Land and Environment Court of New South Wales CITATION : Filipowski v Lyndon and ADI Limited [2001] NSWLEC 139 No 50024 of 2001 PROSECUTOR Filipowski DEFENDANT Lyndon PARTIES : No 50025 of 2001 PROSECUTOR Filipowski DEFENDANT ADI Limited FILE NUMBER(S) : 50024; 50025 of 2001 CORAM: McEwen AJ KEY ISSUES: Environmental Offences :- Marine Pollution - plea of guilty - penalty - s 10(1)(b) Crimes (Sentencing Procedure) Act 1999 LEGISLATION CITED: Crimes (Sentencing Procedure) Act 1999, s 10 Marine Pollution Act 1987, s 8 CASES CITED: Camilleri Stockfeeds Pty Ltd v Environment Protection Authority [1994] 82 LGRA 21; R v O'Neill [1972] 2 NSWLR 582 DATES OF HEARING: 14/06/2001, 15/06/2001 DATE OF JUDGMENT: 06/28/2001 PROSECUTOR Mr A L Hill (Barrister) SOLICITORS Abbott Tout LEGAL REPRESENTATIVES: DEFENDANTS Mr J Sexton SC SOLICITORS Ebsworth & Ebsworth JUDGMENT: IN THE LAND AND 50024-25 of 2001 ENVIRONMENT COURT McEwen AJ OF NEW SOUTH WALES 28 June 2001 No. 50024 of 2001 Barbara Filipowski Prosecutor v Darrin John Lyndon Defendant No. 50025 of 2001 Barbara Filipowski Prosecutor v ADI Limited Defendant JUDGMENT Introduction 1. By summonses filed on 23 February 2001 the prosecutor as plaintiff claims orders against each defendant "…in that they did, on the 6th of August 1998, at Garden Island, cause oil to discharge into Port Jackson (Sydney Harbour) in contravention of Section 8(1) of the Marine Pollution Act 1987…". Section 8(1) of the Marine Pollution Act 1987 reads: Subject to subsections (2) and (4), if any discharge of oil or of an oily mixture occurs from a ship into State waters, the master and the owner of the ship, and any other person whose act caused the discharge, are each guilty of an offence punishable, upon conviction, by a fine not exceeding - (a) if the offender is a natural person - 2 000 penalty units; or (b) if the offender is a body corporate - 10 000 penalty units. 2. At the commencement of the hearing it was agreed that the matters would be heard together and that evidence in one set of proceedings would be read as evidence in the other. 3. The defendant ADI was at the time of the incident a corporation owned by the Commonwealth of Australia. Amongst its varied and diverse commercial activities was the refurbishment of vessels for both the Royal Australian Navy, and commercial operators. It carried out this work at both the Captain Cook Graving Dock, and a floating dock berthed at Garden Island. 4. On either 1 or 2 August 1998 the tug Woona, owned by Waratah Towage, was raised in the floating dock. It was due for a five year check, refurbishment, and Lloyds certification. Work on the Woona had commenced prior to 6 August 1998. 5. The defendant Darrin Lyndon, now 27 years of age, had commenced an apprenticeship with ADI when he left school in 1991. On the day of the incident Mr Lyndon, as a boilermaker/welder, was one of the team assigned to the work on the Woona, on the floating dock. The Floating Dock 6. The floating dock has a pontoon deck of some 1200 square metres. The deck is cambered with the high point in the centre. At the stern of the pontoon deck, and around that edge, was constructed a "save all", of about 200 millimetres on the port and starboard sides diminishing in height to zero at the centreline. On 6 August the floating dock was berthed on the western side of Garden Island, in Woolloomooloo Bay, with its stern to the south. 7. The "save all" has weep holes at the level of the deck so it can drain upon resurfacing. However once the floating dock is resurfaced, those holes are sealed with quick set cement before work starts. Cement had been applied to the weep holes prior to 6 August 1998. 8. When the floating dock is raised it is trimmed to ensure that all liquids on the pontoon deck flow to the port and starboard sides, and thence to the stern, to be caught within the "save all". Liquid which flows to the "save all" area drained to a sump tank in the floating dock, which had a capacity of 1600 litres. 9. In the sump tank was a manually operated pneumatic diaphragm pump; it was in a sealed compartment to protect it when the floating dock submerged. The "manual" aspect of the pump was that it needed to be switched on. Once "on" there was an electrified flow switch which triggered its operation when liquid in the sump reached a predetermined level. 10. When operated the pump in the sump would discharge liquid to a 40,000 litre holding tank located on the wharf adjacent to the floating dock. Other than observing the level in the 40,000 litre tank (it had a sight glass), the operation of the sump pump could not be seen or heard. 