Writing

Duty to notify contamination set to change

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Image:  EPA, West Footscray Fire

What is the issue?

At the present time, Victoria has the most limited duty to notify pollution or contamination.  That will soon change.

Currently, the obligation to report pollution or contamination is limited to environmental auditors engaged to undertake a statutory environmental audit where there is an imminent environmental hazard, and under some waste discharge licences issued under the Environment Protection Act 1970.

In addition, any annual report by directors submitted under the Corporations Act 2001 (Cth) must report on whether the entity’s operations have been subject to significant and particular state or Commonwealth environmental regulation and how the entity has performed.

From 1 December 2020, or sooner if proclaimed, Victoria will join other states in imposing a specific duty to report on ‘notifiable contamination’ to the EPA under the Environment Protection Act 2017 (new Act).  Notifiable contamination includes contamination for which the reasonable cost of action to remediate the land is likely to exceed $50,000.[1]

It would be prudent to obtain advice now on the duty to notify EPA of contamination before the new Act commences.  The new Act applies to land that is contaminated before or after commencement.[2]

What does it mean for me?

The new duty to notify contamination applies to a person in management or control of land.  EPA must be notified if the land has been contaminated by notifiable contamination as soon as practicable after the person becomes aware of the notifiable contamination, or reasonably should have become aware of the notifiable contamination.

The test of whether a person in management or control of land becomes aware, or reasonably should have become aware, of notifiable contamination is determined with reference to:

  • The person’s skills, knowledge and experience;
  • Whether the person could practicably seek advice regarding the contamination; and
  • Any other circumstances of the contamination.[3]

The duty applies to a person in management or control of land, including government land managers and corporate land managers.

The penalties are up to $19,342 for a natural person or $96,714 for a body corporate.  Significantly, the new Act purports to abrogate the privilege against self incrimination.[4]

What are the existing reporting duties?

Currently, all directors of companies (other than small companies limited by guarantee and small proprietary companies) required to submit an annual report under the Corporations Act 2001 (Cth) must give details of the company’s performance in relation to environmental regulation.[5]  This reporting obligation is triggered if the entity’s operations are subject to ‘any particular and significant environmental regulation’ under a law of the Commonwealth or of a State or Territory.[6]  The company’s performance must be detailed.

Accordingly, it would appear that any notification of significant contamination to the EPA under the new Act must also be reported on by directors in their annual report.

When does the new duty arise?

The circumstances in which a duty to notify a pollution incident arises was considered by the Land and Environment Court (NSW) [7] in a rare prosecution by the EPA for failure to notify a pollution incident.  The court considered that the duty to notify arose only when the defendant became aware that the clean-up operation would cost more than $10,000 with reference to the definition of material harm in the Protection of Environment Operations Act 1997 (NSW).  The defendant was found not guilty of the charge of failure to notify.  The court held that the respondent’s awareness of the bare fact that the pollution incident occurred did not trigger the duty to notify.

What are the next steps?

If you are concerned about a pollution incident, the discovery of contamination or legacy contamination it is prudent to obtain legal advice about your current and future reporting obligations and responsibilities.

Provision of false information is an offence under s 463 of the new Act, including concealing any materially relevant information or document.  This is an indictable offence which may also be heard and determined summarily.  The penalty is up to $80,595 for a natural person or up to $402,975 for a body corporate.[8]

[1] Section 37 Environment Protection Act 2017 (new Act)

[2] Section 38

[3] Section 40(3)

[4] Section 42

[5] Section 298 Corporations Act 2001 (Cth)

[6] Contravention of section 298 occurs when a director of the company, registered scheme or disclosing entity fails to take all reasonable steps to comply, or to secure compliance.  This is contravention of a civil penalty provision.

[7] Environment Protection Authority v Bulga Coal Management Pty Ltd (2014) 200 LGERA 235; [2014] NSWLEC 5.

[8] Calculated on the basis of the current penalty unit which may increase by the time the new Act commences.

