R v Forest Owner Marketing Services Limited
[2016] NZHC 20673
•21 October 2016
IN THE DISTRICT COURT
AT HAMILTON (EX TAURANGA)
CRI-2015-047-000257 [2016] NZDC 20673
THE QUEEN
Prosecutor
v
FOREST OWNER MARKETING SERVICES LIMITED
Defendant(s)
Hearing: 17 October 2016 Appearances:
Mr Batts for the prosecution
Mr Alcorn for the Forest Owner Marketing Services LimitedJudgment:
21 October 2016
RESERVED SENTENCING DECISION OF JUDGE M HARLAND
Introduction
[1] Forest Owner Marketing Services Limited has pleaded guilty to one charge of unlawfully discharging sediment onto land in circumstances which may have resulted in that contaminant entering a tributary of the Tirohanga Stream. The offending occurred between 23 October 2014 and 28 May 2015 during a forestry harvest operation undertaken on land south-east of Ōpōtiki. The discharge was unlawful and a contravention of ss 338(1)(a) and 15(1)(b) of the Resource Management Act 1991 (“the RMA”) because it was not expressly allowed by a national environmental standard or other regulations, a rule in the regional plan or the resource consent granted in respect of the operation. The maximum penalty I can impose is a fine not exceeding $600,000.
[2] Two co-defendants, Gaddum Construction Limited and Chance Brown, were also charged with similar offending. They previously requested and then accepted a sentence indication given by Judge Thompson on 29 August 2016. There was no dispute that Forest Owner Marketing Services Limited was the main offender, not because it undertook the actual works that resulted in the discharges of sediment occurring, but because it was the principal logging contractor responsible for the operation.
Background
[3] Since 2012 the Keys Trust has owned the 9 ha radiata pine forestry block (known as Keys Forest) with which were are concerned. It is surrounded by indigenous forest. Gullies and tributary streams within the property flow into the Tirohanga Stream, which then flows northwards into the Pacific Ocean.1
[4] Part of the forestry block was harvested by another forestry contractor eight years earlier, but in early 2013 the Keys Trust decided it wished to harvest more of the trees in the block. It applied to the Bay of Plenty Regional Council (“the Council”) and was granted resource consent2 which authorised it to:
(a) carry out land and soil disturbance by undertaking earthworks within riparian areas in association with forest harvesting;
(b) carry out forest harvesting activities on riparian slopes where exposed areas may exceed permitted activity levels; and
(c) discharge treated sediment – contaminated stormwater – to land in circumstances where it may enter water.
[5] A number of conditions were attached to the resource consent. Relevant to this prosecution are conditions 6.3, 6.5, 7 and 8. These specific conditions were designed to manage potentially adverse effects caused by erosion and sedimentation, and to ensure that the harvesting operations were managed so as to avoid the discharge of sediment into any watercourse. There were specific provisions in
condition 8 relating to stormwater discharges.
1 Wildlands Report, p 4, defendants bundle of documents Tab 2
2 Resource Consent 67324
[6] Forest Owner Marketing Services is a company that provides forest harvesting and marketing services to private forest owners across the North Island of New Zealand. These services include harvest planning, forest road construction, forest harvesting, and transporting, marketing and selling logs. It harvests approximately 750,000 tonnes of wood per annum and operates at any one time approximately 40 harvesting sites. It employs 15 staff members and engages with in excess of 50 different contractors at any one time.
[7] In about September 2014 Mr Dan Gaddum, a director of the defendant company, contacted Mr Keys and offered to provide forestry harvesting services for Keys Forest.
[8] Mr Gaddum obtained a copy of the resource consent from the Council, but after receiving it he emailed the Council querying whether it was possible to change the consent to authorise the discharge of untreated sediment-contaminated stormwater to land, rather than requiring sediment-contaminated stormwater to be treated before it was discharged. The Council told Mr Gaddum that he would need to seek a formal change to condition 8.1 of the consent. Mr Gaddum responded that the consent conditions, as they were written, were “basically impossible to comply with the consented harvest plan” and so the defendant company would proceed with a hauler system, which would allow compliance. Mr Gaddum provided the Council with a revised harvest plan and explained that a harvest line hauler would be used to harvest the trees in Keys Forest.
[9] On 23 October 2014 the Keys Trust and the defendant company entered into a forest harvesting and marketing agreement. Under that agreement the parties agreed that the defendant company would harvest the trees at Keys Forest and pay Keys Trust the gross sales proceeds less any costs, which included a harvesting management fee and a percentage of the gross sales value. Specific terms of this agreement included the following:
(a) All road and skid construction within the harvesting block was the responsibility of the defendant company. All roading costs would be met initially by the defendant company and offset as much as possible from log harvest returns;
(b) All environmental and health and safety matters were to be managed by the defendant company, specifically it agreed to manage all the necessary vegetation removal and roading resource consents applicable to the block.
