Victoria's 'general environmental duty': What is it, and what can I do about it?

In brief

The recently passed Environment Protection Amendment Act 2018 will transform Victoria's environmental protection law, including by introducing a general environmental duty requiring all Victorian businesses, industry and community members to prevent and minimise environmental harm as far as reasonably practicable. Partner Jillian Button, Associate Isabella Kelly, and Paralegal Simon Chiarelli provide an overview of key concepts underpinning the general environmental duty and its enforcement.

The GED

The recently passed Environment Protection Amendment Act 2018 (EPA Act) will amend the Environment Protection Act 2017 (EP Act) and repeal the Environment Protection Act 1970. It heralds a new era of environmental regulation in Victoria, establishing a scheme that places an increased onus on organisations to proactively address and minimise their environmental impact.

The new general environmental duty (GED) will operate as the 'central offence' of the EP Act. Drawing from the duties model set by the Occupational Health and Safety Act 2004 (Vic) (OHS Act), the GED requires 'people engaging in activities that may give rise to risks of harm to human health or the environment from pollution or waste to understand those risks and take reasonably practicable steps to minimise them.'¹

After an initial period of up to four years, during which the GED will be complemented by a 'material harm' offence, the GED will be the only general harm-related offence in the EP Act, meaning that a wide spectrum of environmental incidents and environmental risk-management practices will be tested through the prism of the GED.

Breaches of the GED could attract civil and/or criminal penalties of up to $1.6 million,² with intentional or reckless breaches attracting penalties of up to five years' imprisonment and $3.2 million in fines.³

Similar duties are enshrined in legislation in Queensland, South Australia, Northern Territory, Australian Capital Territory and Tasmania, but in these jurisdictions a breach of the GED does not carry any civil or criminal penalties, and the GED supports and complements other 'actual harm' offences. Accordingly, the GEDs in other states play less of a central role than will their new Victorian cousin.

The concept of 'reasonable practicability'

In assessing whether an organisation has sufficiently minimised the risks of harm as far as is 'reasonably practicable', the new section 6(2) of the EP Act will provide that a decision-making authority will have regard to:

1. the likelihood of those risks eventuating;
2. the degree of harm that would result if those risks eventuated;
3. what the person concerned knows, or ought reasonably to know, about the harm or risks of harm and any ways of eliminating or reducing those risks;
4. the availability and suitability of ways to eliminate or reduce those risks; and
5. the cost of eliminating or reducing those risks.

Given these factors have been derived from '[t]he concept of ensuring health and safety' under section 20 of the OHS Act, it is helpful to consider the approach of the courts in considering what is 'reasonably practicable' under that section.

In Baiada Poultry Pty Ltd v The Queen,⁴ the High Court considered the meaning of 'reasonably practicable' under the OHS Act, finding that:

The words "reasonably practicable" indicate that the duty does not require an employer to take every possible step that could be taken. The steps that are to be taken in performance of the duty are those that are reasonably practicable for the employer to take to achieve the identified end of providing and maintaining a safe working environment. Bare demonstration that a step could have been taken and that, if taken, it might have had some effect on the safety of a working environment does not, without more, demonstrate that employer has broken the duty imposed...⁵

 

In other words, the question of whether an organisation has complied with the GED cannot be determined merely by assessing whether it could have taken some step but did not. Instead, the taking of that step must have been reasonably practicable when having regard to the particular facts and circumstances, including the factors listed under the proposed new section 6(2) of the EP Act, as outlined above.

For some organisations, particularly those engaged in activities with higher levels of environmental risk, these five 'reasonably practicable' factors will be familiar from other contexts, including non-statutory risk-management matrices, as well as developing and maintaining safety cases. For others, particularly at the lower end of the risk spectrum, the balancing of these factors will be new.

The onus of proof

Where an action is brought alleging a breach of the GED, the applicant will largely bear the onus of proving the breach, rather than the defendant having to demonstrate its compliance with the GED. This position is derived from the decision in Chugg v Pacific Dunlop Ltd,⁶ in which the High Court found that the applicant bears the onus of proving the defendant's breach of the relevant duty under a now superseded OHS Act, including establishing the issue of 'reasonable practicability'.⁷

The Court did, however, recognise that there are certain matters, such as the cost and suitability of avoiding a risk or hazard, which may be 'peculiarly within the knowledge of the defendant'.⁸ The Court commented that in such circumstances, the defendant may in fact bear 'the practical evidentiary burden' on some aspects of the overall question of 'reasonable practicability'.⁹

Guidance is coming

The EPA Act provides for the creation of 'Compliance Codes' that will provide guidance on how a person may comply with an environmental duty or obligation. It is expected that a detailed Compliance Code will be released setting out actions that can be taken to fulfil the GED.

Additionally, the EPA Act provides that permissions (reformed environmental licences) can specify what actions can be taken to fulfil a person's obligations under the GED. Compliance with these measures will deem the person to have complied with the GED in respect of relevant activities.

Next steps

Given the above, we suggest that organisations actively consider any options that are available to mitigate a risk, and document the reasons why that option is or isn't 'reasonably practicable' in light of the particular facts or circumstances that affect that organisation. This will assist the organisation in the event it must respond to any alleged breaches of the GED. It will also be important for organisations to commence reviewing their internal environmental policies and procedures to effectively respond to the new GED, ahead of its commencement in 2020.

If you require advice in relation to the impact of the GED or the EPA Act on your business, please contact Jillian Button.