A Moree irrigator has been fined more than $350,000 after an investigation by the Natural Resources Access Regulator found the farmer built a dam without approval and knowingly pumped almost double their water allocation for years.
The company, Henry Payson Pty Ltd, operates 1,500 hectares of land at Binneguy Station, east of Moree on the Gwydir River, which includes 152 hectares of irrigated cotton.
The sole director and shareholder, George Barne, pleaded guilty to four charges in the NSW Land and Environment Court.
According to the NSW government's National Resources Access Regulator (NRAR) his company knowingly took water from the Gwydir Regulated River water source when its metering equipment was under-recording, and built a dam to store water for the purposes of irrigating cotton crops without holding the required approval.
The court fined the company $175,000 for the first offence which included 12 instances of knowingly taking water while equipment wasn't working between 2016-2017.
The second offence attracted a $125,000 fine for 27 instances of the same offence between 2017-18.
Barnes was also fined $43,750 for constructing a dam without approval, a further $10,000 for using the dam and ordered to pay legal costs.
Judge says farmer 'deliberately deceived' regulator
In the judgement, Justice Rachel Pepper said she was "satisfied beyond reasonable doubt that Payson knowingly took water while the meter was under-recording by at least a factor of 1.8".
She said Barne's actions "deliberately deceived the regulator" about the amount of water pumped from the Gwydir River during 2016-17 and 2017-18.
Justice Pepper said the offences caused "substantial harm to the integrity and consistent administration of the water management scheme in NSW".
Between October 2015 and March 2018, James Wheildon was employed by Barne as a farm manager on Binneguy Station.
Mr Wheildon told the court he said to Barne that there was a discrepancy with the meter.
"[Barne] threatened me with my job," Mr Wheildon told the court.
"[He] said something to the effect of 'You won’t work in this industry (or area) again, because you won’t get anything but fired and no reference by me, if you push this issue'.
"'You’ll be in as much trouble as me as you’re the one who ordered the water and pumped it. I don't want to hear anything about it'."
The court heard that after becoming aware the meter was under-recording Payson Pty Ltd grew more ambitious and increased the cotton crop plantation by 100 hectares to now include 250 hectares across all five irrigated fields in 2017-18.
According to Mr Wheildon, Barne also said if they fixed the meter it would all of a sudden show they were ordering twice as much water compared to the past couple of years which would "put us at risk of getting busted".
According to Justice Pepper, Barne then sold part of the cotton crop in advance and became anxious about the economic and social implications of revealing the under-metering.
Justice Pepper found that Barne falsified the water budget submitted to the department to cover up the water take.
According to Justice Pepper, "these findings significantly elevate the objective seriousness of the commission of the meter offences".
Farmer 'embarrassed, ashamed'
NRAR director of enforcement and investigation Lisa Stockley said the maximum penalties for corporations for taking water while a meter wasn't working was $2.2 million, but she was satisfied with the penalty handed down by the court.
"It is the first tier one offence that we've successfully prosecuted since NRAR commenced in 2018, and also the largest fine when those amounts are combined," she said.
Barne offered an early guilty plea and expressed his remorse to the court and detailed his mental health issues at the time.
"I am embarrassed, ashamed and very sorry for the impact on my family and the cotton industry," Barne told the court.
The Environmental Defenders Office said the fine should have been larger.
Andrew Kwan from the community legal centre said the penalty was inadequate.
"On its face, $353,000 sounds like a decent fine but it is just 5 per cent of the maximum penalty that was available," he said.