[10] The defendant company then subcontracted Gaddum Construction Limited and CB Logging Limited to undertake the actual forestry works. Specifically:
(a) Gaddum Construction Limited, a company owned and operated by Dan Gaddum’s brother Guy Gaddum, was engaged to carry out earthworks for the harvesting operation, including constructing a road from the logging truck access road to the skid site, constructing tracks within the forest for use during harvesting, reinstating the existing logging tracks and constructing hauler pads;
(b) CB Logging Limited, a company owned and operated by Chance Brown, was engaged to harvest the trees and drag them to the skid/processing site for loading onto trucks. CB Logging is now in liquidation.
[11] When the defendant company engaged the two sub-contractors, it gave them each a copy of the relevant resource consent 67324 and the revised harvest plan.
The offending
[12] As outlined above, the defendant company decided that the trees in Keys Forest would be harvested using hauler system. A cable hauler mounted on an excavator was to be used. This involved cable-hauling trees up to a number of hauler pads, and then skidding the trees behind a bulldozer from the hauler pad down to the site’s skid processing site. The logs would then be loaded onto trucks at the skid/processing site.
[13] In preparation for the cable hauling operation, the defendant company directed Gaddum Construction to construct new tracks in Keys Forest, to re-open the tracks that had been created during harvesting work eight years earlier, and to construct new hauler pads.
[14] The terrain in Keys Forest is steep to very steep, with most slopes over 300 and some in excess of 350. The gradient of the haul tracks constructed for the forestry operation in November 2014 were steeper than 200 in some places.
[15] New tracks were created as follows:
(a) in early November 2014 a Gaddum Construction employee constructed two tracks that were to be used for hauling the logs during harvesting operations;
(i) Track A to a hairpin corner marked “B” (Hairpin B); (ii) Track D between Track A and Pad 4;
(b) In early November 2014 Mr Brown of CB Logging constructed Track C
from Hairpin B towards Pad 3.
[16] The construction of these three tracks (A (by Gaddum Construction), C (by CB Logging) and D (by Gaddum Construction)) resulted in large amounts of sediment and side-cast material consisting of soil and/or rock either being pushed over the steep slopes into wood debris adjacent to the new track or being left in an unstable position at the top of steep slopes where it was at risk of collapsing into the gullies and streams below.
[17] After the tracks had been created in November 2014, Mr Brown of CB Logging used the tracks to drag logs from Pads 2, 3 and 4 down to the skid/ processing site at the bottom of the hill. This work was undertaken from approximately mid-November 2104 to mid-January 2015.
[18] Because large amounts of insecure sediment and side-cast material had been left on the edge of the forestry tracks above the steep faces, when Mr Brown was dragging the logs down from the hauler pads to the skid/processing site portions of that sediment and side-cast material were pushed over the embankments into the gullies below. Later rainfall then moved that sediment and side-cast material into streams in Keys Forest.
[19] During the harvesting work, Mr Brown was concerned about the large amounts of side-cast material being pushed down into gullies as logs were dragged along the tracks, particularly at Hairpin B. He told Dan Gaddum about this and sent him a photo of it on 19 November 2014, saying “Every time we turn with a drag throws fill over. Be good for you to come out and have a look.” Dan Gaddum responded that he would be there the next morning and suggested Mr Brown might have to carve the right hand bank off some more to straighten the track. Mr Brown responded that it was not possible to carve any more from the right bank.
[20] Approximately one month later, Dan Gaddum and Chance Brown met at Keys Forest again. At this meeting Mr Brown told Mr Gaddum that he could not install water controls at Track C with his equipment and that Mr Gaddum would need to arrange for that to occur.
[21] On 19 December 2014 there was an approximately “1 in 5 year” rainfall
event at Keys Forest.
[22] On or about 11 January 2015 a member of the public reported to a Council officer (Mr Wiki Mooney) that he had seen sediment in the stream south of the skid site in Keys Forest. I infer that Mr Mooney then contacted either the landowner (Keys Trust) and/or the defendant company, because of what followed.
[23] On 12 January 2015 Dan Gaddum sent Mr Mooney an email requesting that he not enter Keys Forest or any of the defendant company’s sites unaccompanied, because of health and safety issues. Mr Gaddum indicated that the site could be visited when he returned from leave.
Council inspection on 23 January 2015 and compliance field sheet
[24] Mr Mooney inspected the Keys Forest site on 23 January 2015. He walked up the tributary stream south of the skid/processing site and noted large quantities of sediment in the stream bed along the flat areas at the lower end of the stream.
