Upper Mooki Landcare Inc v Shenhua Watermark Coal Pty Ltd and Minister for Planning

[2016] NSWLEC 6

Land and Environment Court

New South Wales

Medium Neutral Citation:	Upper Mooki Landcare Inc v Shenhua Watermark Coal Pty Ltd and Minister for Planning [2016] NSWLEC 6
Hearing dates:	31 August, 1-3 September 2015
Date of orders:	19 February 2016
Decision date:	19 February 2016
Jurisdiction:	Class 4
Before:	Preston CJ
Decision:	(1)   The proceedings are dismissed.  (2)   The question of costs is reserved.
Catchwords:	JUDICIAL REVIEW – development consent for open cut coal mine – likely significant effect on threatened species of the koala – development application contained indication of likely significant effect – whether misdirection in giving or considering indication – consideration of impact on koala population including by koala translocation – whether failure to consider what was local population of koalas – condition of consent requiring koala plans of management – whether condition deferred consideration of impacts on koalas – whether failure to consider precautionary principle or principle of conservation of biological diversity and ecological integrity – application dismissed
Legislation Cited:	Environmental Planning and Assessment Act 1979 ss 5A, 5A(1), 5A(2), 78A(1), 78A(8A), 79B, 79B(2A), 79B(3), 79C(1)(b), 79C(1)(e), 80(1), 89E(1), 89H National Parks and Wildlife Act 1974 ss 5, s 97(2) Protection of the Environment Administration Act 1991 s 6(2) Threatened Species Conservation Act 1995 s 94A Environmental Planning and Assessment Regulation 2000 cll 50(1)(a), 50(1)(b), Sch 1 cll 1(1)(e), 1(1)(ea), Sch 2, cll 3(9)(d), 6(e), 7(1)(d)
Cases Cited:	Australian Broadcasting Tribunal v Bond [1990] HCA 33; (1990) 170 CLR 321 Bentley v BGP Properties Pty Ltd [2006] NSWLEC 34; (2006) 145 LGERA 234 Currey v Sutherland Shire Council [2003] NSWCA 300; (2003) 129 LGERA 223 Davis v Gosford City Council [2014] NSWCA 343; (2014) 87 NSWLR 699 Drake-Brockman v Minister for Planning [2007] NSWLEC 490; (2007) 158 LGERA 349 Environment Protection Authority v Ballina Shire Council [2006] NSWLEC 289; (2006) 148 LGERA 278 Master Education Services Pty Ltd v Ketchell [2008] HCA 38; (2008) 236 CLR 101 Minister for Planning v Walker [2008] NSWCA 224; (2008) 161 LGERA 423 Newcastle and Hunter Valley Speleological Society Inc v Upper Hunter Shire Council [2010] NSWLEC 48; (2010) 210 LGERA 126 Notaras v Waverley Council [2007] NSWCA 333; (2007) 161 LGERA 230 Palmer v The Board of Lands and Works (1875) 1 VLR 80 Re Sydney Harbour Collieries Company (1895) 5 Land Appeal Court Reports 243 Rivers SOS Inc v Minister for Planning [2009] NSWLEC 213; (2009) 178 LGERA 347 Telstra Corporation Ltd v Hornsby Shire Council [2006] NSWLEC 133; (2006) 67 NSWLR 256; (2006) 146 LGERA 10 Ulan Coal Mines Ltd v Minister for Planning [2008] NSWLEC 185; (2008) 160 LGERA 20 Walsh v Parramatta City Council [2007] NSWLEC 255; (2007) 161 LGERA 118
Category:	Principal judgment
Parties:	Upper Mooki Landcare Inc (Applicant) Shenhua Watermark Coal Pty Ltd (First Respondent) Minister for Planning (Second Respondent)
Representation:	Counsel: Mr P W Larkin SC with Mr S B Nash (Applicant) Mr N J Williams SC with Mr D Hume (First Respondent) Mr A Shearer (Barrister) with Ms R Mansted (Barrister) (Second Respondent)   Solicitors: EDO NSW (Applicant) Minter Ellison (First Respondent) Legal Services Department, Department of Planning and Environment (Second Respondent)
File Number(s):	40370 of 2015
Publication restriction:	No

Judgment

The nature of the proceedings and outcome

1. A local community group, Upper Mooki Landcare Inc, has brought judicial review proceedings challenging the legality and validity of a decision of the Minister for Planning (‘the Minister’), by his delegate, the Planning Assessment Commission (‘PAC’), to grant development consent (‘the Consent’) to an application made by Shenhua Watermark Coal Pty Ltd (‘Shenhua’) to carry out the Watermark Coal Project (‘the Project’), an open cut coal mine about 25kms southeast of Gunnedah. The four grounds of challenge all have a common concern about the manner in which the impacts of the Project on koalas were assessed in the development application and considered by the PAC in determining the development application for the Project. No other issues about the Project’s impacts on the natural or built environment were raised in the proceedings, including any potential impacts on the black soil plains of high agricultural value or potential hydrological impacts on groundwater resources.

2. Two of the grounds of challenge (grounds 4 and 1(a)) contended that the development application and the PAC’s consideration of the development application involved misdirection as to the construction of the statutory provisions regarding whether there was likely to be a significant effect on the threatened species of the koala or its habitat. Both the development application and the PAC did in fact conclude that the Project was likely to significantly affect the koala and its habitat. The applicant argued, however, that those conclusions were made by misconstruing the relevant statutory provisions.

3. The applicant contended that the development application was required to contain an indication as to whether the Project was likely to significantly affect the koala or its habitat and in so indicating it was required to address the factor in s 5A(2)(a) of the Environmental Planning and Assessment Act 1979 (‘EPA Act’) of whether the Project is likely to have an adverse effect on the life cycle of the koala such that a viable local population of the koala is likely to be placed at risk of extinction. The applicant argued that the terms used in this factor, particularly the concept of a “viable local population”, were to be interpreted in a particular way by applying the definitions in the assessment guidelines issued and enforced under s 94A of the Threatened Species Conservation Act 1995 (‘TSC Act’), which are the “Threatened species assessment guidelines: the assessment of significance” (2007) (‘the Threatened Species Assessment Guidelines’). The applicant contended that the development application and the PAC’s consideration of it failed to apply the definitions in the Threatened Species Assessment Guidelines, particularly those concerning “viable local population”, and hence the consideration of the particular factor in s 5A(2)(a) of the EPA Act and the general question of whether the Project was likely to significantly affect the koala or its habitat, miscarried in law.

4. The third ground of challenge (ground 1(b)) was that the PAC’s consideration of the relevant matter under s 79C(1)(b) of the EPA Act of the likely impacts of the Project, including the environmental impacts on the natural environment, miscarried in law by the PAC failing to consider the impact of the Project on the koala. The applicant argued that the PAC’s consideration of the impact on the koala miscarried in at least two main ways: first, the PAC failed to consider and determine what was the local population of koalas that would be impacted by the Project and, second, by imposing a condition of consent requiring the preparation and implementation of a koala plan of management for the Project detailing measures to mitigate and manage impacts on the koala, including koala translocation, the PAC deferred consideration of the impact of the Project on the koala until after the decision to grant development consent was made.

5. The fourth ground of challenge (ground 3) was that the PAC failed to consider, as part of the public interest under s 79C(1)(e) of the EPA Act, two of the principles of ecologically sustainable development (‘ESD’), namely the precautionary principle and the principle of conservation of biological diversity and ecological integrity. The applicant contended that the PAC’s consideration of these two principles of ESD needed to be informed by the fact that koalas, as protected fauna, are taken to be the property of the Crown and, it was argued, are the subject of a public trust. The applicant argued that the PAC failed to consider and apply the precautionary principle by not undertaking an assessment of the risk-weighted consequences of various options and not considering whether the condition of consent requiring a koala plan of management and koala translocation management plan was the proportionate response to the uncertainty as to the success of the koala translocation program.

6. I find that the applicant has not established any of these grounds of challenge to the PAC’s decision to grant development consent to the Project. The proceedings should therefore be dismissed. The question of whether the applicant should pay costs in the event of its challenge being unsuccessful was not argued and should be reserved.

The application and approval process

7. On 14 October 2011, Shenhua requested the Director General's Environmental Assessment Requirements (‘DGEARs’), together with a Background Document for the Project.

8. The Background Document described the Project and identified the project application boundary (‘Project Boundary’), which was contained within the boundaries of Exploration Licence (‘EL’) 7223. The majority of the land required for the Project is owned by Shenhua. Open cut mining would not be undertaken within the adjoining Breeza State Forest or on the black soil plains of high agricultural value. The mine plan avoided large areas of critically endangered ecological communities.

9. The Background Document acknowledged that preliminary studies had identified "populations of Koalas within and surrounding the Project Boundary", that koalas were a "key issue of concern", and that it was likely that the Project Boundary "supports a permanent local population of Koala". It was also indicated on the form of the request for DGEARs that, but for s 79B(2A) of the EPA Act, the Project would have required concurrence under the TSC Act - such a requirement arising where development is "likely to affect threatened species" under s 79B(3) of the EPA Act.

10. The DGEARs were issued on 19 April 2012. They identified "biodiversity" as a "key issue" that the EIS must address and required a detailed assessment of "potential impacts of the development on any terrestrial … threatened species or populations and their habitats…"; "measures taken to avoid, reduce or mitigate impacts on biodiversity"; and "a comprehensive offset strategy to ensure the development maintains or improves the terrestrial … biodiversity values of the region in the medium to long term".

11. A development application for the Project was lodged on 25 October 2012 (‘the Development Application’). The Development Application was submitted in the form approved for the purposes of cl 50(1)(b) of the Environmental Planning and Assessment Regulation 2000 (NSW) (‘EPA Regulation’). At item 5 of the form, Shenhua answered "yes" to the question "Is the development likely to significantly affect threatened species, populations or ecological communities, or their habitats?". At item 6, Shenhua indicated that, but for s 79B(2A) of the EPA Act, the development would have required concurrence under s 79B of the EPA Act.

12. On 29 October 2012, a draft Environmental Impact Statement (‘EIS’) was submitted to the then Department of Planning and Infrastructure (‘the Department’) for review. After consideration and inter-agency consultation, the Department required Shenhua to revise the EIS to address a number of issues prior to public exhibition, including in relation to impacts on koalas and koala habitat. Some of these issues were outlined in the agencies’ comments, including in correspondence from the Office of Environment and Heritage (‘OEH’). OEH commented that: inadequate identification of the impacts of the Project on the onsite and regional koala populations has been undertaken; clarification is required on the area considered to be koala habitat within the Project area and how the mining sequence will impact on this habitat; inadequate information has been provided to make an informed assessment of the suitability of the proposed translocation site for koalas; and the avoidance, mitigation and offset measures outlined within the koala plan of management do not adequately ameliorate the impacts of the Project on koalas. Shenhua was notified of the adequacy issues and provided with that correspondence.

13. After receiving further drafts of the EIS, the Department considered them and confirmed that the adequacy issues had been addressed sufficiently such that the EIS was adequate for exhibition. As part of the feedback process, the Department noted that the vegetation mapping of koala habitat for the 20km locality around the project site was "very useful and informative".

14. On 22 February 2013, Shenhua lodged the revised EIS, which included a covering report (‘EIS Main Report’) together with appendices A - AF. The EIS was exhibited from 28 February to 26 April 2013. The EIS Main Report addressed koala issues in detail and indicated that "it is considered that the local Koala population and habitat has the potential to experience significant impacts in the absence of adequate management and mitigation measures implemented". The potential impacts on the Koala and Koala habitat were summarised in Table 46, which set out the Koala habitat in the Disturbance Area and Onsite Offset Areas that will be impacted at eight separate intervals across the 30-year life of the mine, in addition to the number of koalas requiring staged translocation at each of those intervals.

