EDO NSW case “epitomises” public interest litigation

ELAINE JOHNSON*

The Land and Environment Court has found that a case brought by EDO NSW on behalf of the Fullerton Cove Residents Action Group to protect the environment “epitomises the very concept of litigation properly brought in the public interest.” 

The Court ordered that, even though they lost the case, the residents should not have to pay the legal costs of the Department of Trade & Investment. The Court also ordered the Department to pay the legal costs of the residents group in disputing the costs of the court case.

What was the case about?
The residents group had challenged an approval of a CSG pilot project located on a floodplain, adjacent to an internationally-listed wetland, with wells that will continuously extract gas and water from depths of 800-900 meters for at least 12 months.

The residents went to Court because they were concerned that there had been no groundwater assessment, and a full Environmental Impact Statement should have been prepared to assess impacts on biodiversity and groundwater.

In March this year, the Court dismissed the residents group’s case, finding that the groundwater and biodiversity assessments met the standards set by our planning laws. After judgment, the Department pursued the residents for its legal costs. The CSG company, Dart Energy, did not.

What did the Court say about costs?
The Court ordered that because the residents group’s case was genuine public interest litigation, it should not have to pay the legal costs of the Department in responding to its appeal.

During the hearing on costs, the Department argued that the residents weren’t really concerned about the environment, they just wanted to stop the development at Fullerton Cove.

The Department extensively cross-examined both the residents group and EDO NSW about the residents’ motivations in bringing the case. However, according to the judge, the cross-examination “only served to reinforce the genuineness of Fullerton’s contention that it had commenced the litigation in the public interest in order to protect Fullerton Cove from what it perceived to be an inadequate assessment of the potential adverse consequences of coal seam gas exploration in that environmentally sensitive area.”

The Court also rejected the Department’s arguments that the case didn’t raise any new points of law and had little merit. Instead, the judge found that “not only did the litigation raise one or more novel issues of general importance, but that the litigation has contributed in a material way to the proper understanding, development and administration of the law.”

The Court also ordered that the Department pay the residents group’s own legal costs of having to dispute the costs of the litigation.

EDO NSW had written to the Department on a number of occasions, urging it to accept that the resident group’s case was public interest litigation. On each occasion, the Department declined the group’s offers.  The judge described the Department’s responses as, “for a model litigant, less than fulsome and unhelpful in the circumstances.”  The Department must now pay the residents group’s costs of arguing the point.

Why do we have special rules for public interest cases?
The Land and Environment Court has special rules in place which are designed to facilitate access to justice in exactly these kinds of cases. If a case is genuinely brought in the public interest, the person bringing the case should not be punished with a costs order simply because they lost.

If the law were to allow the general public to be frightened away from the Courts by the prospect of adverse costs orders worth tens of thousands of dollars, there would be little point in allowing those people access to justice in the first place.  As Justice Biscoe of the Land and Environment Court said recently in another public interest case (Friends of King Edward Park v Newcastle City Council):

“There is little point in the legislature opening the door to public participation in this way if the doorway is then blocked by a menacing costs hound which threatens to savage the responsible public interest litigant who dares to enter and loses.”

*Elaine Johnson is a Senior Solicitor at EDO NSW.

EPA requires BHP to stop polluting the George’s River

ELAINE JOHNSON*

Nine months after Macarthur Bushwalkers filed its case against BHP seeking orders to stop alleged pollution of the Georges River in the Illawarra, the NSW Environment Protection Authority (EPA) has required BHP to implement a program of works to protect this valuable river system.

While the Court case has been stalled pending the EPA’s decision, the notice issued to BHP by the EPA just before Anzac Day is a great outcome for the community and the environment, in more ways than one. Not only has the EPA decided that BHP must stop polluting, but in the process, the EPA actively engaged with the public, seeking written submissions and meeting with community representatives face to face.

The litigation
EDO NSW filed the case against Endeavour Coal and Illawarra Coal Holdings, subsidiaries of BHP Billiton, on behalf of the Macarthur Bushwalking and Cycling Club (MBCC). Illawarra Coal owns and operates BHP’s underground coal mine West Cliff Colliery, near Appin, and Endeavour Coal holds the environment protection licence for the mine.

MBCC brought the litigation because the community was concerned that a range of chemical toxicants including arsenic, zinc, copper, aluminium and nickel were being discharged into the Georges River from the West Cliff Colliery via Brennans Creek at levels well above the Australian and New Zealand Environment Conservation Council (ANZECC) Guidelines for healthy river systems.

