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IN THE REGIONAL (ENVIRONMENTAL) COURT FOR THE REGION OF THE CAPE, HELD AT HERMANUS

CASE NO: ECH 100/05

In the matter of:

THE STATE

versus

DAVID PIERRE ACKERAccused

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PLEA AND SENTENCE AGREEMENT IN TERMS OF SECTION 105A OF THE CRIMINAL PROCEDURE ACT, READ WITH SECTION 297 THEROF AND

SECTION 151 OF THE NATIONAL WATER ACT 36 OF 1998

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WHEREAS the accused, Mr David Pierre Acker (hereinafter referred to as "the director") has been charged with having contravened Section 151 (1) (i) of the National Water Act 36 of 1998 read with Sections 1 and Sections151(2), 152 and 153 thereof, together with Section 332 of the Criminal Procedure Act 51 of 1977;

AND WHEREAS the State, represented by the Chief Prosecutor, Mr. Lindsey Ashley Louther, duly authorised by the National Director of Public Prosecutions and the director, legally represented at all times herein by Messers Fairbridge Arderne and Lawton Inc. ("Fairbridges"), have negotiated and agreed a plea and sentence agreement in respect of the aforesaid charge, which they have reduced to writing;

NOW THEREFOREthe director, duly represented by Fairbridges and the State, represented by the Prosecutor, hereby agree as follows:

1.This agreement constitutes an agreement contemplated in Section 105(A) of the Criminal Procedure Act 51 of 1977 as amended (hereinafter referred to as "the Act"). In the event of the Court not accepting that this agreement to be just in terms of Section 105(A)(9)(a) of the Act, this agreement shall fall away and shall have no further force and effect, but subject to the parties' rights in terms of Section 105(A)(9)(b) of the Act.

2.The director admits that at the time of the commission of the offence, to wit on or about May 2003, he was the managing director and a shareholder of the company known as Whitby Distillers and Liquor Wholesalers (Pty) Ltd, (hereinafter referred to as "the Company"), which company owned and managed thedistillery and the property on which it is situated, in Grabouw, Western Cape, on the banks of the Klipdrift River (hereinafter referred to as " the property").

3.The director admits that on or during May 2003 he acted, or omitted to act, in such a manner that caused the pollution or possible pollution of a water source , as defined in the National Water Act 36 of 1998, being the Klipdrift River, in contravention of Section 151 (1) (i) of the said Act.

4.The director admits that he was the person in charge of operations at the Company when spent cooling water generated from the alcohol distilling process in operation at the property was dischargedinto thecooling water holding reservoirs, then erected on the property, and which then drained into the storm water drains and into the Klipdrift River, due to a malfunction of the pumps which had been installed to pump the said waste water from the reservoirs into the effluent disposal dam on the property.

5.The directorspecifically confirms that the pumps installed and utilised by the Company at the time of the aforesaid incident, and used to pump the said cooling water from the reservoirsinto the effluent disposal dam utilised by the Company for the purpose of storage, had malfunctioned, preventing the effective removal of the cooling water to the effluent disposal dam.

6.Mr Jacques Rossouw of the Department of Water Affairs and Forestry, Western Cape Region, ("DWAF") inspected the site on the 20 May 2003 after receiving a complaint from a riparian owner about an alcoholic smell emanating from the KlipdriftRiver in the vicinity of the property. He was informed of the malfunctioning pump whereupon he requested all operations at the distillery to cease as he suspected that the spent cooling water was causing pollution to the KlipdriftRiver. Production at the distillery was shut down, but on the morning of the next day, 21 May 2003, production was resumed at the property and the spent cooling water discharged into the KlipdriftRiver.

7.Mr Rossouw took water samples upstream and downstream from the discharge point at the property, as well as from the stream which was still being discharged from the property into the river. The director admits that the spent cooling water discharged into the Klipdrift Riverpolluted it by altering the chemical and biological properties of the water, (as defined in the National Water Act) and made it potentially harmful to aquatic organisms in the river and to the resource quality.

8.The director confirms further that on receipt of a letter received from Mr Rossouw of the Department of Water Affairs and Forestry, Western Cape Region, ("DWAF") on 22May 2003, advising the Company inter alia of the reasonable steps to be taken by it in terms of Section 19(1) of the National Water Act, 1998, including stopping all production at the distillery until the pump was replaced and to ensure that no further cooling water was to enter into the storm water drain on the property, he ensured that this instruction was duly followed at the property and there was no further discharge of cooling water into the Klipdrift River in that the aforesaid reservoirs were demolished and two cooling towers were erected on the property, to which the said cooling water was then pumped and, once cooled sufficiently, is now reused again as coolant in the distilling process.