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Royal Commission into Aged Care and other Inquiries – Soft skills

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Source: Shuttershock

The role of solicitors and barristers during a Royal Commission or Board of Inquiry is worth reflecting on.  While traditional style legal advice may be required on topics such as disclosure obligations, legal professional privilege and the engagement of experts, a solicitor or barrister should also expect to use all of their ‘soft skills’ in addition to their legal skills when representing a client before a Royal Commission or inquiry.

To date, I am fortunate to have worked on several Royal Commissions and inquiries.  Like any brief, it arrives with a mix of responsibility and privilege.  While the subject matter has varied from anti-corruption to bushfires, the lessons for CEOs preparing to give evidence have a common thread.  One of the main parts of the role of a barrister or solicitor is supporting a client through the process of obtaining instructions from within the organization, identifying the ‘red flags’, honestly and robustly discussing what went wrong, and then developing a plan to offer the commissioners reporting on the Royal Commission or inquiry regarding how things might be done differently next time.

Some themes to consider when assisting a client through a Royal Commission or inquiry:

  1. Preparation: Andrew Palmer at the University of Melbourne (and the Victorian Bar) teaches his evidence students that ‘The most prepared side usually wins’.  During a Royal Commission or inquiry, that rule is underscored.  Unlike litigation, while there may not be a loser and a winner in the traditional sense, there are most certainly winners and losers in the court of public opinion.
  2. Media: Even if a client chooses not to make statements to the media, clients should expect that the modern Royal Commission or inquiry hearing room will have journalists tweeting what is said (unless of course a suppression order has been made).  It is possible that an article describing the evidence given in the hearing room will be published in an online newspaper before the client has left the witness box.  Accordingly, it is recommended that clients engage a media or communications consultant to assist with media liaison.
  3. Impact on staff: A Royal Commission or inquiry usually brings a level of strain across an entire organization.  Clients should consider whether a counsellor or psychologist ought be made available to staff in addition to the usual EAP that may apply.
  4. Strategy: Surviving the court of public opinion will only be possible if there has been a robust and honest review of ‘what went wrong’ coupled with consideration of ‘what will be done differently in the future’.  That process may be time-consuming and should engage the whole organization.
  5. Inquiries have a life of their own: Usually a Royal Commission, such as the recently announced Royal Commission into Aged Care, will have Terms of Reference or Letters Patent issued under the Royal Commissions Act 1902 (Cth) or state equivalent.  Even so, solicitors and barristers must keep close track of the ‘live issues’ that arise on a daily basis and give consideration to an appropriate and accurate response.  Those ‘live issues’ may appear to be at the margins of the Terms of Reference but nonetheless will need to be addressed if the client is to secure a ‘win’ or at least, manage a ‘loss’.
  6. Eat breakfast: On the day a client gives evidence, remind them to eat breakfast.  They may have a restless night on the back of several weeks of intensive work with lawyers and across the organisation.  This might be the last chance they have to eat all day!
  7. Cross-examination: Remind clients to tell the truth, regardless of the consequences.  The process of preparation has hopefully assisted to clarify the positives and the negatives within the bounds of the Royal Commission or inquiry and assess what went wrong and what will be done differently in the future.  Answer ‘yes’ or ‘no’ to closed questions.  Obviously remind the client to consider whether the answer ‘yes’ or ‘no’ is true or requires qualification in light of what has been learned during preparation.

If you or your client wishes to discuss any these ideas or others in relation to the Royal Commission into Aged Care, or any other inquiry, please do not hesitate to contact me.

20 changes to the EPA you need to know about

In 1971, the Victorian EPA was established under the Environment Protection Act 1970 (Vic) (EP Act).  It was the second EPA to be established in the world.  On 2 December 1970, the first EPA was established in the USA.