The Georges River is vitally important to the Botany Bay Catchment. Its headwaters are located 60km south-west of Sydney in the town of Appin, and the river flows past BHP’s West Cliff Colliery, north towards Liverpool, then east towards Sydney before discharging into Botany Bay.

MBCC alleged that pollution from BHP’s mine had been discharged into the Georges River via Brennans Creek for more than 10 years, since January 2002. MBCC argued that the pollution wasn’t authorised by BHP’s environment protection licence, and was therefore in breach of the Protection of the Environment Operations Act 1997 which prohibits the pollution of waters.

The EPA’s decision
Just ten days after the case was filed in Court, the EPA issued a media release advising that it was looking to place limits on BHP’s licence with respect to salt and metals being discharged into Brennans Creek. This was formalised in September 2012, when BHP applied to vary its licence seeking limits for a number of key pollutants alleged in this case including aluminium, nickel, zinc, copper, arsenic, lead and salinity. BHP’s licence variation application, if granted, would effectively authorise much of the pollution alleged in the Court case. This meant that MBCC’s case was put on hold while the EPA made its decision.

After nine months of consultations and negotiations with BHP and the community, on 24 April 2013 the EPA determined BHP’s application by issuing a licence variation notice which sets limits for a range of pollutants including those alleged in MBCC’s case. In other words, the notice authorises that pollution. Because of this, MBCC’s case may not be able to continue.

However, the EPA also took the important step of requiring BHP to stop polluting. Under its licence, BHP is now required to carry out a program of works to achieve 95% species protection in Brennans Creek and the Georges River by December 2016. The EPA has also required ongoing monitoring of ecological impacts during this period while the works are being constructed.

The EPA’s notice states that the requirement that BHP stop polluting is to ‘ensure that measures are taken to protect the environment from harm’, and ‘to protect or restore the environmental values’ of Brennans Creek and the Georges River affected by the discharge that has already occurred. This is in effect one of the key remedies that MBCC was seeking through the Court case – orders to stop the alleged pollution – and as such represents a win for the community.

Community participation in pollution licensing – a precedent
Aside from the environmental outcomes achieved, it is important to consider the way in which the EPA came to its decision in this case.

Traditionally, licensing decisions have been made between the regulator and the licensee, with little (if any) public involvement. However, in this case, the EPA consulted with the public on BHP’s application, accepting public submissions, and meeting with community representatives to hear their views and receive advice from independent experts.

The EPA’s decision to involve the public in this licensing process serves as a valuable precedent for other licensing decisions, particularly where there are real concerns about actual or potential environmental harm, as was the case here. In this case, submissions made to the EPA included independent expert reports containing the results of water monitoring, assessment of ecological impacts and feasible treatment options. This case demonstrates the public’s ability to constructively contribute to licensing processes, and should encourage the EPA to open up its doors to the community when major decisions are being made about how to deal with pollution.

*Elaine Johnson is a Solicitor at EDO NSW

Image: Woolwash by Ken Hall, Australian Photography Tours (copyright)
Woolwash by Ken Hall, Australian Photography Tours (copyright)

Court applies fresh approach to weighing of economic, social and environmental impacts

NATASHA HAMMOND-DEAKIN*

Last week Preston CJ, Chief Judge of the Land and Environment Court handed down a significant judgment on a coal mine extension project. Warkworth Mining Limited, a subsidiary of Rio Tinto, had been granted approval to expand its coal mining operations near the small village of Bulga. The Court’s decision to overturn this approval has attracted considerable attention and concern about its implications.

The case
The Warkworth mine had previously been expanded in 2003. As part of that expansion approval, Warkworth agreed to protect a significant local landform, Saddleback Ridge, which provides a buffer between Bulga village and the mine. Warkworth had also agreed to protect significant remnant vegetation including endangered ecological communities in perpetuity.

In 2009 Warkworth sought approval for a further extension. That extension, which was ultimately challenged by the Bulga Milbrodale Progress Association (the Association) in Bulga Milbrodale Progress Association Inc v Minister for Planning and Infrastructure and Warkworth Mining Limited, would result in the closure and excavation of Wallaby Scrub Road, the clearing of approximately 766 ha of four types of endangered ecological communities protected under threatened species legislation, and the removal of Saddleback Ridge. This extension was approved by the Planning Assessment Commission under delegation from the Planning Minister in 2012. However, following the Association’s challenge, the Court overturned this approval, disapproving the extension due to its significant and adverse impacts on biological diversity, and the adverse noise, dust and social impacts on Bulga.

