(Griffiths J –29 August 2016) 

Administrative law – judicial review challenge to Minister’s decision to approve coal mine project – failure to apply ss 82 and 527E of the Environmental Protection and Biodiversity Conservation Act 1999 (Cth) (the EPBC Act) in assessing impact of combustion emissions – failure to apply the precautionary principle as required by ss 136(2)(a) and 391 of the EPBC Act – failure to comply with s 137 of the EPBC Act regarding inconsistency with the World Heritage Convention – judicial review application dismissed

Environmental law – construction and application of ss 82, 133, 136, 137, 391 and 527E of the EPBC Act in assessing effects of climate change on the Great Barrier Reef

Facts:  This was an application for judicial review of the decision of the Minister for the Environment to approve the proponent, Adani Mining Pty Ltd (‘Adani’) taking an action.  The action was the proposed construction of a new open-cut and underground coal mine in central Queensland and a rail link and associated infrastructure to transport coal between the mine and coal export terminals (‘action’).

The applicant alleged that the Minister failed to comply with the requirements of the Environmental Protection and Biodiversity Conservation Act 1999 (Cth).  The applicant was primarily concerned with the likely impacts of the action on the Great Barrier Reef (‘reef’), in particular the likely impacts of greenhouse gas emissions arising from the transport and combustion overseas of coal produced at the mine (‘combustion emissions’).

The applicant’s amended originating application contained four grounds.  The fourth ground was abandoned before the hearing commenced.  The Court addressed the grounds in the order in which they were presented at the hearing.

Ground 2 alleged that the Minister made an error of law by:

  1. characterising the combustion emissions as ‘not a direct consequence of the proposed action’, without applying the test in section 527E of the EPBC Act; and
  2. failing to comply with the requirement in section 136(2)(e) of the EPBC Act in respect of the information about the emissions and the impact those emissions would have or were likely to have on the matter protected.

Ground 3 alleged that the Minister, in finding that it was difficult to identify the necessary relationship between the taking of the action and any possible impacts on relevant matters of national environmental significance, the Minister made an error of law in failing to consider or apply the precautionary principle to that conclusion as required by sections 136(2)(a) and 391 of the EPBC Act.

Ground 1 alleged that the Minister made an error of law by failing to apply the statutory prohibition on the Minister acting inconsistently with the World Heritage Convention (‘WHC’).  In particular, ground 1 alleged that the Minister’s decision was inconsistent with:

  1. Australia’s obligations under the WHC, in particular the obligation under Article 4 to do ‘all it can to the utmost of its resources to identify, protect, conserve, present and transmit to future generations the outstanding universal value of the Great Barrier Reef World Heritage Area; and
  2. the World Heritage Management Principles, particularly that the identification, protection, conservation, presentation and transmission to future generations must be the ‘primary purpose’ of the management of the Great Barrier Reef World Heritage area.

Submissions

Ground 2

The applicant submitted that in order to comply with section 136(2) of the EPBC Act, the Minister had to ask whether the consequence of the combustion emissions on the Reef were ‘relevant impacts’ of the proposed action on the Reef, within the meaning of sections 82 and 527E of the EPBC Act.  The applicant contended that instead, the Minister applied a range of criteria beyond the EPBC Act to justify a differential treatment of the combustion emissions.  This caused him to dismiss from further consideration the consequences of the proposed action notwithstanding that they posed ‘the greatest threat to the Reef’.

The applicant submitted that the proper approach was for the Minister, having taken into account the additional information, to have then asked whether the combustion emissions were impacts within the meaning of section 527E of the EPBC Act.  The applicant said the consequences for the Reef of climate change resulting from the combustion emissions were impacts of the action in the same sense as ‘downstream’ consequences identified in the litigation relating to the Nathan Dam.

With respect to ground 2, the applicant’s key argument was that the Minister failed to properly consider whether the impacts of the combustion emissions on the Reef were relevant impacts in circumstances where new information before him indicated that they were relevant impacts.

In reply, the Minister submitted that the applicant’s submissions were based on a misconstruction of section 527E of the EPBC Act and his statement of reasons.  The Minister relied on the decision of Tarkine National Coalition Inc v Minister for the Environment [2014] FCA 468 in asserting that the relevant ‘events or circumstances’ for the purpose of section 527E of the EPBC Act were the effects of climate change in producing increased ocean temperatures, ocean acidification and more intense weather events and that those events or circumstances would only be an impact if the proposed action was a ‘substantial cause’ of them within the meaning of section 527E of the EPBC Act.

The Minister submitted that the part of his statement of reasons should be construed as involving a finding on his part that the proposed action would not be a substantial cause of climate change effects.  The Minister said his reasons demonstrated that he did consider and apply section 527E in the context of combustion emissions and that he found that the proposed action would not be a substantial cause of any climate change effected and would not have a relevant impact on the Reef.

