Zagami v Waste Services New South Wales - [2005] NSWADT 217

No judgment structure available for this case.

CITATION: Zagami v Waste Service New South Wales [2005] NSWADT 217

DIVISION: General Division

PARTIES: APPLICANT
Paul Joseph Zagami
RESPONDENT
Waste Service New South Wales

FILE NUMBER: 043350; 043351; 043386

HEARING DATES: 21/03/05

SUBMISSIONS CLOSED: 03/21/2005

DATE OF DECISION:
09/22/2005

BEFORE: Montgomery S - Judicial Member

APPLICATION: access to documents - business affairs - access to documents - cabinet documents - access to documents - internal working documents - access to documents - legal professional privilege - Freedom of Information Act - access to documents - business affairs - Freedom of Information Act - access to documents - cabinet documents - Freedom of Information Act - access to documents - internal working documents - Freedom of Information Act - access to documents - legal professional privilege

MATTER FOR DECISION: Principal matter

LEGISLATION CITED: Evidence Act 1995
Freedom of Information Act 1989

CASES CITED: Re Organon and Department of Community Services and Health (1987) 13 ALD 588
Re Pfizer v Department of Health, Housing and Community Services (1993) 30 ALD 647
Searle Australia Pty Limited v Public Interest Advocacy Centre (1992) 108 ALR 163

REPRESENTATION: C Jackson, barrister
N Williams SC, barrister

ORDERS: The Agency’s decision in relation to each of these matters is affirmed.

1 Mr Zagami is employed by Collex Pty Ltd (“Collex”) as the NSW Public Affairs Manager. Collex and related companies are major operators of liquid waste treatment plants around the world. Collex provides liquid waste treatment services in the Sydney Metropolitan region and acts in competition to Waste Service. Both Waste Service and Collex operate a number of facilities, including liquid waste treatment plants ("LTPs"), which receive wastes for processing.

2 The Waste Service Lidcombe LTP receives liquid wastes from a range of industries and is a major service provider for industrial liquid waste. It was commissioned in 1988. The environmental impact of the plant is managed through a comprehensive licence issued by the Department of Environment and Conservation (“the DEC”).

3 Collex's Camellia facility opened in 1996 and Unanderra LTP opened in 2002.

4 These reasons relate to three separate applications by Mr Zagami for review of decisions taken by Waste Service New South Wales (“the Agency”) in response to applications by Mr Zagami under the Freedom of Information Act 1989 ("the Act").

Matter number 043350

5 The initial application in matter number 043350 sought access to the following documents:

b. 7 May 2004 to 30 July 2004

Prior to the waste sludges leaving the Lidcombe Liquid Treatment Plant,

On arrival of waste sludges at the above landfills, and

Prior to the sludges being placed in the above landfills".

6 The Agency identified the following documents as meeting the description of the application but access was refused on the basis that the documents were exempt from production:

1.2 Waste Service NSW Stabilised Plant Residue Weekly, Composite Analytical Certificates Ref Nos:

1.3 Waste Service NSW Stabilised Residue TCLP two-day Composite Analytical Certificates: Ref Nos:

1.4 ALS Environmental Certificates of Analysis - January 2004

1.5 ALS Environmental Certificates of Analysis - February 2004

1.6 ALS Environmental Certificates of Analysis - March 2004

1.7 ALS Environmental Certificates of Analysis - April 2004

1.8 ALS Environmental Certificates of Analysis - May 2004

1.9 ALS Environmental Certificates of Analysis - June 2004

1.10 ALS Environmental Certificates of Analysis - July 2004”

7 The Agency identified the following documents as meeting the description of the application and released them to Mr Zagami:

1.2 Stabilised Residue Quality Checklist

1.3 Toxicity Characteristics Leaching Procedure.

1.4 Preparation of Stabilised Residue samples for SCC and TCLP analysis and attached coversheet.”

8 The initial application in matter number 043350 sought access to the following documents:

b. 7 May 2004 to 30 July 2004

Prior to the waste sludges leaving the Lidcombe Liquid Treatment Plant,

On arrival of waste sludges at the above landfills, and

Prior to the sludges being placed in the above landfills".