A polycentric problem
The Court has brought a fresh perspective to the fraught process for decision makers of assessing and determining a project application. The Court stated that the range of interests affected, and the complexity and interdependence of the issues means that decision-making involves a polycentric problem, or a complex network of relationships with interacting points of influence. The resolution of one issue will have repercussions on the other issues, and the other issues may change in nature and scope depending on how the first issue is resolved. This means that the decision maker must determine the relevant matters to be considered in deciding whether or not to approve the project, and also subjectively determine the weight to be given to each matter and balance those weighted matters.

Weighing economic considerations
The Court has analysed for the first time the economic modelling and evidence put forward in support of a large mine. The Court criticised elements of Warkworth’s modelling, in particular Warkworth’s attempt to put a value on non-market elements such as endangered ecological communities and social impacts. The Court stated that economic analysis, such as a cost benefit analysis, is of limited assistance to the decision making process here, which requires consideration and balancing of economic, environmental and social factors. Ultimately the Court found that the economic benefits of the mine were outweighed by the negative impacts on social and environmental factors.

Like-for-like required for biodiversity offsets
The Court has applied NSW government guidelines requiring biodiversity offsets to provide flora and fauna species that are ‘like-for-like’, in that the offset must protect the same species that are being impacted by the development. This is in contrast to the approach increasingly taken by government in accepting biodiversity offsets that do not require such a high standard of protection for threatened species.

Social impacts of open cut coal mines
The Court has for the first time recognised the detrimental social impacts of the noise and dust conditions routinely imposed by the Minister to mitigate the impacts of large mines, in particular conditions providing for the acquisition of properties in the ‘zone of affectation’ most impacted by noise and dust.

What does this mean for future decisions?
This case may prove to have profound implications for the assessment of major developments, and no doubt will be scrutinised closely by industry and lawyers alike. In particular, it is likely that the case will transform the approach taken to, and methodology underpinning, the economic assessment of major projects.

N.B. Warkworth has appealed the Court’s decision.

*Natasha Hammond-Deakin is a Senior Solicitor at EDO NSW

Image by Stephen Bell.
Warkworth by Stephen Bell

Fullerton Cove judgment highlights need for CSG law reform

ELAINE JOHNSON*

Just before the Easter long weekend, the Land and Environment Court dismissed a case brought by residents against Dart Energy’s coal seam gas pilot project in Fullerton Cove near Newcastle. The Court lifted an injunction on drilling that had been in place since September last year, allowing Dart to proceed with drilling their wells. However, five days later, Dart announced that it would suspend its project due to proposed new controls for CSG at State and Federal levels, including the NSW Government’s recent restriction on CSG within 2km of residential areas, and the Commonwealth’s EPBC Act water trigger.

The case
The Fullerton Cove Residents Action Group (FCRAG) brought the case because they were concerned that the Department of Trade and Investment did not consider any groundwater assessment before granting approval for the project. The project site is located on a floodplain, and includes 12 months of continuous gas and water extraction from CSG wells drilled to depths of 800-900 metres.

FCRAG were also concerned that there had not been proper assessment of ecological impacts, given the site is next to the Hunter Estuary Reserve, an internationally listed wetland which is home to many migratory birds. They also argued that a full Environmental Impact Statement (EIS) was required, including mandatory public consultation, which had not been prepared for Dart’s project.

In September 2012, the Court granted an interim injunction against Dart Energy stopping it from drilling the gas wells until the full case was determined. It was the first injunction granted against a CSG company by the NSW Land and Environment Court.

The main case, decided on 28 March 2013, tested the rigour of the assessment process under Part 5 of the Environmental Planning and Assessment Act 1979 (NSW) (EPA Act) for CSG pilot production.

What the Court said
The Court found that the requirement under Part 5 of the EPA Act for the Department to consider environmental effects of the CSG pilot project ‘to the fullest extent possible’ did not include consideration of a groundwater assessment. This was despite the fact that the pilot project included 12 months continuous gas and water extraction, with an option to extend to 2 years.

Justice Pepper found that the Department’s failure to obtain or consider any groundwater assessment before approving the pilot project under Part 5 of the EPA Act did not amount to legal error. In making this finding, her Honour took into account several factors, including that it was a pilot project only, and that the Department had knowledge of the geology of the area generally.

The Court also found that even though no ‘7-part test’ for threatened species and ecological communities was carried out, it was sufficient for the Department to have ‘general regard’ to the 7-part test for threatened species.

Finally, the Court found that this pilot project was not likely to have a significant effect on the environment and therefore no EIS was required.

