Otago Regional Council v Crichton Dairy Farms Limited DC Oamaru CRN 09045500039 [2010] NZDC 306 (2 March 2010)

Last Updated: 22 September 2016

IN THE DISTRICT COURT
AT OAMARU

CRN 09045500039 CRN 09045500040 CRN 09045500057 CRN 09045500058 CRN 09045500059 CRN 09045500060 CRN 09045500061 CRN 09045500062

BETWEEN OTAGO REGIONAL COUNCIL

Informant

AND CRICHTON DAIRY FARMS LIMITED

GEOFFREY LAURIE NORRIS KEITH WALLACE PHEASANT Defendant

Hearing: 2 March 2010

Appearances: A Logan for the informant S Watson for the defendants

Judgment: 2 March 2010

NOTES OF JUDGE J E BORTHWICK ON SENTENCING

Introduction

[1] The defendants have been charged with offences relating to two events
including the irrigation of water (which resulted in surface run-off and ponding in three separate locations) and secondly, the discharge of dairy effluent onto land.
[1] The defendants, having pleaded guilty, are hereby convicted. Upon
conviction the company, Crichton Dairy Farms Limited, is exposed to a fine of up to $200,000. Mr Norris and Mr Pheasant, you face an additional term of imprisonment of up to two years. However, counsel are of the view that fines are appropriate in

the circumstances and I agree. I am going to deal with the offending in relation to the two events separately.

Ponding of irrigation water

[3] The defendants, Crichton Dairy Farms Limited, its managing director Mr
Pheasant and farm manager Mr Norris each face two charges relating to the use of water for irrigation purposes. The defendants had earlier disputed the summary of facts, their concern principally being with the number of occasions that the irrigation was said to have caused run-off and ponding of surface water. At the last call-over defence counsel was not available and, as a consequence, I was unable to indicate to the parties what weight I would likely attach to the disputed facts if they were found to exist, and the significance of the same to sentencing or other disposition.
[3] The factual differences between the informant and defence counsel have now
been resolved. It is agreed that the water was irrigated in a manner that caused ponding to occur at three separate locations. In two locations water encroached onto

a roadway. In those locations rainfall and leakage from a rural water scheme
contributed to the ponding. At a third location, north of St Helens Road, the ponding on a neighbouring farmer's property was caused by the operation of a centre pivot and contributed to by rainfall. Apart from minor crop damage to that farm, the informant does not allege that there was damage done to the environment as a
consequence of this offending. I note that the defendants have also disputed
whether certain statements contained in the summary of facts were made by Mr Norris, however, nothing rests on this in terms of the defendants' culpability.

[3] This is not the first time that irrigation has caused ponding of surface water.
There was a previous incident in February 2008 (also in the area of St Helens Road). I understand that there was a warning issued in relation to that incident, but that the defendant company did not tell Mr Norris about that warning (Mr Norris was not in the employment of the company at that time). Nor was Mr Norris told about the conditions under which the company was taking and using water from the North Otago Irrigation Scheme or that there was a problem with the set-up of the centre pivot north of St Helens Road.

[6] I understand that the defendants are shareholders of the North Otago
Irrigation Scheme (NOIC). NOIC holds consent to use water to irrigate land within a specified command area, including the locality of the defendant's farm. It is a term of its consent that the use of water will not result in surface water run-off or ponding. The defendant company has agreed to take and use water from the NOIC scheme on the same conditions as the NOIC permit — that is to say, it cannot use water in a way that results in run-off or ponding.
[6] The defendants have experienced difficulties in using water in a way which
complies with this agreement. The sub-soils on the farm are slow to drain excess water and when water is applied at a rate that exceeds soil infiltration, that can cause

surface run-off. Over-application of water has the potential to cause erosion,
induced downstream drainage problems and reduced surface water quality. In this case there was minor inundation of a neighbouring farmer's crop and minor flooding to the roads (but not to the extent that there was a risk of harm to passing motorists).

[6] On that basis I was able to give a sentence indication and having done so
counsel advised that there was no need for a disputed facts hearing and guilty pleas would be entered.

Starting point for a fine

[6] Where there are two or more co-defendants the starting point for a fine is to
be assessed having regard to the gravity or seriousness of the offence and secondly, the culpability or blameworthiness of the individual offenders (in other words, what role did each defendant have to play in the offending). The starting point then takes into account the aggravating and mitigating features of the offence. It is adjusted upwards or downwards by taking into account the aggravating or mitigating factors relating to the offenders.
[9] In terms of the seriousness of the offence, the damage done to the environment was minor I have assessed the culpability or blameworthiness of Mr Norris' actions as being moderate. He has demonstrated a real want of care in how he has managed the irrigation system. He said that he was unaware of the ponding

that occurred in the separate locations. He had not undertaken an inspection of the farm in the area of St Helens Road notwithstanding that irrigation had commenced in October 2008. (He also says that had he done so he would not have been seen surface water run-off.) The summary of facts records that Mr Norris was unaware of the property's farm management plan, which begs the question as to exactly how he was managing the irrigation system.

