by UHSIA which specify requirements that must be satisfied before the commencement of earthworks as well as construction are conditions 2.2 and 4.1(1) concerning the provision of management plans for waste and water respectively. As stated in par 137 above, such plans were part of the EMP for the Stage 1 activities accepted by the Director-General’s delegate in October 2004.

146. Condition 3.6(3) requiring a monetary contribution to the Council was accepted as being satisfied, see par 41 above.

147. UHSIA relied particularly on alleged breaches of conditions 3.10(1) and 9.2. It alleged that condition 3.10(2) (land management plan “prepared by a technically qualified person(s) within six months of the date of the Consent, or as otherwise agreed by the Director-General and updated annually”) was not complied with as the relevant plan was required prior to commencement of construction works and within six months of the date of the Consent. As MACH identified the condition refers to “... or as otherwise agreed by the Director-General”. The Director-General’s delegate approved the land management plan in the EMP in 2004, giving rise to a clear inference that the Director-General in subclause (2) agreed with what was proposed. No breach of condition 3.10(1) has been established in these circumstances.

148. Condition 9.2 requires the preparation and submission to the Director-General of an Annual Environmental Management Report (AEMR), the first to be completed and submitted within 12 months of the Consent (22 December 2000) and annually thereafter. As the first AEMR was produced on 2 November 2006 UHSIA alleged this condition was breached. As MACH submitted, the AEMR preparation is not a pre-condition to the commencement of engineering or construction works. The condition does not specify “prior to construction”. I agree with the submissions of MACH that read in a commonsense way such a report could not include the requisite content until some work referred to in the plans had commenced. It is about assessment of mine performance which has yet to occur. Further, the Director-General can determine a date other than 12 months from the Consent for the submission of the first report under subclause (4). No breach of condition 9.2 has been established.

149. The Council agreed that the landscape management plan had been complied with for Stage 1 as required by condition 3.7(1), as identified in the letter from the Council to Hansen Consulting dated 17 August 2004, see par 36 above.

150. As MACH submitted there is no practical utility in requiring compliance with the floodlighting condition (condition 6.5) before mining activities are known. This circumstance was referred to in the Pre-construction Compliance Report that went to the Director-General’s delegate, see par 40 above.

151. Compliance with condition 8.4 relating to noise investigations and management is arguably premature when the mine plan has yet to be finalised. Sections of the EMP and Pre-construction Compliance Report dealt with the noise conditions 6.4(4) and 8.4 which were accepted by the Director-General’s delegate, see par 137 above.

152. No relevant breaches of the Consent have been established by UHSIA in relation to the engineering work.

153. There is no legal or factual basis for finding that the engineering work was not related to the development as required by s 99(4). As the other two limbs of Hunter Brokerage have been satisfied MACH has established that the Consent has not lapsed. Alternatively UHSIA has not discharged its onus of establishing that the Consent has lapsed. Nevertheless I will consider the balance of argument in relation to construction work.

Construction work – construction of ED1

First and third limb of Hunter Brokerage

154. The first and third limb of Hunter Brokerage was satisfied in that construction work, namely the partial construction of dam ED1, occurred on the Land before 15 February 2005. This is clearly established by the evidence of Mr Webber. It is agreed that the dam construction finished by March 2005. The work had physically commenced on the Land and was not a sham.

Second limb of Hunter Brokerage

155. UHSIA submitted correctly that several conditions of Consent required certain matters to be addressed before any construction work could take place. I have identified these in pars 92-93 above. I held above that the decision of the Director-General’s delegate in the letter of 15 October 2004 to accept Coal & Allied’s documents in relation to Stage 1 is a complete answer to UHSIA’s case concerning conditions requiring the satisfaction of the Director-General. It is debateable in these circumstances whether the views of hydrologists Mr Gilbert and Mr Droop as to whether condition 1.1 of the Consent which requires general compliance with the EIS has been complied with strictly arises for consideration.