What does this decision mean for other CSG projects?
Pilot production can have the same kinds of environmental effects as full-scale production, albeit on a smaller scale. The Court’s finding in this case highlights significant problems with leaving the assessment of those impacts up to Part 5 of the EPA Act for CSG pilot projects. This is particularly problematic because most CSG exploration (including pilot production) involving five or fewer wells is assessed under Part 5.

In this case, Dart gained approval for 12 months’ continuous gas and water extraction, with an option to extend up to two years. The Court’s finding that no groundwater assessment is required by Part 5 in such circumstances is significant. It raises serious questions about the effectiveness of the EPA Act in protecting groundwater resources when it comes to CSG pilot production.

The project site is next to the Hunter Estuary Reserve, home to many protected migratory birds, and contained identified endangered ecological communities. The Court’s further finding that it wasn’t necessary for 7-part tests to be carried out for those species and communities also highlights serious deficiencies in the Part 5 environmental assessment process for biodiversity.

The judgment confirms that Part 5 of the EPA Act is unable to properly deal with assessment of CSG pilot projects, particularly when it comes to groundwater. If CSG pilot production can be approved under Part 5 without a groundwater study, it is difficult to see how the community can have any confidence that groundwater impacts are being rigorously assessed, or indeed at all. It is important that the new planning system addresses these deficiencies.

*Elaine Johnson is a Solicitor at EDO NSW

Image: Tawny Sunrise by Su Walker

Image,

The limits of adaptive management

KIRSTY RUDDOCK*

Last week the Land and Environment Court applied the precautionary principle and refused a mining project that provided insufficient information in its environmental assessment about the impacts of the mine on groundwater and surface water. The case sets an important benchmark in environmental decision making that can now be applied to all planning decisions.

The case
In SHCAG Pty Ltd v Minister for Planning and Infrastructure and Boral Cement Ltd [2013] NSWLEC 1031, Commissioner O’Neill and Acting Commissioner Adam refused the continued operation of the Berrima Colliery. The expansion application sought to double the output from the Berrima Colliery to 440,000 tonnes per year and allow continued operation for eight years. Southern Highlands Coal Action Group (SHCAG) argued that Boral did not adequately consider the impact the project would have on the local groundwater resources, groundwater biodiversity, and the Wingecarribee River in preparing its environmental assessment, and that the impacts of the project on groundwater, groundwater ecologies, and surface water pollution are inconsistent with the principles of Ecologically Sustainable Development, the Wingecarribee Local Environmental Plan, and State Environmental Planning Policy (Sydney Drinking Water Catchment).

The consequences
As a result of the decision Boral will not be able to continue the operations until they submit and have approved a further Environmental Assessment. While this will have a significant impact on their operations, it emphasises the importance of ensuring detailed environmental assessments and baseline monitoring are completed prior to seeking approval for a mining project.

The precedent
The Court stressed that the preparation of a management plan as a condition of consent is not a panacea to overcome the necessity to consider all of the environmental impacts of a proposal. In this case there was an absence of monitoring data to calibrate and confirm Boral’s assumptions and therefore the Planning Assessment Commission had not considered all of the impacts and the means of controlling them. The Court was therefore satisfied that the precautionary principle is activated and that the Boral had not established that its activities would not cause harm to the environment. The Court also found that they could not determine appropriate conditions to address these impacts as there was not adequate information before them to allow for the imposition of clear limits in the approval that can be adaptively managed to ensure they are met. Adaptive management requires precise limits on the cumulative operations of the colliery which the evidence showed did not exist in the Water Management Plan.

Importantly the Court also found it was required to assess not only the new impacts but the continued impacts of dewatering over the whole mine workings. This was important here as some of the impacts related to the previous mining activities, and the mine had argued that only the new impacts should be considered.

The Court also found the residents had valid concerns about noise dust and safety impacts on the Medway Road through Medway village. They found the road was unsuitable for 132 truck movements per day and the haulage road needed to avoid the village.

EDO NSW perspective
The Court has not in recent years applied the precautionary principle to refuse a mining operation. The case is important in strengthening the environmental standards that apply to environmental assessment. It has also set limits on the use of adaptive management, so that it cannot be used to overcome the deficiencies in Environmental Assessments.  This will ensure that the onus is on companies to show through baseline monitoring and other assessments that their project is not likely to cause environmental harm.

Our conclusion
The case will be useful for all communities affected by mining and will provide guidance  to people making submissions on environmental assessments.

*Kirsty Ruddock is the Principal Solicitor at EDO NSW

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