15. The mitigation measures to manage the impact on koalas were summarised in the EIS Main Report and set out in more detail in the Koala Plan of Management (‘KPoM’) which was Appendix L. Those measures included: general Koala protection; installation of Koala proof fencing; road design standards; vertebrate pest management; fire management; monitoring of the health of selected individuals of the Koala population within the Project Boundaries and onsite biodiversity offset areas; drought protection to provide a stable water source for Koalas during droughts; public education; staged natural movement of Koalas away from mining areas; staged translocation of Koalas; habitat protection; habitat revegetation and enhancement; mine site rehabilitation; population monitoring and reporting; and key performance indicators to measure effectiveness.

16. Appendix F (‘Revised Risk Assessment’) of the EIS set out a table prepared in accordance with AS/NZS Standard ISO 310000 - 2009: Risk Management - Principles and Guidelines and Handbook 203 - 2012, with the stated objective of identifying and assessing the level of risk associated with the potential environmental and socio-economic issues relating to the Project. The levels of risk were set out in a Qualitative Risk Matrix. On the preliminary risk assessment, "Loss of biodiversity and disruption to threatened flora and fauna or habitats" was rated as of "Critical" consequence with an "Almost certain" likelihood, qualifying as a "High" risk level. In view of the mitigation measures proposed in the EIS, the level of risk was revised to "Medium".

17. Appendix K (Ecological Impact Assessment (‘EIA’)) noted that "the Project has potential to impact on the ecology of the local area, and without any amelioration, it has potential to have a significant impact on … the Koala population within the Project Boundary". It noted that to mitigate these potential impacts, a substantial mitigation package has been proposed, including a KPoM and a Biodiversity Management Plan (‘BMP’). The EIA recorded that there is a population of the koala within the Project Boundary and set out the methodology for surveying for koalas and estimating density and population within the survey area (including the Project Boundary, as well as adjoining portions of Breeza State Forest and Offset Area 6).

18. The EIA referred to the approved Recovery Plan for the Koala prepared by OEH (‘Recovery Plan’), and stated that, according to the two systems of categorisation of Koala habitat in the Recovery Plan, "the Project Boundary is capable of supporting a viable, low density population of Koalas", or alternatively, "the Project Boundary is considered capable of supporting a viable medium to high density Koala population". The Recovery Plan uses "population viability analysis", which is said to be "useful to focus management measures on those factors likely to have the greatest impact on the long-term survival of populations".

19. The EIA concluded that "[w]ith the implementation of the proposed avoidance, mitigation, and offset measures, it is expected that the Project will not result in a significant impact to the Koala".

20. Appendix I to the EIA contained assessments of significance of threatened species according to s 5A of the EPA Act. In relation to the koala, the assessment of significance stated that the Project "will remove known and potential forage and breeding habitat for the Koala. However, known habitat will remain in Breeza State Forest, and a detailed KPoM has been prepared to mitigate impacts on this species. A viable local population is unlikely to be placed at risk of extinction."

21. Appendix L to the EIS was the “Koala Plan of Management”. The purpose of the KPoM was stated to be “to provide a management framework for the local Koala population and associated habitat known to exist within the Project Boundary and Onsite Offset Areas ... for the life of the Project”. The primary objectives and the content of the KPoM were:

●   identification, mapping and ranking of Koala habitat in the Project Boundary (the entirety of the site that is the subject of this assessment, including areas to be impacted and areas that will not be impacted);

●   identification of the extent of the Koala habitat in the Project Boundary, study area (a 5km radius of the Project Boundary) and the broader locality;

●   identification of any threats to Koalas and Koala habitat in the Project Boundary and study area and strategies to minimise such threats;

●   provision of amelioration measures and strategies to protect and enhance core Koala habitat and linkage corridors currently present in the Project Boundary, study area and wider locality, in order to sustain the quality and integrity of this habitat and enhance the survival potential for the local Koala population;

●   identification of initiatives that would contribute to the sustainability and enhancement of the Koala population in the Gunnedah region;

●   development of a practical framework for the progressive regeneration of Koala habitat linking existing habitat areas with the Project Boundary;

●   provision of a suitable and practical translocation plan for individual Koalas if the need arises; and

●   provision for effective implementation and monitoring of this KPoM.

22. The KPoM identified that the Project would have direct and indirect impacts on the local population and regional populations of koalas. The koalas that occur within the Disturbance Area are part of the wider population of the Liverpool Plains/Gunnedah LGA population. The KPoM identified that “there is potential for a significant impact on koalas occurring within the Project Boundary if impacts are not mitigated” and “the Project has the potential to have a significant impact on the local population of the Koala”. In terms of the regional population, the KPoM found that, based on the current estimate of koalas within the Disturbance Area, the Project will require the translocation of 2.1% of the total population of koalas within the Gunnedah LGA (estimated to be 12,753 individuals).

23. Chapter 7 of the KPoM provides general information regarding the koala, including key habitat requirements, conservation status and threatening processes. Chapter 8 of the KPoM provides population estimates of koalas in the region (the Gunnedah local government area (‘LGA’)) and the locality (within 20kms of the Project Boundary). Chapter 9 addresses koalas and koala habitat within the study area (within 5kms of the Project Boundary). Chapter 10 assesses the potential impacts of the Project on the local population and regional population of koalas. As I have noted, the KPoM identified that the Project has the potential to have a significant impact on the local population of the koala.

22. Chapter 11 outlines the mitigation and offset measures proposed to ameliorate the impacts of the Project on the koala. It sets out a hierarchy of impact reduction measures: avoidance of impact, mitigation of impact and compensation by offset. The categories of mitigation measures have earlier been listed. They include translocation of koalas and the mitigation measures that will be implemented to ensure the safety and protection of koalas being translocated from the Project Boundary to the release site.

23. Chapter 12 deals with monitoring of the koala population and koala habitat within the Project Boundary and Onsite Offset Areas over the life of the Project, and reporting on monitoring results. Chapter 13 sets performance outcomes and indicators to demonstrate the encouragement of a sustainable local koala population and associated habitat within the Project Boundary and Onsite Offset Areas.

24. Appendix M to the EIS (“Report on Matters of National Environmental Significance”) also identifies that the Project has the potential to have a significant impact on "the Koala population within the Project Boundary". It includes a "Significant Impact Assessment" in relation to the impact on the koala, listed as vulnerable under the Environment Protection and Biodiversity Conservation Act 1999 (Cth). It finds that the "population of the Koala that occurs in and near the Project Boundary is likely to be part of a key source population for breeding or dispersal"; the population of the koalas within the Project Boundary is not necessary for maintaining genetic diversity; the population of the koala within the Project Boundary is an "important population"; "no long term decrease in the size of an important population of the Koala is considered likely to occur"; and the Project will not disrupt the breeding cycle of an important population of the koala since "[i]t is expected that the Koala will be able to continue to breed and persist" in the Onsite Offset Areas. Again, it concluded that "[w]ith the implementation of the proposed mitigation measures outlined in the KPoM and the Biodiversity Offset Package, no significant impact is considered likely to the Koala."

25. Submissions on the EIS were made by members of the public, agencies and interest groups. The OEH submission of 2 May 2013 addressed koala-related issues. The OEH submitted that: the description of the Koala population that occurs at the project site was inadequate; there was inadequate identification of the impacts of the Project on the onsite Koala population; the avoidance and mitigation measures outlined within the KPoM do not adequately ameliorate the impact of the Project on Koalas; the translocation of Koalas should be used in exceptional circumstances, not as a major mitigation measure; the proposed offsets within the KPoM do not adequately ameliorate the residual impact of the Project on Koalas; and inadequate identification of the impacts of the Project on Koalas in a regional context have been undertaken. OEH made recommendation to address these identified inadequacies, including provision of further information on the local and regional Koala populations and updated discussion on the avoidance and mitigation measures in light of this further information on the Koala populations.

26. A number of public and interest-group submissions dealt with koalas (and in particular, koalas in the local area) and the cumulative impacts of the Project, including from an ecological perspective. The Department considered all of the submissions and identified "Biodiversity - particularly the adequacy of the biodiversity offset strategy and potential impacts on Koalas" as a key issue raised in submissions.

27. On 8 May 2013, the Minister issued a request to the PAC under s 23D of the EPA Act to review the Project and hold a public hearing (which was revised in November 2013).

28. In November 2013, Shenhua lodged its Response to Submissions Report (‘RTS’). It responded to the submissions “in relation to the description of the local and regional Koala population and the potential impacts of the Project on these populations. It includes details concerning population estimates and densities, the staging of impacts, current utilisation of tree species within the Project Boundary and information on how the age class and health status of the population will be assessed.”

29. The RTS included Appendix E, being a "Revised Koala Plan of Management" (‘Revised KPoM’). The Revised KPoM addressed the distribution of koalas, the extent and type of habitat available specifically to koalas, the extent of habitat corridors on a local and regional scale; discussed the koala population in the study area; and analysed the impact of the Project on koalas in the study area. The RTS analysis was not restricted to the level of the Gunnedah LGA, but the LGA is referred to as a reference point. Indeed, the surveys upon which the KPoM and Revised KPoM were based related to the survey area (which included the Project Boundary and adjoining portions of Breeza State Forest and Offset Area 6).

30. The RTS and Revised KPoM included a section responding to submissions regarding indirect impacts, and providing for measures designed to minimise onsite and offsite traffic, noise, light and dust impacts of the Project on koalas. The matters addressed include cumulative impacts of fragmentation, disease and drought. Justification for translocation of koalas was also provided.

31. The RTS contained an assessment of significance for the koala. In relation to the factor in s 5A(2)(a) of the EPA Act of whether "a viable local population …is likely to be placed at risk of extinction", the RTS referred to the impacts within the Project Boundary, and assessed that "as long as the translocation program is successful, the local population is likely to remain viable". The RTS stated that one of the objectives of the KPoM was the “provision of amelioration measures and strategies to protect and enhance core Koala habitat and linkage corridors currently present in the Project Boundary, study area and wider locality, in order to sustain the quality and integrity of this habitat and enhance the survival potential for the local Koala population” and that another objective was “identification of initiatives that will contribute to the enhancement of the Koala population in the Gunnedah region".

32. The Revised KPoM revised the discussion and proposal for translocation of koalas in light of the submissions. Matters such as when to time translocations relative to the koala breeding season are addressed. Eight key habitat corridors to be maintained throughout the life of the mine are identified. Detail is given regarding indirect impacts. A section on 'indirect impacts' refers, in the case of each indirect impact, to the part of the koala habitat and therefore the koalas which will be affected. Details of the spot assessment technique (‘SAT’) survey conducted during field surveys in the survey area are given. Habitat utilisation and connectivity is also considered, addressing the movements of koalas in the immediate vicinity of the Project. Appendix F (Biodiversity Offsets Report) to the RTS discusses the methodology for calculating koala densities across each of the offset areas surveyed.

