Prosecution under hazardous waste legislation fails for lack of evidence

Key points
  • As a matter of established law for a criminal prosecution to succeed in Australia the prosecutor must bring evidence capable of proving the elements constituting the alleged criminal offence the subject of the prosecution.
  • In a recent case in the criminal jurisdiction of the New South Wales Local Court the prosecution failed because the magistrate held that there was no evidence capable of establishing one of the elements of the offence.
  • The alleged offence was breach of the Commonwealth Hazardous Wastes (Regulation of Exports and Imports) Act 1989 (“the HWA”) relating to alleged breach of a permit for the export from Australia to Belgium of scrap lithium ion batteries as hazardous waste.  The prosecution was brought against the corporate exporter as the holder of the export permit.
  • Specifically the magistrate found that the prosecution acting on behalf of the Commonwealth Department of Environment (“the Department”) had failed to establish any evidence that the batteries were hazardous waste as defined in the HWA, and its incorporated schedules and subordinate regulations.  Thereby the magistrate held that the prosecution failed to establish a prima facie case and the whole prosecution failed.
  • This was the first prosecution for an alleged offence under the HWA.


The Judgment

The background to the judgment was very unusual.  The HWA and its subordinate regulations incorporate the Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and their Disposal (“the BC”).  The relevant regulations are the Hazardous Waste (Regulation of Exports and Imports) (OECD Decision) Regulations 1996 (“the OECD decision”).  The object of the BC, HWA and the regulations is to regulate the export, import and transit of hazardous wastes to ensure that the waste is managed in an environmentally sound manner so that human beings and the environment both within and outside Australia are protected from any harmful effects of the waste.

A party intending to export hazardous waste from Australia to another country is required to obtain an export permit from the Department.  The permit sets out particulars relating to matters such as the type of waste to be exported, the maximum quantity of the waste, the way it is to be packaged, the route of transit (usually by sea) to be used to move the waste to its final destination, and other relevant matters.  It is an offence under the HWA punishable by heavy fines to export or import hazardous waste other than in accordance with the permit.  Offences under section 40 of the HWA can be intentional, reckless or negligent.  The prosecution alleged that the exporter’s alleged breaches of the permit were negligent.  The exporter denied breaches of the permit and pleaded not guilty to the offences.  It is crucial to the commission of any offence under the HWA that the exported material is “hazardous waste” as defined in the HWA, the BC and the Regulations including the OECD decision. 

The exported materials being scrap lithium ion batteries were carried in containers from Sydney to Antwerp in Belgium in three separate shipments under an export permit over two months in 2016.  However while one of the carrying vessels was trans-shipping cargo in Colombo, Sri Lanka a fire began in one of the containers carrying the scrap batteries.  Investigations conducted on behalf of the exporter showed that the most probable cause of the fire was defective stowage and handling of the containers by the shipowner and its agents.  The fire occurred in mid-June 2016 and the exporter promptly notified the department of the occurrence pursuant to its obligations under the permit.  The fire caused no damage to people or to the environment.  The Department had carried out various investigations including interviewing the exporter’s employees.  Ultimately prosecution was commenced under section 40 of the HWA in the Parramatta Local Court in July 2017.

After very protracted litigation the trial was conducted in March 2019.  At the conclusion of the prosecution’s case the exporter took the view, already foreshadowed to the prosecution four months previously, that there was no case for the exporter to answer because the prosecution’s evidence had failed to establish that the batteries were hazardous waste as defined in the HWA and the regulations.  The exporter asked the magistrate to find that the prosecution had not established a prima facie case.  It is interesting that neither the HWA, the BC nor any of the regulations specifically mention lithium ion as hazardous waste whereas many other substances including some heavy metals are specifically listed as hazardous waste.  Some of the definitions of what might constitute hazardous waste are based upon characteristics and behavior of substances and in some cases far from clear.

The witnesses called on behalf of the prosecution from the Department did not have any qualifications or expertise in industrial chemistry, whereas the exporter’s senior manager handling the application for the permit had considerable expertise and educational qualifications in industrial chemistry, and gave evidence that in her opinion and experience the batteries were not hazardous waste as defined in HWA, the BC and regulations.  The evidence of the Department’s employees was that the Department had formed an opinion that lithium ion batteries were hazardous waste, but had not made any appropriate inquiries to establish as a fact that that was the case scientifically.

The magistrate construed the HWA, the BC and the OECD decision and held that the batteries were not hazardous waste.  Hence the prosecution had failed to establish a prima facie case that an element of the alleged offence (namely that the batteries were hazardous waste) had been proved.

Due to the magistrate having found against the prosecution for failing to establish a prima facie case, he did not need to decide the underlying defence issues of whether or not there had been breaches of the export permit.  It follows that as the lithium ion batteries were not hazardous waste within the meaning of the HWA, the BC and the regulatory regime, that there was no legal basis for the Department to insist that the exporter obtain a permit before it could lawfully export the batteries.

The outcome of the prosecution is a reminder that a well-prepared corporate defendant can succeed in an environmental regulatory prosecution in the Local Court, and that if a prosecution does not have the necessary evidence to establish the elements of the offence, then it will fail.  The Australian exporter was represented throughout the Department’s investigation and the subsequent prosecution by Hicksons’ Consultant Derek Luxford and his Transport, Trade & Energy team. 

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