9 The Agency identified the following documents as meeting the description of the application but access was refused on the basis that the documents were exempt from production:

1.2 Waste Service NSW Stabilised Plant Residue Weekly, Composite Analytical Certificates Ref Nos:

1.3 Waste Service NSW Stabilised Residue TCLP two-day Composite Analytical Certificates: Ref Nos:

1.4 ALS Environmental Certificates of Analysis - January 2004

1.5 ALS Environmental Certificates of Analysis - February 2004

1.6 ALS Environmental Certificates of Analysis - March 2004

1.7 ALS Environmental Certificates of Analysis - April 2004

1.8 ALS Environmental Certificates of Analysis - May 2004

1.9 ALS Environmental Certificates of Analysis - June 2004

1.10 ALS Environmental Certificates of Analysis - July 2004”

10 The Agency identified the following documents as meeting the description of the application and released them to Mr Zagami:

1.2 Stabilised Residue Quality Checklist

1.3 Toxicity Characteristics Leaching Procedure.

1.4 Preparation of Stabilised Residue samples for SCC and TCLP analysis and attached coversheet.”

11 Of the 10 documents to which access was not granted, access was refused to Document 1.1 under section 25(l)(b) of the Act on the basis that a copy of this document was, and still is, available from the Department of Environment and Conservation Public Register. The Applicant has not pressed this part of the application.

12 As to the balance of the documents to which access was not granted, access was refused to each of the documents by reason of the exemptions set out in clause 7(l)(b) and (c) of Schedule 1 to the Act ie they are said to be documents affecting business affairs. Clause 7 of Schedule 1 to the Act provides:

(a) if it contains matter the disclosure of which would disclose trade secrets of any agency or any other person, or

(b) if it contains matter the disclosure of which:

(i) would disclose information (other than trade secrets) that has a commercial value to any agency or any other person, and

(ii) could reasonably be expected to destroy or diminish the commercial value of the information, or

(c) if it contains matter the disclosure of which:

(i) would disclose information (other than trade secrets or information referred to in paragraph (b)) concerning the business, professional, commercial or financial affairs of any agency or any other person, and

(ii) could reasonably be expected to have an unreasonable adverse effect on those affairs or to prejudice the future supply of such information to the Government or to an agency.

(2) A document is not an exempt document by virtue of this clause merely because it contains matter concerning the business, professional, commercial or financial affairs of the agency or other person by or on whose behalf an application for access to the document is being made.”

13 The commercial context in which the application arises, together with the factual background of the issues relating to the operation of the Respondent's Lidcombe Liquid Treatment Plant ("LTP"), is contained in the evidence of Anita Mitchell and Damian O'Connor.

14 The particular evidence which details the commercial value of the information is contained in the affidavit of Bruce Bailey, the Plant Manager of the Respondent's Lidcombe LTP. Mr Bailey’s evidence is that:

(b) the LTP continuously samples the stabilised residue with samples combined into composites on a two daily, weekly and monthly basis;

(c) the taking and preparing of samples plus the internal and external analytical costs currently run at approximately $100,000 per year;

(d) documents 1.2-1.10 comprise the Certificates of Analysis from external laboratories in connection with the composite samples;

(e) the information contained in these Analysis Certificates would enable a competitor to infer the nature of the proprietary process used by Waste Service in producing the stabilised residue;

(f) the stabilised residue process is a key cost in the overall operation of the LTP;

(g) the information contained in the Certificates will also enable a competitor to determine such things as:

(ii) when combined with other information sought in proceeding 043386, the actual volumes of various waste streams could be effectively inferred, providing substantial information about the market size of particular types or groups of waste;

(iii) the ability of the Waste Service LTP to handle a particular liquid waste stream, which will impact upon cost competition in relation to that particular waste stream.

15 The information in these documents relates to key operational matters pertaining to the LTP, both in relation to the processes employed and the volumes and types of waste received from time to time. The Agency asserts that the information has a commercial value to it, as it is information used for the purpose of carrying on the commercial activity in which it is engaged and it is important to the viability of its continued business operations.

16 The Agency relies on evidence from Mr Bruce Bailey, the Plant Manager of the LTP. Mr Bailey provided affidavit evidence and also appeared at the hearing. He provided both public and confidential evidence and was cross-examined.

17 Evidence presented on behalf of the Agency suggests that disclosure of the documents would make the information available to competitors, which would give those competitors an unreasonable competitive advantage over the Agency. In particular, disclosure would make publicly available information that would enable the determination of the proprietary process used in the production of stabilised residue, the determination of the commercial strengths and weaknesses of the plant, and the type and volumes of liquid waste streams that it processes. Disclosure of the information therefore could reasonably be expected to substantially diminish the commercial value of the information by making it generally available at no cost. This information would be valuable to the Agency’s competitors as a factor for consideration in tendering.

