Land and Environment Court of New South Wales CITATION : EPA v Larkray Pty Ltd [2001] NSWLEC 92 PROSECUTOR PARTIES : Environment Protection Authority DEFENDANT Larkray Pty Ltd FILE NUMBER(S) : 50056 of 2000 CORAM: Sheahan J KEY ISSUES: Prosecution :- breach of conditions of Pollution Control Licence - plea of guilty LEGISLATION CITED: Crimes (Sentencing Procedure) Act 1999 s 10 Protection of the Environment Operations Act 1997 s 241 CASES CITED: DATES OF HEARING: 09/04/2001 EX TEMPORE JUDGMENT DATE : 04/09/2001 PROSECUTOR Mr D Samuels Solicitor EPA LEGAL REPRESENTATIVES: DEFENDANT Barrister Mr A Galasso Solicitors Hill Thompson & Sullivan JUDGMENT: IN THE LAND AND Matter No: 50056 of 2000 ENVIRONMENT COURT Coram: Sheahan J OF NEW SOUTH WALES 9 April 2001 ENVIRONMENT PROTECTION AUTHORITY Prosecutor v LARKRAY PTY LTD Defendant JUDGMENT 1. The defendant company operates a substantial piggery on the property "Wonga", near Young NSW, and has pleaded guilty to a charge that on or about 3 to 4 October 1999 (the wet Sunday and Monday of a long weekend) it contravened the following condition of its Pollution Control Licence 001780, namely: Condition W3: 'There must be no discharge of wastewater to any watercourse or to any area other than the defined wastewater disposal area'. 2. According to this licence the only location of an authorised discharge point was spray irrigation on the premises. The recycling and disposal of the recycled wastewater was to take place within the defendants own premises and not outside those premises. 3. On this occasion the wastewater allegedly discharged was recycled piggery effluent. 4. It was discharged onto the neighbouring property "Olde Moppity" owned by Mr Nation, who gave evidence this morning, and, diluted by substantial rain, found its way ultimately to Currawong Creek. 5. The defendant's counsel, Mr Galasso, asks the court to note that while the contents of this wastewater may cause environmental harm to waterways, they are often used as an organic fertiliser. 6. The court has been assisted by substantial agreement upon the facts. 7. The Statement of Agreed Facts ("ASF") (Exhibit E1) describes in detail the effluent system in place then and now, and the events of 3 to 5 October 1999. It would appear to be common ground that the relevant pump was appropriately turned off, but that a valve/pipe system malfunctioned, due to the failure of a plastic thread fitting, such that a loaded pipe separated from the valve. 8. The pumping station at that time was located approximately 20m from Mr Nation's boundary. It was shielded from that boundary by a small bank, which was admitted not to have been maintained in good condition, but also not to have been adequate to hold the amount of fluid discharged in this mishap. 9. Immediately the incident was discovered by representatives of the defendant, the system was turned off. The Financial Controller of the defendant company telephoned the EPA at about 10.30am on Tuesday 5 October 1999, and is asserted to have advised that somewhere between 10,000 and 70,000 litres of recycled fluid was discharged in the incident. However, no-one really knows how much was discharged on this occasion. 10. The EPA officer, Mr Don Russell, visited the scene, made a video (Exhibit E2) which the court was shown, and took samples which showed high concentration of nutrients in the areas affected, leading the EPA scientist, Stephanie Wallace, to conclude (par 24 of her affidavit): The unauthorised discharge of up to 70,000 litres of wastewater effluent at the Windridge Pig Farm on 3-4 October 1999 resulted in contaminated effluent entering and progressing down a watercourse on Mr Nation's property, with the sample results suggesting that the effluent entered Currawong Creek. The concentrations of nutrients in the discharge channel on Mr Nation's property and downstream in Currawong Creek were well in excess of the ANZECC guidelines or indicative values for the protection of aquatic ecosystems. These concentrations indicate there was potential for environmental effects on the aquatic flora and fauna of the receiving waterways. The seriousness of the environmental effect from this discharge would be proportional to the quantity and duration of the discharge. In the short term, the high levels of ammonia could prove harmful to the aquatic ecosystem, with the high ammonia concentrations reported possibly toxic to fish. In the longer term, the nutrients could encourage the growth of nuisance algae and macrophytes. 11. The defendant's expert, Mr Wright of Australian Water Technologies responds (in par 4 of his affidavit) to some nominated paragraphs of Wallace's affidavit in these terms: 8. The ANZECC Water Quality Guidelines referred to are the 1992 edition. New draft guidelines have since been released (in 1999) due to many limitations contained within the 1992 guidelines. It needs to be emphasised that 'guidelines' are not 'standards' or 'limits'. The draft 1999 guidelines contain the following statement … He goes on to quote from them, and, then, in response to par 11, he points out that: 82mm of rain in 2 days is 12.6% of the area's annual average rainfall (648mm is the annual average rainfall). This paragraph states that 'the heavy rainfall probably assisted in the dilution and dispersion of the pollutant'. It should be noted that a heavy fall such as this is also likely to transport other pollutants from the rural catchment into the waterway. Such pollutants may include soil fertilisers, grazing animal wastes, eroded soil material and other pollutants. Such heavy rain may indeed have transported material into the waterways that may have had some influence on the chemical results. I should also quote his response to paragraph 24: From my experience, the water quality and ecosystem