[25] A short distance upstream in tributary 2, he saw short ends/slovens3 in the stream. He also saw sediment in the stream bed which had discharged from the small tributary. When he entered the small tributary, Mr Mooney saw sediment in the stream bed of that small tributary.
[26] Mr Mooney then arrived at a point where he saw several large stems which had been felled and had slid into the gully standing vertically, almost blocking access through the stream.
[27] Mr Mooney then climbed up the slope face and walked north along Track D and noted large amounts of soil material on slash, hanging suspended over the outer edge of Track D. Some of the young trees growing along the edge of Tracks D and A, which were lying horizontally as a result of the dragging operation, also had soil material on top of them. Mr Mooney also saw areas where soil material from recent harvesting work was covering the face of areas where old slips had occurred.
[28] At the point where the new Track A connected with the original east/west track, Mr Mooney saw what appeared to be the discharge point for sediment runoff into the head of the tributary he had walked up earlier. He climbed over the embankment and followed the sediment discharge down to where it linked up with other sediment that had discharged over an old slip.
[29] Mr Mooney then went to where the new track had been cut around the southern end of the hill near Pad 3. He saw that a considerable amount of soil had collapsed over the embankment below Track C into the gully below. As he walked along Track C he saw a soak-hole on the outer edge of Track C. Runoff had flowed into that soak hole and then discharged through a hole in the base of it down the embankment into the head of the tributary below Track C.
[30] Mr Mooney then walked down from Pad 4 until he arrived at the tributary stream (tributary 1). Mr Mooney saw side-cast material had eroded down the face of
the slope to the gully floor below and along the bed of that tributary. He followed
3 The unwanted portion of the stem butt that retains the shape of the felling cuts.
tributary 1 downstream, tracking sediment in the stream to where it slowly disappeared over a waterfall.
[31] Mr Mooney climbed down the waterfall to the confluence of tributary 1 and the main tributary of the Tirohanga Stream, and saw that the pool upstream of the confluence was very clean while some sediment was visible in a pool in the main tributary of the Tirohanga Stream downstream of its confluence with tributary 1. When Mr Mooney walked along the main tributary of Tirohanga Stream downstream of its confluence with tributary 1 he saw small increases of sediment build-up along the stream bed, particularly in flat stretches.
[32] Following this inspection Mr Mooney emailed a compliance field sheet to Dan Gaddum and the Keys Trust on 30 January 2015 summarising the issues he had found. He recorded that major non-compliance issues had been found at Keys Forest and he particularly identified that side-cast material from track construction had discharged into a tributary in breach of condition 7.4 of the resource consent. This aspect cannot have come as a surprise to Mr Gaddam as it was precisely what Chance Brown had told him he was concerned about on 19 November 2014 in relation to Hairpin B. Amongst other remedial actions set out in the compliance field sheet, Mr Mooney required the defendant company and Keys Trust to ensure that:
·there was no likelihood of further discharges of sediment occurring from the junction of the existing logging track and the newly constructed track; and
·the side-casting on the link road connecting the existing logging track at the top end and the newly constructed access track was effectively stabilised by compacting and the use of hydro-seed or similarly effective surface protection.
[33] Mr Dan Gaddum sent an email to Mr Mooney on 5 February 2015 stating that rehabilitation measures were under way, and advising that some of these measures had already been completed.
[34] On 17 February Mr Mooney emailed Mr Gaddum advising that he wanted to undertake a site visit the following day with a Council-contracted soil conservator and a scientist to assess the issues he had found on 23 January. Mr Gaddum replied
that the defendant company “could not have people at their work sites unaccompanied” and that he considered 12 hours notice of a Council visit to Keys Forest to be unacceptable and unfair. He said that 27 February was a suitable time for him. In a follow-up email on the same day, Mr Gaddum stated that all work required in the compliance field sheet of 30 January had been completed.
Council inspection on 4 March2015 and compliance field sheet
[35] The Council’s follow-up inspection was postponed until 4 March, at which time Mr Mooney, the soil conservator, a forestry consultant, and a Council enforcement officer went to Keys Forest and met with Mr Gaddum and Mr Keys. Whilst some mitigation and remedial works had been undertaken (for example the shorts had been removed from the stream, some silt fences had been erected and some hay and seed had been spread across exposed areas), the Council officers found that some of the issues identified in the previous field sheet had not yet been remediated. In particular, there were still issues with:
· side-cast material sitting on top of slash and horizontally layered trees, instead of being keyed-in;
· side-cast material having been left in an unstable state where it could potentially be eroded by rainfall.