18 Mr Bailey’s evidence is that an examination of all the refused analytical reports would allow a suitably qualified reader to establish the overall processing capabilities of the Agency’s LTP. The normal operating performance of the plant could be easily established. A review of the database of results can be used to develop a base line of the composition of the stabilised residue created by the waste treatment process. The "base line" would be developed by statistical methods to develop averages and normal deviations. Within the normal "base line" there will be variations in key chemical components that could be used as markers for to determine the frequency of receipt of many different types of liquid wastes. When combined with the knowledge of the actual mass quantity of stabilised residue, then the actual volumes of various waste streams could be effectively inferred, thus providing substantial information about the market size of particular types or groups of wastes. An examination of the "base line" could also reveal to the trained eye, certain process limitations and vulnerabilities where certain components of the residue are close to the prevailing maximum limits. This could provide valuable information to a competitor for pricing policies.

19 Mr Bailey states that the stabilised residue process and final disposal of the stabilised residue is a key cost in the overall operation of the liquid waste plant. The commercial value of the information lies in the fact that a proper knowledge and understanding of the various statistics and the underlying factors which they represent is integral to the carrying on of the Agency’s commercial activities. The disclosure of this material to a competitor would assist a competitor in understanding the key operations of the Agency’s business, including critical matters relating to the pricing of its services. This in turn would allow the competitor to make its own pricing decisions based on this information, which would be a severe detriment to the Agency’s competitive position in the market.

20 In addition, it is argued that the information concerns the business, professional, commercial and financial affairs of the Agency. Disclosure of the information could reasonably be expected to have an unreasonable adverse effect on those affairs as that disclosure would have the effect of making available commercially sensitive information to the Agency's competitors who could use this information to the significant detriment of the Agency's business, including the erosion of its competitive position in the market.

21 The Agency relies on the decision in Re Organon and Department of Community Services and Health (1987) 13 ALD 588 at 595 as authority for the principle that the compilation of statistical and scientific data can have commercial value. Re Organon held that:

"To the extent that the statistical information contained in the document is disbursed to the world generally, the value of that investment must be substantially diminished."

22 The Agency also relies on the decision in Searle Australia Pty Limited v Public Interest Advocacy Centre (1992) 108 ALR 163 at 177, where the Full Court held that commercial value might attach to information contained in any documents, which concerned the nature of techniques used in, and the actual results of tests. See also Re Pfizer v Department of Health, Housing and Community Services (1993) 30 ALD 647 at 676.

23 Mr Zagami contends that these documents which may shed light on the way in which the Agency has handled the reception and treatment of liquid waste at its LTP. Mr Zagami does not dispute that in some cases, statistics and technical data are of commercial value, however it asserts that whether or not this is so will turn on the facts and circumstances of a particular case.

24 In relation to the issue Mr Zagami relies on the evidence of its NSW Compliance Manager, Dr Philip Abraham. Dr Abraham provided affidavit evidence and also appeared at the hearing and was cross-examined. His evidence is that knowledge of the level of contaminants in treated sludge is of no value in understanding the operation of the Agency's plant.

25 In particular, his evidence is that it is not true to suggest that the testing of the end product would reveal the proprietary process for treating that product. All that the data can indicate is whether the treatment process is adequate. That is, whether the treatment process is performing well enough to bring the treated waste within environmental requirements.

26 Mr Zagami contends that if release of the documents sought would reveal the Agency's non-compliance with environmental requirements lead to the erosion of the Agency's competitive position in the market-place, then that would not be an unreasonable adverse effect.

Decision

27 On the evidence I am satisfied that the documents sought are of commercial value. I am persuaded by the evidence provided on behalf of the Agency that the totality of the information that would revealed by these documents would allow a person with sufficient technical knowledge to ascertain aspects of the Agency's operations and that in doing so a competitor could obtain a commercial advantage. I am satisfied that this would allow a competitor access to an additional factor that could be taken into account in a tendering process.

28 I accept that there may be no commercial advantage to Collex in obtaining the documents sought, however release of the documents cannot be considered as release only to Mr Zagami. It must also be viewed as release to of the Agency's other competitors. I accept the Agency's argument that there may be others in the marketplace with less sophistication and with more to gain commercially by obtaining access to this information. The information could allow a competitor to determine the strengths and weaknesses of the plant and the volume and type of waste that it processes. This is information that has a commercial value to the Agency.

