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Insights | Planning and Environment Law

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Insights | Civil Action and Contaminated Land

June 2018 | by Felicity Niemann & Alison Brookman

  • Council costs claimed from the polluter
  • How to prove the amount claimed
  • No final decision yet on the substantive case

An interesting case is unfolding in the Environment Resources and Development Court which illustrates some of the issues that may arise for local government, landowners and developers where contamination has been found to exist.

The Corporation of the City of Campbelltown v Caltex Petroleum Pty Ltd [2018] SAERDC 12.

Both parties applied to the court for orders for production of documents. The substantive proceedings are still before the Court and have not yet been concluded.

Facts  

The council's leisure centre has been operating at the same site since the 1970s, it was upgraded in the 2000s which included construction of 2 indoor pools.

A creek and the River Torrens are located nearby.

The Caltex petrol station on Lower North East Rd, generally opposite the council land, has operated since the 1960s.

Underground tanks at the Caltex site leaked into the groundwater and a hydrocarbon plume in the groundwater migrated under the council land.

Using powers under section 104 of the Environment Protection Act 1993, the council claims that it suffered loss and damage to its property in mitigating the environmental harm caused by the hydrcarbon plume.

Civil remedies may be sought by any person or a public authority under this provision of the Act where costs or expenses have been incurred in taking action to prevent or mitigate environmental harm. The council says that it was necessary to take a precautionary approach to the design and construction of the pools, and to continue monitoring the contamination. Additional costs were incurred over and above those it would have, had there been no contamination.

Caltex says that the money spent or incurred by the council was not incurred to 'prevent or mitigate' the contamination and that it was not reasonably incurred, and so could not be recovered.

Court Applications 

The council sought production of accounts and invoices of Caltex in relation to investigations and reports regarding its site

  • documents may be required to be produced if they are 'directly relevant' to a matter in issue
  • the court found these accounts and invoices were not directly relevant to the question whether the council's decision and the costs incurred were reasonable

Caltex sought production of non-litigious legal advice given to the council regarding the contamination

  •  the council sought to recover the costs of such advice and so it was argued that privilege had been waived
  •  the court decided that the council had not put the advice received in issue

Both parties' interlocutory applications were dismissed, while the substantive proceedings are expected to continue.

In the event that the matter proceeds to a hearing, the Court will likely make a decision on the question of the council's entitlement to damages, under this rarely utilised provision of the Act.

Lessons learnt?  

Councils should not overlook the possibility of seeking civil remedies when taking action to prevent or mitigate environmental harm. Business operators and land owners should also be aware of these provisions where environmental harm could occur. 

For further information in relation to contaminated land issues please call (08) 8235 3007 to speak to one of our specialist practitioners.  

Disclaimer

The content of this newsletter is for general information purposes only and should in no way be treated as formal legal advice.