[36] Mr Mooney pointed out these issues to Mr Gaddum whilst they walked around Keys Forest. Mr Mooney showed Mr Gaddum the side-cast material and slash that was hanging on the edge of the track at Hairpin B, and when they walked along Track D Mr Mooney said to Mr Gaddum he was concerned about soil material on top of slash and horizontal trees at the outer edge of Track D. At one stage, when Mr Mooney was pointing out issues with side-cast material on top of slash, Mr Gaddum disagreed that there was an issue, saying that the side-cast material was on top of solid ground.
[37] On 9 March 2015 Mr Gaddum emailed the Council stating that he had been concerned enough about Chance Brown’s work at Track D in December that he took photographs of it on 3 December. He also stated that the sediment that had been
found later in the stream at Keys Forest had been caused by a rain event on
15 December 2014.
[38] Mr Mooney emailed a further compliance field sheet to the defendant company and the Keys Trust on 11 March 2015. The field sheet summarised the main compliance issues that had been found during the 4 March inspection and required remedial action to be carried out by 10 April. The Keys Trust and the defendant company were required:
(a) to ensure silt fences are monitored, maintained and de-silted after each and every rain event;
(b) to ensure works are undertaken to remove soil off slash on newly-formed
Track D;
(c) upon removal of the soil material, to ensure all slash was pulled back and away from the outer edge of the access track;
(d) upon removal of the slash, to ensure the exposed soil material along the outer edges of the tracks was keyed in, compacted, sown with grass seed and covered with hay;
(e) to ensure similar steps to the foregoing were taken in relation to the other newly-formed Track C;
(f) to ensure every attempt was made to control run-off from discharging through soil that had not been properly stabilised and especially along the newly-formed tracks;
(g) to ensure ongoing maintenance until the area was satisfactorily stabilised with good ground cover vegetation and/or canopy closure, and the risk of erosion and off-site sedimentation from the earthworks was considered to be low.
[39] Mr Gaddum emailed Mr Mooney on 13 March 2015 stating that he agreed with some of the matters required to be done and set out in the compliance field sheet but questioned others, particularly those outlined in paragraph [38] above at (b), (c), (d) and (e). Mr Gaddum said he was not sure those remedial works were a good idea, stating:
These areas are now all relatively stable and any fill has compacted. Over time they will further stabilise as they vegetate and are covered in organic matter from the standing trees.
I can understand your concerns if water was being directed over these areas however currently it is not. Over time these areas will further stabilise and while the slash will rot down it is very unlikely that material will slump down the slope as the standing trees will stabilise the area and the forest floor. The fill is not likely to be saturated at this point....
Doing the work you are proposing raises the risk of who bears the responsibility of sediment entering the stream from any earthworks associated with what you are proposing. I assume it is not EBOP so in this case we would prefer to leave the site as it is and monitor what is going on there.
[40] At some time after this, but before 22 March 2015, Cyclone Pam occurred. I was not provided with any comparative data about that event, although the parties agreed that it was a severe rainfall event.
[41] Mr Gaddum emailed Mr Mooney on 22 March 2015 asking for the Council’s substantive response to his comments and suggesting that the main source of sediment migration from the storm in December 2014 was an old slip that occurred a long time ago below the main access track. Mr Mooney responded that it was a matter for the defendant company as to whether it was confident that the remedial work it had carried out would mean that there would not be any further unauthorised discharges to streams.
Council inspection on 13 April 2015, compliance field sheet and abatement notice
[42] A further site visit by Mr Mooney and the soil conservator took place on
13 April 2015 as there had been rainfall events in the area since their last visit. The site visit revealed a number of cracks along the outer edge of Track D leading to Pad
4, and some holes through which soil material that had been deposited onto slash, and horizontally layered trees along the outer edge of Track D during harvesting, had fallen through. A number of cracks were seen along the outer edge of the southern part of Track A leading to Hairpin B, including where soil material had been deposited into slash at Hairpin B.
[43] A compliance field sheet was issued on 20 April 2015 stating that the remedial works required were the same as those which had been set out in the previous compliance field sheet.
[44] Mr Gaddum responded to the compliance field sheet of 20 April on the same day stating that his contractors were going onto the site the next day and would attend to the issues then.
[45] Following the 13 April inspection the soil conservator completed a report on Keys Forest. His conclusion was that the defendant company’s harvesting operation had contravened a number of conditions of the resource consent including condition
6.3 (bullet points 2 and 6) and condition 7(a) and (d). This report advised that:
The track construction and hauling operations have resulted in side-cast material and sediment from the haul track going over the steep to very steep side slopes. It was noted in the inspection that in some places, the side- casting has been directly onto woody material/logging slash immediately below the haul track, with no keying in to natural ground.