29 While I am conscious of the fact that the data is not current, I am satisfied that if access were given to the documents that are sought under this application, when combined with other information that is available to Collex through other sources, the Agency might be placed at a commercial disadvantage. I am not satisfied that this situation would be resolved by release of the documents in an edited form. That being the case, it is my view that access to these documents should be refused by reason of the exemptions set out in clause 7(l)(b) of Schedule 1 to the Act.

Matter number 043351

30 The initial application in matter number 043351 sought access to the following documents:

Copies of the entire Waste Service NSW Annual Return to the Environmental Protection Authority for the Waste Service NSW Liquid Treatment Plant at Hill Road, Homebush and other Waste Service NSW landfills and facilities that received liquid sludges from the Waste Service NSW Liquid Treatment Plant at Hill Road, Homebush in the period 1 January 2004 to 30 July 2004.”

31 The Agency identified the following documents as meeting the description of the application:

1.2 "Lidcombe Liquid Treatment Plant Interim Briefing" letter to Waste Service c/- Clayton Utz from ERM Australia dated April 25, 2004. Marked "Privileged and Confidential"

1.3 Draft legal advice from Clayton Utz to Waste Service dated May 6, 2004

1.4 Copy of EPA licence variation titled "Immobilised waste sludge"

1.5 "Liquid Treatment Plant" paper to June 30, 2004 Board meeting." Marked "Highly Confidential", and attachment marked "Confidential and May Be Subject To Legal Privilege".”

32 Mr Zagami does not challenge the refusal to provide access to document 1.1, 1.3, nor document 1.4. Accordingly, the documents in issue are 1.2 and 1.5.

33 The Agency asserts that these documents are exempt from production clause 10 of Schedule 1 of the Act and under clause 7(1)(b) and (c), and clause 9 of Schedule 1 of the Act. Clause 9 of Schedule 1 provides:

(a) would disclose:

(i) any opinion, advice or recommendation that has been obtained, prepared or recorded, or

(ii) any consultation or deliberation that has taken place,

(2) A document is not an exempt document by virtue of this clause if it merely consists of:

(a) matter that appears in an agency's policy document, or

(b) factual or statistical material.”

34 Clause 10 of Schedule 1 provides:

(2) A document is not an exempt document by virtue of this clause merely because it contains matter that appears in an agency's policy document.”

35 In this regard the Agency relies on the evidence of its Director, Environment and Safety, Ms Anita Mitchell. Ms Mitchell provided affidavit evidence, both public and confidential, and appeared at the hearing and gave both public and confidential evidence. She was also cross-examined in relation to her evidence.

Document 1.2

36 This document is a briefing note prepared by Environmental Resources Management Australia ("ERM”). It is addressed to Ms Mitchell c/o a solicitor at Clayton Utz. Ms Mitchell’s evidence is that the dominant purpose for seeking the preparation of the document was to provide the factual framework to enable Clayton Utz to provide the Agency with legal advice concerning the proceedings that it anticipated might be brought by the DEC. It is marked "Privileged and Confidential". Accordingly, the Agency says that the document is an exempt document under clause 10 of Schedule 1 to the Act.

37 The Agency also contends that the information contained in this report is of commercial value to the Agency in that it contains detailed operational performance data in relation to the plant. This operational performance data is said to be of commercial value in relation to the expression of interest process at the LTP. The Agency also contends that the disclosure of the information would result in the commercial value of the information to the Agency being diminished.

38 The document also outlines procedures for the operation of the plant, information that is of commercial value to the Agency in that a competitor could cross-reference their own procedures to those of the Agency without having to pay for their development. The information could also be utilised in negotiations with regulatory agencies in relation to their practices. Disclosure of the information to a competitor would result in the commercial value of the information to the Agency being diminished.

39 Further, it is submitted that the report is exempt pursuant to clause 7(1)(b) of Schedule 1 to the Act. The commercial value of the information is represented by the detailed operational data disclosed in relation to the LTP. To the extent that this information has a commercial value to the Agency and to its competitors, this will be diminished or destroyed if the information is disclosed.

40 In the alternative, the Agency submits that the document is an exempt document pursuant to clause 7(1)(c) of Schedule 1 to the Act, on the basis that it is information that concerns the business, professional, commercial and financial affairs of both the Agency, and its consultant ERM. The Agency relies on an affidavit from Ms Claudia Cowell, a Senior Associate with ERM and the author of the document. Ms Cowell’s evidence is to the effect that that disclosure of the information will have an adverse effect on ERM's professional and commercial affairs. She also asserts that the document has a commercial value to ERM, by reason of the fact that it is engaged in the business of providing to its clients, for a fee, information of the type set out in the document. The commercial value would be diminished if the information was made available to the public, as anyone (including potential clients), might avail themselves of the information and advice contained in the letter, without appropriate recompense to ERM.

