Appellants: McBride QC; Levy & McRae, Glasgow

Respondent: L Pike, AD ad hoc; Crown Agent

20 December 2011

Introduction

[1] On 2 August 2011, in Inverness Sheriff Court, the appellants pled guilty, on a summary complaint, to a charge in the following terms: -

" Between 1 and 28 July 2010, both dates inclusive at Belladrum Burn, Beaufort Estate, by Beauly you S D CAMERON LIMITIED (being a company registered in Scotland under company registration SC363452) did carry on a controlled activity, namely carrying out building or engineering works, or works other than construction, alteration or operation of impounding works in surface water or wetlands, in inland water (other than groundwater) in that you did carry on engineering works and did deepen and widen the channel of a pool in the said Belladrum Burn and did remove sediment including stones, gravel and sand from the river bed which involved operating machinery namely a digger in inland water namely said Belladrum Burn without the authority of an authorisation under the aftermentioned Regulations;

CONTRARY to the Water Environment (Controlled Activities) (Scotland) Regulations 2005 Regulations 5 and 40(1)(a) and the Water Environment and Water Services (Scotland) Act 2003 Section 20(3)(d)"

The appellants' plea of not guilty to a second charge they faced and pleas of not guilty tendered by Steven Cameron, a co-accused, in respect of two other charges were all accepted by the respondent. On the same day, having been addressed by the procurator fiscal depute and in mitigation on behalf of the appellants, the sheriff imposed a fine of £30,000, allowing seven days for payment. The minute of proceedings records that fine had been discounted from one of £40,000, in terms of Section 196 of the Criminal Procedure (Scotland) Act 1995. The appellants now appeal against the fine imposed.

[2] The facts and circumstances giving rise to the charge to which the appellants pled guilty are as follows. The offence was committed in the riverbed of the Belladrum Burn, in the Beaufort Estate, by Beauly, which is owned by Ann Gloag. Works which had not been authorised by the Scottish Environmental Protection Agency (" SEPA") in terms of regulation 8 of the Water Environmental (Controlled Activities) (Scotland) Regulations 2005 ("the 2005 Regulations") were carried out in an area of the riverbed, approximately 120 metres upstream from the burn's confluence with the River Beauly. 100 metres downstream from where the works were carried out there is a small building which is used by Ann Gloag and members of her family as a summerhouse. The Belladrum Burn is surrounded by an area of deciduous and coniferous woodland. The unauthorised works were carried out at a part of the burn which is wide and shallow. It is an area of low gradient. The burn, at that point is located in a flood plain, formed by sand, silt, gravel and alluvium.

[3] On 28 July 2010 employees of the Ness and Beauly Fisheries Trust responded to complaints they had received from a ghillie and a fishermen. Those complaints related to a mechanical digger being used to carry out extensive excavation works within the Belladrum Burn. The employees of the trust went to Beaufort Castle. On arrival there they met Mrs Gloag and informed her of the complaints they had received. Mrs Gloag informed them that she had instructed that the burn be deepened, so as to allow children to swim in the burn. An employee of the trust then contacted SEPA. SEPA officials immediately took the view that authorisations, granted by them, were necessary for the excavation that was being carried out to the burn. They officials checked SEPA's records and discovered that no application for authorisation to excavate the burn bed had been received. Accordingly they decided to visit the locus.

[4] Around 5:15 on 28 July 2010, SEPA officials visited the downstream end of the Belladrum Burn. After inspecting the burn they went to the summerhouse. Close by the summerhouse they found a large trailer full of sand, gravel and stones. The trailer was wet and dripping water. It was obvious that the material on the trailer had recently been extracted from the burn. Parked downstream of the summerhouse the SEPA officials noticed a red Vauxhall van bearing the appellants' signage "S.D.Cameron Limited".

[5] The SEPA officials also encountered employees of the appellants, who were still on site. The SEPA officials explained to the appellants' employees that they were investigating unauthorised excavation works to the burn bed. The appellants' employees were asked about the volume of material extracted from the burn. In response to that enquiry the SEPA officials were informed that 20 trailer loads of rock and sediment had been removed from the burn. The purpose of doing so was to steepen the burn channel and to prevent flooding of the summerhouse. The appellants' employees stated that they were aware of the requirement to "obtain licences" for the work they were carrying out, but that they thought it was "not their job to get licences".

[6] On investigating the matter further SEPA officials noticed a digger parked in the vicinity and a large mound of sediment, sand and gravel piled beside the burn. The officials later confirmed that the area of the burn bed excavated by the appellants had been 44 metres in length and 14 metres in width. The result of that excavation had been that the burn channel had been considerably deepened and widened at the locus. The burn banks and the point bars forming the channel of the burn had been adversely affected. The removal of the sediment and the "armour layer of the burn bed" had left the finer sediment underneath unprotected and subject to further erosion.

[7] The SEPA officials instructed the appellants' employees to cease work immediately, to enable further investigation to take place. The appellants' employees complied with that instruction. Subsequently work was carried out to reinstate the burn bed, which had been removed by the appellants. Those works were carried out by the appellants and other contractors to the satisfaction of SEPA.

Submissions

[8] In advancing submissions in support of the appeal, senior counsel for the appellants began by stressing that the legislation under which this prosecution had been brought, the Water Environment and Water Services (Scotland) Act 2003 ("the 2003 Act") and the 2005 Regulations covered a wide variety of activities, including those that caused direct harm to members of the public. It was submitted that no such harm had occurred in the present case.