When hauling logs down the haul tracks to the skid site where the logs were loaded onto the trucks, sediment has been swept off by the logs over the edge of the tracks, including one hairpin corner. This has resulted in further side-cast material going over the edge of the track. The loose side-cast material on the steep slopes has then been susceptible to sheet and rill erosion from rainfall events.
[46] The Council issued an abatement notice against the defendant company on
23 April 2015 which required it to:
(a) clean out and/or extend the silt fences so that they were not outflanked; (b) on and under the tracks outlined in pink and blue in the map appended to
the notice;
(i) pull back the side-cast material and unstable woody material and place in a stable area; and
(ii)slope back the track into the bank to direct surface water runoff away from the outside, fill slopes and direct the discharge onto stable or natural ground; and
(iii)complete surface stabilisation (hay mulch and grass seeding) on
exposed area left uncovered;
(c) Ensure that all water controls (cut-offs and sediment traps) were located on stable or natural ground and had ongoing maintenance as necessary until the area was satisfactorily stabilised with good ground cover, vegetation and/or canopy closure, and the risk of erosion and off-site sedimentation from the earthworks was low.
[47] After receiving the abatement notice Mr Gaddum contacted the Council and, after indicating his disappointment at receiving the abatement notice, advised that the stabilisation work at Keys Forest had been completed.
May and June 2015 inspections
[48] On 18 May 2015 Mr Mooney inspected Keys Forest and found that a large landslide had occurred sometime between the photographs being taken by Mr Gaddum on 30 April and 18 May 2015; that is after Cyclone Pam. This landslide had involved large amounts of side-cast material collapsing from the Hairpin B site, falling down the steep slopes and blocking a section of Track D. The slip had continued beyond Track D passing through radiata pine forest and into a small gully, a small stream, and then into a tributary of the Tirohanga Stream approximately
235m downhill from the top of the landslide. The landslide was 20-30 metres wide at the top and debris had dropped approximately 120m from Hairpin B into the small valley below.
[49] The landslide debris discovered by the Council on 18 May was the material that Mr Mooney had referred to in his three compliance field sheets that he had shown Mr Gaddum during the inspection on 4 March, and which had been the subject of the abatement notice issued to the defendant company on 23 April 2015. This landslide debris was comprised of side-cast material that was originally created when Gaddum Construction constructed Tracks A and D in November 2014.
[50] On 20 May 2015 Mr Mooney returned to Keys Forest with a scientist from Wildlands Consultants to assess the ecological effects of the landslide and other landslides that had occurred as a result of the forest harvesting. The Wildlands report identified two landslides:
(a) Landslide A (from the Hairpin B corner constructed by Gaddum
Construction); and
(b) Landslide B (from Track C constructed by CB Logging).
[51] Landslide A, which is referred to in paragraph [38] above, was described as a significant landslide, involving a large volume of material falling down a steep slope and generating sufficient force to create a bare, un-vegetated face.
[52] Landslide B was described as a smaller landslide emanating from Track C,
15 metres wide at the top but narrowing to 1.5m ten metres beneath the track. This landslide resulted in debris flowing down a small gully and into a stream which flowed into the main tributary of the Tirohanga Stream approximately 260m from the top of the landslide. The silt fences erected above, adjacent to and below one of the pre-existing forestry tracks were inundated by sediment as a result of Landslide B.
[53] On 28 May 2015 the Council requested that the defendant company cease undertaking any further remedial work, because of the weather. The Council decided to arrange for this remedial work to be undertaken by an independent contractor. The estimate of the cost of the remedial work is $16,800 + GST, which the defendant company has undertaken to pay.
Starting point
[54] The Crown submitted that the starting point for a fine should be $60,000 whereas the defendant company submitted that it should be $40,000. Both counsel referred to two cases and their respective analyses of them to support the starting points they adopted. The cases concerned are both decisions over which I presided, being Waikato Regional Council v Professional Harvesting Systems (NZ) Limited & anor4 and Waikato Regional Council v Corboy Forest Management Limited & anor.5
[55] The principles and purposes of sentencing were not disputed. In this context there is a focus on the principles of denunciation and deterrence, but I must also bear
4 DC Hamilton CRI-2011-075-866, 25 January 2013
5 [2015] NZDC 21655
in mind the purpose of the Resource Management Act, which is to promote the sustainable management of natural and physical resources. This requires the adverse effects of activities on the environment to be avoided, remedied or mitigated. One way of managing the potentially adverse effects that may be associated with an activity is for plans to specify when resource consent may be required, and if resource consent is required, the conditions imposed are the manner in which these effects are either avoided or mitigated. The whole point is to try and prevent unnecessary man-made damage to the environment whilst commercial activities such as this are being undertaken.