33. Between February and March 2014, Shenhua provided additional responses to other submissions.

34. On 6 December 2013, OEH wrote to the Department commenting on Shenhua’s RTS and other responses to submissions. OEH concluded that Shenhua “has addressed many of the comments provided by OEH” and “OEH considers that general biodiversity and cultural heritage impacts have been adequately addressed by the inclusion of an enhanced Biodiversity Offset Package. However, OEH considers that a number of issues regarding koalas at the project site require further attention prior to endorsement of the Watermark Revised Koala Plan of Management. These matters are outlined in more detail in the attachment”. OEH said that it "supports the vision in the KPoM of achieving a viable onsite population throughout and at the end of the life of the mine", but made recommendations for collecting specific details of the koala population. OEH noted the proposal for translocation of koalas and made recommendations regarding the Koala Translocation Management Plan, undertaking a trial for koala translocation, and the availability of alternative procedures if koala translocation is not successful.

35. On 13 May 2014, the Secretary's Environmental Assessment Report (‘SEAR’) was issued. It stated that the Department and OEH were "satisfied that Shenhua's revised biodiversity offset strategy would adequately compensate for the impacts of the Project on EEC's and threatened species of the locality, including the Koala". The SEAR noted that the EIS included tests of significance for the koala, among other threatened species, which concluded that the Project is unlikely to result in any significant impact on the koala, subject to implementation of the proposed avoidance, mitigation and offsetting measures. The SEAR noted that “[w]hilst raising some initial concerns about the impacts on threatened fauna habitat, both OEH and DOE [Department of Environment] accept this conclusion, and are now satisfied that the Project is unlikely to significantly affect the identified threatened species”.

36. The SEAR acknowledged that the EIA predicted that there is a "population of about 262 Koalas within the Project disturbance area" and that this onsite population represents approximately 2% of the estimated Koala population in the Gunnedah LGA. The resident Koala population of 262 individuals would be progressively displaced over the 30 year project life. The SEAR noted that the Revised KPoM includes measures specifically designed to mitigate and manage impacts on koalas, including translocating koalas within the project disturbance area, in accordance with a detailed Koala Translocation Management Plan. The SEAR evaluated the key elements of the proposed translocation program. The SEAR recorded that:

To address the unknowns and risks associated with the population dynamics and health of the resident Koala population on the site, OEH recommends that Shenhua be required to collect specific details of the Koala population including population composition, breeding success and population health to provide baseline information on the status of the population prior to commencement of management activity.

The Department agrees, and has recommended conditions requiring Shenhua to monitor the structure and health of the resident population both prior to the commencement of mining, and on an ongoing basis, as part of a comprehensive final KPoM prepared in consultation with OEH and Gunnedah Council.

With regard to translocation, OEH recommends that any translocation be undertaken in accordance with the NPWS [National Parks and Wildlife Service] translocation policy outlined above, and that it should be undertaken as a trial measure in the first instance, with alternative procedures (eg assisted or natural migration) available if translocation is found not to be successful.

…

The Department acknowledges that translocation is a ‘last resort’ mitigation measure, but accepts that it is more than likely to be required, and is indeed warranted, for this project. Relying on other methods, such as natural or encouraged migration, is likely to have potentially higher risks associated with predation or vehicle strike.

Previous translocation studies indicate that, with detailed baseline data and the implementation of comprehensive and well structured translocation methods, Koala translocation can be successful in not only conserving the resident Koala population, but potentially extending Koalas into un-utilised or under-utilised habitat areas, this assisting in the recovering of the species. In this regard, a 2009 national study into native fauna translocation found that, of 18 Koala translocations with reported outcomes, 17 were successful.

The Department also acknowledges that the biodiversity offset strategy and rehabilitation strategy for the project will ultimately provide for the long term conservation of over 8,000 hectares of preferred Koala habitat, which is almost 10 times the area of Koala habitat in the project disturbance area. The project would also provide for nearly 4,500 hectares of new Koala habitat (ie. through revegetation/rehabilitation), which is some 5 times the area of Koala habitat removed by the project.

To ensure that the translocation plan has the highest likelihood of success and to conserve the Koala in general, the Department has recommended conditions requiring Shenhua to:

●   establish and/or maintain the proposed 8,166 ha of Koala habitat in the on-site and off-site biodiversity offset areas and rehabilitation area;

●   conserve these areas in perpetuity;

●   prepare and implement a detailed final KPoM, with the plan to be prepared by recognised Koala experts in consultation with OEH and Council, and include amongst other things:

●   detailed baseline data on the resident Koala population and Koala habitat on site and in the biodiversity offset areas and release areas;

●   identification of threats to Koalas and habitat;

●   measures to mitigate and manage the identified impacts, including a detailed KTMP;

●   a program to monitor Koala health and habitat;

●   implement the commitment to indirect Koala mitigation, such as the $180,000 contribution to the ARC Linkage Project; and

●   identify potential risks to the successful implementation of the plan, and include contingency measures to address these risks.

39. In Appendix B to the SEAR, the Department noted that it was satisfied that the Project is able to be carried out in a way which is consistent with the aims, objectives and provisions of the particular environmental planning instrument dealing with koalas, State Environmental Planning Policy No 44 – Koala Habitat Protection (‘SEPP 44’).

40. The PAC held a public hearing on 26 and 27 June 2014. Issues raised included the impact on koalas and koala habitat. The Australian Koala Foundation (‘AKF’) made a submission to the PAC identifying the relevant population as the "Gunnedah Koala population" and addressed the direct and indirect impacts of the Project on that koala population and its habitat. The Nature Conservation Council similarly referred to the “Gunnedah Koala Population”, noting that it is one of the two largest remaining populations west of the Great Dividing Range but from 2008 or 2009 has been under severe stress from drought and heatwave conditions and disease. A number of other submissions were received from various individuals and organisations dealing with koalas.

41. The PAC's review report on the Project was issued on 29 August 2014 (‘PAC Review Report’). The discussion and recommendations relating to 'biodiversity' in that report primarily concerned koalas. The PAC discussed the size of the koala population:

The currently available population estimates vary widely and the OEH submission of December 2013 raised concerns about the population uncertainties, recommending more detailed baseline information would be needed. Nonetheless in meeting with the Commission the OEH confirmed that the management responses and actions will generally be the same, whether the koala population is at the lower or upper end of the population range. The Commission understands that if the population is smaller, then fewer koalas would be likely to be intercepted in or around the project site.

42. The PAC discussed the Revised KPoM, noting that OEH had indicated that a number of components require further attention prior to any endorsement of the plan. These included “further characterisation of the population”, “consideration of wider vegetation corridors”, “establishment of shelter sites”, “a response plan should the Koala population either onsite and at any translocation sites change in a way that is inconsistent with the expectations of the translocation program” and “contingencies in the event the translocation program is not successful”.

43. The PAC generally agreed with these concerns raised by OEH. The PAC then discussed how it proposed each of these concerns should be addressed. The PAC noted that the Department had proposed a draft condition requiring a Koala Plan of Management be prepared and implemented to the satisfaction of the Secretary and found that this draft condition included a “fairly comprehensive list of requirements the plan would need to address”. The PAC considered, however, that Shenhua “should be undertaking some of this further work now, prior to any determination of the application”.

44. The PAC identified “two key areas where further work now would assist in progressing the Koala Plan of Management, once any approval of the mine was given”. First, “additional monitoring to characterise the koala population would be useful, and should continue throughout the next stages of the assessment process to ensure the baseline data collected prior to any mining is of the best possible standard”. Second, the PAC considered that it would be better to commence planting of suitable feed and shelter trees for koalas as soon as possible and not wait until approval is granted.

45. The PAC found that a technical working group of koala experts should be established:

Even if tree planting is successful, managing and minimising the risks to the local population and implementing a successful translocation program will be a complex task that will require significant monitoring and adaptation to ensure fatalities are minimised. With this in mind the Commission considers that a working group of koala experts should be established to provide oversight and ongoing input into the monitoring … The Commission considers that this expert oversight from a Technical Working Group will be critical to ensuring that the koala population is adequately monitored and managed and to ensure any unexpected changes are identified and appropriately responded to …

The group should be formed as soon as possible as it would be able to provide useful input into the tree planting program, the additional/ongoing koala monitoring program to be established and the further development of the Koala Program of Management. The Technical Working Group would also have a useful role in overseeing the results of the monitoring, management and any translocation of koalas and so an ongoing requirement for the Technical Working Group should be included in the conditions of any consent for the mine”.

46. The PAC made recommendations as to how its findings should be implemented, including:

21.   The Commission recommends that monitoring of the koala population should be ongoing and planting of koala feed and shelter trees should be progressed as soon as possible.

22.   The Commission recommends that a technical working group of koala experts from government, the scientific community and the local wildlife and veterinary practices must be established to oversee the management of koala issues associated with the project. This working group must:

a.   be established in consultation with the NSW Office of Environment and Heritage, and include appropriate expertise as required by the Office of Environment and Heritage;

b.   be formed as soon as possible;

c.   provide input and comment on the tree planting program, its progress and future planting priorities;

d.   review the koala monitoring program being implemented and provide input and guidance on the development of this monitoring program;

e.   provide input into the development of the Koala Plan of Management;

f.   have an ongoing monitoring and advisory role in the management of koalas during any mining, which should be included in conditions of any consent for mining.

47. In Appendix 3 to the PAC Review Report, which summarised the meetings held by the PAC, the PAC noted that at a meeting with OEH questions had been raised about “the size of the koala population in question”. OEH advised that it “doesn’t have a population number, but more important than the population size is the management response”. OEH advised that “it is generally satisfied with the overall package provided in the Koala Plan of Management”. The OEH “emphasised the need to establish baseline data for koalas onsite and at any proposed translocation sites as early as possible”. The PAC noted that “the koalas are important, including in this location and that the correct mechanisms will need to be provided to ensure the best management of the koalas”.

47. Shenhua issued its response to the PAC Review Report on 3 October 2014. It supported the PAC Review Report's recommendation 21 that monitoring of the koala population and planting of feed and shelter trees should be progressed as soon as possible and recommendation 22 to establish a Koala Technical Working Group, as well as other recommendations.

48. The SEAR was also supplemented by an addendum in November 2014 (‘Addendum Report’). The Addendum Report amended the recommended conditions relating to koalas to incorporate the recommendations in the PAC Review Report, including recommendations 21 and 22. However, the Department noted that it was not able to compel Shenhua to plant trees and undertake continued monitoring prior to determination of the Project. The Addendum Report recommended that the Project be approved subject to conditions.

49. On 10 November 2014, the PAC was requested to determine the Development Application and to hold a public meeting on the Project. That meeting was held on 10 and 11 December 2014. Issues relating to koalas were again raised by multiple speakers at the meeting and in written submissions presented either before or after the meeting, including one researcher who considered that Shenhua had overestimated the size of the koala population. The AKF continued to express concern about the sufficiency of the information available on the koala population likely to be affected by the Project.

50. The PAC further met with the Department, the NSW Office of Water and consultants on 21 January 2015. Among other matters relating to koalas, it was discussed that research from Victoria had found translocation more effective where temporary fencing is provided around the translocation sites. Afterwards, the PAC requested the Department to update the draft recommended conditions to require the commencement of planting of Koala habitat (feed and shelter trees) shortly after consent is granted and to include AKF as a member of the Koala Technical Working Group.

51. The PAC granted the Consent on 28 January 2015 and also published its determination report on 28 January 2015 (‘PAC Determination Report’). The PAC Determination Report indicated that the PAC had considered the PAC Review Report, responses to it, the SEAR, the Addendum Report, the application documents and various objector submissions (all of which contained copious discussion of koala related impacts). It also recorded it had considered the relevant matters under s 79C of the EPA Act. Koalas were identified as one of six "key points" in a separate document providing an overview of the PAC’s determination.