Now 47 years after the inception of the EPA, the Environment Protection Act (Amendment) Act 2018 (Vic) was passed by the upper house on 9 August 2018 and lower house on 23 August 2018.  This Act follows the report of the Independent Inquiry into the EPA in March 2016 and the State Government’s response to that report in January 2017.  There are a large number of changes to the EPA and its powers that you and your clients need to know about if you practice in the area:

  1. Risk-based regulation: The Act represents a highly significant shift to a ‘risk based’ approach to regulation rather than simply managing the impacts of pollution on segments of the environment through the grant of works approvals and conditions on licences.
  2. Public health: While the purposes of the Act are almost identical to the purposes of the EP Act, there is a shift towards human health.  For example, the new principle of conservation requires biological diversity and ecological integrity to be protected for purposes that include the protection of human health.
  3. Governing body: The first phase of reform has already been implemented by passage of the new Environment Protection Act 2017 . Since 1 July 2018, the EPA has a new Governing Board.  The statutory role of Chief Environmental Scientist was also created.
  4. Mandatory reporting: The Act creates a new duty to notify pollution incidents as soon as reasonably practicable and a duty to take action to respond to harm caused by a pollution incident and to notify certain contamination.
  5. Corporate veil: The Act provides power for the EPA to direct a notice to a related or ‘associated’ entity over which the body corporate had control if the entity is being wound up or it has failed to comply with a notice from the EPA.  Exercise of that power is subject to a test that requires knowledge, a position of influence and a failure to exercise due diligence by the associated entity.
  6. Clean up powers: The EPA may take action in response to immediate or serious risk of harm to human health or the environment including conducting a clean up.  The EPA may make a claim on a financial assurance to cover the costs of the clean up.
  7. Cost recovery powers: The EPA may recover its reasonable costs in relation to issuing notices including improvement notices, prohibition notices, environmental action notices or site management orders.  The costs are recoverable against a person who the EPA reasonably believes caused the circumstances.  Reasonable  costs include legal costs.  Unrecovered costs may become a charge on the land and the EPA may lodge a notice of that charge with the titles office which is required to be noted in the Register.
  8. Third party rights: Third parties whose interests are affected by a contravention or non-compliance or who have been granted leave of a court may take action if the EPA has not taken enforcement or compliance action.  A court may make an order restraining a person from engaging in specified conduct or requiring specific action to be undertaken if the court considers appropriate.  Interim orders may also be made.
  9. Compensation for third parties: A court may make a compensation order requiring a person to pay compensation for injury, loss or damage and costs incurred by the interested third party.
  10. General environmental duty: A breach of the general environmental duty may incur a penalty up to 10,000 penalty units (currently $1,611,900) for a body corporate or 2000 penalty units (currently $322,380) for a natural person.  The general environmental duty requires a person engaging in an activity that may give rise to risks of harm to human health or the environment from pollution or waste to minimize those risks so far as reasonably practicable.  A breach of the general environmental duty in the course of conducting a business or undertaking is an indictable offence.  Multiple or aggravated breaches of this duty attract higher penalties – currently up to $3,223,800 for a body corporate.
  11. Development licence: Works approvals are replaced with ‘development licences’ for ‘development activities’.  A requirement to hold a development licence is triggered for construction or installation of plant or equipment or development of processes or systems for a prescribed development activity.  Certain modifications to plant, equipment, processes or systems which may create a risk of material harm to human health or the environment from pollution or waste may also trigger a requirement to hold a development licence.  This reform is coupled with a new definition of environment.
  12. Definition of environment: The old concept of ‘segments of the environment’ is replaced with a very broad definition that includes climate, water, land, atmosphere, sound, odour, taste, plants and animals and social aesthetics.
  13. Operating Licences, Permits and Registrations: The Act requires an operating licence for a prescribed operating activity and a permit for a prescribed permit activity.  A new concept of a pilot project licence is also introduced.  A registration activity triggers a requirement for authorization.  Refusal triggers a right of appeal to VCAT.
  14. Licence reviews: Operating licences must be reviewed after 4 years.  Conditions of the licence may then be varied by EPA or the licence revoked.
  15. SEPPs: SEPPs are replaced with environment reference standards which identify environmental values.
  16. Waste: The regulation of waste emissions requires detailed review by operators and industry because it represents a transformative change to waste regulation in Victoria.
  17. Audits: A new tool called a preliminary risk screen is introduced to define the scope of environmental audits.  Environmental auditors have new duties to notify the EPA in relation to imminent danger or an imminent state of danger to human health or the environment .
  18. Planning permits: The Act requires a development licence applicant to provide a copy of a planning permit or the planning scheme amendment to the EPA as part of the development licence application.  In that sense, planning permits are intended to precede the grant of EPA licences.
  19. Public Register: A new Public Register is created.  This is intended to contain details of enforceable undertakings, licences, permits or registrations that have been issued by EPA and conditions that attach in addition to the term.  The register is to be made available for inspection by the public.  Exemptions for persons or classes or persons may be applied for.
  20. VCAT Review: Rights of review to VCAT lie from decisions by the EPA to issue a notice such as an improvement notice; a prohibition notice; a notice to investigate; an environmental action notice or an abatement notice.  Further, a large list of decisions by the EPA under the Act are reviewable to VCAT including on applications for permits or authorisations, requirements to provide environmental assurances.  An application for review of a reviewable decision must be made within 15 days.  Limited grounds of review apply to certain decisions.

