EPA Decision upheld in recent High Court Judicial Review case

Sue Ann Foley and Michelle Hayes ("the Applicants") – v - the Environmental Protection Agency and Ireland and the Attorney General (Respondents) and Irish Cement Limited (Notice Party)
 
The High Court found in favour of the Environmental Protection Agency (the "EPA") in a recent judgment of Mr Justice Twomey in respect of two judicial review challenges to the EPA's decision to grant Irish Cement Limited a revised licence for its cement works at Castlemungret Co. Limerick. Fieldfisher acted for the EPA.

The Court heard the two challenges together in the interests of efficiency and delivered a single judgment covering both matters.

These proceedings involved challenges to a decision by the EPA made pursuant to section 90(2) of the EPA Act 1992 to grant a revised Industrial Emissions Licence to Irish Cement Limited ("ICL") for its cement plant at Castlemungret, Co. Limerick. The revised licence permits ICL to change the fuel it incinerates from fossil fuels alone to a combination of fossil fuels and non-hazardous waste. This change has the potential to save up to 40,000 tonnes in carbon emissions per annum, reduce the amount of waste ending up in landfill and reduce the imports of fossil fuel. The Court noted that there are four other cement plants on the island of Ireland and the other four plans are permitted to incinerate waste as an alternative to fossil fuels.

The installation is located at a site in Limerick which comprises a limestone open cast quarry, the cement works and the Bunlicky Clayfield Pond at which the Notice Party manufactures CEM [1], eco-efficient CEM [II] and Sulfate-resisting Portland cements. The EPA granted the revised licence to ICL on 18th May 2021 after a very detailed licensing process and that decision was the subject of the judicial review challenges.

The Applicants who were both living in the vicinity of the Irish Cement plant alleged that the EPA's decision was unlawful.

The main issues raised by the Applicants in both proceedings included the following:
 

1. Alleged impermissible use of Regulation 10 of the Environmental Protection Agency (Industrial Emissions) (Licensing) Regulations 2013 ("the 2013 Regulations") to request further information;
2. failure to provide reasons for determining that ICL was a fit and proper person;
3. failure to designate Bunlicky Pond under the Water Framework Directive;
4. failure to apply the correct version of the EIA Directive (i.e. Directive 2011/92/EU as amended by Directive 2014/52/EU);
5. a number of grounds related to the alleged failure to conduct an adequate appropriate assessment and/or Environmental Impact Assessment;
6. error in the manner in which the Agency considered the impact of Chromium 6;
7. alleged failure to describe the features of the project and measures envisaged to avoid or prevent a breach of sulphur dioxide emission limits; and
8. alleged failure to deal with submissions made by third parties including those prepared by Dr Imelda Shanahan on behalf of Ms Foley.

The EPA submitted that a number of matters raised by the Applicants at hearing had not been pleaded. In respect of those matters which had been pleaded by the Applicants, the EPA sought to demonstrate to the Court that it had properly applied the legal framework and that there was adequate information before it so as to properly make the decision to grant a revised licence. The EPA further asserted that the Applicants were simply not happy with the merits of the issues which were determined by the EPA in the course of the licence review process and these are not "legal errors" that could be reviewed by the Court.

The Applicants spent a significant amount of time at hearing on the alleged lack of reasons for the EPA's decision to determine ICL a fit and proper person. Counsel for the EPA submitted that in the context of the granting of a revised licence to ICL who were already deemed a fit and proper person in respect of the pre-existing licence, the requirement for reasons was not as stringent as if ICL was applying for a licence outright and took the Court to relevant documents to demonstrate that sufficient reasons were in fact provided in this context.

Mr Justice Twomey heard the case over seven days in May 2022, and Judgment was delivered on 26 July 2022. A significant portion of the judgment is dedicated to the rules regarding pleadings and the need for precise pleadings in an application for judicial review. Mr Justice Twomey identified a number of factors by way of background to support the need for precise pleadings and the Court's responsibility to strictly enforce this. Such factors include the seriousness of an allegation that a public body has acted unlawfully, the fairness to Respondents in understanding the case they have to meet and the lack of costs deterrent in environmental cases where Applicants have costs protection and are not liable for the Respondents and Notice Parties costs regardless of the outcome. Mr Justice Twomey found that a number of issues raised at trial had not been properly pleaded and held that he did not have jurisdiction to consider these points.

