THE new section 118 of the Environmental Protection Act brings Western Australian into a similar position to New South Wales, Victoria, Northern Territory and the ACT, where each director or person concerned in the management of the body corporate automatically commits an offence if the body corporate commits an offence.
This is unless he or she can establish a defence based on knowledge, lack of authoritative position, due diligence and reasonable precautions or defences open to the body corporate.
In South Australia and Tasmania an automatic offence arises unless the defendant proves the offence didn’t result from his or her failure to take all reasonable and practicable measures to prevent it.
Officers knowingly promoting or acquiescing in the commission of the offence commit an additional offence.
The due diligence defence is not being defined in the WA statute.
In South Australia, Tasmania and the ACT, the legislation provides guidance in defining due diligence.
In the ACT the courts consider whether officer:
p Were personally familiar with requirements;
p Took all reasonable steps to comply;
p Took steps to ensure other relevant people were informed of, and complied with, requirements;
p Took steps to establish an environmental system and to educate staff on the system; and
p Reacted immediately and personally when they became aware of non-compliance.
In South Australia and Tasmania a body corporate seeking to establish the defence of due diligence must show proof of proper reporting standards and systems promoting and enforcing compliance with the legislation.
Judicial consideration of due diligence requirements under Australian environmental legislation is sparse.
The courts have said ‘due diligence’ contemplates a mind concentrated on the likely risks and is not satisfied by general precautions unless also designed to prevent the contravention.
Further, the notion of due diligence involves an absence of negligence or fault.
Judicial consideration of ‘due diligence’ in the Trade Practises Act context may assist. For example:
p Industry practice is irrelevant unless amounting to a precaution or indicating the exercise of due diligence;
p If no precautions were taken, proof that there were none that could have been reasonably taken is required; and
p Proof of an established system designed to ensure that reasonable precautions are taken to prevent contravention and which provides for adequate supervision is operational.
An environmental management system, specifically designed to capture the environmental legal requirements of the company’s operations is one such system but it must be designed so as to prevent contravention and be regularly updated, actively managed, accessible and implemented.
Gretta Lee, associate - 9429 7606
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