A NSW Court has found a company and its directors guilty
of giving the Environment Protection Authority misleading
information in its Annual Return, sending a powerful message that
information given to the EPA must not be false or
The decision in EPA v Wyanga Holdings; EPA v Cauchi 
NSWLEC 68 demonstrates the importance for EPA licence holders, and
anyone else who provides information to the EPA, of ensuring that
the information they provide to the EPA is not false or misleading,
not only in what it says but what it doesn't say.
A problem with the Annual Return
Wyanga Holdings operated a quarry on the NSW north coast. Its
EPA licence for the quarry specified a maximum annual extraction
limit of 50,000 tonnes. However, the evidence indicated that Wyanga
extracted almost twice that amount in the relevant year.
Wyanga's EPA licence contained a standard condition
requiring it to provide an Annual Return, in a form provided by the
EPA. That form included a "statement of compliance" with
the EPA licence conditions and a certification of the
"statement of compliance". Wyanga acknowledged in its
Annual Return that it had not complied with two conditions of the
EPA licence but did not refer to the extraction limit condition.
Its directors signed the certification.
The Court found that the information in the Annual Return was
misleading in a material respect, because it did not refer to the
exceedance of the extraction limit.
Prosecution of the more significant offence
The EPA prosecuted the corporate licence holder and each of its
two directors with the offence of providing false or misleading
information under an EPA licence condition, under section 66(2) of
the Protection of the Environment Operations Act 1997 (POEO Act),
instead of the lesser offence of certifying a statement which is
false or misleading, under section 66(4) of the POEO Act.
This is important because the offence under section 66(2)
carries a much higher maximum penalty ($1 million for a corporation
and $250,000 for an individual) than the offence under section
66(4) ($250,000 for a corporation and $120,000 for an
The defendants argued that the appropriate offence was the
lesser offence under section 66(4), and that the offence under
section 66(2) applies only to the provision of monitoring
information. However, the Court held that the section 66(2) offence
can relate to any information provided under an EPA licence
condition, and it found each of the defendants guilty of that
A sentencing hearing is scheduled for next month.
Key lessons from the case
The case is another indication that the EPA is prepared to take
strong action against a person it believes has provided false or
misleading information, and to hold individual directors
responsible for the actions of a company. The POEO Act also allows
the EPA to prosecute individuals involved in the management of a
company, and it has done so on previous occasions. Although the
defendant in this case is a small company, the risk for directors
and managers applies to all companies.
It also highlights the scrutiny which the EPA will apply to an
EPA licence holder's Annual Returns.
Standard EPA licence conditions require licence holders to
provide information to the EPA in a variety of situations,
including a pollution incident, so licence holders should be
careful about the information they provide to the EPA in all of
Directors and managers of companies which hold EPA licences, and
all companies involved in environmentally sensitive activities,
should ensure they have robust systems in place to collate and
check information which is provided to the EPA. These systems
should be backed by a sound understanding of legal compliance
risks, and good training and internal audit programs.
Clayton Utz communications are intended to provide
commentary and general information. They should not be relied upon
as legal advice. Formal legal advice should be sought in particular
transactions or on matters of interest arising from this bulletin.
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