Last reviewed 3 August 2016
Sarah Holmes of Bond Dickinson LLP, reports on several cases which illustrate the range of options available to the court when sentencing individuals under the Environmental Offices Definitive Guideline.
Until 15 July 2016, the sentencing of individuals following conviction for environmental crimes had received little coverage compared with the sentencing of companies by courts applying the Sentencing Council’s Definitive Guideline on Environmental Offences. Since the Guideline came into effect on 1 July 2014 Thames Water Utilities has been fined £1 million and Powerday plc fined over £1.2 million following conviction for environmental permitting breaches.
However, the record term of imprisonment to which Terence Dugbo of Leeds has been sentenced for environmental crime serves to highlight the consequences for individuals as well as organisations for breaches of environmental law. Mr Dugbo was sentenced to seven years and six months imprisonment for breaching an environmental permitting condition, conspiracy to defraud and acting as a company director while disqualified.
When considering the sentencing of individuals under the Environmental Offences Definitive Guideline, the 12-step process to be followed by a court is similar to that for organisations, albeit with different starting points and category ranges for fines and custodial sentences, and some differences in the available ancillary orders. The following cases illustrate the range of options available to the court and some of the other consequences of a conviction.
Case 1: In the case of Terence Dugbo and his company TLC Recycling (in liquidation), the breach of environmental permit condition concerned the treatment of CFC gas cylinders on a site that was not permitted to undertake this activity. Had this been the only offence, any sentence imposed would have been much shorter since the highest end of the custodial range for a deliberate offence causing the highest category of harm is three years. However, this was just a part of the defendant’s criminal activity, which included falsifying paperwork submitted under the Waste Electrical and Electronic Equipment (WEEE) regime to claim £2.2 million in recycling payments from Producer Compliance Schemes, conspiracy to defraud and acting as a company director while banned. The defendant had previous convictions for illegally exporting hazardous waste to Nigeria and for fraud.
Mr Dugbo’s crimes also illustrate some current constraints on prosecuting and sentencing for environmental crime. The Definitive Guideline on Environmental Offences does not apply to breaches of the WEEE Regulations, for which only financial penalties can be imposed. Further, proceedings must be commenced within 12 months of the Commission of an offence. The compliance year for which Mr Dugbo was prosecuted was 2011, and the judge noted that the scale and complexity of the false paperwork was such that it took nearly a year for the Environmental Agency (EA) to go through it. Had it been possible to bring a prosecution under the relevant WEEE Regulations, then an unlimited fine could have been imposed in the Crown Court, but no term of imprisonment ordered.
In addition to sentencing Mr Dugbo to prison, the judge disqualified him from acting as a company director for 12 years and authorised commencement of recovery proceedings under the Proceeds of Crime Act 2002 for £2.2 million.
Case 2: In March 2016, the operator of an illegal waste site in North Runcton, Norfolk was sentenced to 15 months in prison for:
operating a regulated facility without being authorised by an environmental permit, in breach of the Environmental Permitting (England and Wales) Regulations 2010
failing to comply with two enforcement notices issued under the Town and Country Planning Act 1990 requiring the discontinuance of the use of land for the depositing, storage, handling, processing and transfer of waste and in respect of its import onto the site.
The defendant had used the appeals mechanism under the Town and Country Planning Act 1990 to delay the coming into force of the enforcement notices, which had been issued in September 2010. The appeal against the enforcement notices in August 2011 was unsuccessful but the defendant then lodged an application for permission to appeal against the inspector’s decision with the High Court. Although this was unsuccessful, the process delayed the coming into effect of the planning enforcement notices and the defendant continued to trade during this time.
The defendant claimed that he had not been aware that the operation was not legal until a visit from the EA Officers in November 2012. On inspection, the EA had found many thousands of tons of waste wood, waste soil and construction and demolition waste. The case report does not discuss the relationship between the County Council as the waste planning authority and the EA, but the prosecution of the defendant for breach of the Environmental Permitting Regulations (EPR) enabled a custodial sentence to be imposed.
Although the case report did not set out the court’s application of the 12 steps, the 15 months imprisonment would be consistent with a culpability finding of a deliberate offence, where a defendant intentionally breaches or flagrantly disregards the law, and a Category 2 level of harm, where significant adverse effect or damage is caused to air or water quality, amenity value or property. The starting point for consideration of a custodial sentence in such cases is 1 year with a range of 26 weeks’ – 18 months’ custody.
Case 3:A four-month prison sentence suspended for 18 months was imposed on Stuart Allen, the operator of an illegal waste cooking oil deposit, storage and processing plant in Dorset on 15 July 2016. The defendant had pleaded guilty to:
two offences of keeping controlled waste in a manner likely to cause pollution or harm human health
failing to comply with seven anti-pollution notices.