41 Mr Zagami questions whether the evidence establishes that the document is exempt under clause 10 of Schedule 1 to the Act. In doing so it refers to Ms Cowell’s evidence that the brief to ERM is "to review the chemical characteristics of residual waste material arising from a Waste Services NSW facility".

42 Mr Zagami argues that the two client legal privileges under the Evidence Act 1995 are the "legal advice" privilege" provided for by section 118 and the "litigation privilege" provided for by section 119. Mr Zagami says that the document does not fit within the "legal advice" privilege and therefore is not privileged unless it comes within the definition of section 119. Mr Zagami questions whether the evidence establishes that the document was generated "for the dominant purpose of obtaining professional legal services" in anticipation of legal proceedings, as required under section 119. Mr Zagami questions whether the dominant, purpose, or an at least equally important purpose was simply to test the liquid sludge residue to determine whether or not the plant was functioning adequately.

Finding

43 I understand that following cross-examination of Ms Mitchell, Mr Zagami determined that he would not maintain the challenge to the Agency’s assertion that the document is an exempt document under clause 10 of Schedule 1 to the Act. Nevertheless, out of abundance of caution I make the finding that I accept the Agency’s evidence in relation to the purpose for obtaining the document.

44 Sections 118 and 119 of the Evidence Act 1995 provide:

Evidence is not to be adduced if, on objection by a client, the court finds that adducing the evidence would result in disclosure of:

(b) a confidential communication made between 2 or more lawyers acting for the client, or

(c) the contents of a confidential document (whether delivered or not) prepared by the client or a lawyer,

“119 Litigation

Evidence is not to be adduced if, on objection by a client, the court finds that adducing the evidence would result in disclosure of:

(b) the contents of a confidential document (whether delivered or not) that was prepared,

45 In my view the document falls within the scope of privilege afforded by section 119 of the Evidence Act 1995. Accordingly it is an exempt document pursuant to clause 10 of Schedule 1 to the Act.

Document 1.5

46 This document is a report that was prepared detailing the results of an investigation that Ms Mitchell undertook in her capacity as Director Environment and Safety at the request of the Agency NSW's Board.

47 The Agency contends that the evidence discloses that the document is a highly confidential document developed by the Agency to provide the Board with strategic options available regarding the LTP. The document contains information which is of commercial value to the Agency, including (a) detailed financial information on the performance of the plant; (b) an analysis of a range of options for the future of the plant, including estimates as to the cost of each option; (c) options for the treatment of hydrocarbons at the LTP; (d) financial information including the capitalisation value of the plant and liabilities associated with rehabilitation of the site. This information, in conjunction with the operating processes of the plant would enable a competitor to estimate the cost structure of the plant; (e) details of the amount of stabilised residue produced by the plant on an annual basis and specific estimates of particular sectors of the market; (f) the document specifically mentions two of the Agency's larger contractors by name and value, a number of other contracts by value and the size of the customer base; (g) details of a supplier which provides the proprietary treatment process for residue with comments on the supplier's costings; and (h) the strategic options available, including options to address the issues of hydrocarbons in the residue. These are developed in detail and are costed. This information highlights the processing deficiencies of the facility, which would enable competitors to understand which waste streams the facility has difficulty in treating.

48 The Agency asserts that the commercial value of this information, representing highly sensitive material going to all facets of the LTP operation, in particular its financial performance, is obvious. The information would also be of value to a competitor to enable it to gain a thorough insight into the operation of the Agency's business, which would place the competitor in an advantageous position in any competitive situation. The commercial value of the information would be lost or diminished if it became generally available, as the information would be equally available to any participant in the relevant market. Accordingly, the document is exempt pursuant to clause 7(1)(b) of Schedule 1 to the Act.

49 In the alternative, the Agency asserts that the document concerns the business, professional, commercial and financial affairs of the Agency. An unreasonable adverse effect would result by the disclosure of this information due to the advantageous competitive position, which would be achieved if competitors possessed this information. The document is therefore also exempt pursuant to clause 7(1)(c) of Schedule 1 to the Act.

50 In addition, the Agency asserts that the document is an exempt document under clause 9 of Schedule 1 to the Act, in that it disclosure would disclose an opinion, advice or recommendation that has been obtained, prepared or recorded, or a consultation or deliberation that has taken place, in the course of, or for the purpose of, the decision-making functions of the Agency. The Agency relies on the evidence set out in Ms Mitchell’s confidential affidavit as the basis for asserting that disclosure of the document would, on balance, be contrary to the public interest.

