UK: Landmark Contaminated Land Case Finally Ends after Judicial Review

Last Updated: 13 December 2010
Article by Aidan Thomson

An important contaminated land appeal finally came to a conclusion in February 2010.

Last year, the Secretary of State for Environment Food and Rural Affairs decided two appeals under the contaminated land regime set out in Part 2A of the Environmental Protection Act 1990 ("Part 2A").

The appeals were made by Redland Minerals Limited ("Redland") and Crest Nicholson Residential plc ("Crest") against a remediation notice served on them by the Environment Agency ("EA").

The Secretary of State:

  • dismissed Crest's and Redland's appeals; and
  • confirmed the remediation notice (in a modified form).

This was the first appeal against a remediation notice to be heard by the Secretary of State under Part 2A. Crest's subsequent challenge to the Secretary of State's decision by way of judicial review failed in February 2010.

Factual background

The case concerned a site at Sandridge, Hertfordshire (the "Site"). From 1955-1980, the Site was used as a chemical works producing bromate and bromide. Redland subsequently purchased the interests of the companies that had run the chemical works and took on their liabilities.

Whilst the chemical works was in operation, bromate and bromide entered the soil and gradually made their way into the underlying chalk aquifer. Crest purchased the Site from Redland in 1983. At the time, Crest knew a certain amount about the bromide contamination problem in the soil (but not the underlying aquifer), and nothing about the contamination issues relating to bromate. By 1987, Crest had developed the Site and sold 66 houses.

Over the course of time, the bromate and bromide that was seeping into the underlying chalk aquifer led to closure of a number of water company abstraction boreholes.

In June 2002, St Albans City and District Council identified the Site as being contaminated land under Part 2A on the basis of the bromate and bromide "pollutant linkages" on the Site. In July 2002, the Site was designated as a "special site" under Part 2A. Where this happens, the EA, rather than the local authority, becomes the regulator responsible for the Site.

On 11 November 2005, the EA served a remediation notice (the "Notice") on Redland and Crest identifying them both as the "Class A" appropriate persons for the pollutant linkages, and therefore liable for remediation actions at the Site. Prior to issuing the Notice, the EA had tried to apply all of the complex liability rules on "attribution", "exclusion" and "apportionment".

Redland and Crest immediately appealed against the Notice to the appropriate appeal body, namely the Secretary of State.

The decision

The contentious issues in the appeals related not to whether the Site should have been determined to be contaminated land, but to:

  • the remediation actions required by the Notice for dealing with the two significant pollutant linkages;
  • whether Redland and, in particular, Crest were liable as Class A appropriate persons; and
  • the application of the complex "who pays what" liability rules relating to attribution, apportionment and exclusion.

Essentially, the Secretary of State decided that Crest and Redland had been properly identified as Class A appropriate persons on the basis that they had "caused" the pollution. The remediation actions were appropriate in the main and the approach taken by the EA to applying the liability rules was sensible.

Crest challenged the decision that it had "caused" the pollution by way of judicial review, but the action failed in February 2010.

Conclusion

Enforcement under Part 2A is not swift. However, the Secretary of State's decision, and the decision of the judge hearing Crest's judicial review application, are strongly supportive of the approach taken by the EA and will give it, and the local authority regulators, confidence that their enforcement actions will not easily be challenged by those they have earmarked as appropriate persons.

Redland and Crest will have been extremely disappointed with the result of the appeal. It effectively fixes them with liability for activities that took place long ago and that, at the time, were not necessarily improper or out of the ordinary.

Overall, the case demonstrates that, although cumbersome, Part 2A is an important weapon in a regulator's armoury that does still get used. It serves as a reminder that:

  • the sites of an organisation's current and former operations could be a source of liability under Part 2A;
  • buyers should always be mindful of the liability that they might be incurring when purchasing property or property-owning companies; and
  • sellers can still be liable in the future for contaminated property unless steps are taken at the time of sale to secure proper indemnification/protection and the triggering of appropriate Part 2A exclusion tests.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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