Posted on June 28, 2023 by Stuart Simington and Emma Wei 11

Environment protection licence refused despite general terms of approval

The Land and Environment Court recently handed down a decision dealing with the interrelation between the integrated development regime established under Div 4.8 of the Environmental Planning and Assessment Act 1975 (EP&A Act) and the regime for the provision of environment protection licences which may be issued under Chapter 3 of the Protection of the Environment and Administration Act 1997 (POEO Act).

The Court determined that as the power to grant consent under the EP&A Act and the power to grant an environmental protection licence under the POEO Act are separate and distinct exercises of power, development consent for an integrated development did not necessarily compel the EPA to grant a licence.

Facts

The case concerned an application made by Crush and Haul Pty Limited (the applicant) to the EPA (the respondent) in 2022 for an environment protection licence under s 53 of the POEO Act to carry out extractive activities at a quarry.

Development consent for the quarry to carry out these activities had already been granted by the Northern Regional Planning Panel in 2020 to a separate entity, Rixa.

The development, as integrated development, caused the EPA to grant general terms of approval prior to the final determination of the planning panel. The EPA granted these general terms but did not grant Rixa the environment protection licence required to carry out the extractive activities which the POEO Act provided was conditional upon Rixa being a ‘fit and proper person’ under s 45(f) .

The EPA later issued a notice of intention to refuse Crush and Haul’s application for an environment protection licence on the basis that Crush and Haul was not a fit and proper person. Whilst that application had not been finally determined, given 60 days had passed since its lodgment, the EPA was deemed to have refused it.

Issue

The applicant sought a declaration by the Court that the EPA was required, by operation of s 4.50(1) in Div 4.8 “Integrated Development” of the EP&A Act, to issue an environment protection licence.

That section seeks to provide greater certainty for applicants by reducing the duplication of approval processes through requiring an approval body, who has granted general terms of approval, to issue subsequent approvals consistent with the consent granted to the integrated development. It does so by proscribing that:

(1) Despite any other Act or law, an approval body must, in respect of integrated development for which development consent has been granted following the provision by the approval body of the general terms of the approval proposed to be granted by the approval body in relation to the development, grant approval to any application for approval that is made within 3 years after the date on which the development consent is granted if, within that 3-year period, the development consent has not lapsed or been revoked.

Yet, in regard to the provision of environment protection licences under the POEO act, s 7(2) of the that Act outlines that:

(a) this Act prevails over any other Act or statutory rule to the extent of any inconsistency

The proceedings centred on whether the words “despite any other Act or law” in s 4.50(1) overrode the provisions in Chapter 3 of the POEO Act governing the decision-making process in relation to applications for licences.

Submissions

The applicant submitted that the overarching purpose of the integrated development regime under Div 4.8 of the EP&A Act was to ensure consistency between that Act and other statutory regimes, so as to create certainty for proponents by establishing a “one stop shop” whereby all necessary assessments are undertaken at the time development consent is determined.

It was argued that this certainty was achieved through compelling approval bodies to approve any subsequent applications under s 4.50(1). As a result, the applicant submitted that the EPA was under an obligation to grant the environment protection licence and was not permitted to reassess the matter.

The respondent argued that as the POEO Act commenced a year later than the EP&A Act, any inconsistency between the two Acts should be resolved according to s 7(2) of the POEO Act. The Respondent also argued that it could not be bound by s 4.50(1) as the applicant of the licence was a different entity to the one which obtained development consent.

In response, the applicant argued the term “despite any other Act or law” in s 4.50 of the EP&A Act applied to any provision, regardless of whether it that preceded or post-dated EP&A Act, and emphasised that the term “any application” in s 4.50(1) ensured it applied irrespective of whether the entity that made the application was the same one that received development consent.

Findings

Pritchard J rejected the applicant’s construction of s 4.50(1), and instead agreed with the respondent that the EP&A Act should be read subject to the POEO Act. It was also held that there was no requirement to issue a licence given the applicant was a different entity to the one that was granted development consent.

Pritchard J explained that the construction offered by the applicant would render the power to issue licences under the POEO Act nugatory, which would ultimately run counter to the objects of the Act. Notably s 51(2) of the POEO act provides that:

(2) A decision by the appropriate regulatory authority on whether it will issue a licence, or on the general terms of a licence it proposes to issue, in relation to integrated development is subject to the provisions of this Chapter (including section 45).

Accordingly, Pritchard J held that by compelling the EPA to issue a licence, there would be no scope for the EPA to exercise the discretion granted under the POEO Act, nor comply with its concomitant obligation to consider whether the applicant is a fit and proper person under s 45(f).

Rather, Her Honour found that the power to grant development consent to an integrated development and the power to issue a licence were separate and distinct exercises of power, and not part of a “one stop shop” as argued by the applicant.

Conclusion

If development consent for an integrated development is obtained, this does not necessarily mean that an environment protection licence will be granted.

You can read the decision here: Crush and Haul Pty Limited v Environment Protection Authority [2023] NSWLEC 60.

If you have any questions about this blog post, please leave a comment below or contact Stuart Simington on 02 8235 9704 or Emma Wei on  02 8235 9725.

UPDATE: Since the posting of the blog, Crush and Haul Pty Ltd has successfully appealed the EPA’s decision to refuse the issuing of the environment protection licence. The Commissioner granted the licence satisfied that Crush and Haul Pty Ltd was a fit and proper person under s 83 of the Protection of the Environment and Operations Act 1997. The full judgment of the Class 1 appeal can be found here.