9.The parties agree that no permanent damage has been caused to any organisms in the KlipdriftRiver or to the resource quality and that no enquiry in respect of compensation for harm, loss or damage in terms of section 152 of the Act is required. The proposed sentence as contained herein is aimed at address the future management of the distillery to avoid a recurrence of such incidents in the future.

10.The parties agree that following are material or substantial facts relevant to this agreement:

10.1.At the end of 2003, after the occurrence of the incident in question, the shareholding in the Company was substantially changed and a new senior management team was appointed by the new majority shareholder. Mr Andre Simonis was appointed as the new Managing Director of the Company and its name was changed to Oude Molen Distillery.

10.2.The new ownership of theCompany was accompanied by an injection of much needed capital, along with a new branding and image, and a commitment by the senior management and the directors of the Company to best practice environmental management within the distilling environment. The director has been retained as the production director and a minority shareholder and has been part of this process.

10.3.The new management team, led by Mr Simonis,has adopted aggressive Environmental Management Planning for the distillery, in the preparation of which, all the reports of previous environmental incidents at the property, were considered and measures agreed so as to ensure that there is no reoccurrence thereof. There has been no re-occurrence of the aforesaid incident.

10.4.As part of its environmental upgrading planning, the Company engaged and still currently retains the consulting services of:

10.4.1.Mr Simba Matora of Ecopulse who is an expert in industrial environmental performance management systems, with a particular focus on water utilisation minimisation and wastewater management; and

10.4.2.Mr Craig Sheridan of Triton Consultants, who is currently completing his PHD in chemical engineering at the University of Cape Town and is advising the company on the possibilities of developing a constructed wetland as part of the process of bringing the waste water to within acceptable levels for re-use in the distillery or for the irrigation of vineyards to be developed on the property, the success of which will hopefully dictate new methods of effluent treatment in the Wine and Brandy industry nationwide.

10.5.In further pursuance of its environmental objectives, the Company has now undertaken the significant re-design of the waste water and effluent flow systems on the property and implemented this redesign. This redesignentailed the development of different systems to deal with and differentiate between different by-products of the distilling process, including effluent waste,cooling water, wash water and blow off that is created by the distilling process, none of which is now discharged into the KlipdriftRiver. More specifically:

  • the construction of two further cooling towers on the property, all four of which now operate. This means that the Company is now able to circulate and re- utilise 90 % of the cooling water that is circulated in the distilling process and hence has dramatically reduced its need for and , dependence on fresh water for cooling purposes;
  • the redirection of the effluent in the factory itself in newly installed high grade stainless steel piping (80mm), via a monitoring gauge, directly to the effluent disposal dam. A high grade of piping was utilised to cope with the waste water temperature which leaves the plant at 90 degrees Celsius.
  • The construction of two sumps, underground to catch and pump all the wash water from the distillery factory to the effluent disposal dam.

The total cost of and procurement of the new systems, viz. pipes, effluent gauge and installation ran to over R350000.00.

10.6.The Company has also embarked on a general upgrade of the distillery since early 2004, including the comprehensive redevelopment of existing buildings and the addition of new buildings and has also installed gauges on the fresh water lines and effluent lines, and enhanced its system of monitoring the usage of raw water. To this end regular breaks in the rawwater pipes leading from the fresh water dam from which the Company derives its fresh water , arising from forestry contractors driving over these lines, are now being monitored by the Company and the issue addressed with the SAFCOR management, on whose property these incidents occur. The Company has also begun to address the unauthorised tapping into their fresh water lines by third parties, conscious that recent water scarcity demands careful and responsible legal utilisation of this resource.

10.7.The Company has also now specifically set out to find a better utilisation of the distillery's waste water which is currently stored in an effluent disposal storage dam of less than 50,000 cubic meters on its property. This storage dam, despite having been in existence for many decades prior to the original Whitby Distillers having started operations on what was originally the Highlands Canning industrial site, has not at any point received a licence or authorisation from the DWAF or its predecessors and has been a problem which has been inherited by the Company, with which the Company intends to deal, as set out below.

10.8.In this regard it is stressed that the Company is acutely aware that any solution it arrives at in respect of the disposal or use of waste water needs to be sustainable in the longer term and is currently exploring viable options in this regard. In all cases the new management of the Company, including the director, are of the view that solutions that are adopted need to be part of a comprehensively monitored programme to be able to predict problems before they arise.

10.9.The working relationship between the Company and the DWAF has, since the Company has a new management team and majority shareholder, substantially improved; and there have been no complaints directed at the Company by DWAF in respect of its effluent disposal since environmental management planning has been implemented. Mr Rossouw of DWAF visited the said storage dam subsequent to the new management team taking over and is witness to the fact that the waste water dam itself now has minimal noxious odours.

