Powys County Council v Price and another

Environment – Contaminated Land – Appropriate person – Predecessor of appellant local authority causing or knowingly permitting contamination of land by operating landfill site on land owned by respondents — Appellants entering into tenancy agreement with respondents to install treatment and filtration plant on site – Appellants subsequently terminating agreement — Court holding appellants liable as “appropriate person” liable for remediation of contaminated land – Appellants appealing — Whether appellants “appropriate person” under section 78F(2) of Environmental Protection Act 1990 – Appeal allowed Until 1993, the appellants’ predecessor had operated a landfill site on part of a farm, known as Rhosforlo, Garth, Builth Wells, Powys, owned by the respondents. In 1996, the appellants were created following a local government reorganisation in Wales when their predecessor was abolished. By a tenancy agreement in 2001, the respondents let to the appellants a small piece of land adjacent to the site for the purpose of installing a treatment and filtration plant on the site. The appellants had sought to enter into the tenancy on the assumption that they were bound by the remediation regime under Part IIA of the Environmental Protection Act 1990. In 2015, the appellants’ contaminated land officer wrote to the respondents giving three months’ notice to terminate the tenancy, noting that the precedent established in R (on the application of National Grid Gas plc (formerly Transco plc) v Environment Agency [2007] 3 EGLR 5 meant that the appellants were not liable for any contamination of the site. The respondents subsequently challenged that interpretation of the law and sought a declaration that the transfer of liabilities from their predecessor to the appellants included a contingent liability for contaminated land under Part IIA of the 1990 Act. The court granted the declaration sought on the basis that the appellants were “an appropriate person” under section 78F(2) of the 1990 Act, with responsibility for remediation works, as it had taken over the liabilities of its predecessor by virtue of the Local Government (Wales) Act 1994 and the Local Government Reorganisation (Wales) (Property etc.) Order 1996: see [2016] EWHC 2596 (QB). The appellants appealed. Held: The appeal was allowed. Once it was brought into force, Part IIA introduced a new regime of strict liability for historic contamination under which liability could extend not only to the original polluter but also to a landowner or occupier other than the polluter. Although the regime was retrospective in the sense that it created potential present liability for acts done in the past, that was not the same as creating a deemed past liability for those acts. Prior to the coming into force of Part IIA, the appellants’ predecessor had not been under any contingent or potential liability comparable to those in other cases cited to the court. At the date of succession it had not been under any liability, whether accrued, contingent or potential, in respect of Part IIA, which was capable of passing to the appellants by virtue of article 4 of the Local Government Reorganisation (Wales) (Property etc) Order 1996. The respondents had drawn attention to a series of cases in which a successor body was held to have succeeded to a contingent liability. However, they were all cases in which the predecessor body had acted in breach of an existing duty but where no cause of action had accrued until damage was suffered, which was not the present case: Walters v Babergh District Council (1983) 82 LGR 235, Devine v Northern Ireland Housing Executive [1992] NI 72, Anton v South Ayrshire Council [2012] CSOH 80 and Bavaird v Sir Robert McAlpine Ltd [2013] CSIH 98 distinguished. In the present case, the judge had not been entitled to find that the appellants were an “appropriate person” within section 78F. The definition of an appropriate person could not be construed so as to include the appellants as successors to their predecessor. That flowed from the natural meaning of the words of the provision and was compelled by the House of Lords’ decision in Transco in relation to the same provision. The emphasis in section 78F(2) and (3) was on the actual polluter, the person who caused or knowingly permitted the pollution. The appellants clearly did not fall into that category. Part IIA of the 1990 Act did not operate retroactively in the sense that the predecessor body had to be deemed to have been under a liability which only arose under legislation which came into force after it ceased to exist. The word “liabilities” in the context of transfer orders did not include potential liability arising from a change in the law after the date of the transfer: R (on the application of National Grid Gas plc (formerly Transco plc) v Environment Agency [2007] 3 EGLR 5 applied. Stephen Tromans QC and Rose Grogan (instructed by Powys County Council) appeared for the appellants; Robert McCracken QC and Annabel Graham Paul (instructed by JCP Solicitors, of Carmarthen) appeared for the respondents. Eileen O’Grady, barrister Click here to read a transcript of Powys County Council v Price and another