156. I agree with and adopt MACH’s submissions on why ED1 as constructed is not inconsistent with the conditions of Consent when these are read in a commonsense, holistic and practical way, as the authorities cited above in par 135 emphasise. At issue is the interpretation of the EIS which must be generally complied with in accordance with condition 1.1. The EIS which includes a number of related technical reports identifies two separate water management systems, the environmental dams managing clean water and the sediment dams managing “dirty” water, summarised above at par 23. ED1 is described in the EIS as an environmental dam. It is agreed that the dam identified as ED1 constructed in the northern fine rejects emplacement area is a sediment dam. The experts agree that the dam can be increased in size in the future by raising the height of its embankment, see par 86 above.

157. An EIS is not to be construed strictly as if a legislative instrument, the flavour of UHSIA’s submissions on its construction. A large, complex project may well change in some aspects over time including changes in the regulatory environment. For example, changes in the DSC’s approach to hazard assessment of dams occurred between the EIS finalisation in 1997 and 2004 when the DSC received documents from Parsons Brinkerhoff, see Mr Gilbert’s evidence at par 84 above.

158. The EIS, particularly section 6.4.3 on water pollution management, identifies the nature of the water management system to be installed including at (vii) headed “Environmental Dams in the Fines Rejects Emplacement Area”. This part of the EIS was focussed on by UHSIA. The role and location of environmental dams is identified including a dam called ED1 for the northern fine rejects emplacement area. Just as important is section 6.4.4 on erosion and sediment control including at (i) headed “Temporary Controls” which states that “[c]onstruction of the clean water diversion works outlined in Section 6.4.3 will be undertaken prior to earthworks”. As MACH submitted condition 3.5(1) of the Consent implies that the carrying out of the development required taking measures to control sediment during both the construction and operation of the Mine. Mr Droop and Mr Gilbert agreed that the dam called ED1 as constructed was better characterised as, or could function as, a sediment dam, see pars 82 and 85 above.

159. Although not strictly necessary to support MACH given the terms of the EIS set out in the previous paragraph support the use of ED1 as a sediment dam in the initial stages of the Mine, the reasoning in Norlex at [89]-[90] addressing the purpose of engineering work (in that case water testing and analysis) identifies that work which satisfies more than one purpose can satisfy the necessary requirements of Hunter Brokerage.

160. The EIS contains varying references to the capacity of ED1 including a nominal size of 50 ML and a minimum volume of 30 ML as highlighted in the evidence of Mr Gilbert. Mr Droop focussed on references in the EIS to 520 ML. The approach of Mr Gilbert to the EIS which includes numerous technical reports summarised above in pars 83-85 accurately considers the EIS as a whole. As Mr Gilbert identifies the EIS contains several possible sizes of environmental dams including ED1 and specifies design criteria not a final design.

161. Further, I agree with MACH that it was incorrect to say as Mr Droop did that ED1 “was required to contain 50% of PMP from the upstream catchment” meaning it must have a volumetric capacity of 520 ML. To the extent the views of the DSC can be inferred, sediment dam ED1 was not prescribed under the Dams Safety Act 1978. It does not appear in the schedule of prescribed dams in 2004-2005. As ED1 was not a prescribed dam the DSC would not have specified any volumetric capacity requirements, see par 84 above.

162. The reasons set out above in pars 120-153 in relation to why the engineering work had been conducted in accordance with the Consent apply also to the construction work.

163. A practical approach to development of the large site in a complex mining project potentially occurring over 21 or more years is reflected in the Director-General’s approval of Stage 1 works including a sediment dam which happens to be labelled ED1. As Mr Gilbert identified, and Mr Droop did not disagree, ED1 can be altered in the future to perform a different function including as an environmental dam.

164. The second limb of Hunter Brokerage is satisfied by the construction work relied on by MACH. UHSIA has not discharged its onus of establishing that the Consent has lapsed in relation to the construction work.

Effect of construction certificate

165. It is strictly unnecessary to determine if a total answer to UHSIA’s case is the issuing of a construction certificate on 8 September 2005 as MACH submitted. MACH submitted in reply that under the EPA Act a construction certificate including plans is incorporated as part of a consent under s 80(12) as found in Burwood Council v Ralan Burwood Pty Ltd (No 3) (2014) 206 LGERA 40; [2014] NSWCA 404 at [202]. The parties provided written submissions addressing this issue to the Court after the conclusion of the hearing.