52. The PAC addressed koalas in section 7.3 of the PAC Determination Report. The PAC Determination Report discussed the size of the koala population:

Koalas occur in the region and on the project site, although the koala population estimates vary widely. The applicant estimates the koala population to be between 8,613 and 16,893 individuals in the Gunnedah LGA. The Australian Koala Foundation (‘AKF’) disputes this estimate, as they estimate the koala population for the Gunnedah LGA to be in the range of 800-1,300 individuals. The population has reduced significantly, as a result of droughts and heatwaves, with the estimated reduction of up to 70% since 2009.

54. The PAC noted that Shenhua has developed a Koala Plan of Management, which outlines the works that will be undertaken to manage the impacts to the local population of koalas and sets out the impact reduction measures for avoiding, minimising and mitigating impacts to the local koala population.

55. The PAC noted that the KPoM states that in order to mitigate impacts to the koalas, the animals will be encouraged to naturally move away from habitat that is being cleared. If the animals do not naturally move, then a translocation plan will be implemented. The PAC recorded that AKF had “declared categorically” that translocation of individuals does not work and had provided examples of the mortality rates of other translocation projects.

56. The PAC discussed the issues of the mapping of vegetation and the classification of koala habitat and the contest between Shenhua and AKF on these issues.

57. The PAC Determination Report noted that the PAC who had undertaken the review of the Project (‘the Review PAC’) had considered that the koala population and impacts to the population was a significant issue and had discussed it in the PAC Review Report. Four specific recommendations were made in the PAC Review Report, including the establishment of koala feed and shelter trees as soon as possible and the establishment of a Koala Technical Working Group to oversee the management of koala issues associated with the Project.

58. The PAC Determination Report noted that a Koala Technical Working Group will be established as recommended. The PAC addressed the recommendation to establish koala feed and shelter trees:

The Commission notes that both feed and shelter trees are critical to the survival of the koala, and that mature trees are essential. The Commission agrees with the Review PAC’s Recommendation 21: “The Commission recommends that monitoring of the Koala should be ongoing and planting the koala feed and shelter trees should be progressed as soon as possible”. The sooner the planting of feed and shelter trees commence and become established, the better it will be for the koala population.

The Department advised that the PAC Review Recommendation 18 that koala feed trees be planted prior to determination is not legally enforceable. The Commission agrees with the intent of the Review recommendation and considers this can be achieved by requiring planting of feed trees within a short time after approval. The Commission in discussions with the Department has included a condition of consent (Condition 32 of Schedule 3) that the applicant shall prepare an Interim Koala Habitat Plan, within 1 month of the date of the consent. The applicant then must commence the planting of koala feed and shelter trees within 2 months of the approval of the Interim Koala Habitat Plan. The planting and establishment of the feed and shelter trees, shall be carried out in consultation with the Koala Technical Working Group and the amended condition also provides for the AKF to be a member on the Working Group. The applicant shall also maintain existing mature feed and shelter trees on site to provide sufficient habitat for this threatened species.

59. In the final section on “Commission’s findings and determination”, the PAC stated:

In relation to koalas, the Review Report made several recommendations to assist with protection of this iconic species. These have now largely been incorporated into the conditions of consent and the Commission is satisfied the specific requirements for a Koala Plan of Management and Working Group will ensure that koalas are given the best chance of survival both in any translocation programs and through the establishment of additional habitat (albeit in the long term).

60. The Consent included extensive and highly detailed conditions in relation to biodiversity and the koala. Condition 34 requires preparation of a Biodiversity Management Plan describing, amongst other matters, the measures to establish and/or maintain koala habitat. Condition 34 states:

The Applicant shall prepare and implement a Biodiversity Management Plan for the development to the satisfaction of the Secretary. This plan must:

(a)   be prepared in consultation with OEH and DPI [Department of Primary Industries], and be submitted to, and approved by, the Secretary prior to the commencement of any development on site;

(b)   describe the short, medium, and long term measures that would be implemented to:

●   manage the remnant vegetation and fauna habitat on the site;

●   implement the biodiversity offset strategy;

●   establish and/or maintain the potential koala habitat areas identified in Table 13;

●   integrate the implementation of the biodiversity offset strategy to the greatest extent practicable with the rehabilitation of the site;

(c)   include detailed performance and completion criteria for evaluating the performance of the biodiversity offset strategy, and triggering remedial action (if necessary);

(d)   include a detailed description of the measures that would be implemented over the next 10 years for:

●   enhancing the quality of existing vegetation and fauna habitat in the biodiversity offset areas;

●   creating native vegetation and fauna habitat in the biodiversity offset areas and rehabilitation area through focusing on assisted natural regeneration, targeted vegetation establishment and the introduction of naturally scarce fauna habitat features (where necessary);

●   maximising the salvage of resources within the approved disturbance area – including vegetative and soil resources – for beneficial reuse in the enhancement of the biodiversity offset areas or rehabilitation area;

●   collecting and propogating seed;

●   protecting vegetation and fauna habitat outside the approved disturbance area on-site;

●   minimising the impacts on fauna on site, including undertaking pre-clearance surveys;

●   managing any potential conflicts between the proposed enhancement works in the biodiversity offset strategy areas and any Aboriginal heritage values (both cultural and archaeological) in these areas;

●   managing salinity using best practice dryland salinity management revegetation measures;

●   controlling weeds and feral pests;

●   controlling erosion;

●   managing grazing and agriculture on site;

●   controlling access; and

●   bushfire management;

(e)    include a seasonally-based program to monitor and report on the effectiveness of these measures, and progress against the detailed performance and completion criteria;

(f)   identify the potential risks to the successful implementation of the biodiversity offset strategy, and include a description of the contingency measures that would be implemented to mitigate against these risks; and

(g)   include details of who would be responsible for monitoring, reviewing and implementing the plan.

61. Condition 35 requires the establishment of a Koala Technical Working Group comprising experts, including the AKF, to advise on project-related koala management issues, including development and implementation of the KPoM. Condition 35 states:

The Applicant shall establish and maintain a Koala Technical Working Group for the development to the satisfaction of the Secretary. This group must:

(a)   be established in consultation with OEH and Council, and comprise a range of koala experts from government, the scientific community and local wildlife and/or veterinary practices (including the Australian Koala Foundation if available), whose appointment has been approved by the Secretary;

(b)   be established prior to the commencement of any development on site;

(c)   meet at least twice a year; and

(d)   provide advice on project-related koala management issues, including:

●   preparation and implementation of the Koala Plan of Management (see condition 36 below);

●   establishment and maintenance of koala habitat areas in the biodiversity offset areas and key koala corridors (see condition 31);

●   koala monitoring (see condition 36);

●   koala translocation; and

●   koala incident risk mitigation and management.

Note: The Koala Technical Working Group is an advisory committee. The Department and other relevant agencies are responsible for ensuring that the Proponent complies with this approval.

62. Condition 36 requires preparation and implementation of a KPoM, to be prepared in accordance with, among other documents, the draft KPoM, the EIS and SEPP 44, which includes detailed information on baseline data on the resident koala population and potential koala habitat, as well as information on koala distribution in the surrounding region, identified direct and indirect impacts on koalas and measures to mitigate and manage them. Condition 36 states:

The Applicant shall prepare and implement a Koala Plan of Management for the development to the satisfaction of the Secretary. This plan must:

(a)   be prepared by suitably qualified, experienced koala experts whose appointment has been approved by the Secretary in consultation with OEH, Council and the Koala Technical Working Group (see condition 35);

(b)   be submitted to, and approved by, the Secretary prior to the commencement of any development on site;

(c)   be prepared generally in accordance with SEPP 44, the accompanying guidelines provided in Circular B35 – State Environmental Planning Policy 44 – Koala Habitat Protection, the Gunnedah Comprehensive Koala Plan of Management, the NPWS Policy and Procedure Statement No. 9 – Policy for the Translocation of Threatened Fauna in NSW and the draft koala plan of management in the EIS;

(d)   include detailed performance and completion criteria for evaluating the performance of the plan, and triggering remedial action (if necessary);

(e)   include detailed information on:

(i)   baseline data on the resident koala population and potential koala habitat on site and in the biodiversity offset areas and release areas, as well as information on koala distribution in the surrounding region;

(ii)   identification of direct and indirect threats to koalas and potential koala habitat on site and in the biodiversity offset and release areas;

(iii)   measures to mitigate and manage the identified impacts on koalas, including:

●   progressive clearing in the project disturbance area;

●   early revegetation of potential koala habitat species in the biodiversity offset areas and the key koala corridors;

●   speed limits, signage and fencing on roads in key koala habitat and movement areas;

●   the proposed rail corridor underpass;

●   pest and weed management;

●   provision of water stations and other measures to assist in drought periods;

●   koala management awareness training for site personnel; and

●   a detailed Koala Translocation Management Plan;

(f)   include a program to monitor:

●   resident koala health, distribution and population size on site and in the biodiversity offset areas;

●   translocated koala health and distribution;

●   existing and revegetated potential koala habitat; and

●   koala-related incident and injuries;

(g)   detail the implementation of the Applicant’s commitments to indirect koala mitigation measures, which must include measures of at least equivalence to those identified in the EIS (see notes below);

(h)   identify the potential risks to the successful implementation of the plan, and include a description of the contingency measures that would be implemented to mitigate against these risks; and

(i)   include details of who would be responsible for monitoring, reviewing, and implementing the plan.

Notes:

●   The Koala Plan of Management should be integrated as far as practicable with the Biodiversity Management Plan.

●   The key koala corridors are shown on the figure in Appendix 7.

●   With regard to indirect koala mitigation measures, the EIS identified a contribution of $180,000 ($60,000/year) over the 3 year life of the Australian Research Council (ARC) Linkage Project. The Department acknowledges that this project is yet to be confirmed.

63. Otherwise, the Consent requires that the Project is to be carried out generally in accordance with the EIS, which includes measures dealing with koala mitigation (Sch 2, cl 2(a)), and the statement of commitments, which includes a requirement to implement various mitigation and management measures for the koala outlined in the EIS and the RTS (Sch 2, cl 2(b); Appendix 3, item 34).

The statutory framework governing the process

64. The Project, as a coalmine, is State significant development: s 89C of the EPA Act. The Minister is the consent authority for State significant development: s 89D(1) of the EPA Act. The Minister has power, and in this case has exercised the power, under s 23(1) of the EPA Act to delegate the functions of the consent authority to the PAC.

65. A person may apply to the Minister (as the consent authority) for consent to carry out State significant development: s 78A(1) of the EPA Act. The application is to be made in accordance with the regulations. Clause 50(1)(a) of the EPA Regulation provides that:

A development application:

(a) must contain the information, and be accompanied by the documents, specified in Pt 1 of Sch 1, and

(b)   if the consent authority so requires, must be in the form approved by that authority …

66. The Minister has approved a form of development application in respect of State significant development for the purpose of cl 50(1)(b) of the EPA Regulation. This was the form used by Shenhua for its development application.

67. Part 1 of Sch 1 of the EPA Regulation specifies what a development application must contain (in cl 1) and the documents that must accompany a development application (in cl 2). Amongst the information that a development application must contain is:

1(1)(e)   an indication as to whether the development is likely to significantly affect threatened species, populations or ecological communities, or their habitats, unless the development is taken to be development that is not likely to have that effect, because it is biologically compliant development.

68. “Biologically compliant development” is defined in cl 1(2) of Sch 1 of the EPA Regulation. It is not relevant in this case as the Project is not biologically compliant development.