[11] By way of mitigation Mr Norris pointed to a number of steps taken to avoid run-off by improving the efficiency of the irrigation system and secondly, reconfiguring the irrigation infrastructure around the farm. Problems with the runoff to the neighbouring property were able to be rapidly addressed once he became aware of them. I assess the starting point of $20,000, and this applies also to the company. The defendant company is liable for the actions of its employees in the same manner and to the same extent as if it had personally committed the offence. However, that fine is uplifted to $25,000 to reflect the fact that it was warned by the Regional Council in 2008 that its irrigation was causing surface run-off. This is an aggravating factor. By way of mitigation the company purchased the damaged crops from the neighbouring farmer. It has invested $11,000 in soil moisture probes and has incurred costs in repairing leaks to the rural water scheme.
[11] In respect of Mr Pheasant, the informant and defence counsel submitted that the starting point for a fine should be $10,000. Mr Pheasant is the managing director of the company. His culpability is less than that of the company and Mr Norris but is still within the low to moderate range. He did not take all reasonable steps to prevent the commission of this offence. He did not tell Mr Norris of the event in February 2008 and did not ensure that the farm irrigation plan was updated to address the cause of the surface water ponding, at least in the area of St Helens Road.

[13] Finally, I record that at yesterday's hearing concerning the disputed facts it was submitted that the defendants could not comply with the conditions of the agreement between the defendant company and NOIC, and that it is not possible to use water on this property in a way that does not result in its run-off or ponding. Defence counsel went so far as to suggest that no-one in the Waiareka Valley could irrigate in a way which could comply with the Act or the Regional Plan. If that is correct, then it is likely that the defendants will re-offend if they continue to use water in the future. However, I set aside these submissions because the steps that have been taken in relation to the irrigation infrastructure seem to be appropriate measures to reduce the risk of offending in the future. It may well be, however, that more is required to avoid future re-offending, and in that regard the defendants intend to seek advice from irrigation consultants. But I reiterate my view that the responsibility for complying with the terms of the supply agreement and with the Regional Plan and the Act rests with the defendants.

Discharge of effluent

[13] The company and Mr Norris face separate charges concerning the discharge

of contaminants to land (the contaminants being dairy shed effluent). This is a
sizable dairy farm operation; it is 430 hectare farm milking 1,500 cows. Effluent is disposed of by way of a travelling irrigator. The irrigator failed to shut off and continued to operate from a stationary position which resulted in ponding. The effluent did not, however, enter into a drain or waterway. Given the condition of the sub-soil it was unlikely that it would have contaminated groundwater. Apart from localised soil damage it is unlikely that the discharge in this case would have had more than a minor effect on the environment.

[15] The summary of facts records Mr Norris' statement that the irrigator would have been stationary for around an hour. I note also that Mr Norris became quite agitated when speaking to the informant's officers and what is recorded there does not reflect well on him in terms of his attitude towards this offending.

[16] The informant submits that the starting point for this offence should be a fine of $15,000. It is not suggested that the offending was deliberate but that there was a lack of care in the way that the defendants performed their functions. The irrigator

had not been checked in the previous hour. Travelling irrigators are prone to
breaking down and vigilance is required in relation to their management.

[16] In these circumstances I find Mr Norris' culpability and the seriousness of the offence to be towards the lower end of the scale. While I accept what the informant has to say in relation to the performance of travelling irrigators, I am not sure that constant oversight is warranted.
[16] I assess the starting point for a fine at $12,000 in relation to Mr Norris and find likewise in respect of the company. However, I will uplift the starting point for the company's fine to $17,000 to reflect that in October 2008 there had been a separate incident of ponding around the travelling irrigator in respect of which an infringement notice was issued. Defence counsel submitted the uplift should apply to the company only, which I accept.
[16] The company has now installed a flow sensor switch at a cost of $7,000. That will shut off the irrigator if it becomes stationary or is disconnected from its hose. It has made other adjustments to the irrigator designed to minimise the risk of over-application of effluent. While these steps are commendable, they should have been taken immediately in October 2008. Nevertheless, the company is entitled, by way of mitigation, for those matters to be taken into consideration when considering the final penalty. Mr Norris is likewise entitled to credit for having taken steps to remediate the discharge.
[16] Otherwise, the defendants have not appeared or been convicted of any other offending under the Resource Management Act. There is no suggestion of profits being realised as a consequence of the offending, and the defendants have pleaded guilty at their first opportunity and are entitled to a discount of the fine of 33%.

Penalties

Mr Norris:

• CRN 09045500040 — convicted and fined $6,000. Court costs of $130 and solicitor costs of $113.
• CRN 09045500060 — convicted and fined $12,000. Court costs of $130 and solicitor costs of $113.
• CRN 09045500059 — convicted and discharged. Court costs of $130 and solicitors costs of $113.

Crichton Dairy Farms Limited:

• CRN 09045500039 — convicted and fined $10,000. Court costs of $130 and solicitor costs pursuant to the Costs in Criminal Cases (to be fixed by the Registrar if needs be).
• CRN 09045500057 — convicted and discharged. Court costs of $130 and solicitor costs of $113.
• CRN 09045500058 — convicted and fined $13,400. Court costs of $130 and solicitor costs pursuant to the Costs in Criminal Cases (to be fixed by the Registrar if needs be).

Mr Pheasant:

• CRN 09045500062 — convicted and discharged. Court costs of $130 and solicitor costs of $113.
• CRN 09045500061 — convicted and discharged. Court costs of $130 and solicitor costs of $113.

[21] I order that 90% of all fines are to be paid to the informant. As there are no costs sought in relation to informant's investigation costs, no order is made.

J E Borthwick

District Court Judge

JEB/WF/DD/ORC V CRICHTON, NORRIS AND PHEASANT (DC SENTENCING).DOC.