51 Mr Zagami says that he is not interested in the bulk of the material contained within the report. Rather, he is interested in any data that indicate the condition of stabilised residue for discharge from the plant. Mr Zagami disputes that such data is of any commercial value. Mr Zagami disputes that there would be any competitive advantage in knowing which residue the facility has difficulty in handling.

Finding

52 On the evidence before me I am satisfied that this document contains information that is of commercial value to the Agency. I am also satisfied that the information would be of value to a competitor to enable it to gain a thorough insight into the operation of the Agency's business. The commercial value of the information would be lost or diminished if it became generally available. Accordingly, in my view, the document is exempt pursuant to clause 7(1)(b) of Schedule 1 to the Act.

53 I am also satisfied that it would be impracticable to sever the data that indicates the condition of stabilised residue for discharge from the plant from the balance of the document.

54 Accordingly, it is my view that access to the document should be refused.

Matter number 043386

55 The initial application in matter number 043386 sought access to the following documents:

2. Any report(s) of the independent EPA-accredited auditor required to be engaged by Waste Service NSW and provided to the EPA to assess the landfill and on any environmental impact and any additional monitoring or work needed, as referred to in the Media Statement.

3. A copy of the Pollution Reduction Program entered into by Waste Service NSW with the EPA to:

Improve the quality of the sludge; and

Investigate beneficial reuse options for the oils

56 The Agency identified the following documents as meeting the description of the application but access was refused on the basis that the documents were exempt from production:

1.2 "Report to Address Environmental Impacts Associated with the Disposal of Sludge from Lidcombe Liquid Treatment Plant at the Lucas Heights Landfill Facility" – August 2004

1.3 EPA Pollution Reduction Program

1.4 Letter from Waste Service to DEC dated August 20, 2004

1.5 Letter from Waste Service to DEC dated September 21, 2004”

57 Mr Zagami does not press access to document 1.3. The Agency contends that the balance of the documents were exempt from production under clause 7.1(b) and (c) of Schedule 1 to the Act.

Document 1.1

58 The Agency has identified some 3,500 LTP Stabilised Residue Checklists. A checklist is created for each individual load of stabilised residue. It contains details of the waste feed tanks, on-line time of each tank, time of transportation to landfill, load weight and GPS details of the precise location at the landfill.

59 The Agency contends that the data from these checklists can be used to infer the rate of residue production, which is a key component of calculating the cost of treatment. When used in conjunction with other documents, accurate assessments can be made of the quantities, frequencies and receival patterns of different individual types of waste streams as well as possible influences on processing rates. It is an important incident to the Agency's business, that it maintains an effective traceability link of waste from acceptance on the site, through processing, to the resultant stabilised residue created. The checklists provide that link.

60 The Agency further contends that the documents contain information which has a commercial value to it for the purpose of carrying on its commercial activity in that the information is used by it for the purposes of carrying out and refining those activities and to enable it to evaluate matters relating to its business such as volumes of stabilised residue produced, rates of tipping, including seasonal fluctuations and the flow of different liquid waste streams into the facilities on a seasonal basis. This information can be used to confirm pricing as a function of rate of production of stabilised reside.

61 The Agency assets that the information would all be of use to a competitor in running its own LTP and landfill operations. It therefore has a commercial value, which would be destroyed or diminished in the event of its disclosure to such a competitor.

62 The information contained in the document also relates to the business, commercial and financial affairs of the Agency associated with dealing with stabilised residue, including waste flows, waste volumes, waste management procedures, processes, methods and equipment at the Lidcombe LTP and the Lucas Heights landfill. Disclosure of the information can reasonably be expected to have an unreasonable adverse effect by making available commercially sensitive information about the Agency's business and commercial affairs to the Agency's competitors, who could use this information to the significant detriment of the Agency's business. Further, disclosure could undermine the negotiating position of the Agency in respect of its dealings with potential clients, via tender or otherwise and would generally have serious implications for the operation of the Agency in the context of a competitive market.

63 Mr Zagami says that the Document would provide evidence in relation to whether the Agency is complying with its license conditions. Mr Zagami would like to discover whether contaminants have been dumped, at Lucas Heights in particular, in breach of licence conditions, and would like to find out the extent of any resultant environmental damage. Mr Zagami disputes that this information will give any insight into cost structures. It asserts that it has no desire to use information obtained to run its own operations. The Collex-Onyx conglomerate run many such landfills. They have a research arm, and they have no dearth of knowledge in this area.

