Express law No. 66

24 January 2008

Federal Court confirms flexibility in EPBC Act referral
and assessment processes

The recent Federal Court decision in the case about
dredging in Port Phillip Bay and the Yarra River–Blue
Wedges Inc v Minister for the Environment, Heritage & the
Arts [2008]
FCA 8
(15 January 2008)–has confirmed that,
under the Environment Protection and Biodiversity
Conservation Act 1999 (Cth) (EPBC Act), changes made
to projects after their initial referral to the Commonwealth
Minister for the Environment, Heritage and the Arts will
not necessarily require a new referral.

The EPBC Act prohibits actions that have or are likely
to have a significant impact on a matter of national environmental
significance, unless the person taking the action has obtained
approval from the Commonwealth Minister. A person wishing
to take such an action refers the action to the Minister
for a decision as to whether it does need approval (that
is, whether it is a 'controlled action'). If
the Minister decides it is a controlled action, an assessment
of the relevant impacts of the action is required before
the Minister decides whether to grant an approval.

Background

In this case, Blue Wedges Inc challenged a decision of
the Minister to approve a project to deepen shipping channels
in Port Phillip Bay and the Yarra River. Blue Wedges Inc
argued in the Federal Court that the project had changed
substantially between the original referral in 2002 and
the final decision to approve the project in December 2007,
and that the approval process should start again.

Decision of the Federal Court

Justice Heerey dismissed the application by Blue Wedges
Inc and held that the approval decision was lawful. His
Honour declined to order that Blue Wedges Inc pay the legal
costs of the Commonwealth and the other respondents.

Changes to a proposed action between referral and assessment

The first ground of challenge to the approval decision
was that the subject of the 2007 assessment had changed
so much from what was described in the 2002 referral that
it was a different project.

The changes in the project between 2002 and 2007 were
said to be changes in scale (deepening shipping channels
to a greater depth than originally proposed), location
(extension of the project to channels and parts of the
bay not identified in the referral), nature (involving
additional activities such as the disposal of contaminated
dredge material) and impact.

Justice Heerey rejected this ground, acknowledging that
changes to proposed actions between the referral and assessment
stages are inevitable, particularly since the environmental
approval process for a major project can take years.

His Honour said that it was likely that the EPBC Act was
drafted on the assumption that it would be preferable for
proposed actions to be referred at an early stage, so that
they could evolve in a direction that was positive for
the environment. It would be a strange result if making
an environmentally positive (or environmentally neutral
but cost positive) change meant proponents were forced
to start all over again.

His Honour described the referral mechanism as a kind
of 'triage system', not intended to make a
detailed diagnosis or to fix in stone all details of a
project.

Justice Heerey said that there may come a point where
changes to a proposed action were so substantial that it
became a different action, but that point had not been
reached in this matter.

Adequacy of assessment

Blue Wedge's alternative ground of challenge was
that the assessment did not adequately address the relevant
impacts of the project and did not provide enough information
for the Commonwealth Minister to make an informed decision.

Justice Heerey also rejected this ground, saying that
the assessment report was not the sole repository of information
for the Minister to make an informed decision. Section
132 of the EPBC Act allowed the Minister to request further
information 'if the Minister believes on reasonable
grounds that he or she does not have enough information
to make an informed decision'.

His Honour considered that there was no evidence in this
case that the Commonwealth Minister believed he did not
have enough information to make an informed decision.

Costs

The usual position is that the unsuccessful party must
pay the winning party's costs, but in this case Justice
Heerey declined to make an order requiring Blue Wedges
Inc to pay costs.

Following the High Court's decision in Oshlack
v Richmond River Council (1998) 193 CLR 72, his Honour
gave consideration to the high level of public concern
about the channel deepening and the role of Blue Wedges
Inc in raising public awareness and representing numerous
community and environmental groups, as well as the fact
that the challenge raised novel questions of general
importance about the approval process under the EPBC
Act. These factors supported the exercise of the court's
discretion not to award costs; and the fact that the
applicant's solicitor also acted for businesses
who feared commercial damage arising from the project
did not detract from the public interest in the litigation.

Implications for clients

This decision confirms that proposed actions referred
under the EPBC Act can change between the referral and
assessment stages, as the project evolves, without the
process having to start again. Formal variation under Div
1A of Pt 11 is one mechanism for dealing with such changes,
but projects can also evolve and change by informal processes
within the EPBC Act framework.

There are clear environmental benefits from a system of
early referral of projects to the Minister, and flexibility
as to the details of a project leading up to assessment
should help to encourage the development of proposals in
environmentally positive directions.

AGS Senior Executive Lawyer Emily Nance and Lawyer David
Brown acted as instructing solicitors for the Minister
for the Environment, Heritage and the Arts in this case.

For further information please contact:

Susan Reye
Senior General Counsel
T 02 6253 7110 F 02 6253 7317
susan.reye@ags.gov.au

David Brown
Lawyer
T 03 9242 1391 F 03 9242 1265
david.brown@ags.gov.au

Helen Chisholm
Senior Lawyer (outposted to the Department of the Environment,
Water, Heritage and the Arts)
T 02 6275 9338 F 02 6274 1105
helen.chisholm@ags.gov.au

Important: The material in Express law is
provided to clients as an early, interim view for general
information only, and further analysis on the matter
may be prepared by AGS. The material should not be
relied upon for the purpose of a particular matter.
Please contact AGS before any action or decision is
taken on the basis of any of the material in this message.