The Minister went on to submit that the applicant’s submissions were misguided in contending that climate change itself constituted the event or circumstance.  The Minister said the relevant event or circumstance was the effect of climate change, being the increase in sea temperature and ocean acidification.  The allegations were therefore misdirected as it was not the emissions themselves that were the relevant event or circumstance, but rather the increase in sea temperature and ocean acidification. 

The Minister’s approach was that there was no event or circumstance within the meaning of section 527E of the EPBC Act if there was no net increase in emissions in circumstances where the relevant event or circumstance was the consequences of climate change increasing sea temperature and ocean acidification.

Adani also submitted that ground 2 misunderstood the Minister’s conclusion and also involved an attempt to have the Court review the merits of the Minister’s conclusions about combustion emissions, which was not permitted in judicial review proceedings.

Ground 3

The applicant submitted that part of the Minister’s statement of reasons was in identical terms to the Minister’s first statement of reasons concerning his earlier decision to approve the project, in circumstances where the first statement of reasons did not involve any evaluation of the impact of combustion emissions.  The applicant contended that the Minister’s reliance on the Coordinator-General’s report and consideration of the precautionary principle was confined to scope 1 and scope 2 emissions and necessarily involved a failure to deal with the precautionary principle in respect of the combustion emissions, which resulted in a failure to comply with sections 136(2)(a) and 391 of the EPBC Act.

In reply, the Minister submitted that his obligation to take account of the precautionary principle did not require him to take measures or consider taking measures if he found that a proposed action would not have any adverse effect on matters of environmental significance.  The Minister relied on the fact that his reasons addressed sections 136(2)(a) and 391 of the EPBC Act and stated that he agreed with the Coordinator-General’s report (which, as discussed above, only dealt with scope 1 and scope 2 emissions). 

The Minister relied on observations in the decision of Minister for Planning v Walker [2008] NSWCA 224 in support of the contention that it was unnecessary to apply the precautionary principle to every issue which arises in the decision making process. 

The Minister submitted that the applicant’s contentions were based on a misapprehension of Australia’s international obligations and the operation of section 137 of the EPBC Act.  The Minister further submitted that the WHC must be construed in accordance with the general principles of treaty interpretation.  Therefore, Article 4 of the WHC made to be construed in its context, including in the light of Article 5, which created a flexibility in implementing the WHC obligations.

With respect to the operation of section 137 of the EPBC Act, the Minister submitted that the section did not have the effect of making any inconsistency with Australia’s obligations under the WHC a jurisdictional fact but rather required the Minister to determine whether the giving of approval for the taking of the proposed action and the conditions to attach to any approval would be inconsistent with Australia’s obligations under the WHC.

In any event, the Minister submitted that nothing in Article 4 of the WHC suggested that the approval of the proposed action placed Australia in breach of its obligations because, on its proper construction, Article 4 imposed an overarching duty not to act in the manner manifestly contrary to the purpose of the WHC.  The Minister said he had properly concluded that the proposed action should not be refused having regard to the speculative nature of any net increase in global greenhouse gas emissions resulting from the relevant combustion emissions.

Adani refuted the allegation and relied on the fact the statement of reasons stated that the Minister had considered the precautionary principle.  Further, Adani contended that the statement of reasons indicated that the Minister did not confine his consideration of the precautionary principle to the Coordinator-General’s report alone.

Ground 1

With respect to ground 1, the applicant’s key argument was that the Minister failed to comply with section 137 of the EPBC Act because the Minister relied entirely on the assessment in Adani’s EIS and the evaluation in the Coordinator-General’s report, but those materials contained no consideration of the combustion emissions (which were only addressed in the new material).

In reply, the Minister submitted that the prohibition imposed by section 137 did not arise in circumstances where he concluded the action would not affect the Reef, as set out in his statement of reasons.

Adani rejected the applicant’s submissions about ground 1 and submitted that:

  1. the Minister’s statement of reasons needed to be read as a whole; and
  2. the applicant’s approach offended well established principles regarding the proper approach to the construction of such reasons.

Decision:  

  1. The Court analysed the relevant provisions of the EPBC Act in detail before considering the applicant’s grounds for review.
  2. At the outset, the Court commented that the nature of the proceeding was such that the Court could not step into the shoes of the Minister and decide for itself whether Adani’s action should be approved, and if so, what conditions should apply.  The Court’s function was confined to reviewing the legality, not the merits of the Minister’s decision.
  3. The Court found that the applicant did not deny the force of those principles.  However, it sought to dilute them to some extent by reference to the events leading up to the Minister making his decision in October 2015.
  4. The Court distinguished the case from the decision of Soliman v University of Technology, Sydney [2012] FCAFC 146, on which the applicant sought to rely, on the basis that:
    1. in this case, the Minister provided a statement of reasons in respect of an administrative decision made by him based upon information obtained by his Department not only from the proponent but also from other government agencies and the public, including information supplied by the applicant (different to the process in an adversarial hearing); and
    2. in Soliman, one of the parties had provided detailed legal submissions on the topic of mitigating circumstances, which was described as a submission which was ‘central to the party’s case’.  In circumstances where the decision maker made no reference to the submissions in the written statement of reasons, the Full Court inferred that the submission had not been addressed and it amounted to jurisdictional error.
  5. In particular, the Court found the Minister’s statement of reasons was not devoid of material indicating the Minister’s path of reasoning, even though there was no reference in the reasons to specific sections of the EPBC Act, such as section 527E.