[56] In terms of setting the starting point I must consider the effect of the offending on the environment, the culpability of the defendant company for the offending and ensure that the end outcome (the amount of the fine) is consistent with other like cases. In this case, the starting point must also be relative to the starting point adopted by Judge Thompson for the co-defendants, being $25,000 for Gaddum Construction and $17,500 for Mr Brown.6
The effect of the offending on the environment
[57] It seems to me, that there are two distinct sediment discharges to water bodies encompassed by the timeframe set out in the charge. There is:
(a) the sediment that was discovered in the tributaries including the main tributary of the Tirohanga Stream during Mr Mooney’s inspection on 23
January 2015; and
(b) the landslide debris from the two landslides seen by Mr Mooney on 18
May 2015 some of which found its way into tributaries including the main tributary of the Tirohanga Stream. Sediment was also being released from erosion points along the edges of the main tributary at this time.
[58] The Wildlands report, dated July 2015, whilst describing the Tawa-dominant forest surrounding Keys Forest and its margins as of high ecological value,
considered the gullies within Keys Forest prior to the landslides to have low
6 CRI-2015-047-000258 Mr Brown was prosecuted instead of his company because it is in liquidation, allegedly as a result of not being paid by the defendant company for the work it did in relation to this contract.
ecological value. The access tracks landslide scars, side-cast material and other harvesting debris within Keys Forest was also considered to have little or no ecological value.
[59] The streams within Keys Forest were, however, described as having moderate to high ecological value because they provide habitat for aquatic invertebrates, long-fin eel (classified as At Risk-Declining) and provide potential habitat for Hochstetters frogs (classified also as At Risk-Declining). The habitat within the main Tirohanga Stream tributary was described to be of moderate to high ecological value and the small streams feeding the larger tributary were described as of moderate ecological value.
[60] One threatened nationally-vulnerable bird species was heard during the ecologist’s site visit and one at risk-declining fish species was seen on a previous visit.
[61] Overall, the report concluded that:
(a) habitats previously suitable for Hochstetters frogs in small streams were adversely affected;
(b) habitat for indigenous fish within the larger Tirohanga Stream tributary may have been adversely affected at the time of the landslides occurring, but the water was found to be likely to provide habitat for fish species in the medium to long term subject to the stream bed not being further seriously compromised by ongoing sedimentation;
(c) although indigenous vegetation was somewhat affected by the landslides, it was considered likely to recover as long as there was no further long- term sedimentation;
(d) invertebrate species diversity was low downstream of Landslide B, but appeared to be recovering below Landslide A;
(e) there was a high risk of slope failure from the combined weight of the
side-cast material and saturated mobile soils, and that long term issues for major landslide and associated sedimentation were likely, especially in relation to the slope edge at the top of Landslide A and along the vehicle
track;
(f) remediation was “urgent” to “address issues resulting from the landslides
and potential ongoing sedimentation and erosion.”
[62] I agree with Judge Thompson that the damage that was caused to the streams in particular was exactly what the consent conditions were designed to avoid. In my view the effect on the environment overall was moderate to high in relation to the water bodies affected. Whilst the remedial work proposed will go some way towards preventing the severity of these potentially adverse effects continuing to occur, the Wildlands Report described the need for remediation as urgent in July 2015. This work has still not been undertaken, although it is proposed to occur in the near future. Over a year has passed since the report- an entirely unsatisfactory situation- and I regret to say I was not provided with any reason to explain why it has taken so long for this remedial work to be done.
[63] I place little weight on the submission that the sediment released was natural or that the negative effects on the stream were exacerbated by natural erosion. The key point is that the resource consent conditions were designed to prevent adding to that which may occur naturally by man-made activity. The concern here is the cumulative effect man-made activity might have on that which is naturally occurs. For this reason it is not a matter of justification or excuse or a matter that mitigates the offending in this case.
Culpability of the defendant
[64] The defendant company had the overall responsibility and oversight of the harvesting operation, including construction of the road and skid sites. The agreements it had with both Gaddum Construction and CB Logging7 passed on those responsibilities to those two contractors; however as head contractor the defendant company was charged with ensuring those responsibilities were complied with.
[65] In his interview, Mr Dan Gaddum for the defendant company explained that during harvesting he would go to the site every couple of weeks. As it transpired this
7 Tabs 1 and 2 , defendant’s bundle of documents
may not have been enough. I refer particularly to Mr Brown’s concerns about side- cast material at Hairpin B, which he relayed to Mr Dan Gaddum and sent a photo of it on 19 November 2014. Mr Gaddum’s solution to carve the right hand bank off to straighten the track was not one which Mr Brown considered was possible and Mr Brown’s concern, expressed about one month later during a site meeting concerning water controls at Track C, as well as his concerns about the side-cast material at Hairpin B, indicate to me that given the difficult topography, more on-site management was required by the defendant company.