69. Amongst the documents that must accompany a development application for State significant development is an environmental impact statement (cl 2(1)(e) of Sch 1 of the EPA Regulation). The environmental impact statement is required to be prepared in the form prescribed by the regulations: s 78A(8A) of the EPA Act. Schedule 2 of the EPA Regulation prescribes the requirements for an environmental impact statement. Before preparing an environmental impact statement, the responsible person must make a written application to the Secretary of the Department of Planning for the environmental assessment requirements with respect to the proposed statement: cl 3(1) of Sch 2 of the EPA Regulation. The Secretary is to notify the responsible person of the environmental assessment requirements: cl 3(5) of Sch 2 of the EPA Regulation. For State significant development, the Secretary may waive the requirement to apply for and obtain environmental assessment requirements: cl 3(9) of Sch 2 of the EPA Regulation. However, the power to waive this requirement is not available for State significant development that is on land, that amongst other things, is “likely to significantly affect threatened species, populations or ecological communities, or their habitats”: cl 3(9)(d) of Sch 2 of the EPA Regulation.

70. A species impact statement ordinarily needs to accompany a development application that is likely to significantly affect threatened species, populations or ecological communities, or their habitats, but not if the development application is for State significant development: cl 2(1)(f) of Sch 1 of the EPA Regulation.

71. There are particular procedures for public notification and comment on the development application for State significant development and the accompanying documents: s 89F of the EPA Act and cll 82-85B of the EPA Regulation.

72. The power to determine a development application in respect of State significant development is given, not by the usual power under s 80(1) of the EPA Act, but rather under the particular power under s 89E(1) of the EPA Act.

73. In determining the development application, the Minister, as the consent authority for State significant development, is to take into consideration such of the matters in s 79C as are of relevance to the State significant development the subject of the development application, subject to Div 4.1 and Pt 4 of the EPA Act: s 89H of the EPA Act.

74. One of the generic matters to be considered is in s 79C(1)(b) of “the likely impacts of that development including environmental impacts on both the natural and built environments, and social and economic impacts in the locality”.

68. The Minister may determine a development application in respect to State significant development by:

(a)   granting consent to the application with such modification to the proposed development or on such conditions as the Minister may determine, or

(b) refusing consent to the application: s 89E(1) of the EPA Act.

76. Ordinarily, for development that is likely to significantly affect a threatened species, population or ecological community, or its habitat, development consent cannot be granted “without the concurrence of the Chief Executive of the OEH or, if a Minister is the consent authority, unless the Minister has consulted with the Minister administering the Threatened Species Conservation Act 1995”: s 79B(3) of the EPA Act.

77. However, the requirements for consultation and concurrence in s 79B of the EPA Act “do not apply to State significant development unless the requirement of an environmental planning instrument for consultation or concurrence specifies that it applies to State significant development”: s 79B(2A) of the EPA Act.

78. In this case, there was no such requirement of an environmental planning instrument for consultation or concurrence. Instead, it was a matter for the Secretary, through the content of the notified environmental assessment requirements, to decide what consultation was necessary. In preparing those environmental assessment requirements with respect to an application for State significant development, the Secretary “must consult relevant public authorities and have regard to the need for the requirements to assess any key issues raised by those public authorities: cl 3(4) of Sch 2 of the EPA Regulation.

The alleged misdirection grounds

The applicant’s submissions

79. Two of the grounds of challenge allege that there was a misdirection in the information contained in the development application for the Project and the PAC’s determination of the development application regarding the requirement of cl 1(1)(e) of Sch 1 of the EPA Regulation that the development application contain “an indication of whether the development is likely to significantly affect threatened species, populations or ecological communities, or their habitats”. The applicant submitted that, in order to provide this indication of whether a development was likely to affect the threatened species of the koala or its habitat, the factors listed in s 5A(2) of the EPA Act and the Threatened Species Assessment Guidelines must be taken into account: s 5A(1) of the EPA Act.

80. One of the factors that must be taken into account in the case of a threatened species is that in s 5A(2)(a) of the EPA Act of “whether the action proposed is likely to have an adverse effect on the lifecycle of the species such that a viable local population of the species is likely to be placed at risk of extinction”. The applicant contended that this factor is to be interpreted by applying the definitions of the key terms used in this factor in the Threatened Species Assessment Guidelines, namely:

Life cycle: the series or stages of reproduction, growth, development, ageing and death of an organism.

Viable: the capacity to successfully complete each stage of the life cycle under normal conditions.

Local population: the population that occurs in the study area. The assessment of the local population may be extended to include individuals beyond the study area if it can be clearly demonstrated that contiguous or interconnecting parts of the population continue beyond the study area, according to the following definitions.

●   The local population of a threatened plant species comprises those individuals occurring in the study area or the cluster of individuals that extend into habitat adjoining and contiguous with the study area that could reasonably be expected to be cross-pollinating with those in the study area.

●   The local population of resident fauna species comprises those individuals known or likely to occur in the study area, as well as any individuals occurring in adjoining areas (contiguous or otherwise) that are known or likely to utilise habitats in the study area.

●   The local population of migratory or nomadic fauna species comprises those individuals that are likely to occur in the study area from time to time.

In cases where multiple populations occur in the study area, each population should be assessed separately.

Risk of extinction: the likelihood that the local population will become extinct either in the short-term or in the long-term as a result of direct or indirect impacts on the viability of that population.

81. The definition of “local population” depends on the concept of the “study area”, which is defined to be:

Study area means the subject site and any additional areas which are likely to be affected by the proposal, either directly or indirectly. The study area should extend as far as is necessary to take all potential impacts into account.

82. This definition of “study area” refers to the subject site and direct and indirect impacts. These terms are defined as follows:

Subject site means the area directly affected by the proposal.

Direct impacts are those that directly affect the habitat and individuals. They

include, but are not limited to, death through predation, trampling, poisoning of the animal/plant itself and the removal of suitable habitat. When applying each factor, consideration must be given to all of the likely direct impacts of the proposed activity or development.

Indirect impacts occur when project-related activities affect species, populations or ecological communities in a manner other than direct loss. Indirect impacts can include loss of individuals through starvation, exposure, predation by domestic and/or feral animals, loss of breeding opportunities, loss of shade/shelter, deleterious hydrological changes, increased soil salinity, erosion, inhibition of nitrogen fixation, weed invasion, fertiliser drift, or increased human activity within or directly adjacent to sensitive habitat areas. As with direct impacts, consideration must be given, when applying each factor, to all of the likely indirect impacts of the proposed activity or development.

83. The applicant submitted that application of these definitions in the Threatened Species Assessment Guidelines demands a different inquiry to that which was undertaken in the development application for the Project or by the PAC in determining the development application. The applicant submitted that neither the development application nor the PAC considered what was the local population of koalas as that term is defined in the Threatened Species Assessment Guidelines, but instead considered different populations of koalas. As a consequence, the applicant submitted, both the development application and the PAC involved misdirection and failed to consider according to law the factor in s 5A(2)(a) of the EPA Act in deciding whether there was likely to be a significant effect on the threatened species of the koala or its habitat, and hence failed to consider according to law whether the Project was likely to affect the threatened species of the koala.

84. The applicant submitted that these failures had two sets of consequences that correspond to the two grounds of challenge in ground 4 and ground 1(a). First, the applicant submitted that the development application did not comply with cl 50(1)(a) of the EPA Regulation and was not a development application within the meaning of the EPA Act. As a consequence, the applicant submitted, there was no development application to which the Minister as the consent authority could grant consent. This was ground 4.

85. Second, the applicant submitted that, because the development application failed to consider according to law whether the Project was likely to significantly affect the threatened species of the koala or its habitat, the PAC’s consideration and determination of the development application was also not according to law. The PAC was bound by s 89E(1) and s 89H (applying s 79C) of the EPA Act to determine a “development application” and that development application includes the information contained in and the documents accompanying the development application. One of the pieces of information that the development application was required to contain was an indication as to whether the Project was likely to significantly affect the threatened species of the koala or its habitat. This was information that the PAC was bound to take into account in determining the development application. The applicant submitted that the misdirection in the information as to that matter infected the PAC’s consideration of the information, such that the PAC’s consideration and determination of the development application failed in law. This was ground 1(a).

Shenhua’s submissions

86. Shenhua noted that grounds 4 and 1(a) were related and indeed ground 1(a) depended on ground 4 being sustained. Shenhua submitted that the applicant’s contentions in grounds 4 and 1(a) involve two major premises and a minor premise.

87. The first major premise is that the “indication” referred to in cl 1(1)(e) of Sch 1 of the EPA Regulation must be compliant with the Threatened Species Assessment Guidelines. The second major premise is that the PAC was required to consider the Threatened Species Assessment Guidelines in deciding whether to grant consent to the Project under s 89E of the EPA Act. The minor premise is that, when the PAC determined to grant consent, it did not have information before it containing an “indication” of the relevant kind and accordingly failed properly to consider whether the Project was likely to have a significant effect on koalas. Shenhua submitted that each of these premises is flawed.

88. As to the first major premise, Shenhua submitted that the applicant’s interpretation of the term “an indication” in cl 1(1)(e) of Sch 1 of the EPA Regulation is erroneous. In using the term “an indication”, cl 1(1)(e) does not require any evaluation or provision of detailed information, but rather directs attention to the contents of the approved development application form, which simply asks the question of whether the development is likely to significantly affect threatened species, populations or ecological communities, or their habitats. This is supported by the text and context of the EPA Regulation and its regulatory history.

89. As to the second major premise, Shenhua submitted that the Minister, as the consent authority for State significant development, is not required to consider s 5A of the EPA Act or the Threatened Species Assessment Guidelines. As the Court of Appeal held in Davis v Gosford City Council [2014] NSWCA 343; (2014) 87 NSWLR 699, particularly at [94] and [115]-[116], s 5A only applies in deciding whether there is likely to be a significant effect on threatened species, populations or ecological communities, or their habitats.

90. For development other than State significant development this question needs to be addressed for at least two purposes: first, to decide whether the particular form of environmental assessment of a species impact statement needs to be prepared and to accompany a development application (s 78A(8)(b) of the EPA Act) and, second, to decide whether there needs to be consultation with or the concurrence of a public authority such as the Chief Executive of OEH (s 79B(3) of the EPA Act).

91. For State significant development, neither of these purposes is applicable. The requirement for a species impact statement to accompany a development application if the application is in respect of development that is likely to significantly affect threatened species, populations or ecological communities, or their habitats, does not apply to an application in respect of State significant development (s 78A(8) of the EPA Act). The requirements in s 79B for consultation and concurrence also do not apply to State significant development (s 79B(2A) of the EPA Act).

92. The only decision called for under the EPA Act in respect of State significant development that requires consideration of s 5A is the Director-General’s decision under cl 3(9) of Sch 2 of the EPA Regulation as to whether to waive the requirement to apply and obtain environmental assessment requirements. Where, however, environmental assessment requirements have been requested and given (as happened here), s 5A has no role to play.

93. Shenhua submitted that s 5A also has no role when it comes to assessing the development under s 89H (which applies s 79C of the EPA Act).

94. It follows, Shenhua submitted, that the PAC had no legal duty to consider s 5A or the Threatened Species Assessment Guidelines when determining the development application for the Project.

95. As to the minor premise, Shenhua submitted that the applicant’s argument is factually unsound. The development application for the Project did in fact contain an indication as to whether the development was likely to significantly affect the threatened species of the koala and its habitat. The indication given on the approved development application form was “yes”. The PAC was required to and did in fact consider that indication under s 89H (applying s 79C) of the EPA Act.