10.10.All of the regular monitoring tests on the effluent disposal dam which the Company now ensures are performed,show a slow but clear trend towards the contents thereof meeting a Chemical Oxygen Demand ("COD") level that would be sufficiently low enough to lawfully entitle the Company to utilise the said water for irrigation purposes.

10.11.The Company, subsequent to a noise complaint in July 2004, arranged for and held a meeting with the residents of Klipkop, Grabouw, and the Company's neighbours, and explained to them in a free and frank manner the workings of the distillery, the recent changes to the Company, and its future plans. Since the date of that meeting, which was addressed by Mr Simonis, there have been no complaints by the community surrounding the property.

11.The directoragrees to enter a plea of guilty in respectof the charge laid against him in terms of Section 151(1)(i) of the National Water Act, on the further terms of this agreement; and taking into account the aforesaid material facts and circumstances. The director therefore admits that during 20 -21 May 2003 and in the district of Grabouw, regional division of The Cape, within the jurisdictional area of this court, he failed to shut down operations at the Whitby Distillery resulting in the discharge of spent cooling water into the Klipdrift River and thereby unlawfully and intentionally caused pollution as is defined in the National Water Act 36 of 1998 to a water resource, to wit the Klipdrift river.

12.The parties agree that the Court shall be requested to postpone the passing of sentence, in terms of Section 105A (1) (a)(ii)(bb) read with Section 297 (1)(a) of the Act, for a period of 3 ( three) years and that the conditionsset out below shall apply during the period of the said postponement of sentence, and that the director shall be ordered to appear before the Court at the expiry of the said 3 (three) year period, namely on 3 October 2008

12.1.The director shall ensure that the Company submits a formal application to the Department of Water Affairs and Forestry in terms of the National Water Act for a General Authorisation for the existing waste water storage dam on or before 31 December 2005;

12.2.The directorshall sponsor, in the sum of R35000.00 per year, for a period of three consecutive years, the research of a deserving South African student, registeredin the chemical engineering department at the University of Cape Town, into viable methods of bringing the waste water generated in the brandy and wine distilling process to within acceptable levels for re-use ineitherthe distillery process or for irrigation purposes.

12.3.The following specific conditions shall attach to these payments:

  • The research shall be conducted primarily at, but not limited to, the Oude Molen distillery site and shall take into account and not duplicate previous research done in this area by either DWAF and/or WINETECH, with whom the said student shall be instructed to consult; and
  • The said money shall be paid to, and administered by, DoctorPetersen, in his capacity as an academic member of the Chemical Engineering Department at the University of Cape Town, or his successor, and who shall determine, in his sole discretion, which student is to receive the funding each year for the three year period; and
  • The said money may be awarded to the same student more than once and shall be paid annually to the University of Cape Town by The director on or before the 31st of January each year, commencing in 2006; and
  • In the event of no student intending to proceed with suitable research in the department of Chemical Engineering at the University of Cape Town, which will qualify for sponsorship in terms of this agreement, in any one year, then Doctor Peterson, in consultation with the Company, and Jacques Rossouw of DWAF, or his successor, shall disburse the money towards another student in the chemical engineering department at UCT and under his control, whose research will, in his opinion, be useful to the South African Brandy and Wine industry in South Africa;
  • Any written research or material, including any thesis generated by a student which was sponsored in whole or part by the money to be paid by the director in terms of this agreement, shall, as a condition of payment, be made available to the Company, the DWAF and the public.
  1. The directorshall ensure that the Company , in consultation with the DWAF continues to implement and investigate a strategy for the effective long term handing of the wastewater that is created by its distilling process, with the aim of getting the waste water to a stage where it can be reutilised in the distilling process, or safely for agricultural irrigation, and including but not limited to, the implementation of any processes that are suggested or that are derived at as a result of the research referred to in clause 12.2 above.
  2. The director shall, for the duration of three years, ensure that the water quality in the Klipdrift River, above and below the property and distillery site is monitored regularly, and that such data and information is made available to the public, and the DWAF on request, and on the termination of the three year period, summarised and interpreted by an independent expert, nominated by the DWAF for disclosure to the DWAF and the company.

13.The director acknowledges that at the end of the three year period referred to in clause 12above, if the Court is satisfied that the conditions imposed on him in terms of clause12have been complied with, he shall be discharged by the Court without it passing sentence, and thatsuchdischarge shall have the effect of an acquittal, except that the convictionshall be recorded as a previous conviction.