The need for precise pleadings and the efficient administration of justice:

Mr Justice Twomey highlighted the importance of correctly pleading points in submissions to the Court, prior to the hearing itself. He drew reference to the Court of Appeal judgment in Morgan v ESB [2021] IECA 29 at para 11:

"A plaintiff is required to plead specifically and cannot properly rely on the pleading equivalent of the Trojan Horse, which can as needed be sprung open at trial to disgorge a host of new and/or reformulated claims."

Some of the claims argued but not pleaded related to wild life (including Whooper Swans and Dolphins), a failure to comply with the Water Framework Directive and insufficient consideration of the proportion of waste and fossil fuel to be incinerated.

The Court took a strict approach and held that it did not have jurisdiction to consider those matters raised by the Applicants at hearing which were not pleaded. The Court considered whether it should deal with the merits of those unpleaded claims in case an appellate court reached a contrary view on the pleading point. Ultimately, the Court decided not to do so as it considered there was no incentive for parties to ensure that their case is properly pleaded, that with the current shortage of judges there is an increased onus on courts to ensure that court resources are used efficiently, that if it did deal with the points the resulting judgment would be based on arguments which were one-sided, and in light of the Supreme Court deprecating the approach in judicial review of making arguments in court for which leave has not been granted in AP v DPP [2011] 1 I.R. 729 at para 8.

Mr Justice Twomey also expressed concerns at the length of time taken in recent civil cases to decipher and administer justice, echoing Justice Charleton's extra-judicial statement that civil cases have become "unfocused, demanding too much judicial time and this requires radical reform". [Charleton J., Trinity College Law Review 2022 at para. 2.]

Another issue highlighted in the Judgment was the greater onus on Courts to ensure efficiency in environmental cases as while the threat of a costs order against a litigant operates as a deterrent to the inefficient use of court time, it does not have the same deterrent effect in environmental cases as in other cases as environmental litigation is required to be not prohibitively expensive for Applicants. Mr Justice Twomey considered that there is arguably a greater onus on the court in environmental cases to ensure that there is an there is an enforcement of the rules on pleadings in those cases, since the taxpayer, even if it wins the case, may not be awarded its full legal costs against a losing Applicant in an environmental judicial review.

Mr Justice Twomey notes at paragraph 57 of his judgment that the existence of such a strict time limit in judicial review "would also seem to suggest that the alleged illegality, which is claimed to make the administrative decision null and void, should be one which is immediately and reasonably obvious to a challenger (as distinct from, say, a long list of possible inconsistencies and discrepancies regarding a decision of a State body, which discrepancies have only come to mind over several months preparing for a hearing, or indeed on the eve of a hearing)".

Points that were pleaded and argued at the hearing:

Application of the Habitats Directive:

As there are protected sites under the Habitats Directive in the vicinity of the Irish Cement factory (for example, the River Shannon and River Fergus SPA), the grant of the Revised Licence is subject to Article 6(3) of the Habitats Directive and the European Communities (Birds and Natural Habitats) Regulations 2011 (S.I. No. 477/2011). The Court noted the principles set out in the Supreme Court's decision in Connelly v An Bord Pleanála [2018] IESC 31 that before consent is granted by the EPA to issue a revised licence, all scientific doubt about the potential adverse effects on the sensitive area must have been removed and that specific scientific findings must be made which allow that conclusion to be reached. The Court then went on to consider the specific claims made by the applicants in relation to the Habitats Directive:

Nitrogen Emissions

One of the claims made by Ms Foley related to emissions arising from the co-incineration of waste and alternative raw materials with the existing fossil fuels used by ICL. Ms Foley alleged errors in ICL's modelling methodology for nitrogen oxide emissions and nitrogen deposition. However, the Court found against this claim in circumstances whereby the Applicant said that the NIS used the wrong deposition rate, the EPA agreed and despite having sought data using the revised deposition rate, noted that it still fell below the recommended levels. Accordingly, the Court held that it could not see that there was any gap or lacuna in the analysis to give rise to a reasonable scientific doubt or that an intelligent person could not discern the reason for the EPA's analysis and conclusions regarding the submissions of Ms. Foley.