    Ground 2

  6. The physical effects associated with climate change, namely increased ocean temperature and ocean acidification could only be an ‘impact’ if Adani’s action was a substantial cause of those events or circumstances.  In construing the statement of reasons in accordance with the principles discussed above, the Court determined that the Minister found that he could not determine that the action would be a substantial cause of the relevant events or circumstance for the reasons set out in his statement of reasons.  The Minister was unable to draw firm conclusions as to the likely contribution of Adani’s action to a specific increase in global temperature.  This meant that it was difficult to identify the necessary relationship between the taking of the action and any possible impacts on relevant environmental matters, including the Reef.
  7. The Court was satisfied that the statement of reasons, while not expressly referring to section 527E of the EPBC Act, evidenced that the Minister had sufficiently addressed section 527E.
  8. The Court did not accept the applicant’s contention that the Minister erred in not accepting and acting upon the new information as establishing that the combustion emissions would, or were likely to, have an adverse impact on the Reef.  It was a matter for the Minister to make relevant findings of fact, including whether or not to accept that the new material established that combustion emissions would, or were likely to, have the adverse impact on the Reef as claimed by the applicant.  Having regard to the limited role of the Court in reviewing findings of fact in a judicial review proceeding, the Court was not satisfied that the applicant demonstrated any reviewable error concerning this aspect of the Minister’s reasoning of his decision to approve the action.

    Ground 3

  9. Similarly, the Court found that the references to the precautionary principle in the Minister’s statement of reasons should be read as references to the Minister’s consideration of that principle in the context of his assessment of direct impacts of the project and not any indirect impacts such as greenhouse gas emissions.
  10. The Court accepted the Minister’s submission that the absence of any explicit reference in the statement of reasons to him having taken into account the precautionary principle in relation to combustion or greenhouse gas emissions did not mean that his decision to approve the action was invalid.
  11. Since the Minister did not find that there was any threat of serious or irreversible damage to the Reef which would be caused by the combustion emissions, the necessary precondition to the application of the precautionary principle did not exist.  Therefore, even if the Minister did not take account of the principle is approving the action (at least insofar as combustion emissions were concerned), it would not vitiate his decision.
  12. On that basis, the Court rejected ground 3.

    Ground 1

  13. The Court accepted that the WHC imposed obligations on Australia but considered that the applicant overstated the nature of them.
  14. The applicant’s claim that the Minister breached section 137(1) of the EPBC Act turned on the asserted inconsistency between the Minister’s approval of the action and the obligations imposed on Australia by Article 4 of the WHC.  The applicant invited the Court to adopt a literal construction of the obligations set out in Article 4.  The Court did not adopt that construction.
  15. The Court followed the general rule of treaty interpretation in Article 31 of the Vienna Convention on the Law of Treaties 1969, which required a treaty to be interpreted in good faith and in accordance with the ordinary meaning of the words of the treaty in their context and in light of the treaty’s object and purpose.
  16. Adopting this approach, Article 4 was to be construed having regard to Article 5.  Article 5 made it plain that State Parties were to endeavour, in so far as possible, and as appropriate for each country, to do the matters specified.  In that sense, the nature of the obligation was non-absolute.
  17. The Court accepted the Minister’s submission that, properly construed, Articles 4 and 5 of the WHC gave considerable latitude to State Parties as to the precise actions they may take to implement their ‘obligations’ under the relevant provisions of WHC.  The Court also accepted that the Minister was mindful of the prohibition imposed by section 137 of the EPBC Act, given it was expressly referred to in his statement of reasons.
  18. However, the omission of any reference to combustion emissions in the relevant part of the statement of reasons did not mean that the Minister did not turn his mind to combustion emissions in concluding that the approval would not be inconsistent with the WHC.
  19. For those reasons, the Court held that the applicant failed to establish any breach of the statutory prohibition imposed by section 137 of the EPBC Act.  There was therefore no need to determine whether, if there had been such a breach, it would have had the effect of invalidating the Minister’s approval decision.

    Conclusion

  20. The Court dismissed the Originating Application for judicial review and directed the parties to seek to agree proposed orders for costs.  Failing agreement, the Court would deal with the matter on the papers.

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