The reforms are proposed to have full effect by 1 December 2020, with staggered commencement dates to be proclaimed.

Does the tribunal have jurisdiction? Implications of a recent High Court decision regarding residents of different States.

What does it mean for me?

If you are considering filing an application in a Tribunal such as the Victorian Civil or Administrative Tribunal (VCAT) or the South Australian Civil and Administrative Tribunal (SACAT) against an interstate resident, or if you are a not a resident of the State in which you wish to bring a proceeding, you should seek advice regarding the implications of the recent High Court decision in Burns v Corbett.[1]

An issue arises as to whether the tribunal is exercising judicial power over a matter in making a decision on your proceeding.

What is the issue?

In April, the High Court decided that the New South Wales Civil and Administrative Tribunal (NCAT) did not have jurisdiction to decide a proceeding between a resident of New South Wales, a resident of Queensland and a resident of Victoria.

The High Court decision related to two complaints of anti-discriminatory statements made against Mr Burns, a resident of NSW, by Ms Corbett, a resident of Victoria and by Mr Gaynor, a resident of Queensland.  The High Court considered that as NCAT was not a Chapter III court, and not a State court invested with Federal jurisdiction, it did not have jurisdiction.

Whether or not a tribunal has jurisdiction will turn on findings of fact as to where the parties are resident.

The principle is limited to natural persons.  However, it must be applied outside the anti-discrimination context including to planning and environment matters before the VCAT.  It is common for planning and environment proceedings in the VCAT to include natural persons as parties (such as owners of land seeking a permit for development or objectors to developments).  Advisors and clients should be aware that it cannot be assumed that the VCAT will have jurisdiction over a matter where there are non-Victorian residents as parties.

How has the High Court’s decision been applied?

In South Australia, Raschke v Firinauskas[2] involved an application for vacant possession by the landlord who was an interstate resident.  The Tribunal considered that it did not have jurisdiction to decide a dispute between landlords and tenants where one party is an interstate resident.

In construing the exercise of jurisdiction as judicial rather than administrative, SACAT considered ‘the nature of the task of the Tribunal is to supervise the compliance of the parties with the terms of their agreement and make orders that largely mimic the remedies that flow from the enforcement of the agreement as if it were the subject of a contractual dispute in a court’.[3]

Accordingly, the new Attorney-General has introduced a bill to amend the jurisdiction of SACAT by Statutes Amendment (SACAT Federal Diversity Jurisdiction) Bill 2018 (SA).  This provides for matters where SACAT does not have jurisdiction to be referred to the  Magistrates Court.

Both SACAT[4] and VCAT[5] have made statements regarding the limits of what they can and cannot decide.  They are able to decide:

  • applications in which one party is resident overseas;
  • applications in which a landlord is resident in a territory.

Of significance:

  • only natural persons may be residents – that is, corporations cannot be residents;
  • a person’s state of residence is determined at the date a proceeding commences, not at the date of the conduct that led to the dispute or claim.

In Victoria, it should be expected that when VCAT is exercising original jurisdiction, this issue may be raised if a non-Victorian resident is a party.  On the other hand, it is arguable that when VCAT is exercising review jurisdiction conferred by or under an enabling enactment, then the issue may not arise.  This is because an exercise of original jurisdiction may be considered to be a ‘matter’ and an exercise of judicial power.  When VCAT exercises original jurisdiction it ‘discharges a function that resembles the exercise of judicial power by a court’ and it must do so ‘subject to any statutory constrains that are imposed on it’.[6]

Examples of original jurisdiction relevant to planning and environment practitioners and clients include:

  • Requests to amend or cancel a planning permit under s 87 of the Planning & Environment Act 1987 (Vic);
  • Applications for an enforcement order under s 114.[7]

If one of the parties to such a proceeding is resident of a state other than Victoria, then the adjudication of the matter may involve an exercise of Federal judicial power.  VCAT can exercise State judicial power[8] but not Federal judicial power.

