Citation: Dyno Nobel Asia Pacific Pty Ltd v Environment Protection Authority [2017] NSWCCA 302
Court: Court of Criminal Appeal
Date: 8 December 2017
Judges: Simpson JA at [1]; R A Hulme J at [64]; Wilson J at [65]
Background
The appellant was an Australian company that manufactured ammonium nitrate emulsions at rural premises in the Hunter Valley. Its operations produced waste water, which was stored in on-site dams. In early 2015, during dam upgrade works coinciding with heavy rainfall, the company pumped large volumes of waste water from one dam to another. To manage rising water levels, evaporation sprays were activated. During this period, a valve failed and contaminated water escaped the site.
The released water flowed through a gully and culvert onto a neighbouring cattle property. It entered a stock watering dam used by the neighbouring farmer. Between 20 and 24 February 2015, while the farmer was absent, five of his cattle died. Those animals showed signs consistent with poisoning, including foaming at the mouth and severe bloating, and one had partly aborted its calf.
The company pleaded guilty in the Land and Environment Court to two charges under the Protection of the Environment Operations Act 1997 (NSW): contravening a licence condition (s 64) and polluting waters (s 120(1)). The primary judge fined the company $60,000 on the licence offence and $400,000 on the pollution offence. The company appealed both fines to the Court of Criminal Appeal, arguing identifiable error in the sentencing exercise and that the penalties were manifestly excessive.
Legal Issues
- Whether the primary judge erred in finding that the deaths of the cattle were caused by the water pollution, and specifically whether that causal link was proved beyond reasonable doubt as an aggravating factor under s 21A(2)(g) of the Crimes (Sentencing Procedure) Act 1999 (NSW)
- Whether the cattle deaths constituted "substantial harm to the environment" within the meaning of s 21A(2)(g), given that the provision refers to harm caused by the offence rather than purely economic loss
- Whether the primary judge erred in assessing the objective seriousness of the offences and the weight given to mitigating factors, including good character and co-operation
- Whether the resulting fines were manifestly excessive
Decision
The Court of Criminal Appeal accepted that causation was established beyond reasonable doubt. The available evidence, including the veterinarian's and agronomist's attendance, the condition of the cattle and surrounding pasture, and the timing of events, was sufficient to support a finding that the polluted water caused the deaths. The court applied the common-sense approach to causation confirmed in March v E & MH Stramare Pty Ltd (1991) 171 CLR 506, and rejected the appellant's submission that the cause of death was unproven.
On whether the cattle deaths amounted to "substantial harm" as an aggravating factor, Simpson JA found that the deaths of five animals, together with partial loss of a calf, fell within that description. The provision is not confined to harm to the natural environment in an ecological sense; harm to livestock sustained as a result of the pollution was harm caused by the offence and appropriately characterised as substantial.
The court identified error in the primary judge's sentencing approach. The primary judge had assessed the starting point for the pollution offence, then made separate deductions for the plea of guilty and for mitigating factors, rather than arriving at a single adjusted figure. This produced a result inconsistent with the approach endorsed in Markarian v The Queen (2005) 228 CLR 357, where the High Court cautioned against a purely mathematical, staged deduction method.
Applying the correct approach and taking into account all objective circumstances, the aggravating factor of substantial harm, and the available mitigating factors (including the plea of guilty, good character, co-operation, and reparation paid to the farmer), the Court of Criminal Appeal substituted a fine of $300,000 for the pollution offence. The licence contravention fine of $60,000 was not disturbed.
Orders Made
- Appeal allowed in part
- The $400,000 fine imposed by the Land and Environment Court for the waters pollution offence was set aside
- A fine of $300,000 substituted in its place
- All other orders of the Land and Environment Court confirmed, save that the publication notices were adjusted to incorporate the varied fine amount
Key Takeaways
- The Court of Criminal Appeal confirmed that a common-sense approach to causation applies when determining whether cattle deaths caused by polluted stock water can be proved beyond reasonable doubt as an aggravating factor at sentence under s 21A(2)(g) of the Crimes (Sentencing Procedure) Act 1999 (NSW).
- "Substantial harm" within s 21A(2)(g) is not limited to ecological or environmental harm in a narrow sense; harm to livestock resulting from the pollution of a stock watering dam falls within the provision's scope.
- Sentencing courts must apply an instinctive synthesis rather than a staged, arithmetical deduction of individual factors from a starting point, consistent with the approach affirmed in Markarian v The Queen (2005) 228 CLR 357.
- In dismissing most of the appeal, the court reduced the pollution fine from $400,000 to $300,000 primarily because of the error in sentencing methodology, not because the primary judge's overall assessment of seriousness was unreasonable.
- A single comparable decision (here, Environment Protection Authority v Custom Chemicals Pty Ltd [2016] NSWLEC 146) was treated as providing only limited guidance on appropriate penalty levels, with the court noting that one case cannot establish a sentencing range.
Legislation and Cases Referenced
Legislation
- Protection of the Environment Operations Act 1997 (NSW), ss 64, 120(1), 123, 241
- Crimes (Sentencing Procedure) Act 1999 (NSW), ss 3A, 21A, 22
- Criminal Appeal Act 1912 (NSW), ss 5AA, 5AB
Cases
- March v E & MH Stramare Pty Ltd (1991) 171 CLR 506; [1991] HCA 12
- Markarian v The Queen (2005) 228 CLR 357; [2005] HCA 25
- The Queen v Olbrich (1999) 199 CLR 270; [1999] HCA 54
- Royall v The Queen (1991) 172 CLR 378; [1991] HCA 27
- Hili v The Queen; Jones v The Queen (2010) 242 CLR 520; [2010] HCA 45
- Wong v The Queen; Leung v The Queen (2001) 207 CLR 584; [2001] HCA 64
- R v Thomson; R v Houlton (2000) 49 NSWLR 383; [2000] NSWCCA 309
- Environment Protection Authority v Custom Chemicals Pty Ltd [2016] NSWLEC 146
- Environment Protection Authority v Orica Australia Pty Ltd (the Evaporator Incident) [2014] NSWLEC 104
- R v KB; R v JL; R v RJB [2011] NSWCCA 190
- R v Nakash [2017] NSWCCA 196