96. The development application for the Project also indicated that the development would, but for s 79B(2A) of the EPA Act, have required a concurrence under s 79B of the EPA Act, including a concurrence under the TSC Act. As noted earlier, such concurrence is only required for development that is likely to significantly affect a threatened species, population or ecological community, or its habitat. But the requirement for such a concurrence does not apply to State significant development, because of s 79B(2A) of the EPA Act. Nevertheless, by this answer, the development application contained another indication as to whether the development was likely to significantly affect the threatened species of the koala or its habitat.

97. Shenhua submitted that, in any event, the EIS and other documentation before the PAC specifically addressed the factors in s 5A(2) of the EPA Act.

98. In response generally to the applicant’s arguments, Shenhua submitted that the Threatened Species Assessment Guidelines cannot be used lawfully to vary the meaning and effect of s 5A(2), including the factor in s 5A(2)(a) of the EPA Act. It is an error to use an instrument made under an Act to construe the Act itself: Master Education Services Pty Ltd v Ketchell [2008] HCA 38; (2008) 236 CLR 101 at [19].

The Minister’s submissions

99. With respect to ground 4, the Minister submitted that all that the terms of cl 1(1)(e) of Sch 1 of the EPA Regulation require is that the development application contain an indication as to whether the development is likely to significantly affect threatened species, populations or ecological communities, or their habitats. This indication is non-evaluative and does not require provision of evaluative and detailed reports.

100. The Minister submitted that the term “an indication” in cl 1(1)(e) of Sch 1 of the EPA Regulation bears its ordinary English meaning. The Macquarie Dictionary defines “indication” as “anything serving to indicate or point out, as a sign, token, etc”. The Oxford English Dictionary defines it as “the action of indicating, pointing out, or making known; that in which this is embodied; a hint, suggestion, or piece of information from which more may be inferred”. The applicant’s argument does not relate to this ordinary English meaning of “indication”.

101. As a matter of fact, the Minister submitted, the development application for the Project contained an indication conforming with the ordinary English meaning of the word. The relevant indication was given on the approved form for making a development application for State significant development (by ticking the relevant box). The documents provided by Shenhua with that form and subsequently (all of which form part of the development application for the Project) also contained various indications in respect of this matter, coupled with substantive discussion.

102. With respect to ground 1(a), the Minister submitted that it fails for four reasons.

103. First, the ground as pleaded depends on the proposition that the matters in s 5A (including the factor in s 5A(2)(a) and the Threatened Species Assessment Guidelines) were required to be considered under s 79C(1)(b), since it is a breach of s 79C(1)(b) and s 89H (which makes s 79C applicable to State significant development) which is said to give rise to invalidity. The Minister submitted, however, that s 5A was not required to be so considered by the Minister as consent authority in determining a development application for State significant development. Section 5A has a specific but limited role within the scheme applicable to State significant development. The Minister adopted Shenhua’s submissions concerning this limited role of s 5A in respect to State significant development.

104. Second, the Minister submitted that the development application and accompanying and supporting documents did in fact contain an indication as to whether the Project was likely to significantly affect threatened species, ecological communities or their habitats. The indication was “yes”. This indication in the development application and other documents was considered by the PAC, as the Minister’s delegate, in determining the development application for the Project.

105. Third, the Minister submitted that the documentation in support of the development application did in fact contain substantive analysis of the matters in s 5A, including in relation to koalas, and considered the impacts by reference to various spatial areas, including in a manner which corresponds with the concept of a “study area” in the Threatened Species Assessment Guidelines. The gravamen of the applicant’s complaint is that the documentation did not address impacts on koalas by reference to the “local population” but rather by reference to larger populations, such as those occurring throughout the Gunnedah LGA, and hence the documentation understated the size of the impact on koalas.

106. The Minister submitted that this complaint was factually wrong. The documentation did not only refer to koala populations or analyse the impacts on koala populations in relation to the Gunnedah LGA. The Minister cited the discussion in the EIS Main Report, the KPoM and BMP, the RTS, and the Revised KPoM of the koala populations in the local area and the regional Gunnedah LGA as well as in the various areas that would be impacted directly or indirectly by the Project, including the Disturbance Area (the total area of land to be disturbed by the Project, bounded by the Disturbance Boundary), the Project Boundary (the entirety of the site the subject of assessment), the Study Area (comprising a 5km radius of the Project Boundary, including the adjoining Breeza State Forest and the vegetated hills to the northwest) and the Survey Area (the area within which koala surveys were undertaken, including the Project Boundary, portions of the Breeza State Forest and Offset Area 6). The Minister submitted that having regard to all of the documentation, the applicant has not established that the assessment of the koala population and the impacts on the koala population proceeded in disconformity with the concept of “study area” referred to in the Threatened Species Assessment Guidelines.

107. Fourth, the Minister submitted that whatever be the applicant’s complaint under this ground, it is immaterial in that it could not have made a difference to the decision made by the PAC. The requirement in cl 1(1)(e) of Sch 1 of the EPA Regulation is that the development application contain an indication as to whether the development is likely to significantly affect threatened species, populations or ecological communities, or their habitats. The applicant’s argument was that the matters in s 5A are to be taken into account in giving this indication. The applicant’s complaint was that consideration of the matters in s 5A (and in particular s 5A(2)(a) and the Threatened Species Assessment Guidelines) in the manner contended for by the applicant demanded giving the indication that the Project was likely to significantly affect the threatened species of the koala and its habitat. But that is precisely the indication that the development application and accompanying and supporting documents for the Project did give: the Project was likely to significantly affect threatened species, populations or ecological communities, or their habitats, and in particular the threatened species of the koala and its habitat. Hence, even if there were to have been any alleged misdirection or other error of law in providing the indication, the decision could not have been any different: Australian Broadcasting Tribunal v Bond [1990] HCA 33; (1990) 170 CLR 321 at 353.

129. Fourth, Shenhua submitted that the PAC, by imposing conditions of consent addressing the size of the koala population and the success of the koala translocation program, did not impermissibly defer consideration of these matters. The statutory scheme permits the imposition of such conditions. The power to attach conditions to a consent for State significant development is given by s 89E(1)(a) of the EPA Act. It is broad and flexible. It is in identical terms to the now repealed power in s 75J(4) to impose conditions on an approval under the former Pt 3A of the EPA Act. Section 89E(1) provides that the Minister may grant consent to an application for State significant development (with such modifications of the proposed development or on such conditions that the Minister may determine). Shenhua submitted that the description of the effect of the former s 75J(4) in Ulan Coal Mines Ltd v Minister for Planning [2008] NSWLEC 185; (2008) 160 LGERA 20 at 37 [78] - [80] is equally applicable to the power in s 89E(1)(a). The conditions of consent imposed by the PAC were not outside the power in s 89E(1)(a) and hence the PAC, by granting consent subject to the conditions, did not unlawfully defer consideration of the matters the subject of the conditions.

The Minister’s submissions

135. The Minister made similar submissions to Shenhua. First, the Minister noted that there was extensive consideration given to the impact of the Project on koalas in the Project documentation, public submissions, inter-agency comments (including OEH), analysis by the Department, the PAC Review Report, the PAC Determination Report and in the conditions of consent. As a matter of fact, therefore, there was no failure to consider the impact of the Project of koalas or a deferral of consideration of that matter.

136. Second, the Minister submitted that it is wrong to suggest that a generally expressed head of consideration, such as s 79C(1)(b) of the EPA Act, requires resolution or factual findings on various subtopics. Hence, there was no legal duty on the PAC to make factual findings on the two issues at the level of particularity argued by the applicant.

137. Third, the Minister submitted that at the base of the applicant’s argument about the two issues of the size of the koala population and the success of koala translocation was a challenge to the factual correctness of the PAC’s decision to grant consent on conditions that addressed these two issues. This is not permissible on judicial review: Walsh v Parramatta City Council at [62].

138. Fourth, the Minister submitted that the applicant’s argument that there was a failure to consider the two issues was factually incorrect. It was recognised throughout the documentation and consideration that the Project would involve the likely translocation of 262 koalas over the 30 year life of the Project, being the estimate of koalas in the Disturbance Area. It was therefore wrong to suggest that there was a failure to consider the size of any relevant overall population of the koala that would be directly impacted by the Project. Translocation of koalas was the subject of substantive discussion and consideration, including in the Project documentation, various submissions, interagency advice, the Departmental assessment, meetings held by the PAC and the discussion by the PAC in the PAC Review Report and the PAC Determination Report. In the PAC Determination Report alone, reference is made to the topic in a number of places. As such, it is wrong to suggest that there was a failure to consider the likely success of the koala translocation program.

139. Fifth, the Minister submitted that the imposition of conditions of consent did not impermissibly defer consideration of the two issues, but instead was a proper response to the residual risk to the koalas. The conditions of consent, including conditions 35 and 36, involved monitoring of impacts, periodic evaluation and a compliance system directed towards adaptive management. They were intended to deal with residual risk in accordance with the precautionary principle and were a proper response to dealing with uncertainty as to the impacts: Rivers SOS Inc v Minister for Planning [2009] NSWLEC 213; (2009) 178 LGERA 347 at [131] and Ulan Coal Mines Ltd v Minister for Planning at [99].

140. Sixth, the conditions imposed by the PAC on the consent were of a kind that has been recognised as appropriate and legitimate in the context of large scale projects such as the Project. Conditions which retain practical flexibility, leave matters of detail for later determination and delegate supervision of some stage or aspect of the development are all in accordance with the statutory scheme. The conditions imposed by the PAC on the consent were within the power in s 89E(1)(a) of the EPA Act.

No failure to consider impacts on koalas established

141. I agree with the submissions of Shenhua and the Minister that the PAC did not fail to consider any relevant matter concerning the impacts of the Project on koalas that it was bound to consider, essentially for the reasons that they have given, which I adopt.

142. As Shenhua and the Minister submitted, the PAC did in fact consider the two matters raised by the applicant of the size of the koala population and the likely success of the koala translocation. The PAC actively engaged in considering the impacts that the Project was likely to have on the koalas and the measures to mitigate these impacts, including in relation to koala translocation. This is evident in the summary of the process of consideration of the development application for the Project that I have earlier set out, particularly in the Department’s analysis and review and the PAC’s review and determination of the development application. The PAC was well aware of the impacts the Project was likely to have on koalas, the measures to avoid, mitigate and compensate for these impacts and the uncertainties and risks associated with these impacts and measures, and decided on actions in response. The imposition of particular conditions dealing with the impacts on koalas and mitigation measures (particularly conditions 35 and 36) was in fact evidence of the PAC’s active consideration and management of the issues, and not, as the applicant alleged, deferral of consideration of the issues.

143. There was no legal duty on the PAC, as the delegate of the Minister who was the consent authority, to make definitive findings of fact, at the level of particularity alleged by the applicant, about the precise size of the population of koalas that were likely to be impacted by the Project or the certainty of success of the koala translocation program, before determining to grant consent to the Project. At the base of the applicant’s challenge to the PAC’s decision to grant consent on conditions is a criticism of the factual soundness and merits of the decision to approve a development that will impact on the koala population, including by necessitating koala translocation. That criticism, of course, is not open in judicial review of an administrative decision.

144. The PAC had power under s 89E(1)(a) of the EPA Act to grant consent on conditions, such as conditions 35 and 36, that provide for preparation of plans of management, including detailed information on the baseline data of the koala population, the identified impacts on koalas, the measures to mitigate and manage the identified impacts, the program to monitor koala health, distribution of population size and translocated koala health and distribution, and the potential risks to successful implementation of the plan and the contingency measures to mitigate against these risks. Such an adaptive management approach is an appropriate response to deal with the uncertainty and risk concerning the impacts on the koalas and the measures to mitigate the impacts on the koalas. The conditions of consent embodying this adaptive management approach are within power and do not impermissibly defer consideration of the matters the subject of adaptive management until after the grant of consent.