64 Mr Zagami is only interested in data within this report, which indicates the contaminant levels of stabilised, treated sludge. Mr Zagami is happy for other material to be removed. Mr Zagami disputes that this material is exempt and also maintains that there is a strong public interest in the release of this material. It contends that any harm that might flow to the Agency would not be an unreasonable adverse effect.

Finding

65 On the evidence I am satisfied that these documents are of commercial value. I am persuaded by the evidence provided on behalf of the Agency that the totality of the information that would revealed by these documents would allow a person with sufficient technical knowledge to ascertain aspects of the Agency's operations and that in doing so a competitor could obtain a commercial advantage.

66 As I have previously indicated, I accept that there may be no commercial advantage to Collex in obtaining the documents sought, however release of the documents cannot be considered as release only to Mr Zagami. It must also be viewed as release to of the Agency's other competitors.

Document 1.2

67 This document is a report titled "Report to Address Environmental Impacts Associated with the Disposal of Sludge from Lidcombe Liquid Treatment Plant at the Lucas Heights Landfill Facility"-August 2004.

68 This document was prepared by Graeme Nyland from ENVIRON, an EPA Accredited Auditor for the purpose of assessing the environmental impacts associated with the disposal of stabilised residue from the LTP at the Lucas Heights facility. The cost of obtaining this report is detailed in Ms Mitchell’s confidential affidavit.

69 The document contains detailed information on the operation and processes at the LTP, including percentage composition of residue treatment and a step-by-step breakdown of processes at the plant. The document also outlines operational processes at the Lucas Heights landfill including seasonal waste volume data, leachate collection processes, and leachate characterisation. Ms Mitchell asserts that this information could be utilised by a competitor to refine or adjust their own monitoring systems and operational processes. The information on waste volume would be of use as an input into various models utilised to predict the operation of landfills. The information could also be utilised as leverage in negotiation with regulators. She says that a competitor would generally know none of this information as whilst some information is available in the public domain, the details of this information are closely guarded and have been developed over many years of experience. I will elaborate on aspects of this paragraph in a confidential affidavit.

70 The Agency’s evidence is that the report was obtained from an external consultant, for a commercial fee. It contains sensitive data relating to the nature of the processes used at the LTP, including the processes and actual formula for the stabilised residue process. It also includes seasonal waste volume data, leachate collection processes and leachate characterisation details.

71 The Agency contends that this document has a commercial value, both in terms of the expenditure incurred in the preparation of the report from the third party consultant, but also in connection with the detail of the information contained in the report. A competitor would not generally know this information and the details of the information are closely guarded and have been developed over many years of experience.

72 The Agency further contends that the commercial value of that information would be destroyed or diminished by disclosure, as competitors would be in a position to exploit the detail of the operational procedures and processes without having to expend the money to develop their own similar processes.

73 Further, the Agency asserts that the information contained in the document also relates to its business, commercial and financial affairs associated with dealing with stabilised residue, including waste flows, waste volumes, waste management procedures, processes, methods and equipment at the Lidcombe LTP and the Lucas Heights landfill. Disclosure of the information can reasonably be expected to have an unreasonable adverse effect by making available commercially sensitive information about the Agency's business and commercial affairs to the Agency's competitors, who could use this information to the significant detriment of the Agency's business. Further, disclosure could undermine the negotiating position of the Agency in respect of its dealings with potential clients, via tender or otherwise and would generally have serious implications for the operation of the Agency in the context of a competitive market.

74 As is the case with most of the documents that are the subject of this application, Mr Zagami asserts that he is only interested in data within this report which indicates the contaminant levels of stabilised, treated sludge. He is happy for other material to be removed. It also denies that Agency’s assertions as to the commercial value of the information contained within the document.

Finding

75 On the evidence I am satisfied that the document is of commercial value. I am persuaded by the evidence provided on behalf of the Agency that disclosure of the information can reasonably be expected to have an unreasonable adverse effect by making available commercially sensitive information about the Agency's business and commercial affairs to the Agency's competitors, who could use this information to the significant detriment of the Agency's business. In doing so a competitor could obtain a commercial advantage.

76 As I have previously indicated, I accept that there may be no commercial advantage to Collex in obtaining the documents sought, however release of the documents cannot be considered as release only to Mr Zagami. It must also be viewed as release to of the Agency's other competitors.