166. Sections 80 and 81A of the EPA Act as at 8 September 2005 relevantly provided:

80 Determination

(1)   General

A consent authority is to determine a development application by:

(a)   granting consent to the application, either unconditionally or subject to conditions, or

(b)   refusing consent to the application.

…

(12)   Effect of issuing construction certificate

If a consent authority or an accredited certifier issues a construction certificate, the construction certificate and any approved plans and specifications issued with respect to that construction certificate, together with any variations to the construction certificate or plans and specifications that are effected in accordance with this Act or the regulations, are taken to form part of the relevant development consent (other than for the purposes of section 96).

81A Effects of development consents and commencement of development

...

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

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

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

(i)   appointed a principal certifying authority for the building work, and

(ii)   notified the principal certifying authority that the person will carry out the building work as an owner-builder, if that is the case, and

(b1)   the principal certifying authority has, no later than 2 days before the building work commences:

(i)   notified the consent authority and the council (if the council is not the consent authority) of his or her appointment, and

(ii)   notified the person having the benefit of the development consent of any critical stage inspections and other inspections that are to be carried out in respect of the building work, and

(b2)   the person having the benefit of the development consent, if not carrying out the work as an owner-builder, has:

(i)   appointed a principal contractor for the building work who must be the holder of a contractor licence if any residential building work is involved, and

(ii)   notified the principal certifying authority of any such appointment, and

(iii)   unless that person is the principal contractor, notified the principal contractor of any critical stage inspections and other inspections that are to be carried out in respect of the building work, and

(c)   the person having the benefit of the development consent has given at least 2 days’ notice to the council of the person’s intention to commence the erection of the building.

...

167. Under s 81A(5) regulations can be made for the issue of certificates for the erection of buildings inter alia. Such regulations have been made in the Environmental Planning and Assessment Regulation 2000 (Regulation 2000) in relation to proposed building work.

168. MACH submitted that the construction certificate issued on 8 September 2005 by DPE as delegate for the relevant Minister was incorporated into the Consent by virtue of s 80(12). The plans approved by the certifier showed ED1 with a capacity of 50 ML and an embankment height of 7.2 m. ED1 was entirely consistent with plans and specifications approved when the construction certificate was issued. Further, Marvan Properties Pty Ltd v Randwick City Council (2005) 138 LGERA 1; [2005] NSWLEC 9 at [30], [33]-[34] is authority for the valid issuance of a construction certificate for work that had already commenced. The construction certificate in respect of ED1 confirms that the work done was pursuant to and consistent with plans forming part of the Consent. The certificate effectively harmonises the Consent and the work that was done. Secondly, the certificate should be taken to have formed part of the Consent prior to the commencement of works on ED1. This is consistent with the operation of s 80(12) as a deeming provision and does not assert that this provision has a retrospective effect. Thirdly, the construction certificate did not modify the Consent but formed part of it. As the Court of Appeal held in Ralan at [202], plans certified by a construction certificate should prevail to the extent of any inconsistency with the development consent. The conclusions stated by Sackville AJA (McColl and Barrett JJA agreeing) at [206] demonstrate that this reasoning is not obiter and decisions of this Court have expressly adopted it as a statement of principle. Finally, UHSIA did not allege a breach of s 81A(2) of the EPA Act in its Points of Claim and should not be able to raise it in written submissions filed after the conclusion of the hearing. A breach of s 81A(2) is not maintainable on the evidence in any event as UHSIA has not established that the construction work on the dam ED1 before 15 February 2005 was the erection of a building.

169. UHSIA gave four reasons for why this argument should be rejected. Firstly, a valid development consent was a precondition to the issue of a construction certificate. As the Consent had lapsed by 15 February 2005 it could not be affected by the construction certificate issued after this date. Secondly, the construction of ED1 ended prior to the issuance of the construction certificate. MACH misconstrued s 80(12) by assuming it had retrospective effect. Thirdly, even if s 80(12) applied it did not mean that the construction certificate’s approval of a 50 ML dam had the effect of modifying the Consent. The Consent required a dam capable of containing 50% of a PMP event. MACH relied on remarks of Sackville AJA in Ralan at [202] which were obiter. Finally, the construction of ED1 breached s 81A(2) of the EPA Act which required a construction certificate to be issued before the commencement of the erection of a building.