health of rural creeks and rivers in New South Wales, is generally poor. Runoff from rural catchments is often contaminated with nutrients, sediment and toxicants from grazing animal wastes, fertilisers to pastures, eroded soil material and from other putrescible waste materials. From time to time the water quality from rural catchments is very poor - due to the transport of 'slugs' of contaminated runoff from the rural catchment into the waterway. The aquatic ecosystems in such waterways have often adapted to such periodic poor water quality. A survey of macro invertebrate fauna in this waterway could have added some relevant information on the general 'ecosystem health' of the waterway. Such a survey was denied by the property owner of "Olde Moppity". It is not possible to understand the 'ecosystem health' of this waterway. Such a survey could also have searched for any long-term impact from the incident on 4 October 1999 which is the subject of these proceedings... 12. Earlier incidents on "Wonga", affecting Mr Nation's property, occurred in 1995 and 1997. 13. The defendant company was dealt with by Queanbeyan Local Court in July 1996, paying fines totalling $1,000 for the 1995 incident involving a breach of licence (Exhibit L1). A new effluent system was subsequently installed, and it is described in detail in the evidence. There has been no repeat of that incident, which involved irrigation of raw effluent. 14. In July 1997 a spill occurred at the subject site. The defendant agreed to carry out certain remedial actions, which the EPA subsequently inspected, and no further legal action was taken. The EPA's reasons were detailed in its letter of 1 August 1997, a copy of which is attached to the ASF. Relevantly, that 1997 incident occurred during the commissioning of new pumping and environmental improvement infrastructure on "Wonga". 15. The 1999 incident which is the subject of the present charge was a case of mechanical failure, explained by the company's Mr Lawrence as probably the result of "excess pressure or fatigue" (see item 71 of his record of interview). Recurrence has been prevented by the use of galvanised metal fittings, and the securing of the discharge pipe to a rigid section of the pump (see item 73 of that record of interview). 16. The company has also (according to par 16 of the ASF): … (b) Put an additional one-way valve in the system above the point of the incident. The fitting from which the thread stripped was above the existing one-way valve. (c) Built a large bunded area around the pump in the form of a pond to hold approximately 300,000 litres of any escaping recycled liquid in future. (d) Moved the pump further from the boundary, thus reducing pressure on the pump and fittings, and putting a large dam between the pump and gully and boundary. 17. It has also improved its regime of monitoring the pump (see record of interview item 80), and has instructed all staff to notify company principals immediately of any incident so that they can promptly inform the EPA (see Sally Walker's affidavit, 8 March 2001, par 26). 18. The company is confident about its current system (see record of interview item 95). 19. The prosecutor alleges that a dam of that capacity could and should have been constructed before the incident, and that the company should explore other technologies (see record of interview item 82). Mr Robertson of the EPA deposes to, but the company denies, notification by the EPA in 1997 that the bund near the pumphouse was inadequate. 20. There is no evidence of actual environmental harm, but the prosecutor also complains about the lateness of the defendant's notification of this particular incident. 21. The defendant company is a family concern, employing some 60 staff on six sites in NSW and Victoria. "Wonga" has been in its ownership since 1990. Financial and environmental matters are the responsibility of Sally Walker, who swore two affidavits and gave oral evidence. 22. I am satisfied of the company's good intentions, and of its contrition and remorse regarding the subject matter of these proceedings. 23. I am satisfied that it has expended a substantial amount in making the improvements to which I have referred. 24. It has also agreed to pay the prosecutor's costs of $5,920. 25. It conducted, in the year 2000, an audit of its licence compliance, and it cooperated in every way with the prosecutor. 26. It entered its plea of guilty at the earliest opportunity. 27. The defendant's counsel has asked the court to deal with it under s 10 of the Crimes (Sentencing Procedure) Act 1999, but, given the Prosecutor's decision in 1997, following a second infraction by this company at this site, I do not think this is an appropriate case for such leniency. 28. In terms of s 241 of the Protection of the Environment Operations Act 1997, this event was foreseeable, inadequate precautions were in place, and the defendant was in total control of the operation. 29. Holding a licence imposes a heavy responsibility to avoid environmental incidents such as this. 30. The maximum penalty is $250,000, and the prosecutor submits this is a case in the range 15-20% of the worst case. 31. I agree with that submission, but, taking into account the matters put in mitigation and already noted in this judgment, I will apply a discount of 40%, and impose a fine of $30,000 on this occasion. 32. The formal orders of the court will be: 1. The defendant is convicted of the offence with which it has been charged in the summons. 2. The defendant will pay a fine of $30,000. 3. The defendant is ordered to pay the costs of the Prosecutor, as agreed in the amount of $5,920, within 28 days. 4. Exhibit E1 will remain on the court's file, but Exhibit E2 and Exhibit L1 may be returned. 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.