Decisions involving the grant or refusal of a planning permit appear more likely to be an administrative decision.

What are the next steps?

At the time of publication, VCAT and SACAT have issued statements on the potential implications of the High Court decision.  It would be prudent to seek legal advice on this issue if you have any doubts about the implications for you or your clients.

[1] [2018] HCA 15

[2] [2018] SACAT 19

[3] At [27]

[4] SACAT, ‘Frequently asked questions about the impact of the decisions in Burns v Corbett and Raschke v Firinauskas´15 June 2018

[5] VCAT, ‘Resolving disputes between residents of different Australian states’ 13 June 2018

[6] Director of Housing v Sudi (2011) 33 VR 559; [2011] VSC 266 at [208] per Weinberg J quoted in E Nekvapil (2017) Pizer’s Annotated VCAT Act p  116

[7] Yarra Ranges Shire Council v Australian Native Landscapes Pty Ltd [2009] VCAT 1025 at [199]

[8] Simpson v Andrew Maynard Architects Pty Ltd  [2014] VSC 365 at [37] – [38]

Review of land use classification in Victoria and South Australia

What is the issue?

Both Victoria and South Australia are undertaking unrelated but concurrent reviews of land use classification:

  • In Victoria, an Advisory Committee appointed under s 151 of the Planning and Environment Act 1987 (Vic) is considering improvements to land use terms and their definitions in Clause 74 of the VPP.
  • In South Australia, a review is being undertaken by the Department of Planning, Transport and Infrastructure into the definitions in the Development Act 1993 and Development Regulations 2008 as part of the process for development of the new Planning and Design Code.

What does it mean for me?

Both processes offer clients in each jurisdiction the opportunity to express their views about the approach to definitions of land use terms.  This can be an important consideration when preparing development proposals, being the difference between permit required, prohibited or permitted use (no permission required).

It has been suggested that the system in SA is tending towards the Victorian model of a uniform code which applies the same definition to land use classification across every municipality in the State.  In Victoria, users of the VPPs will be aware that clause 75 contains a series of nesting diagrams for particular land uses.  For example, the accommodation group spans land uses from camping and caravan park to host farms and retirement village (refer Figure One below).  The application of umbrella terms in the proposed Planning and Design Code under the new Planning Development and Infrastructure Act 2017 (SA) is one of the issues under consideration in SA. At the present time, SA does not apply the nesting diagram technique.

What are the next steps?

If these issues affect you or your clients you should consider making a submission to the relevant body.

  • In Victoria, the Advisory Committee is now seeking input on its discussion paper.

https://engage.vic.gov.au/land-use-terms-advisory-committee

  • In South Australia, you should write to the Engagement, Education and Communications Team, Planning and Development, Development Division, Department of Planning Transport and Infrastructure

DPTI.PlanningEngagement@sa.gov.au

Nesting Diagram for Accommodation Group

Book review: Pizer’s Annotated VCAT Act (6th Edition) by Emrys Nekvapil

I vividly recall the farewell speech given by the author of this book, Emrys Nekvapil, on the occasion of his departure from King & Wood Mallesons.  His farewell speech was a perambulation around questions of administrative law and statutory interpretation.  He was appropriately gifted by friends at the firm with a large tome.

It warmed the cockles of my heart to see my professional friend and colleague Emrys follow in the steps of Jason Pizer as the author of this highly regarded volume on the Victorian Civil and Administrative Tribunal, now in its 6th edition.  In addition to the usual helpful commentary on the machinery of the VCAT , new parts of the text authored by Emrys include:

1 the impact of cases that consider whether the VCAT may exercise the judicial power of the Commonwealth; and

2 whether the VCAT may determine a proceeding between residents of two states.