145. The applicant has not established that the PAC failed to consider the impact of the Project on koalas under s 79C(1)(b) (applied by s 89H) of the EPA Act. I reject ground 1(b).

Alleged failure to consider two principles of ESD

The applicant’s submissions

146. The applicant’s final ground of challenge, in ground 3, to the grant of the development consent for the Project was that the PAC, in considering the public interest under s 79C(1)(e) (applied by s 89H) of the EPA Act, failed to consider two principles of ESD, namely the precautionary principle and the principle of the conservation of biological diversity and ecological integrity, when assessing the Project’s impacts on the koala. The applicant submitted that the PAC’s obligation to consider these two principles of ESD in the circumstances of this case had two sources.

147. The first source was the statutory obligation in s 79C(1)(e) of the EPA Act to consider the public interest. The PAC, as the delegate of the Minister who was the consent authority, was bound to take into consideration the public interest in determining the development application for the Project: s 89H applying s 79C(1)(e) of the EPA Act. Consideration of the public interest is ample enough, having regard to the subject matter, scope and purpose of the EPA Act, to embrace ESD. By requiring the consent authority to have regard to the public interest, s 79C(1)(e) (applied by s 89H) of the EPA Act required the consent authority to have regard to the principles of ESD in cases where issues relevant to those principles apply: Telstra Corporation Ltd v Hornsby Shire Council [2006] NSWLEC 133; (2006) 67 NSWLR 256; (2006) 146 LGERA 10 at [123]-[124]; Minister for Planning v Walker at 451 at [42]-[43].

148. “Ecologically sustainable development” is defined for the purposes of the EPA Act as having the same meaning as it has in s 6(2) of the Protection of the Environment Administration Act 1991: s 4 of the EPA Act. That meaning is that:

… ecologically sustainable development requires the effective integration of economic and environmental considerations in decision-making processes. Ecologically sustainable development can be achieved through the implementation of the following principles and programs:

(a)   the precautionary principle—namely, that if there are threats of serious or irreversible environmental damage, lack of full scientific certainty should not be used as a reason for postponing measures to prevent environmental degradation.

In the application of the precautionary principle, public and private decisions should be guided by:

(i)   careful evaluation to avoid, wherever practicable, serious or irreversible damage to the environment, and

(ii)   an assessment of the risk-weighted consequences of various options,

(b)   inter-generational equity—namely, that the present generation should ensure that the health, diversity and productivity of the environment are maintained or enhanced for the benefit of future generations,

(c)   conservation of biological diversity and ecological integrity—namely, that conservation of biological diversity and ecological integrity should be a fundamental consideration,

(d)   improved valuation, pricing and incentive mechanisms—namely, that environmental factors should be included in the valuation of assets and services, such as:

(i)   polluter pays—that is, those who generate pollution and waste should bear the cost of containment, avoidance or abatement,

(ii)   the users of goods and services should pay prices based on the full life cycle of costs of providing goods and services, including the use of natural resources and assets and the ultimate disposal of any waste,

(iii)   environmental goals, having been established, should be pursued in the most cost effective way, by establishing incentive structures, including market mechanisms, that enable those best placed to maximise benefits or minimise costs to develop their own solutions and responses to environmental problems.

149. The applicant submitted that the precautionary principle and the principle of conservation of biological diversity and ecological integrity were relevant matters to be considered in the circumstances of this case.

150. The second source of the obligation to consider these two principles of ESD was said to be the doctrine of the public trust. The applicant noted that koalas are “protected fauna” under s 5 of the National Parks and Wildlife Act 1974 (‘NPW Act’). Under s 97(2) of the NPW Act:

Any protected fauna, other than prescribed fauna, shall, until captured or killed in accordance with this Act, be deemed to be the property of the Crown.

151. The applicant submitted that, by this legislative provision, protected fauna (including the koala) became subject to the public trust. The applicant contended that koalas are held by the Crown as trustee of a public trust which, subject to valid exercises of legislative and/or administrative power, requires that koalas be managed in an ecologically sustainable manner and in the interests of the public as a whole, future generations and/or nature: Palmer v The Board of Lands and Works (1875) 1 VLR 80; Re Sydney Harbour Collieries Company (1895) 5 Land Appeal Court Reports 243; T Bonyhady, ‘A useable past: the public trust in Australia’ (1995) 12 EPLJ 329; P Finn, ‘The Forgotten Trust: The People and the State’ in Cope (ed), Equity, Issues and Trends (LBC, 1995), Ch 5; P Stein, ‘Ethical issues and land use planning in the public trust’ (1996) 13 EPLJ 493 at 501.

152. In this case, the applicant submitted that the public trust doctrine imposed an obligation on the Minister as the consent authority, when exercising the statutory power to determine the development application for the Project, to consider the principles of ESD when considering the impact of the Project on koalas:

The principles of ESD informed by the doctrine of the public trust embody a legislative imprimatur upon the Second Respondent as decision-maker to ensure that she observes the public trust in respect of protected fauna of which she is trustee when exercising the discretion conferred upon her to grant the consent to consider affirmatively, fundamentally and properly the precautionary principle and the principle of conservation of biological diversity, intergenerational equity and ecological integrity when considering the impact of the Project on Koala: [61] of the applicant’s summary of argument.

153. The applicant submitted that the PAC, as the Minister’s delegate in granting consent to the Project, breached its obligation, deriving from either source, to consider the two principles of ESD of the precautionary principle and the principle of conservation of biological diversity and ecological integrity.

154. In relation to the precautionary principle, the applicant contended that the PAC did not undertake an assessment of the risk-weighted consequences of various options to mitigate and manage the identified impacts of the Project on the koalas, and thereby failed to consider and apply the precautionary principle. The applicant noted that the option selected by the PAC was to grant consent subject to condition 36 which required preparation and implementation of a KPoM that included detailed information on measures to mitigate and manage the identified impacts on koalas, including a detailed Koala Translocation Management Plan. The applicant contended that the application of the precautionary principle required the PAC to consider whether condition 36 and the required KPoM and Koala Translocation Management Plan were a proportionate response, but the PAC failed to do so. The applicant submitted that there was uncertainty as to the success of the koala translocation program, including whether the proposed translocation of koalas could be achieved. As a consequence, the applicant submitted that the PAC failed to consider and apply the precautionary principle when considering the impact of the Project on the koala.

155. In relation to the principle of conservation of biological diversity and ecological integrity, the applicant noted that the principle requires that the conservation of biological diversity and ecological integrity should be a fundamental consideration in decision-making. The applicant submitted the concept of ‘biological diversity’ means:

The diversity of life and is made up of the following 3 components:

(a)   genetic diversity – the variety of genes (or units of heredity) in any population;

(b)   species diversity – the variety of species,

(c) ecosystem diversity – the variety of communities or ecosystems: s 4(1) of the TSC Act: Bentley v BGP Properties Pty Ltd [2006] NSWLEC 34; (2006) 145 LGERA 234 at 243 at [59].

156. The applicant submitted that the concept of ‘ecological integrity’ means:

At a macro level, ecological integrity involves conservation of the ecological processes that keep the planet fit for life. They “shape climate, cleanse air and water, regulate water flow, recycle essential elements, create and recreate soil, and enable ecosystems to renew themselves”: IUCN, UNEP, WWF, Caring for the Earth: A Strategy for Sustainable Development, Oxford University Press, 1992 at p. 9.

Maintaining ecological integrity involves maintaining ecosystem health. Ecosystems become unhealthy if their community structure (species richness, species composition or food web architecture) or ecosystem functioning (productivity, nutrient dynamics, decomposition) has been fundamentally upset by human pressures: M Begon, C R Townsend and J L Harper, Ecology: From Individuals to Ecosystems, 4th ed, Blackwell Publishing, 2006, p. 645.

Maintaining ecological integrity also involves maintaining ecosystem functioning and ecosystem services. Ecosystem functioning is “the sum total of processes such as the cycling of matter, energy, and nutrients operating at the ecosystem level”: R A Virginia and D H Wall, “Ecosystem Function, Principles of” in S A Levin (ed), Encyclopaedia of Biodiversity, Academic Press, 2001, Volume 2, p. 345. Ecosystem services are “the wide array of conditions and processes through which ecosystems, and their biodiversity, confer benefits on humanity; these include the production of goods, life support functions, life-fulfilling conditions, and preservation of options”: G Daily and S Dasgupta, “Ecosystem Services, Concept of”, in S A Levin (ed), Encyclopaedia of Biodiversity, Academic Press, 2001, Volume 2, p. 353: Bentley v BGP Properties at [60]-[62].

157. The applicant noted that the conservation of threatened species is an essential action in the conservation of species diversity, and hence of biological diversity and ecological integrity: Bentley v BGP Properties at [63].

158. The applicant submitted that the absence of consideration of the uncertainty as to the size of the local population of koalas, the likely success or failure of koala translocation, and any viable local population of koalas impacted by the Project, and the deferral of consideration of these matters until after the grant of development consent, demonstrated that the PAC failed to consider and apply the principle of conservation of biological diversity and ecological integrity. By failing to consider the precautionary principle and the principle of conservation of biological diversity and ecological integrity, the applicant submitted that the PAC breached s 79C(1)(e) of the EPA Act.

Shenhua’s submissions

159. Shenhua submitted that the applicant’s argument that the PAC failed to consider the principles of ESD, including the precautionary principle and the principle of conservation of biological diversity and ecological integrity, is factually unsustainable. Both Shenhua and the Department put information before the PAC regarding ESD, including in the EIS Main Report and the SEAR. The PAC considered this information, as evidenced in the PAC Review Report and PAC Determination Report. Indeed, Shenhua submitted, the conditions which the PAC imposed on the consent, particularly in relation to the ongoing monitoring of koalas and adaptive management, demonstrated consideration and application of the precautionary principle and the principle of conservation of biological diversity and ecological integrity.

159. Shenhua submitted that the applicant’s contention that there was a failure to consider the principles of ESD because of the uncertainty as to the size of the koala population, the failure to make a finding as to the success of the koala translocation program and the absence of consideration of a viable local population of koalas must fail for the reasons already given in relation to the earlier grounds of challenge. The PAC considered these issues and imposed conditions calculated to address them.

160. Shenhua submitted that the applicant’s argument relying on the public trust cannot succeed. Shenhua submitted that the deemed statutory conferral of proprietary rights in protected fauna to the Crown by s 97(2) of the NPW Act discloses no parliamentary intention to create some “public trust” in respect of protected fauna and furthermore discloses no parliamentary intention to introduce some new head of consideration into s 79C(1) of the EPA Act.

The Minister’s submissions

162. The Minister firstly submitted that consideration of the principles of ESD does not require consideration at the level of particularity or in the particular manner of assessment or analysis argued by the applicant: Drake-Brockman v Minister for Planning [2007] NSWLEC 490; (2007) 158 LGERA 349 at [131]-[132]. Hence, even if the PAC were not to have considered the precautionary principle and the principle of conservation of biological diversity and ecological integrity at the level of particularity and in the manner argued by the applicant (which the Minister submitted was not the case), this would not have the legal consequence of causing the PAC to have failed to consider any relevant matter.

163. Second, the Minister submitted that, in fact, the PAC did consider the substance of the principles of ESD in relation to impacts on koalas. The Minister referred to the SEAR and the PAC Review Report which assessed the risk-weighted consequences of koala translocation and recommended imposition of precautionary measures to minimise, mitigate and compensate for any residual risks. The Minister noted that Shenhua's documentation contained copious assessment addressing the substance of the principles of ESD, as did the objector submissions, all of which were considered by the PAC.