Sulphur Emissions

It was noted that Ms Foley made a general plea regarding sulphur dioxide and compliance with emission limit values ("ELVs"). As the EPA had agreed with the submissions made by Ms Foley and by Ms Foley's expert, Dr. Shanahan, and the fact the EPA had advised that ICL should be subject to defined limitations, the Court refused to recognise any basis for challenging the legality of the decision of the EPA in relation to such claims. Ms Hayes also made a claim in respect of Sulphur Emissions on the grounds that her scientific concerns were not addressed but the Court found that the EPA agreed with Ms Hayes' claims regarding sulphur dioxide and the Court rejected this claim.

Emission Level Values and Conditions in the Revised Licence

The Applicant also raised a claim that the EPA had not established beyond reasonable scientific doubt that there will be compliance with the ELVs in the revised licence and it was therefore considered relevant by the Court to refer to the conditions in the Revised Licence. The Oral Hearing Report dealt with conditions to be inserted in the Revised Licence, one of which (Condition 6.3) places an obligation upon ICL to prepare a test program for the co-incineration of waste. This condition effectively states that there will be no entitlement on the part of ICL to co-incinerate waste and fossil fuels, unless it had been established by a test programme that there is compliance with ELVs set out in the licence. This was found to be a complete answer to the claims asserted in this regard by the Applicant and the Court noted it is clear from the decision of Hogan J in the Court of Appeal decision in People over Wind v An Bord Pleanála [2015] IECA 272 that ensuring that no scientific doubt remains can be achieved through the use of conditions in a licence.

Treatment of Chromium emissions

Ms Hayes asserted that the EPA's decision is unlawful because the EPA used a figure for background concentration of hexavalent chromium (chromium VI) based on ambient site monitoring of ICL's factory from August 2017 to February 2018. Ms Hayes claimed that a correct baseline in this context is a site that is unaffected by the site under consideration.

The Court rejected this claim as, in the Court's view, ICL needed to determine the actual effect of the grant of the revised licence and therefore had to consider the actual and current concentration of emissions versus the likely concentration of emissions from the new activity and there was no requirement to consider a greenfield site when evidently there was ongoing activity at the site pursuant to the existing licence.

Secondly, Ms Hayes claimed that the assessment of chromium had the option of using a figure between 3% and 8% figure for background chromium VI as a percentage of total chromium (as recommended by the US Air Resources Board 1986 report) and that ICL chose the 3% figure in order to ensure that the site complied with the guidelines, when it should have used the 8% figure to comply with the precautionary principle. The Court noted from the EPA's oral hearing report that rather than relying on a range of background levels of chromium VI, the EPA had measurements of the actual level of background chromium VI at the ICL site which demonstrated a level of 2.5% and that this would lead to the level of chromium VI remaining with the relevant guidelines.

The court therefore considered Ms Hayes' complaints regarding the treatment of chromium VI to be unfounded and not a basis for challenging the EPA's decision.

The Emission Level Values and Volumetric flow

It was submitted by Ms Foley that there was a failure by the EPA to consider the worst-case scenario in the context of increased volumetric flows and the emission rates under the Revised Licence. However, the Court noted that the modelling assessment was carried out in accordance with EPA guidance with maximum concentrations predicted at the worst-case receptor for the worst-case hour/day/year based on licenced parameters. As such, the Court found that there was no factual basis for Ms Foley's claims in this regard and therefore there was no basis for invalidating the EPA's decision on this ground.

Regulation 10 of the 2013 Regulations

Ms Hayes claimed that the EPA was prohibited from requested further information pursuant to the 2013 Regulations more than once. However, the Court held that Ms Hayes had incorrectly interpreted this provision and went on to confirm that the ordinary meaning of the words in a statutory provision is to be applied and in such circumstances, the wording of the above regulation assigned the EPA a wide discretion to seek, 'as it considers appropriate', information from an Applicant. The Court also noted that if the legislature had wished to restrict the EPA in this regard, it could easily have done so, as was done in relation to information which is requested by the EPA pursuant to Regulation 13 of the 2013 Regulations. The omission of any similar wording in Regulation 10 reinforced the Court's view that there was no justification to read such language into Regulation 10.