These and other additions extend the text beyond a go to guide for members of and advocates before the VCAT.  It is now, more than ever, an insightful discourse on legal developments. The author uses plain language.  The book is therefore accessible to the non-lawyer litigant in person (if they can lift it, at 1281 pages).

Having disclosed my conflict of interest, I suggest you purchase a copy of this book for your own library and dive into it on an as needed basis. It offers a practical and deep insight into key issues which are frequently raised at the VCAT.

This Book Review was first published in the Law Institute Journal (May 2018) p39

Planning and environmental law today: The growing impact of global issues of human rights and climate change on planning and environmental law and practice

This is a summary of the 2017 VPELA Barber Lecture delivered by The Hon Michael Kirby AC CMG, former Justice of the High Court of Australia

Introduction

On 28 November 2017, at the second annual Barber Lecture sponsored by URBIS, guests were welcomed by Tamara Brezzi (President, VPELA) and The Hon Michael Kirby was introduced by Adrian Finanzio SC (2006-2017 VPELA board member).  The Hon Michael Kirby paid respect to the first President of VPELA, Peter Barber.

Planning and environmental law

From 1903 to 1976, planning cases were heard by the High Court from time to time prior to amendments to the Judiciary Act 1903 (Cth).  This changed in 1976.  The High Court took command of the decision as to who should come into the High Court by way of special leave application.  As a result, there was a substantial concentration on federal legislation.   This was a pity because town planning is an area of ‘people law’ which affects people as dwellers on this planet.

During his time as President of the Court of Appeal of New South Wales, The Hon Michael Kirby heard and determined a large number of cases.  In those days, he was never in dissent.  Some cases related to the application of environmental law.  In 1996, the Hon Michael Kirby was appointed to the High Court.  During 1997 – 98, IW v City of Perth (1997) 191 CLR 1 was heard by the High Court.  This case concerned a challenge by IW to a decision of the City of Perth to refuse a permit application.  The permit application was made by a group who were trying to set up a drop in centre for a community in Perth who were living with HIV/AIDS.  The Council debate recorded that Councillors did not think these people were appropriate for this city or country and accordingly drop in centres should not be permitted.  The reasoning went that these strange people might infect others and might be using needles. The claim was brought under anti-discrimination law.  The question before the Court was whether Council had refused to deliver a service under a forbidden ground?

The Judges below said yes.  At this time, Denning J had an opinion on the question what does a Council produce?  A Council produces services and those services deliver products which can be judged by law.  The High Court said that Council was not delivering a service, rather they were performing a statutory function which cannot be delivery of a service and therefore the appeal failed.   There were two dissenting judges including Kirby and Toohey JJ.  The dissenters considered that the Council was offering a service consistent with the view of Denning J.

On 25 March 2003, then Chief Justice French gave an address while still in office.  He recounted how as a student at University of Western Australia he gave a lecture against a person who later became the Minister of Town Planning.  In this speech, French CJ said that the impact on town planning included development of the common law and administrative law.   French CJ quoted his colleague who summed up administrative law in 3 words:  lawful, rational and fair.  French CJ added upholding property rights and indigenous land rights to this list.  Converting respect into action and rectification of denial of historical indigenous people’s land rights was important to allow them access to economic means which might have assisted them to avoid socio-economic disadvantage.

International Human Rights Law

On 10 December 1948, the Universal Declaration of Human Rights was adopted.  Mr Evett was then President of the Assembly of the United Nations.  Article 17 as adopted declares that everyone has the right to own property and no one will be arbitrarily deprived of property.  However, that article did not find its way into the international covenants on socio- and economic rights.  Property rights will be respected but in accordance with the general interests – a recognition that these rules would have to bend to conform to the general interest.

Turning to the United Kingdom, in 1998, Blair piloted through the House of Commons and House of Lords the Human Rights Act 1998 (UK) which made the Human Rights Convention of the European Union apply in the UK.  Lawyers had to consider whether there were provisions relevant to town planning.  Article 1 provided a guarantee of peaceful enjoyment of the possessions of a person.  Article 14 made discrimination unlawful.  Article 16 had the effect that for every dispute at law you were entitled to have access to a court and have dispute decided by a court or tribunal that was independent.