Some 60,000 litres of mixed oils and food wastes were found on the site, stored in a haphazard manner without bunding on bare earth. Spillages leaked through the ground and into a nearby watercourse and two neighbouring properties. The judge concluded that the defendant’s conduct had been reckless rather than deliberate. In addition to the suspended prison sentence, the defendant was ordered to carry out 200 hours of unpaid community service and made the subject of a Criminal Behaviour Order to prevent him from operating a waste business for 10 years.
Prosecution of director and company
Where a director has consented, connived or been neglectful in the commissioning of an offence by a company, then the EA can prosecute the director as well as the company. In the case of Wilco’s Waste Management Ltd, who operated a waste transfer station, the company pleaded guilty to five offences of breaching its environmental permit and one offence of failing to comply with an enforcement notice. The company was fined £12,000 for the six offences and ordered to pay costs of just over £4700.
In the prosecution brought against the company director, Adam Wilcott, the court was told that Mr Wilcott had total control of the site and had admitted the breaches, which he had permitted for commercial reasons, claiming that he would have gone bankrupt had he stopped accepting the waste. He was fined £1920 and ordered to pay £32 victims surcharge.
Although the sums of money concerned were very modest in comparison to the other costs, and the case report does not state whether or not that the company had been required by the EA to remediate the breaches, it is clear that the defendant company and the director were not in the best of financial health and that this was taken into account by the court.
Revocation of environmental permit
Were it not for the impecuniosity of the defendants, Christopher Prynn and Karen Prynn, who had traded as St Eval Recycling Company and operated a household, commercial and industrial waste transfer station in Cornwall, substantial financial penalties would have been imposed. Bodmin Magistrates’ Court imposed fines of £200 on each defendant and an order for costs in each case of £300.
The defendants had pleaded guilty to four offences of breaching EPR in respect of failure to comply with conditions imposed on the environmental permit, failure to comply with an enforcement notice and failing to remove waste from the site once the environmental permit had been revoked on the grounds of operator competence. Although requested to do so, the magistrates did not impose an order requiring the removal of the waste that had been left on the site. However, the magistrates made it clear that the penalty being imposed did not affect the impact of the offending on the environment or the community and, had the defendants had more money, then the penalty would have been substantially more.
The EA revoked the environmental permit, thus preventing the defendants from continuing in business.
Lessons to be learnt
The cases cited above are illustrative of some of the non-financial penalties that can be imposed under the Definitive Guideline where individuals are convicted of a relevant environmental offence, ie:
the unauthorised or harmful deposit, treatment or disposal, etc of waste
illegal discharges to air, land and water
other environmental offences, for which adjustments are made to the starting points and ranges of penalties, including transporting of controlled waste without registering, breach of the duty of care, breach of a nuisance abatement notice, restrictions on the use of public sewers and offences under the Transfrontier Shipment of Waste Regulations 2007.
While the fines in some cases can appear small, the consequences of convictions can be life changing. Convictions for environmental offences can be taken into account by the EA in considering whether to grant applications for bespoke environmental permits — and thus affect the ability to earn a living. For any organisation or individual, the additional costs that conviction can inflict include reputational damage, adverse impacts on current contracts and the ability to tender successfully for contracts in the future, involve remediation and restoration costs, and give rise to increased insurance premiums, quite apart from the likely loss of management time spent dealing with breaches. Environmental convictions can also be taken into account in a wide range of other circumstances. For example, many countries to which UK citizens wish to visit or emigrate stipulate character requirements. Convictions, even without a term of imprisonment having been imposed, may lead to applications being refused.
The cases discussed above concern individuals who were in business to handle waste produced by others. However, there are many opportunities for crime to be committed from the time that waste is produced until it is fully recovered or disposed of. The revised Duty of Care Guidance issued in March 2016 notes that when waste holders transfer waste to another waste holder they have a responsibility to ensure that the waste is managed correctly throughout its complete journey to disposal or recovery. Waste holders are advised to check the next waste holder is authorised to take the waste, ask the next waste holder where they are going to take the waste, and carry out more detailed checks if they suspect the waste is not being handled in line with the duty of care, for example requesting evidence that waste has arrived at the intended destination and that it has been accurately described.
As part of effective and robust governance and to minimise the risks of reputational damage by association, waste producers may wish to consider requiring contractors to notify them if anyone handling the waste in its complete journey has been or is convicted of a relevant offence, or if any waste carrier or facility has its licence or permit revised, suspended, revoked or become time expired. The contract could then set out the options open to the company in terms of termination or variation of arrangements. These same steps and measures should be in place at the outset when selecting or procuring contractors.