[66] There was a one in five year rainfall event on 19 December 2014. I did not receive any submissions about how closely the defendant company monitored weather conditions. Certainly the one in five year rainfall event would not appear to be an event completely out of the ordinary. I do not know if the defendant company inspected the site after the rainfall event, but it should have.
[67] There is then the complaint by a member of the public on 11 January 2015. This is important because it was obvious to that person that there was an unusual amount of sediment in the stream south of the skid site.
[68] Mr Dan Gaddam’s response on 12 January 2015 to a request for a site visit was also telling. His first response was to cite health and safety requirements as a reason for Mr Mooney not being able to go onto the site unaccompanied and he then advised he was on holiday. He suggested that the visit could occur after he returned from holiday. Whilst the response about health and safety matters was valid, a better response would have been to immediately assist the investigation either himself (by taking time out of his holiday if this was possible) or arranging for another person from the defendant company to accompany Mr Mooney on a site visit straight away.
[69] Mr Dan Gaddam’s response to Mr Mooney’s first compliance sheet was to immediately advise that rehabilitation measures were underway and that some had already been completed. His approach was commendable and responsible; however his response to the request for the follow up site visit (giving 12 hours notice) was less helpful. He suggested that the request was unacceptable and unfair, an opinion I do not agree with given the extent of the damage that had been revealed during the
first site visit and conveyed to him in the compliance report. Even if it was difficult to arrange for a site visit the next day, I cannot see how it could not have been arranged the day after.
[70] Later that same day, 17 February 2015 Mr Gaddam advised that the work required in the compliance sheet had been completed, however as is evident from the second site visit this statement was not correct, even though I accept that Mr Gaddam thought this was the case. Mr Gaddam challenged aspects of Mr Mooney’s assessment of what still needed to be done to effectively remediate the site. It appears that he thought the side-cast material was on solid ground and the site was stable.
[71] Cyclone Pam happened some time before 22 March 2015. The site visit on
13 April with the soil conservator followed. Mr Gaddam’s confidence in the stability of the site proved to be wrong. I have carefully considered whether or not Cyclone Pam was such an extraordinary event that regardless of the works being completed as Mr Mooney required there still would have been some sediment discharged to the tributaries, however because of the soil conservators report I am satisfied that had the resource conditions been properly met, the later discharges would not have
occurred.8
[72] The Council responded with another compliance report and an abatement notice. The soil conservators report was provided to the defendant company with the abatement notice. Again Mr Gaddam’s response indicates that he did not really appreciate the extent of the problem. He said that the stabilisation work had been completed and expressed disappointment that the abatement notice had been received.
[73] Again Mr Gaddam’s confidence that the stabilisation work had been done
proved to be ill-founded. The two landslides followed.
[74] Mr Gaddam’s responses bind the defendant company and are relevant to my assessment of the company’s culpability for the offending. I am left with the
8 See para [55] Summary of Facts
impression that he considered some of Mr Mooney’s requirements to be unnecessary. His approaches to Mr Mooney’s requests were at times a little defensive. As it has played out, Mr Mooney’s concerns were well-founded and his requirements were reasonable. Had they in fact been complied with, the landslide events would either not have occurred or would have been nowhere near as dramatic.
[75] I accept that the offending was not deliberate, but I have reached the view that the defendant company’s approach particularly to supervision of its subcontractors’ and its approach to the Council’s requirements to remediate are sufficient to categorise its behaviour as reckless. There was a failure to appreciate the seriousness of the problem and a lack of willingness to accept Mr Mooney’s expertise about what was required to solve it. The steps taken to remediate the problem clearly were not sufficient and Mr Mooney’s concerns provided to be valid.
Similar cases
[76] The Crown relied on the Corboy Forestry case to submit that the starting point should be $60,000 whereas the defendant company relied on the Professional Harvesting case to support its nominated starting point of $40,000. I consider that this case falls somewhere between the two. The adverse environmental effects were, fortunately, not as great as those in the Corboy case, but the defendant’s culpability for the offending in this case is more than in Professional Harvesting. An abatement notice was issued in this case and I have no hesitation accepting that this was necessary.
[77] For the above reasons I consider the starting point for a fine should be
$50,000.
Mitigation
Previous good character
[78] The defendant company has no previous convictions. Normally I would adopt a 5 percent discount to reflect this fact and possibly more, if the defendant company could provide evidence of positively embracing in a practical way the
concept of good corporate environmental stewardship. There is nothing to suggest the latter in this case; however Judge Thompson was prepared to give the two co- defendants a 10 percent discount to reflect previous good character. It would be unfair not to adopt the same approach for this defendant. Accordingly, there will be a 10 percent discount for previous good character.