After 1998, there were a whole range of cases where assertions were made in the UK that the Human Rights Act 1998 (UK) was relevant to planning cases.  It was then necessary to look at the European Court of Human Rights which also became relevant to Australia especially when we enacted a Charter of Human Rights and Responsibilities Act 2006 (Vic).  The Hon Michael Kirby noted the potential application of planning law to gypsies, also known as the roamer people, who do not wish to settle down in a nice neat council house but to move constantly.  These were the Gypsies Roamer. The Human Rights Act 1998 (UK) stated that the test of proportionality applied in the UK.  This was marginally different to the test of Wednesbury unreasonableness.  The policy may have been to keep judges in their place and avoid interference with jurisdiction.  Wednesbury unreasonableness was effectively a ‘non-irrationality’ principle and a very high hurdle.  This made it almost impossible to challenge on the basis of non-irrationality.  However under the Human Rights Act1998 (UK), the principle of proportionality was applied on the basis that it was ‘substantially the same test’ .

The decision in Lopez Ostra v Spain (European Court of Human Rights, Strasburg, 9 December 1994)  related to a State grant of a subsidy to build a tannery near the applicant’s home.  The Court held that this was a breach of human rights.  Environmental pollution resulting from a tannery may prevent residents from enjoying their homes.  The Court awarded Mrs López Ostra ESP 4,000,000 in pecuniary and non-pecuniary loss.

Climate change

Turning to climate change risks, recent work done by the Centre for Policy Development has looked at whether a company director (or town planner) should or must consider modelling for possible impacts of climate change on issues relevant to the decision of that company director (developer or planning regulator).

A joint legal opinion of Noel Hutley and Sebastian Hartford-Davis considers the question of whether there is a breach of s 180(1) of the Corporations Act 2001 (Cth) if a company director fails to take into account any relevant developments affecting climate change.

The argument runs that climate change risks are capable of representing risks of harm to Australian companies which would be regarded as forseeable, to the extent they intersect with the interests of the company.  Certainly directors are not legally prohibited from considering climate change. To the contrary, it is considered that company directors can and in some circumstances should take into account climate change risks.  Company directors need to form their own assessment as to what if any action is to be taken.  In that scenario, they may attract the protection of the business judgment rule.  In Australia there are stronger reasons for this than other countries because Australia is more exposed to the risks of climate change which if not taken into account may amount to a failure of director’s duties.

The CSIRO and Bureau of Meteorology have observed an increase in average surface temp of 0.9C since 1910.  This is linked to increasingly frequent and intense heatwaves and rainfall events.  Modelling that was undertaken as part of Garnaut Climate Change Review 2011 considered the possible impacts of temperature rise beyond 2°C including:

1) agricultural production in Murray Darling Basin will cease;

2) destruction of the Great Barrier Reef;

3) significant increase in cost of supplying urban water;

4) increase in health-related deaths;

5) sea-level rise beginning to cause major dislocation in coastal megacities of south Asia, south-east Asia and China and displacement of people in islands adjacent to Australia.

If it is the duty of a company director to consider climate change risks in decision-making, then is there also a duty on those who are advising on planning and advising decision makers?  It is unsafe for entities or regulators to ignore risks.  It is better if risks are explicitly considered rather than ignored or neglected.  Modelling the potential impact of climate risks under different scenarios has been conducted.  The impacts of a rise of 2°C is the most important model and will guide the development of much government policy around the world.

In March 2015, The Hon Michael Kirby joined a group of experts which met in Oslo and formulated the Oslo Principles on Global Obligations to Reduce Climate Change (Oslo Principles).  The Oslo Principles were designed to uphold the objects of the Paris Agreement of the Parties to the UN Framework Convention on Climate Change (2015).

