Recent contempt of court proceedings in the Environment, Resources & Development Court
At our Planning Master Class in late 2018, we presented a case law review of the matter of City of Onkaparinga v Fleurieu Peninsula Olive Press P/L [2017] SAERDC 37. Recently, in the Registrar, Environment, Resources and Development Court v Fleurieu Peninsula Olive Press P/L (No. 2) [2019] SAERDC 13, the ERD Court found the Respondents guilty of contempt of Court for failing to comply with an order of the Court which was made in the course of those proceedings.
Background
Mr George Konidis is the sole director of Fleurieu Peninsula Olive Press Pty Ltd (Fleurieu) (Respondents). In 2002, the Council granted approval to the Respondents to use land at Sellicks Hill (Land) for the purpose of an olive processing plant, subject to a number of conditions including that the development be undertaken in accordance with an environment management plan.
The Respondents subsequently conducted their olive processing operation contrary to the provisions of the environment management plan (namely, rather than pump processing waste to an underground holding tank to be pumped out and collected by a waste contractor, the Respondents built a dam into which they deposited the waste). The Council commenced section 85 enforcement proceedings which were ultimately resolved by the Respondents making good their breach by securing an approval for, and implementing, a revised waste control system on the Land.
Following the resolution of the substantive matters of the s85 proceedings, the Council made an application to the Court for its costs and was successful. The parties reached an agreement in relation to the quantum of costs, which was reflected in a Court Order that the Respondents pay the Council’s costs in the amount of $24,200, paying quarterly amounts of $2,000 in accordance with an agreed three year payment schedule commencing 31 December 2017 (Costs Order).
Contempt proceedings commenced
The costs payments required in December 2017 and March 2018 were not made and charges for contempt were brought against the Respondents by the Registrar of the Court for failing to comply with the Costs Order (with the Council having notified the Court of the alleged contempt).
The Respondents pleaded not guilty to the charge. In regards to the Costs Order, the Respondents argued:
- that the Council had been unreasonable in pursuing the costs order, because an acceptable waste processing system had eventually been installed to remedy the breach; and
- that they had entered into the Costs Order under economic duress.
The Court held that there was no basis to the first proposition. The Respondents chose to undertake development contrary to their development approval so the Council had little option but to institute and maintain the section 85 proceedings.
As for the second proposition, the Court did not accept that there was anything improper about the Council’s actions which led to the making of the Costs Order. The Respondents were legally represented at the time the Costs Order was made and had made a commercial decision to agree to it.
In relation to the Respondents’ failure to pay the Costs Order, their justifications included that they had requested a meeting with the Council’s CEO but had not been afforded the opportunity to do so.
The Respondents were found guilty of contempt in failing to comply with the Costs Orders. Judge Costello concluded that the Respondents’ failure to pay was not a product of incapacity, but rather, was due to an attitude that they did not need to pay the costs unless and until terms, unilaterally imposed by him, were met by the Council. By implication then, it will not always be the case that a mere failure to comply with a costs order will result in a finding of contempt. In this case, the Council successfully argued that the Respondents should be found guilty of contempt given their attitude and the lack of salient reasons provided to justify their failure to comply with the Costs Order.
Finding the Respondents guilty of contempt, the next question was the sentence the Court would impose.
It was the view of Judge Costello that the nature and circumstances of this contempt were particularly serious and there was a need for personal deterrence. In particular, His Honour considered that Mr Konidis had long displayed an attitude which had the effect of relegating compliance with the Court’s orders to a position of ‘second-order importance’.
Mr Konidis was sentenced to a term of imprisonment for six months, which was suspended on certain conditions, namely:
- that he enter into a bond in the sum of $500 for a period of 12 months;
- that during this 12-month period he be of good behaviour and comply with the Costs Order; and
- that the costs which were in arrears be paid within four months.
Fleurieu was convicted without further penalty (other than the requirement for it to pay, together with Mr Konidis, the Council’s costs of the contempt proceedings).