Remedial efforts
[79] The company spent some $15,000 when the offending was first drawn to its attention. As well, there was the time spent by staff undertaking this work which has not been reflected in dollar terms. I accept that this shows a responsible attitude, however there is nothing to suggest that the remediation undertaken at this stage was anything more than remediating that which ought to have been done in the first place as the resource consent conditions required. I am not persuaded that this sum should be taken into account by way of mitigation.
[80] There is, however, the defendant company’s undertaking to pay the sum of
$16,800 + GST to the Council for the further remediation work that is required to be done by its contractors on the site. How much of this amount should be taken into account is problematic. This is because, as I have identified, despite considering it had undertaken all necessary remedial work and despite being requested by the Council to undertake it prior to the landslides, the defendant company did not do so. There is a compelling argument that, had it done the work required of it, the offending as it related to the landslides at least would not have occurred, or if it had it would not have been so severe.
[81] Standing back from these matters and taking into account that the company made no profit and has suffered a significant loss as a result of the offending, I consider there should be some small deduction to reflect the undertaking to pay and I assess this to be a further deduction of 3 percent.
[82] I was concerned to ensure that the sum would in fact be paid if the outcome of this sentencing was not to the defendant company’s liking and I was assured by counsel that it would be paid regardless. The deduction will not apply if the sum is not paid.
Remorse
[83] The company expressed remorse for the offending. It has now taken on board what the Council has said and has taken steps to change its internal procedures to prevent further similar offending. It has employed a full-time environmental manager and it has developed an environmental management system, in-field auditing tools and a full set of operational procedures that are provided to contractors and include best practice guideline on forest operations including, but not limited to earthworks and sediment control.
[84] It will have to deal with the effect this prosecution has on its commercial reputation, as its international clients require environmental convictions to be disclosed as part of their certification requirements. There is a competitive advantage attached to a clean record which it has lost. There are however also financial implications at a local level. The Council has decided not approached it to harvest a woodlot at a regional park.
[85] It is in everyone’s best interests for those operating in the forestry industry to have proper systems in place to avoid sediment discharges to water ways during harvesting operations. The defendant company has now acted responsibly to address this issue. Although this has occurred after the event, I consider there should be a further small deduction to reflect this fact, which I consider to show an expression of remorse over and above that which is encompassed in the guilty plea. I have decided to do this partly because I am unsure about whether there is any industry leadership about such matters (as opposed to leaving to individual operators to choose to do so and using it as a competitive advantage), and partly to recognise the community interest in environmental offenders learning from their mistakes and taking steps to avoid the recurrence of them. I am satisfied that this has well and truly occurred here.
[86] I fix this deduction at 5%.
Guilty plea
[87] There was some dispute between the parties as to the amount that should be
permitted for an early guilty plea. The Crown’s position was that it should amount to
10-15 percent and the defendant company submitted it should be entitled to a full
25 percent discount.
[88] The defendant company’s guilty plea was indicated less than two weeks before the jury trial allocated for the hearing of it was due to start and this sentencing took place one week before that date. A plea this late in the process is not desirable, particularly on charges such as this which rarely turn on matters of credibility, and for which a defendant’s intention is not a relevant consideration.
[89] I held several judicial telephone conferences to try and establish the defendant company’s intentions.9 On 10 June 2016 the indication was that a resolution was likely to be achieved that would result in the trial not being needed. On 22 September the company reserved its position until Gaddam Construction had decided whether it wished to accept Judge Thompson’s sentence indication. In my Minute I recorded my view that sufficient time had been allowed for all of the parties to decide what they were going to do.
[90] The defendant company continued to dispute aspects of the Summary of Facts, the details of which are unknown to me although the Crown submits they were minor. Mr Batts, however, could not point to any additional work that had been undertaken by the Crown that had not been undertaken by it at the time of the sentencing indication for the remaining two co-defendants. These two defendants received a full 25 percent discount.
[91] I was initially minded to accept the Crown’s submission that the discount should be between 10-15 percent. The entry of the late guilty plea has meant that not all of the back-up trials allocated for the two weeks set aside for this trial have been
able to be filled. I received no real satisfactory answer as to why it took so long for
9 10 June 2016, 22 September 2016 and 3 October 2016.
the defendant company’s position to be resolved. The lateness of the entry of the
guilty plea is unsatisfactory and not well-explained.
[92] Bearing in mind all of these matters I consider that a 20 percent discount is warranted.
Result
[93] The defendant will be convicted and fined the sum of $33,520.10 Ninety percent of the fine will be paid to the Council in accordance with s 342 of the Act.
M Harland
District Court Judge and Environment Judge
10 50,000 – 8100 (18% for mitigating matters) = 41,900 – 8,380 (20% for guilty plea)
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