On 13 November 2017, a decision was made in a case which concerned a claim brought by a litigant and civil society in Peru in the case of Huaraz, Saul v RWE.  Mr Saul, a farmer in Peru, brought a claim against RWE which is a large corporation in Germany and reported to be the largest emitter of CO2 in Europe.  GermanWatch reports that RWE is responsible for ½ of 1% of global CO2 emissions.  Mr Saul asked RWE to bear the costs of protection measures against a glacial outburst in the Peruvian mountains, part of the South American Andes. He filed the claim in 2015 in the District Court of Essen, Germany under German Civil Code.  The Court held that the house of the claimant would be flooded and therefore held he had standing.  The Court also held that climate change could well be responsible for any such flood but rejected the claim on legal grounds.

An appeal was brought to the Higher Regional Court, Hamm against the negative ruling of the Regional Court, Essen. On 13 November 2017, that Court decided that the appeal at the Higher District Court, Hamm would go to trial and is now scheduled as an oral hearing.

The Hon Michael Kirby noted the similarities between this case and litigation regarding asbestosis and cancers arising from cigarette and tobacco use.  He noted the indication that judges and others making decisions regarding environmental questions in Europe might be more willing to render accountable those who are responsible for wrongs.  The Court will determine whether RWE is liable proportionate to the level of impairment to cover the expenses for appropriate safety precautions to protect claimants property such as Mr Saul from a glacial outbreak.  That is, RWE may be required to share costs for protection measures against climate change.  The purpose of this litigation is to render those accountable for inflicting wrongs against others.  The Hon Michael Kirby noted that the fact this litigation is unfolding in Germany is significant, being a ‘serious rule of law country’.

The evening concluded with a question and answer forum hosted by Adrian Finanzio SC.

Capital value – Vast amounts of surface waste

What is the issue?

The Supreme Court of South Australia has recently clarified that the presence of substantial surface waste on an industrial site will have a negative effect on site value and capital value for the purposes of assessment by the Valuer-General.

What does it mean for me?

Owners of land affected by significant industrial or household waste or contaminated soil and groundwater may refer to the decision of the Justice Parker in Bosnakis v Valuer-General [2017] SASC 158 (3 November 2017) when seeking reassessment of site value or capital value for the purposes of rates notices.

What was decided?

The Court applied the test set down by the High Court in Spencer v The Commonwealth[1] on the proper approach to the meaning of market value.  The test is neatly stated as:

The value of land is the price arrived at by a willing but not anxious buyer negotiating with a willing but not anxious seller, both perfectly acquainted with the land and cognisant of all circumstances which might affect its value.[2]

The evidence established that the land in Para Hills was affected by vast surface debris.  Photographs showed a great variety and volume of waste on the land including tyres, concrete pipes, rubble, a large concrete slab, a septic tank, car parts, white goods, polystyrene foam, pallets, sheets of metal, used oil drums and a fibreglass pool shell.

The appellant’s and the Valuer-General’s expert witnesses agreed that the surface waste would impact upon site value and capital value.  There was a significant difference in capital value, with the Review Valuation being $1,050,000, the Valuer-General’s expert contending for $845,000 and the appellant’s expert arriving at a sum of $625,000,.  The two experts before the Court were agreed that the vast amount of rubbish would have a negative effect on what the hypothetical purchaser would be prepared to pay.

The argument by the Valuer-General that because the surface waste was a chattel, it ought not be taken into account because it was not relevantly ‘in the land’ was rejected by the Court.  The phrase ‘in the land’ was submitted to mean the land including all improvements and fixtures that are part of the land.  While the Court accepted the rubbish items were chattels rather than fixtures, he did not accept that the phrase ‘in the land’ was of assistance and distinguished the authority of CSL Limited v Valuer-General.[3]

The Court adopted the appellant’s site valuation of $416,000 at the valuation date.  The capital value was accordingly $625,000; a reduction of $425,000 from the Review Valuation.

What are the next steps?

Owners of land affected by surface contamination or soil and groundwater contamination should seek advice regarding their options for seeking review of valuations of land advised in rates notices if that notice does not consider the contamination.

[1] (1907) 5 CLR 418, 432 and 441 per Griffith CJ and Isaacs J.

[2] Commonwealth Custodial Services Ltd v Valuer-General [2006] NSWLEC 400, [13]

[3] CSR Limited v Valuer-General (1977) 17 SASR 446, 450, Wells J.

(c) Eliza M Bergin

Liability limited by a scheme approved under professional standards legislation