170. I am able to make a preliminary finding only on these issues as more fulsome argument during the hearing would have been preferable rather than submissions after the hearing. A number of issues arose late due to the expedited hearing with a great deal of case preparation immediately before, and to some extent during, the hearing as occurred in relation to the issue of a construction certificate. As already stated the resolution of these issues is not essential to the resolution of the matter before me. Rather than recall the parties I will do the best I can on what has been presented. Some arguments can be dealt with relatively easily. The first and third of UHSIA’s arguments fall away given my finding that the Consent had not lapsed as at 15 February 2005 and that the dam identified as ED1 is compliant with the EIS.

171. MACH’s reliance on Ralan in relation to the effect of s 80(12) as a deeming provision is correct. Further, the Court of Appeal per Sackville AJA at [202] held that a construction certificate becomes part of a development consent so that the construction certificate plans become part of a consent. That finding was not obiter.

172. For the reasons MACH submitted no breach of s 81A(2) has been established. The subsection states that the erection of a building must not commence until a construction certificate has been issued for the building work inter alia. The Regulation 2000 is directed to the issuing of certificates in relation to the erection of a building as provided by s 81A(5). The construction of ED1 was not the erection of a building. That finding is supported by the Court of Appeal in Cariste Pty Ltd v Blue Mountains City Council [1996] NSWCA 92 at 31-32 per Simos AJA (Clarke and Beazley JJA agreeing) cited in MACH’s submissions. Consequently I consider that MACH can rely on the construction certificate dated 8 September 2005 to submit that ED1 was consistent with the Consent.

Construction work – grading of road

First and third limb of Hunter Brokerage

173. UHSIA disputes there is evidence of an upgrade or grading of the access road leading to ED1 which construction work MACH relied on. There is no eyewitness or firsthand evidence of this work having taken place nor is it referred to in the construction report of December 2005 (Exhibit 14, Tab 58).

174. The only evidence MACH appears to rely on to support its claim that grading of the access track to ED1 occurred relates to survey work. The cover letter to the invoice dated 31 August 2003 attached to Mr Boardman’s affidavit at AB-7 indicated that “peg proposed centreline of road (Access Track)” fell within the scope of work performed by GBA. The precise road to which this entry referred is unclear. Mr Boardman did not recall in his affidavit being involved in the pegging of such a road, see par 71 above. In the “Notes” section of the attached tax invoice references were made to work performed in relation to a “haul road” on 23-24 July 2003. The retainer agreement between Coal & Allied and GBA (Exhibit 14) suggests that the road referred to is the “West Link Road”. No reference is made to a road leading to ED1. MACH submitted that it does not matter which road was surveyed, it is clear that work was done in connection with at least one road. To the extent that any work was undertaken on a road it could only have been in connection with the “West Link Road” which did not intersect with ED1 and is outside the pleadings put forward by MACH.

175. MACH has not demonstrated on the balance of probabilities that grading of an access road to ED1 or West Link Road occurred before 15 February 2005. To the extent that there is any evidence that work was done this relates to surveying and not construction work. This aspect of its defence fails to satisfy the first and third limbs of Hunter Brokerage in relation to construction work. It is unnecessary to consider the second limb of Hunter Brokerage given this finding.

176. To the extent there is evidence of survey work in relation to a road, as I have found is a possibility, that can be considered as an addition to the engineering work which I have found above satisfies the requirements of s 99(4).

Conclusion

177. Development consent (file no N95/00147) has not lapsed as engineering and construction work relating to the development took place before 15 February 2005. It is unnecessary to consider whether the Court would have exercised its discretion to make the orders sought by UHSIA.

178. UHSIA’s summons should be dismissed.

179. The parties have not had an opportunity to make submissions on costs. The usual costs rule in Class 4 proceedings is that costs follow the event so that UHSIA as the unsuccessful party must pay MACH’s costs. A costs order to that effect will be made after 14 days unless a notice of motion is filed by a party seeking a different costs order before that period elapses.

Orders

180. The Court makes the following orders:

1. The Applicant’s summons dated 21 March 2017 is dismissed.

2. The Applicant is to pay the Respondent’s costs of the proceedings unless a notice of motion seeking a different costs order is filed within 14 days.

3. The exhibits may be returned.

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Decision last updated: 24 July 2017