Posted on September 12, 2016 by Stuart Simington
Challenging the reasonableness of a clean-up notice can be risky business
A director of Sydney Drum Machinery Pty Ltd was charged with the commission of two offences against the provisions of the Protection of the Environment Operations Act 1997 on the basis that the company had, without reasonable excuse, failed to comply with two (2) clean-up notices. In dealing with the charges, the Court had some interesting things to say about the requisite suspicion that the officer must have when issuing such a notice and the extent to which the recipient can treat the direction as unreasonable on the basis of the cost of compliance, financial capacity and more generally the alleged inappropriateness of the direction.
If you want to read them, the lengthy and detailed facts of the case are set out in the judgment at Environment Protection Authority v Sydney Drum Machinery Pty Ltd (No4)  NSWLEC 59. For the purposes of this article it is sufficient to focus on the following.
What is a reasonable suspicion ?
One of the elements of an offence of the failure to comply with a clean-up notice is that at the time of giving the notice, the authority (or more properly, its delegate) must have reasonably suspected that a pollution event has occurred or is occurring.
The Court therefore had to determine in this case whether the officer had a ‘reasonable suspicion’. Craig J followed previous authority in holding that a subjective apprehension or fear is not enough but that a suspicion, short of knowledge or belief of the fact is sufficient if it would have induced such a suspicion in a reasonable person. On the facts of the case, the Court held that the circumstances would have done.
Is the cost of compliance relevant?
The second issue raised was whether the action directed to be taken was unreasonably costly and otherwise unreasonable and the direction therefore invalid.
The defendant argued that when framing a clean-up direction, the officer is obliged to consider the effect that compliance with the direction will have upon the recipient. It was contended that the power to direct clean-up action is limited to action that is reasonably necessary to prevent, minimise, remove, disperse, destroy or mitigate any pollution resulting or likely to result from the pollution incident. The fact that the clean-up action directed by a notice may have such an effect does not justify the imposition of a requirement that goes beyond that which is necessary. If the direction imposes an extremely harsh burden upon the recipient but a different direction would have been sufficient to achieve clean-up action, the imposition of the more burdensome requirement would involve a invalid exercise of power.
Craig J did not accept that the company’s challenge to the validity of the notices based on the nature and cost of the action the company was directed to carry out.
Rather he held that, generally speaking, the courts will not conduct a merits review of the decision made. Indeed, provided the decision to take the action is rationally open, the notice will be reasonable and valid. Nevertheless, in assessing whether the decision to give the direction is unreasonable it is still necessary to do so by reference to the facts and circumstances existing and known to the decision maker at the time.
Craig J held that the financial capacity of the recipient to comply with a notice is generally not relevant to its validity. Indeed, the financial burden would only be relevant to demonstrate that there was an alternate measure which was equally effective in addressing the pollution event at a disproportionately lesser cost. Even then, that would only be a factor in assessing its reasonableness rather than the sole determinant.
Relevance of expert advice
Further as the circumstances in which the clean-up direction power is exercised is often in an emergency, it will often if not usually, require the exercise of the power without the benefit of specialist engineering evidence or upon expert advice directed to competing considerations such as undertaking a cost/benefit analysis of the possible alternatives. Craig J said at :
‘It is a power that allows a range of effectively evaluative considerations made by staff whose function it is to respond to the occurrence of a pollution incident. The decision to be made by reference to the section falls within the prosecutor’s “area of decisional freedom” provided that it is not arbitrary, capricious or without commonsense’.
The case appears to be a sound contribution to the law applying to clean-up notices. The Court has taken an approach which is supportive of good faith and timely decision making. A recipient of a clean-up notice will ignore the contents of a clean-up notice at considerable risk unless the notice is manifestly unreasonable or the person has a separate and reasonable excuse for non-compliance.