EP Act executive officer liability tied to when harm is actually caused
The liability of an executive officer of a corporation under s 493(2) of the Environmental Protection Act 1994 (Qld) (EP Act) ,for failing to ensure that the corporation complies with the Act, is tied to the corporation’s actual commission of an offence. The environmental harm caused by the corporation must have come to fruition during the executive officer’s tenure as an executive officer.
On 6 August 2021, the Court of Appeal handed down its reasons in R v Dumble & Ors  QCA 161 relating to a ruling by the District Court of Queensland referred under Section 668A of the Criminal Code 1899 (Qld).
The Respondent parties were directors of Linc Energy Limited, with the case relating to the charges brought against those directors, alleging serious environmental harm while undertaking underground coal gasification activities near Chinchilla. The Respondents were charged under Section 493 of the EP Act with failing to ensure that the company complied with the EP Act.
Broadly, the Respondents asserted that to prove the commission of the charged offences, the prosecution must prove that the company committed the alleged offence (against Section 437(1) of the EP Act) during a period when the respective Respondents were one of its executive officers.
The question referred to the Court pursuant to Section 668A of the Criminal Code was framed in the following way:
Is it necessary, pursuant to s 493(2) of the EP Act, that, for an executive officer of a corporation to be guilty of the offence of failing to ensure that the corporation complies with the EP Act (in circumstances where the corporation commits the offence of wilfully and unlawfully causing serious environmental harm), the serious environmental harm caused by the corporation must have come to fruition during the executive officer’s tenure as an executive officer?
With reference to executive officer liability provisions under the Corporations Act 2001 and the Taxation Administration Act 1953, the Court found:
Ultimately, the Court of Appeal concluded that a person who is an executive officer of the corporation when the harm was actually caused is guilty of an offence under Section 493(2) of the EP Act (subject to the statutory defences).
In relation to the prosecution’s submission, that executive officers who have been grossly negligent could escape liability by resigning before the corporation put into effect the decisions to which the executive officer had contributed, the Court indicated that such a submission required proof of a connection between an accused and the corporation’s causative act and the text of the provision does not require that. Further, a director’s liability for offences committed in a corporate context is not limited to liability under Section 493 and Section 493 might not render criminally culpable all those who manage corporations who are morally culpable.
For further information and discussion, please contact our Planning and Environment team.