11. If the pump failed and the sump was full then with rain or other liquid falling on the pontoon deck, there would be an accumulation in the "save all" which, in time would overflow into the harbour. This is what occurred on 6 August 1998. Prior Procedures and Preparation 12. The practice of ADI was for each ship using its floating dock to have both an Environmental Management Plan, and a Silhouette Plan of the vessel to be docked. 13. The evidence of Mr Lenihan, the project manager in charge of the refurbishment of the Woona, was that such a plan and silhouette was prepared and available for the Woona. Although those documents had been archived, they were not tendered. An example of the type of plan used in 1998 was tendered; it, and a contemporaneous policy document showed that ADI was alive to the risk of a variety of environmental impacts potentially flowing from its works, and that procedures were in place to address those risks and respond to and rectify incidents or events (Exhibit D), should they occur. 14. On the wharf, adjacent to the floating dock there was a "portable environmental container". This was maintained in a fully stocked condition with spillsorb, absorbent pads, absorbent socks, and absorbent booms. A similar container was located at the Captain Cook Graving Dock some 500 metres from the floating dock, and additional, similar materials were kept in storage on Garden Island. 15. ADI had maintained, fulltime, an environmental officer; on 6 August 1998 this was a Mr Steve Olley who oversaw the maintenance of these materials and who was the nominated contact in the event of an emergency. The Incident 16. The defendant Mr Lyndon took direct instructions from his supervisor, a Mr Chris Cicuta. Mr Cicuta in turn was under the direction of a foreman, a Mr Greg Gaisher, who in turn took orders from the project manager Mr Lenihan. 17. It was part of Mr Lyndon's job to remove docking plugs from the underside of the Woona. Although Mr Lyndon had never carried out this task before, Mr Lenihan gave evidence that these plugs were regularly removed in procedures of the type being carried out on 6 August. A variety of tanks had their docking plugs removed to enable a check to be made that there was no water in the particular tank, for it to be cleaned if needed, and to enable the Lloyd's survey to be conducted. Identification of the plugs to be removed was arranged by the chief engineer of the vessel, and was shown on the Silhouette Plan. 18. Mr Lenihan said that the removal of docking plugs was a common occurrence, and the number of plugs he would have supervised the removal of would be "in the hundreds". His experience was that very little water came out of the tanks when the plugs were removed – a couple of gallons at most. This is probably due to the chief engineer of the vessel ensuring that the tanks were dry for the purpose of the survey. Mr Lenihan had not experienced contaminated liquid flowing from tanks previously when docking plugs were removed. 19. Instructions as to the removal of the relevant plugs on the Woona was given by Mr Cicuta to both the defendant Darrin Lyndon, and a work colleague, a Mr Leighton Roberts. The plugs to be removed were spread out amongst numerous other similar plugs along the vessel side and were not marked. Mr Lyndon believed that the plugs that he was to remove accessed either empty tanks or ones which would only contain water. 20. Apparently there had been a system of colour coding the plugs to be removed but this had not been done prior to 6 August due to inclement weather. 21. One can thus imagine the surprise Mr Lyndon experienced when, upon the removal of a plug, diesel oil began to pour out of the plug hole and onto him. He described it as "…flowing as if being poured from a drum". The plug hole was between 1 and 1 ½ inches in diameter. From a photograph in evidence it is apparent that Mr Lyndon would have been directly below the plug when he removed it. The flow of oil began to saturate him. Fortuitously, he was able to reinsert the plug within about a minute. 22. The incident occurred at 12:10pm. Mr Cicuta was first to arrive and the portable environmental container was accessed for absorbent pads. Shortly thereafter Mr Lenihan arrived on the pontoon deck. Within the time it took him to arrive oil had already escaped the "save all" and entered the harbour. There was driving rain and strong winds (estimated at 30 knots) from the south west. 23. Thereafter Mr Steve Olley the environmental officer attended, and the clean up continued. Additional absorbent material was placed around the edge of the "save all" and the floating boom was deployed in the water; assisting the dispersal of the diesel which entered the harbour, a work boat from Defence Marine Services was engaged to churn the water to aid that dispersal. It was not until some time after 2:30pm that Sydney Ports Operation Central Control was informed, by an unidentified officer of ADI, of the spill into the harbour. That information was conveyed to the master of the Sydney Ports Corporation shift, Mr Horsington, who with Shift Engineer Stringer and Ports Officer Spencer boarded the SPC vessel FRV1, at Millers Point and proceeded to the location of the floating dock at Garden Island. 