Posted on April 4, 2017 by Carlo Zoppo

An unreasonable time for compliance may provide a ‘reasonable excuse’

The recent decision of the Land and Environment Court of NSW (LEC) in Council of the City of Sydney v Blue Chips Franchise Pty Ltd [2017] NSWLEC 24,  sheds some light on what constitutes a “reasonable excuse” for failing to comply with a requirement under Division 1C of Part 6 of the Environmental Planning and Assessment Act (EPA Act).

The proceedings before the LEC arose from a company’s failure to comply with an investigation officer’s oral requirement under s119M(1) of the EPA Act. The charge of failing to comply with a requirement was dismissed in the Local Court and the Council lodged an appeal to the LEC alleging errors of law on the part of the Local Court magistrate.

Facts

  • On 20 August 2015, an investigation officer of the Council of the City of Sydney (the Council) lawfully entered the premises of Blue Chips Franchise Pty Ltd (Blue Chips).
  • The council officer gave an oral direction under s119K to the employees and the sole director of Blue Chips to immediately produce “all documents” relating to 33 apartments.
  • Blue Chips failed to comply with the direction as it only provided documents relating to 1 of the 33 apartments.
  • Blue Chips was subsequently charged with an offence under s119M(1) for failing to comply with a requirement and during the hearing in the Local Court, the company raised the defence of “reasonable excuse”.
  • Blue Chips  argued that it had a reasonable excuse for failing to comply with the requirement as Council allowed insufficient time to comply with the requirement.

Local Court

In the Local Court the magistrate found that while the Prosecution had proven all the elements of the offence, Blue Chips had proven on the balance of probabilities that the Company had a reasonable excuse for failing to comply with the requirement made by the Council officer.

Accordingly the charge against Blue Chips was dismissed

Appeal to the LEC

The Council lodged an appeal under s42(2B)(b) of the Crimes (Appeal and Review) Act 2001 alleging the following two errors of law:

Ground 1 

Whilst the parties agreed (in the LEC) that Blue Chips bore the legal onus of proving that it had a reasonable excuse, the Council contended that the magistrate had erred in its construction of s119M(1) of the EPA by imposing a requirement on the Council to negative the defence to a criminal standard.

This was found in a statement where the magistrate stated:

Therefore, I am satisfied that the defence bears the onus of proving, on the balance of probability, that there was a reasonable excuse for the failure to not [sic] comply with it and then, thereafter, the prosecution has to negative it to the criminal standard.

In its finding the magistrate also found:

.. that the council has failed to prove beyond reasonable doubt that Blue Chips did, without reasonable excuse, fail to comply with a requirement made of the person by an investigation officer in accordance with Div 1C Pt 6 of the Act

Quite reasonably the Council argued that the magistrate had erred by finding that the Council had to negative the defence to a criminal standard to succeed in the prosecution.

The Chief Judge reviewed the whole of the judgement and held that the magistrate had previously accepted Council’s argument that the defendant bore the onus to prove on balance a reasonable excuse.

Preston CJ found that while the final statement of the magistrate was confusing, on a fair reading of the magistrate’s reasons as a whole, it was clear that the magistrate had properly found that the defendant bore the legal onus of proving, on the balance of probabilities, that there was a reasonable excuse. The Chief Judge Preston rejected this ground.

Ground 2

The Council submitted that the magistrate erred in concluding that Blue Chips had established the defence of reasonable excuse where there was no evidence on which the magistrate could have found that there was a reasonable excuse.  Council argued that Blue Chips did not provide any evidence to support that they were given “insufficient time” to produce all the documents.

Blue Chips submitted that the Council’s argument should be rejected, as there was evidence capable of supporting an inference that Blue Chips could not reasonable comply given the immediacy of the requirement for a response, namely:

  • The Council visit on 20 August was unannounced.
  • Blue Chips did produce some documentation.
  • The director of Blue Chips never said he could not produce the documents, rather, that he could not do it within the time frame required.

The Chief Judge held that the Council had not established that the magistrate had fallen into error as there was some evidence on which the magistrate could have arrived at the conclusion.The Chief Judge rejected the second ground of the appeal.

Take Away Message

In this investigation, the investigation officer attended unannounced and required “all documents” relating to 33 apartments. He required the immediate production of the documents despite a request by the recipient for further time.

The manner in which the direction was given, including the scope and width of the request (‘all documents’) and the time provided to respond, allowed Blue Chips to successfully argue that it had a reasonable excuse to fail to comply with the requirement.

While the expression ‘reasonable excuse’ is not defined in the EPA Act, this case clearly demonstrates that the following matters will be relevant to considering whether the recipient of a a direction may be able to establish a reasonable excuse:

  • Size, scope and volume of request.
  • Accessibility of the documents or information.
  • Time provided for the response.

Its fair to say that any investigation officer who exercises powers to compel a person, must do so reasonably. While this blog is written on the basis of the published judgement, it seems that this matter could have been avoided by simply allowing more time for compliance.

This article was prepared with the assistance of Sophie Hale

Should you require advice regarding the powers of investigation officers please contact Carlo Zoppo, Partner on carlo.zoppo@lindsaytaylorlawyers.com.au or 8235  9705.