Application of the wrong EIA Directive

Both Applicants submitted that the wrong EIA Directive was applied by the EPA to Irish Cement's application for the Revised Licence. The Court provided an in-depth analysis in this regard, found at paragraphs 185-204 of the judgment and ultimately decided to reject such claims.  The background to this claim is that Directive 2011/92/EU (known as the EIA Directive) was amended by Directive 2014/52/EU. The 2014 Directive introduced transitional provisions which determined in respect of any project whether either the 2011 Directive or the 2011 Directive as amended by the 2014 Directive applied and the relevant cut-off date was the 16 May 2017. The Applicants argued that the 2014 Directive should have applied to the application on the basis that whilst an Environmental Impact Statement ("EIS") was submitted by ICL prior to 16 March 2017, the EPA requested further information after this date and so the application should have been considered under the 2014 Directive.

The Court noted that the application by ICL together with the EIS was formally lodged on 16th May 2016 and the Court considered that the crucial criterion for determined which Directive applied was that date. The Court found that since that date was before the deadline date of 16th May 2017 for the 2014 Directive to start to apply to applications, this meant that the 2013 Directive applied.

Noting that a key driver for the transitional provisions is to ensure legal certainty and that, if 'any procedural steps have already been initiated under the 2011 Directive, there should be no doubt arising about which Directive applies, the Court held that it would defeat legal certainty if the fact that the EPA sought further information after this date regarding the EIS meant that the 2011 Directive did not apply to the application. The EPA had applied the correct Directive to ICL application and Ms Hayes' claim to the contrary was rejected.

Transposition Claim

The Applicants claimed that the State had failed to transpose the 2014 Directive into Irish Law. The Court noted that the only claim made at the hearing was a claim that there was a failure to transpose into Irish Law the transitional provisions of the 2014 Directive and no claim was made at the hearing regarding the failure to transpose any of the other provisions of the 2014 Directive into Irish Law. The Court provided analysis of such transitional provisions at paragraph 185 onwards of the Judgment and had concluded that the 2011 Directive was correctly applied by the EPA to ICL's application. In the Court's view the question of whether or not the State transposed the transitional provisions of the 2014 Directive into Irish Law was academic as the 2014 Directive would still not apply to the application the subject of these proceedings and this did not need to be considered by the Court.

The effect on moss (byrophytes)

A significant portion of Ms Hayes' submissions focussed on the claim that the EPA's decision was unlawful because the EPA failed to consider the impact of that decision on bryophytes (i.e. moss) in the context of appropriate assessment under the Habitats Directive. Ms Hayes submitted that the EPA should have carried out further investigation of the consequential impact on other species in the Lower River Shannon Estuary SAC and the River Shannon and River Fergus Estuaries SPA including a habitat survey for bryophytes even though these European sites are not designated for bryophytes. It was noted that the Oral Hearing Report confirmed that Bryophytes are not qualifying interests and therefore a habitat survey of bryophytes was not considered to have been required.

Ms Hayes argued that this approach by the Chair, which was subsequently adopted by the EPA, was unlawful and as a result, invalidated the grant of the Revised Licence. Ms Hayes supported her view that a habitat survey of an unprotected species such as moss/bryophytes should have been undertaken, by reference to paragraphs 39 and 40 from the judgment of the CJEU in C-461/17 Holohan v. An Bord Pleanala ECLI:EU:C: 2018:833.

The Court found that even on a prima facie level, the Applicant's approach appeared to be illogical. The Court did however consider the substance of the Applicant's point and referred to the judgment of the CJEU in Holohan.

Holohan implied an obligation on the EPA to carry out a survey on all species present on the site. However, the Court did not agree with Ms Hayes' interpretation and found instead that Holohan makes it clear that unprotected species are included in the assessment if they are necessary for the conservation of the protected species. Accordingly, the Court concluded that an assessment was not required to be undertaken of unprotected species such as bryophytes where their protection has not been designated as necessary for the conservation of the habitat types and species listed for those protected areas.