24. Upon Mr Horsington arriving at Garden Island at about 3:00pm an oil slick was observed emanating from the stern of the floating dock and spread in a north and north easterly direction, being driven by the 30 knot wind. Mr Horsington did not observe any ADI personnel on the floating dock, and not having been able to contact anybody with responsibility at ADI, radioed his base for the Marine Supervisor Mr Blake to arrange for the tug Shirley Smith to be made available for the purpose of breaking up the oil slick. 25. Mr Horsington and his crew returned to Millers Point, and Mr Blake accompanied them on the return to Garden Island, on board the Shirley Smith. 26. The Shirley Smith arrived at the floating dock at about 3:45pm and some time thereafter commenced to use its propellers to break up the oil, doing so until the light gave out around about 5:40pm. Both Mr Horsington and Mr Blake provided plans of the relevant area of the Harbour at Garden Island, showing the oil slick extending some 150 metres in a north easterly direction from the floating dock. 27. Mr Blake boarded the floating dock, and spoke to Mr Lenihan; Mr Blake says he attended on Mr Lenihan at his office, whilst Mr Lenihan says that the discussion he had with Mr Blake occurred on the floating dock. For present purposes nothing turns on this discrepancy. Mr Blake told Mr Lenihan, and also ADI Quality Manager of Marine, a Mr Greg Foster, that he wished to interview the relevant personnel concerning the incident. Mr Foster said that ADI was still investigating the incident, and would wish to seek legal advice before proceeding with any further comments. Mr Blake took samples, and returned to the Shirley Smith which continued to use its high pressure monitors (and I assume its propellers) to break up the oil slick. 28. Mr Lenihan did not leave Garden Island on the day of the incident until approximately 7:00pm. He was of the view that all that could be done that day, had been done, particularly having regard to the weather conditions. He was of the opinion that the bulk of the oil was cleaned up and otherwise contained. 29. It is unclear when ADI's attention was drawn to the primary cause of the spillage, namely the failure of the sump pump. It was only in cross-examination that Mr Lenihan said that the contractors who serviced the 40,000 litre stationary tank on the wharf, Worth Oil, had attended at 6:00pm on the day of the incident and had on that occasion, pumped the sump of the floating dock. A second pump was located on the dock to aid the pump out of the sump, thereafter. It was not unreasonable for Mr Lenihan to conclude that in those circumstances, a risk of any further spillage was remote. 30. It is significant to note that when Mr Blake and the Shirley Smith left Garden Island at around 5:40pm, on 6 August, they saw no need to either take precautions over and above those which they had observed to have been taken by ADI, and taken themselves, or issue instructions to ADI for further works to be done. Nor did they arrange to return on the following morning for any purpose connected with a further cleanup, or inspection. It can reasonably be concluded that Mr Blake was of the opinion that all that needed to be done had been when he left at about 5:40pm. 31. The day following the spill, 7 August 1998, SPC Marine Supervisor Grahame Edgley commenced duty at 6:00am. At 2:00pm that day, having conducted a variety of other tasks around the Harbour on behalf of SPC, Mr Edgley went with Ports Officer Rush to the floating dock at Garden Island. He observed an oil sheen on the water at the northern end of the floating dock; the log of his vessel notes that that diesel film was then "broken up", on that occasion, for a period of some 30 minutes by the SPC vessel. Mr Rush noted that oil on the floating dock floor was being washed by rain "across the southern end of the floating dock and into the harbour". 32. To obtain an oil absorbent boom to contain this spillage from the southern end of the floating dock, Supervisor Edgley took his vessel back to Moore's warehouse at Millers Point. However before returning to Millers Point his log notes that his vessel attended a random inspection of the vessel Stolt Australia. Such a random inspection suggests that neither Supervisor Edgley, nor his crew, regarded what they saw at the floating dock on 7 August on their first visit, at 2:00pm as requiring their urgent attention. 