[9] The appellants appeared before the court as a first offender. The company had carried on business as land managers, since it was incorporated approximately 2 1/2 years previously. Both of the two directors of the company, one of whom was the former co-accused and whose pleas of not guilty had been accepted, had extensive experience in land management. Senior counsel explained that neither of the directors had any knowledge of the fact that authorisation from SEPA was required for the excavation works the appellants were carrying out. His instructions were that Mrs Gloag's estate managers had also been unaware of such a requirement. Whilst it was accepted that ignorance of the law provided no excuse, the ignorance of those referred to was, nevertheless, part of the background to the commission of the offence.

[10] Senior counsel sought to argue that the unauthorised excavation works had not resulted in any serious effect on the environment. Once SEPA had intervened, a full reinstatement of the burn had taken place. The reinstatement works had extended over two weeks. The land owner, Mrs Gloag, had paid for those works in which other contractors had assisted the appellants. The reinstatement works had been carried out to SEPA's approval. There was no suggestion that there had been any long-term effect on the fishing. Senior counsel argued that, notwithstanding those considerations, the sheriff appeared to have ignored the fact that the river bed had been reinstated and had not treated that as any form of mitigation.

[11] The sheriff reports that during the course of the submissions made to him, he was informed, by the solicitor appearing on the appellants' behalf, that she held within her firm's bank accounts the sum of £40,000. That was the maximum fine that could have been imposed by the sheriff. Furthermore she informed the sheriff that payment of a fine of that amount could be made immediately. Having provided that information, the solicitor for the appellants limited her submissions about the financial circumstances of the appellants to the fact that the each of the two directors earned £20,000 a year from the appellants, both were married and both had children. The solicitor resisted the suggestion made by the sheriff that she might wish to produce accounts relating to the appellants' finances or documentation relating to the cost of the remedial works.

[12] Senior counsel argued that the fact that £40,000 had been lodged with the solicitor's firm was entirely irrelevant to the sheriff's decision as to the level of fine to impose. He also argued that the sheriff had erred in selecting £40,000 as a starting point from which any discount in respect of an early plea should be made.

Discussion

[13] Regulation 5 of the 2005 Regulations provides: -

"No person shall carry on, or shall cause or permit others to carry on, any controlled activity except in so far as it is -

(a)   authorised under these Regulations; and

(b) carried on in accordance with that authorisation."

Regulation 40(1) of the 2005 Regulations provides that it is an offence for a person to contravene Regulation 5. A person guilty of such an offence is liable on summary conviction to a fine not exceeding £40,000 or to imprisonment for a term not exceeding six months, or to both;. and on conviction on indictment to a fine or to imprisonment for a term not exceeding five years, or to both. £40,000 is accordingly the upper limit of the penalty that can be imposed on a body corporate, but only on summary conviction, for an offence under Regulations 5(1) and 40(1)(a) of the 2005 Regulations. For the more serious offences, such as those referred to by senior counsel during his submissions, prosecution on indictment would be competent.

[14] In our opinion the sheriff was perfectly entitled to regard the unauthorised works as constituting a serious offence. They were extensive. The appellants carried them out on behalf of the landowner, Mrs Gloag. It is reasonable to assume that Mrs Gloag's estate managers were also aware of what was going on. On no view were they carried out on the initiative of the appellants.

[15] The unauthorised works were carried out over a period of approximately four weeks. They covered a stretch of the burn bed, approximately 44 metres long and 14 metres wide. Twenty trailer loads of rock and sediment were removed. Having regard to the nature and extent of the unauthorised works the sheriff was entitled to take the view that they had caused considerable damage to the burn and to reject any suggestion that the effect of those works had only been minimal. Of course the restoration works carried out, after SEPA's intervention, sound in mitigation of the offence committed by the appellants. However, the fact that extensive restoration was required and lasted over a period of two weeks merely serves to reinforce the nature of the damage which resulted from the carrying out of the unauthorised works.

[16] Having regard to what the sheriff was informed about the state of knowledge of the appellants' employees, the sheriff was also entitled to have some reservations about what he was informed as to the ignorance of the appellants and their directors as to the need to obtain an authorisation. The same could be said about the stated ignorance of the landowner's estate managers.

[17] In our opinion, it was also open to the sheriff to regard the appellants as being in a position to pay a fine of £40,000. That was presumably why mention was made of that sum, during the plea in mitigation. As we have already noted, the sheriff was informed that the appellants' solicitors held £40,000 in their bank account. We are not persuaded, therefore, that the reference made by the appellants' solicitor to £40,000 should have been disregarded, as senior counsel suggested. What the appellants' solicitor said confirmed that the appellants are in a position to pay a fine of up to £40,000.

[18] Having reviewed all the papers placed before us and considered the submissions of senior counsel we have reached the conclusion that the sheriff erred in choosing a starting point of £40,000. We are not persuaded that if the appellants had been convicted after trial, it would have been appropriate for the sheriff to have imposed a fine of £40,000. The appellants are first offenders. That is an important factor in mitigation. So also is the fact that the unauthorised works were not carried out on the initiative of the appellants alone. They were instructed to carry out them out by others.

[19] Taking into account the other factors we have discussed, including the fact that renovation works have been carried out to the satisfaction of SEPA, we intend to allow the appeal by reducing the fine to one of £20,000. We reach that figure from a starting point of £ 25,000 from which we deduct 20% on account of the plea of guilty. In our opinion a discount of 33% is not warranted in this case, by reason of the fact that the complaint called in court on 24 March 2011, 17 May 2011, 31 May 2011, 21 June 2011, 12 July 2011 an 28 July 2011, before the hearing on 2 August 2011 at which the appellants' plea of guilty was tendered and the fine of £30,000 imposed.