In light of the above, the Applicant's case was said to have been reduced to a bald assertion that a survey should have been carried out in relation to bryophytes. The Court noted it was clear from the decision of O'Neill J in Harrington v An Bord Pleanala [2014] IEHC 232 as that just because an objector to a particular development or licence makes an assertion does not mean that he or she has raised a scientific doubt. Ms Hayes' claim was insufficient to raise scientific doubt and therefore there was no basis for challenging the legality of the grant of the Revised Licence on the grounds of the potential impact upon bryophytes since bryophytes are not a qualifying interest for the two identified protected sites and Ms Hayes had provided no evidence that there was any potential effect on the conservation objectives of the two sites arising from a potential impact on bryophytes.

Fit and Proper Person

Ms Foley claimed that the decision by the EPA to grant the Revised Licence should be invalidated because of the failure of the EPA to provide any, or sufficient, reasons that Irish Cement is considered to be a 'fit and proper person' to be granted the Revised Licence (as per s.84(4) of the 1992 Act), in circumstances whereby ICL has been convicted on three previous occasions of offences over a 15 year period under the Act.
To be considered to be a 'fit and proper person', the applicant must have the requisite technical knowledge to carry out the licenced activity, it must have the requisite financial means and it must not have been convicted of an offence under environmental legislation. Notably, s.84(5) grants the EPA an untrammelled discretion to regard any applicant who has been convicted of offences under environmental legislation, to be a fit and proper person.

The Applicant asserted that there had been insufficient reasons provided for the EPA's decision that Irish Cement is a 'fit and proper person'. The Court referred to Mr Justice Humphreys' useful summary in Balscadden Road SAA Residents Association Ltd. V. An Bord Pleanala [2020] IEHC 586 in regard to the principles to be applied by a court when assessing a claim that an administrative body has failed to give reason or sufficient reasons for its decision. Such principles included:
 

• The extent of reasons depends on the context;
• what is required is the giving of broad reasons regarding the main issues;
• there is no obligation to address points on a submission-by-submissions basis;
• it is not up to the applicant to dictate how a decision is to be organised;
• there is no obligation to engage in a discursive, narrative analysis;
• there is no obligation to set out the reasons in a single document if they can be found in some other identified document; and
• reasons must be judged from the standpoint of an intelligent person who has participated in the relevant proceedings and is appraised of the broad issues involved, and should not be read in isolation.

Mr Justice Twomey noted the following context which was relevant to note in considering the reasons for the decision:
 

• The EPA is an expert body which has already granted an industrial emissions licence to ICL;
• the EPA has licensed the co-incineration of waste with fossil fuels at all other cement factories in the State;
• ICL is the licensee at the cement factory in Platin, County Meath and has been deemed to be a 'fit and proper person' to hold an emissions licence for co-incineration of waste and fossil fuels at that facility;
• S.84(5) of the 1992 Act expressly provides for a person to be a fit and proper person, notwithstanding that it has been convicted of environmental offences;
• the EPA has a very wide discretion to determine whether a person is fit and proper;
• the decision being challenged is not a decision to grant a licence, de novo, but rather is a decision to revise an existing licence;
• there is a difference between the extent of the reasons which will be required a decision to grant a revised licence; and
• at the time of the decision on the Revised Licence, ICL was the holder of an existing licence and there was no evidence that, at the time of its decision to grant the Revised Licence, the EPA did not regard ICL as anything other than a fit and proper person for the purposes of its existing licence.

The Court also noted that if the EPA had refused to grant the Revised Licence because it decided that ICL was not a fit and proper person to hold the Revised Licence, ICL would still have continued to hold the existing licence to burn fossil fuels. In this regard, the Court found that the reason that ICL is a fit and proper person for the purposes of the Revised Licence is that it is the holder of an existing licence and that this reason should be obvious to an intelligent person who had participated in the proceedings. The Court further held that the conditions attached to the Revised Licence, insofar as they address fugitive dust and thus the issue which led to the previous convictions, are themselves reasons for the decision of the EPA to regard ICL as a fit and proper person.

Ms Foley's argument was therefore rejected by the Court.

Conclusion:

In light of the above, the Court rejected the entirety of the Applicants' challenges to the EPA's decision in this case and ordered the parties to engage with each other to see if agreement may be reached regarding any outstanding matters without the need for further court time.

Written by: Rory Ferguson and Alice Normoyle