33. Having obtained the boom at Moore's warehouse, Supervisor Rush and his crew returned to the floating dock. The log of their vessel records the time of return being 3:30pm, for the purpose of applying the boom. It took them about 40 minutes to attend to this task. 34. Mr Hill, counsel for the prosecutor submitted, that these circumstances showed that the offences were continued into the second day, 7 August. It was submitted that this should be seen as exacerbating the offence (the summons only related to 6 August). However the evidence of what was seen and what work was done on both 6 and 7 August suggests that any "continuation" into 7 August was in relative terms minor and treated as such by the officers of SPC. I have earlier referred to the absence of any concern by Mr Blake and his crew at the conclusion of activities on 6 August as to the needs for any further steps to be taken. Nor did SPC otherwise see any need to attend at first light on the morning of 7 August. When they did attend, at 2:00pm that day, the SPC crew before returning with a boom later in the afternoon attended on a random inspection of another vessel. 35. Whilst I accept the observations of SPC officers as to the need for the placing of an additional boom on the afternoon of 7 August, I do not regard it as appropriate to see the offences as continuing into the second day; nor do I accept the prosecution's submission that ADI had "done little to stop the spill continuing to the second day", nor that the circumstances ought be categorised as "appalling", as was put by Mr Hill. 36. It is not insignificant that the prosecutor called no evidence of environmental harm or damage. The costs of SPC for their work in the clean up amounted to $1,770 , and have been paid by ADI. Explanation 37. The initial cause of the oil spill was the removal of the plug by the defendant Darrin Lyndon. The suggestion that there was error and confusion between Mr Cicuta and Mr Lyndon as to which plugs were to be removed is only inferentially available, and in the circumstances inappropriate. Mr Lyndon said he was given specific instructions as to which docking plugs were to be removed, and he commenced to execute those instructions. It is obvious however that there has been a misreading or failure to read the Silhouette, or engineer's instructions as to what tanks the various docking plugs accessed. 38. The parties agreed that the quantity of oil which escaped into the harbour was a maximum of 200 litres. That would not be an unreasonable estimate given the size of the aperture, and period of time for which the diesel flowed. Absent the rain, and the sump tank being full, it would be expected that the oil as spilled would have found its way to the sump. The evidence was that ADI personnel were aware "for some days" that the pump was not working. In those circumstances it was highly irresponsible of ADI, given the degree of risk and potential for damage, in failing to speedily pursue either the rectification of the pump, or the installation of some alternative system, to preclude an event like the present. 39. Although the immediate cause of the spillage was the removal of the docking plug by Mr Lyndon, escape into the harbour would not have occurred but for the failure of the sump pump. Whilst Mr Lenihan gave evidence of the sump pump not working for some days prior to 6 August, there was no evidence as to when Mr Lyndon was aware of this difficulty. Any suggestion that his observation of the "save all" should have put him on notice of the failure of the pump would be speculative and conjecture. Consideration 40. The entry of a plea of guilty establishes for the prosecution the essential elements which need to be made out for a conviction (R v O'Neill [1972] 2 NSWLR 582), and negates any available defences. In the instant matters the prosecution was not asked to particularise the "cause" relied upon, and any deficiency that may have arisen in that regard was cured by the pleas of guilty. 41. Before dealing with the submissions put in mitigation of penalty, I need to deal with the indication on the part of counsel for the defendants that they were prepared to meet the costs of the prosecutor "either as agreed or assessed". 42. Whilst it is not the function of this Court to make an assessment of costs, in the circumstances of a plea of guilty, it is relevant to have an approximate idea of the ambit of the impact of such an undertaking for the purpose of fixing penalty. 43. Mr Hill informed the Court that the prosecutors' costs would be in the order of $60,000 , but that in other similar matters, on assessment, the prosecutors' costs are usually reduced by about one third. 44. I expressed surprise that the prosecutors' costs were so high. 45. Since the first return day of the summonses in these matters, the prosecutor has not had to adduce evidence in addition to that which had been prepared for the sake of commencing the proceedings. 