Executive officer and company fined for breaches of the EP Act

Under the Environmental Protection Act 1994 (EP Act), it is an offence to breach a condition of an environmental authority (EA). Where an offence is committed by a corporation, executive officers of the corporation also commit an offence of failing to ensure the corporation complies with the EP Act.

As is demonstrated by the following, executive officers can personally incur substantial penalties where the corporations they control do not comply with the EP Act.

Breach of EA

Dianne Mining Corporation Pty Ltd (Dianne Mining) held an EA under the EP Act in respect of a copper mine known as the Dianne Mine in Far North Queensland. The Dianne Mine is an underground and open-cut copper mine that operated from the late 1970s until 1982.

Dianne Mining assumed control of the mine site in 2008 which has been in care and maintenance since its closure in 1982. Although the mine was not operational, it continued to be subject to an EA that imposed various obligations on the EA holder.

Following inspections of the mine site by departmental officers in 2016, a number of breaches of conditions of the EA were identified. These included:

• no measures were in place to contain seepage of contaminated leachate from a catch dam;

• a release of contaminated water into an adjacent creek; and

• water samples containing high levels of contaminants in excess of those permitted under the EA.

The company had also failed to provide financial assurance in the amount of $1.1 million, failed to provide environmental reports to the department and had failed to progressively rehabilitate the mine site.

Prosecution

The company was prosecuted by the department for six offences of wilfully contravening a condition of an EA contrary to section 430(3) of the EP Act. The department also prosecuted the executive officer of the company for six offences of failing to ensure that the company complied with the EP Act.

Both the company and the executive offer pleaded guilty to the offences in the Cairns Magistrate Court.

Penalty

The company was fined $250,000 and ordered to pay $2,000 investigation costs and $1,500 legal costs. A conviction was recorded.

The executive officer was personally fined $50,000.

Key takeaway

Executive officers of companies can be personally prosecuted and fined for failing to ensure that companies comply with the EP Act. Executive officers therefore need to take care to ensure that companies comply with their obligations under the EP Act, including conditions of an EA.

Authored by:
Stafford Hopewell, Partner
Sarah Day, Associate