164. The Minister noted that the SEAR expressly stated that the Department had considered the encouragement of ESD in its assessment of the Project, that this assessment integrated all significant socio-economic and environmental considerations and sought to avoid any potential serious or irreversible environmental damage, based on assessment of risk-weighted consequences and that the Department was satisfied that the Project could be carried out in a manner that is consistent with the principles of ESD.

165. The SEAR also noted that to "address the unknowns and risks associated with the population dynamics and health of the resident Koala population on the site”, OEH had recommended that Shenhua be required to collect population details of the Koala population to provide baseline information on the status of the population prior to commencement of management activities. The Department agreed with OEH and recommended certain conditions to this end.

166. The Department also considered the likelihood of success of koala translocations and referred to expert evidence suggesting that where certain methodologies were adopted they were highly successful and that studies had found that of 18 reported translocations, 17 were successful.

167. The SEAR discussed the risk-weighted consequences of the options. The statement was made that "[t]he Department acknowledges that translocation is a 'last resort' mitigation measure, but accepts it is more than likely to be required, and is indeed warranted, for this project. Relying on other methods, such as natural or encouraged migration, is likely to have potentially higher risks associated with predation or vehicle strike". Conditions of consent were recommended "[t]o ensure that the translocation plan has the highest likelihood of success".

168. The Department concluded in the SEAR by observing that an assessment of the development application, EIS, submissions on the Project and Shenhua’s responses had been undertaken "in accordance with the objects of the [EPA Act] and the principles of ecologically sustainable development". It recommended "a comprehensive and precautionary suite of conditions to ensure that the Project complies with relevant criteria and standards, and to ensure that the predicted residual impacts are effectively minimised, mitigated and/or at least compensated for".

169. The Minister noted that the PAC Review Report recorded its consideration of (amongst other things) the SEAR and Shenhua's materials. It noted the advice of the OEH that irrespective of whether the koala population is at the lower or upper end of the population range, “the management responses and actions will generally be the same". The PAC Review Report discussed the proposed mitigation measures and made recommendations to strengthen the conditions to address risk and uncertainty.

170. The Minister noted that that the PAC Determination Report recorded its consideration of the SEAR (and Addendum Report), Shenhua's materials, the objections to the Project and the PAC Review Report. The PAC Determination Report referred to submissions which argued that koala translocation did not work, referred to the recommendations in the PAC Review Report which had largely been incorporated into the conditions of consent, and recorded the PAC’s conclusion that it was "satisfied the specific requirements for a Koala Plan of Management and Working Group will ensure that koalas are given the best chance of survival both in any translocation programs and through the establishment of additional habitat (albeit in the long term)".

171. Third, the Minister submitted that the PAC imposed a regime for monitoring and adaptive management that involved application of the precautionary principle: Telstra Corporation Pty Ltd v Hornsby Shire Council at [163]-[164] and Newcastle and Hunter Valley Speleological Society Inc v Upper Hunter Shire Council [2010] NSWLEC 48; (2010) 210 LGERA 126 at [181]-[185]. The PAC imposed conditions concerning koalas (in particular conditions 35 and 36), which involved monitoring of impacts, periodic evaluation and a compliance system. They were intended to deal with residual risk in accordance with the precautionary principle and were a proper response to dealing with uncertainty as to impacts: Rivers SOS v Minister for Planning at [131]; Ulan Coal Mines Ltd v Minister for Planning at [99]. The imposition of such conditions evidenced the PAC’s consideration and application of the precautionary principle.

172. In these circumstances, the Minister submitted, there is no substance to the applicant’s allegation that there was not an assessment of the risk-weighted consequences of various options and thereby a failure to consider and apply the precautionary principle.

173. Fourth, the Minister submitted that the applicant’s argument that the PAC failed to consider whether condition 36 and the required Koala Plan of Management and the Koala Translocation Management Plan were a proportionate response was factually and legally erroneous. Factually, the PAC did give consideration to the uncertainty as to the success of the planned koala translocation and imposed conditions to address and manage the uncertainty. The approach and measures adopted by the PAC were considered by it to be proportionate to the potential threats to the koala and the uncertainties about the planned koala translocation. While the applicant might disagree with that merit assessment of the proportionality of the response, it is not open to review in these judicial review proceedings.

174. Legally, consideration of the precautionary principle does not, as a matter of law, require the particular proportionality analysis argued by the applicant. Furthermore, application of the precautionary principle does not prohibit granting consent to the carrying out of a project until scientific certainty has been obtained: Telstra Corporation Ltd v Hornsby Shire Council at [179].

175. Fifth, the Minister submitted that neither the NPW Act (by deeming protected fauna to be the property of the Crown) nor the EPA Act imposes a public trust with respect to protected fauna, including the koala. In any event, the applicant’s argument that protected fauna are subject to the public trust adds nothing to the applicant’s other arguments. The applicant relied on the public trust doctrine as another source of the obligation on the PAC to consider the precautionary principle and the principle of conservation of biological diversity and ecological integrity. However, the applicant argued that there was already the obligation to consider these two principles of ESD as part of the required consideration of the public interest under s 79C(1)(e) (applied by s 89H) of the EPA Act.

176. Furthermore, the Minister submitted that the applicant’s argument that the public trust argument required the PAC to consider “affirmatively, fundamentally and properly” these two principles of ESD sought impermissibly to transform the relevant considerations ground of judicial review into a merits based consideration. The Minister submitted that the obligations of the Minister as consent authority in determining a development application for State significant development are best found within the statutory provisions governing the exercise of the power rather than seeking to extract some abstract principle out of an implied public trust: citing by analogy Environment Protection Authority v Ballina Shire Council [2006] NSWLEC 289; (2006) 148 LGERA 278 at [83].

No failure to consider the two ESD principles established

177. I find that the applicant has not established that the PAC, in determining the development application for the Project, failed to consider the precautionary principle or the principle of conservation of biological diversity and ecological integrity, and hence the public interest under s 79C(1)(e) of the EPA Act. This ground of challenge fails.

178. I accept the first step in the applicant’s argument that the PAC, in determining Shenhua’s development application for consent to carry out the Project that would impact on koalas, was obliged to take into consideration the relevant matters of the precautionary principle and the principle of conservation of biological diversity and ecological integrity. That obligation arose as part of the required consideration of the public interest under s 79C(1)(e) (as applied by s 89H) of the EPA Act. It is not necessary to determine whether the public trust doctrine, if it applies, separately gives rise to an obligation to consider those same relevant matters of the precautionary principle and the principle of conservation of biological diversity and ecological integrity. It is sufficient that, as part of the required consideration of the public interest under s 79C(1)(e) of the EPA Act (applied by s 89H), there was an obligation on the PAC to consider these two principles of ESD in determining the development application for the Project.

179. I find, however, that the applicant has not established that the PAC did in fact fail to consider these two principles of ESD. As Shenhua and the Minister have submitted, there is evidence in Shenhua’s development application and supporting documentation, the SEAR, the PAC Review Report, the PAC Determination Report and the conditions of consent of consideration and application of both the precautionary principle and the principle of conservation of biological diversity and ecological integrity in relation to the impacts of the Project on koalas, including koala translocation.

180. The PAC’s obligation to consider these two principles of ESD did not demand consideration at the level of particularity and in the precise manner argued by the applicant in this ground of challenge.

181. Nevertheless, as it happened, the PAC did undertake, in substance, an assessment of the risk-weighted consequences of the measures to mitigate and manage the impacts of the Project on koalas, including by the planned koala translocation, and, in granting consent subject to conditions requiring monitoring and adaptive management, implemented what the PAC considered to be a proportionate response to the impacts. The PAC considered and adopted the recommended measures to assist with the protection of the koala, including the establishment of a Koala Technical Working Group and the preparation and implementation of a KPoM and a Koala Translocation Management Plan, and incorporated these measures into the conditions of consent. The PAC was well aware that there was uncertainty as to the success of the koala translocation program, and hence whether the proposed translocation of koalas could be achieved, but determined that imposing the conditions of consent was an appropriate response to mitigate and manage these uncertainties. As the PAC found in its Determination Report, “the Commission is satisfied the specific requirements for a Koala Plan of Management and Working Group will ensure that koalas are given the best chance of survival both in any translocation programs and through the establishment of additional habitat (albeit in the long term)”. The PAC, therefore, did, in substance, consider the aspects of the precautionary principle and undertake the analysis and assessment that the applicant argued should have been considered and assessed.

182. Similarly, in relation to the principle of conservation of biological diversity and ecological integrity, the PAC recognised that there was uncertainty as to the size of the local population of koala and the likely success or failure of koala translocation. By imposing the conditions of consent, requiring, amongst other things, collection of baseline data on the resident koala population; preparation and implementation of a detailed Koala Translocation Management Plan; and monitoring of resident koala health, distribution and population size and translocated koala health and distribution, the PAC sought to mitigate and manage these uncertainties. The PAC, therefore, did, in substance, address those aspects of the principle of conservation of biological diversity and ecological integrity and undertake the analysis and assessment that the applicant argued should have been considered and assessed.

183. The applicant’s invocation of the public trust doctrine does not assist its case that the PAC failed to consider these two principles of ESD. The applicant’s challenge to the PAC’s determination was that the PAC failed to consider the two principles of ESD of the precautionary principle and the principle of conservation of biological diversity and ecological integrity in the particular respects argued by the applicant. The applicant invoked the public trust doctrine as a source of the obligation to consider these two principles of ESD in these respects. As I have noted above, however, it is not necessary to invoke the public trust doctrine to provide a source of the obligation to consider these two principles of ESD; the obligation can be found under the consideration of the public interest in s 79C(1)(e) of the EPA Act.

184. The applicant’s challenge, therefore, invokes the public trust doctrine as a means to establish the end that the PAC failed to consider the two principles of ESD in the respects argued, and not as an end in itself of being a consideration that the PAC failed to take into account.

185. The applicant is also incorrect in contending that the public trust doctrine requires a consent authority, in determining a development application, not simply to consider the relevant matters but to consider “affirmatively, fundamentally and properly” the relevant matters. The relevant considerations ground of review does not permit judicial inquiry as to whether the consent authority “affirmatively, fundamentally and properly” considers the relevant matters. To do so is to undertake merits review, not judicial review, of the decision of the consent authority.

186. In any event, as I have found above, the applicant has not established on the evidence that the PAC failed to consider the particular aspects of the precautionary principle and the principle of the conservation of biological diversity and ecological integrity or failed to undertake the particular analysis and assessment of these two principles of ESD that the applicant argued that the public trust doctrine demanded be considered and assessed. I reject ground 3.

187. In these circumstances, it is not necessary to decide whether the public trust doctrine applied to the protected fauna of the koala in this case or regulated the exercise of the power (under s 89E(1) of the EPA Act) to determine the development application for the Project. The applicant’s ground of challenge does not succeed even if the public trust doctrine were to apply as articulated by the applicant and regulate the determination to grant consent to the Project in this case.

Conclusion and orders

188. The applicant has not established any of its grounds of challenge to the determination to grant development consent to the Project. The proceedings should therefore be dismissed.

189. The parties have not had an opportunity to argue the question of costs. I will therefore reserve the question of costs. Any party seeking an order for costs can apply and that application can be heard at a later date.

190. I order:

1. The proceedings are dismissed.

2. The question of costs is reserved.

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Decision last updated: 19 February 2016