46. The affidavits tendered in evidence by the prosecutor numbered 8 in all, which (absent annexures) totalled some 36 pages. The prosecutor also prepared a draft statement of agreed facts (3 pages) and tendered additional photographs which had been annexed to some of the affidavits. The proceedings took one day, and a further hour and a half on a second day. 47. One does not have to do much mathematical analysis to see that the estimated costs of the prosecutor suggests an extraordinary number of working hours devoted to what in relative terms is a clear cut, straight forward matter, without complexities. Further the prosecutor is represented by a firm of solicitors and counsel both with extensive experience in this area. 48. It is for these reasons I was surprised when told of the amount of the estimated costs of the prosecutor. Defendants who wish to cooperate with prosecuting authorities and enter pleas of guilty with an expression of genuine contrition may be deterred from doing so if they are at risk of confronting either unacceptably high or unnecessary costs incurred by a prosecutor. 49. In the present case given that the defendants cooperated both at the time of the incident, and entered pleas of guilty upon the first return of the summonses, the strong probability would have been an acceptance at the out set by the defendants of the prosecutor's draft statement of agreed facts. Given that the prosecution was not initiated until some 18 months after the event, there was ample opportunity for the prosecutor to invite the defendants to indicate their attitude, such that substantial costs could have been saved. 50. Neither counsel submitted that the impact of the undertaking by the defendants to meet the prosecutors' costs ought not be taken into account in determining penalty, and I will do so. 51. As to the appropriate penalty counsel for the prosecutor emphasised two matters. Firstly he directed attention to the foreseeability of the event, noting that it could have been prevented without much difficulty. This is true but is answered in part by Mr Lenihan's experience of years of removing docking plugs, without incident. The second matter the prosecutor emphasised was what he described as the "continuance to the second day" of the offence. I have dealt with this earlier. Any such "continuation" was minor and for the purpose of penalty ought play no significant role. 52. Mr Sexton, counsel for the defendants, put submissions in relation to each defendant, separately. As to the company he referred to the following matters (some of which are relevant to the position of Mr Lyndon):- (i) Pleas of guilty were entered at the first opportunity. (ii) Contrition has been, and is, demonstrated. (iii) The authorities were notified of the incident, and when they attended there was cooperation with them. (iv) In relative terms the spill was of a small quantity, although not insignificant. (v) Immediate steps were taken to clean the area, albeit weather conditions still caused a minor problem on the following day. (vi) There is no evidence of environmental harm flowing from the incident. (vii) ADI paid SPC's clean up costs. (viii) Apart from a conviction in October 1999 for pollution at Mullwalla, ADI had a good environmental record and otherwise demonstrated responsibility as a "good corporate citizen"; reference was made to the detailed evidence of Mr Williamson in that regard. (ix) ADI had systems in place to both prevent, and take account of, incidents and hazards of the present type. (x) After the incident ADI demonstrated a desire to take steps to improve its system, and this has been done; refurbishment of the pump system on the floating dock was part of a $450,000 re-fit. (xi) That the payment of the prosecutors' costs were relevant on penalty. (xii) Since the incident ownership and management of ADI has changed, and there was an ongoing demonstration of concern and care for the environment. 53. As to the defendant Darrin Lyndon Mr Sexton put the following matters: (i) That a prosecution under s 8 of the Marine Pollution Act was for a single event, and whilst the proprietor or employer was vicariously liable, the Act also imposed liability for "servants or agents" individually. (ii) If the whole of the penalty to be imposed was visited on ADI, then it would not be appropriate for an additional, separate fine to be imposed on Mr Lyndon. (iii) In the circumstances s 10 of the Crimes (Sentencing Procedure) Act 1999 ought be availed of and Mr Lyndon discharged with no conviction being recorded for the following reasons: a) He had entered a plea at the first opportunity and expressed contrition. b) The accident was inadvertent with Mr Lyndon not being responsible for the failure of the pump to work, or for selecting what turned