Documents 1.4 and 1.5

77 These documents are letters sent by the Agency to the DEC, detailing actions undertaken to manage total petroleum hydrocarbons ("TPH") at the LTP in order to achieve compliance with relevant EPA standards. The documents describe changes in procedures at the plant, disposal options for residue and TPH as well as the purchase of new equipment at the plant. The Agency employed a number of consultants to assist and paid fees to those consultants for their services. The table of sample data attached to Document 1.5 shows the operational efficiency of the plant. The Agency asserts that the samples take considerable internal man-hours to prepare, in addition to the expenditure for sample analysis through independent laboratories. It says that the commercial value of this information lies in the utility of the information to a competitor. It would assist a competitor in determining appropriate procedures, equipment and disposal options for residue and TPH at the competitor's own plant and in gaining an insight into the sort of response and regime which was acceptable to the regulator to remedy potential non-compliance with the relevant standards, without having to engage for itself, the range of consultants which the Agency engaged in order to determine a management regime which would be both efficacious and likely to be accepted by the regulator.

78 The Agency asserts that the commercial value of the information could reasonably be expected to be destroyed or diminished if the information is disclosed, as that information would then be generally available to any competitor.

79 The Agency further asserts that the information contained in the document also relates to the business, commercial and financial affairs of the Agency associated with dealing with stabilised residue, including waste management procedures, processes, methods and equipment at the Lidcombe LTP. Disclosure of the information can reasonably be expected to have an unreasonable adverse effect by making available commercially sensitive information about the Agency's business and commercial affairs to the Agency's competitors, who could use this information to the significant detriment of the Agency's business. Further, disclosure could undermine the negotiating position of the Agency in respect of its dealings with potential clients, via tender or otherwise and would generally have serious implications for the operation of the Agency in the context of a competitive market.

80 In relation to document 1.5, Mr Zagami would like access lo the table of sample data. Mr Zagami disputes that data on the stabilised residue after treatment is of any commercial value. It shows the operational efficiency of the plant. In other words, whether the plant is treating waste to the extent required by its licence conditions, but any detrimental effect that follows is the consequence of environmental breaches, not the disclosure of confidential information.

81 Mr Zagami asserts that there is a strong public interest in the release of the data that it requests. He argues that the public have a right to know whether the Agency has complied with the conditions imposed upon the waste service industry for the public's protection.

Finding

82 On the evidence I am satisfied that each of these document is of commercial value. I am persuaded by the evidence provided on behalf of the Agency that disclosure of the information can reasonably be expected to have an unreasonable adverse effect by making available commercially sensitive information about the Agency's business and commercial affairs to the Agency's competitors, who could use this information to the significant detriment of the Agency's business. In doing so a competitor could obtain a commercial advantage.

83 As I have previously indicated, I accept that there may be no commercial advantage to Collex in obtaining the documents sought, however release of the documents cannot be considered as release only to Mr Zagami. It must also be viewed as release to of the Agency's other competitors.

Orders

Given the above findings, it is my view that the Agency’s decision in relation to each of these matters should be affirmed.

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Citations

Zagami v Waste Service New South Wales [2005] NSWADT 217

Most Recent Citation

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CITATION:	Zagami v Waste Service New South Wales [2005] NSWADT 217
DIVISION:	General Division
PARTIES:	APPLICANT Paul Joseph Zagami RESPONDENT Waste Service New South Wales
FILE NUMBER:	043350; 043351; 043386
HEARING DATES:	21/03/05
SUBMISSIONS CLOSED:	03/21/2005
DATE OF DECISION:	09/22/2005
BEFORE:	Montgomery S - Judicial Member
APPLICATION:	access to documents - business affairs - access to documents - cabinet documents - access to documents - internal working documents - access to documents - legal professional privilege - Freedom of Information Act - access to documents - business affairs - Freedom of Information Act - access to documents - cabinet documents - Freedom of Information Act - access to documents - internal working documents - Freedom of Information Act - access to documents - legal professional privilege
MATTER FOR DECISION:	Principal matter
LEGISLATION CITED:	Evidence Act 1995 Freedom of Information Act 1989
CASES CITED:	Re Organon and Department of Community Services and Health (1987) 13 ALD 588 Re Pfizer v Department of Health, Housing and Community Services (1993) 30 ALD 647 Searle Australia Pty Limited v Public Interest Advocacy Centre (1992) 108 ALR 163
REPRESENTATION:	C Jackson, barrister N Williams SC, barrister
ORDERS:	The Agency’s decision in relation to each of these matters is affirmed.