out to be the "wrong" plug. c) Mr Lyndon was a young man with no convictions; d) Mr Lyndon had recently been retrenched, albeit he had found a new employer; a conviction under s 8 was a serious matter and would create a burden for him, disproportionate to the circumstances of the matter, in his later life. e) Culpability for the event ought be directed in the main, if not totally, to ADI – it being responsible for the pump which did not work, and the ambiguous, or incorrect instructions as to the inappropriate docking plug to be removed. f) What flowed from Mr Lyndon's "mistake", if could be so categorised, was in relative terms a small spill, with him replacing the plug in a short space of time. Findings and penalty 54. Section 8 of the Marine Pollution Act provides the maximum penalty for a corporation for an offence against that section is $1,100,000; for a natural person it is $220,000. 55. Mr Hill provided the Court with a useful summary of recent prosecutions for offences against s 8. The summary is helpful but many of the matters in the summary dealt with offences committed when the maximum penalty $250,000 in the case of a corporation and $50,000 for an individual. Whilst these examples are helpful, each case, like the present, has to be determined on its own facts, albeit there is a public interest in parity of sentence, where appropriate analogies and comparisons can be made and drawn. 56. In fixing an appropriate penalty I am mindful of the observations of Kirby P in Camilleri Stockfeeds Pty Ltd v Environment Protection Authority (1994) 82 LGRA 21 at 36 where His Honour noted: …the task of a court is to assess the relative seriousness of the offenders particular offence in relation to a worst case for which the maximum penalty is provided. Having determined the relative seriousness of the offence the penalty to be imposed is that which approximately correlates upon the scale of penalty set by the legislature from zero to the maximum. (p 36) 57. Whilst the concept of the "low end of the scale" is readily understandable, that for the top end or maximum is less readily gauged or assessed. In the instant case not withstanding the absence of evidence of environmental harm, the spill was not insignificant. It was not at the low end or minor spill end of the spectrum of, say 5 to 10 litres. In terms of quantity of oil spilt it is somewhere below the medium but none the less, a significant quantity. The spill was reasonably foreseeable given the knowledge, for a number of days, of the sump pump not working. To carry out work of the type undertaken, on a floating dock requires constant vigilance. To continue the work knowing the sump pump was inoperative and with unfavourable weather conditions, was not a minor want of procedural or operational care, but culpable negligence which can only be categorised as serious. 58. In the circumstances of the various factors which I have referred to as relevant on penalty, I consider an appropriate discount on account of those matters to be in the order of 30 to 35 per cent. Making such an allowance I consider the appropriate penalty for ADI to be $100,000. 59. As to Mr Lyndon, I do not think it is appropriate that the charges be dismissed under s 10 of the Crimes (Sentencing Procedure) Act 1999. However, having regard again to the various matters touching upon him personally, including his good character, the role he played in the circumstances leading to the spill, and the absence of culpability as ordinarily understood I regard it appropriate to find the offence made out but to discharge him on condition that he entered into a good behaviour bond for a term of 12 months. In making such an order, I formally find in accordance with s 10(2) of the Crimes (Sentencing Procedure) Act 1999 that to inflict any punishment on Mr Lyndon would be inexpedient, and conversely that is expedient to release him on a bond. The bond may be taken before the Registrar of the Court, at which time in accordance with s 96 of the Crimes (Sentencing Procedure) Act 1999, the requirements of s 95 are to be complied with. Orders 60. The formal orders of the court are:- In matter 50025 of 2001 (ADI) 1. I find the offence proved. 2. The defendant is convicted of the charge set out in the summons. 3. The defendant is fined $100,000. 4. The defendant is ordered to pay the costs of the prosecutor, as agreed or assessed. 5. The defendant is allowed one month to pay. In matter 50024 of 2001 (Mr Lyndon) 1. I find the offence proved. 2. Without proceeding to conviction I order that the defendant be discharged on condition that he enter into a good behaviour bond for a period of one (1) year. 3. I make no order as to costs. 61. The exhibits in both matters should remain with the Court file. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.