As such, it is an important decision with wide-ranging implications for developers. Under EPA 1990, LAs are under a duty to inspect and identify land that is ‘contaminated’. For the land to be ‘contaminated’ it must be more than merely ‘polluted’; in effect, there must be a risk of harm (which requires a contaminant, a receptor, and a pathway that brings the contaminant and receptor into contact).

In this particular case, a former brickworks had been filled in during the 1960s and 70s. In 1978 planning permission had been obtained by the then owner and houses had subsequently been built by a developer. Unfortunately, methane gas proved to be a problem and extensive works had to be carried out. The question then arose as to whether the LA could recover those costs from the ‘appropriate person’ – which it identified as being the developer. In its defence, the developer argued that the LA should have pursued one of the earlier landowners, namely those who had originally brought the pollution onto the site rather than the developer who had merely developed the existing polluted site. However, when there are two or more persons who may be ‘appropriate persons’, the government Circular says that the LA must then consider whether any of those persons should be excluded from liability, with the fundamental principle being that liability should be transferred to the person who exerted most recent control over the contamination. Detailed guidance is given, which includes looking to see who introduced the pathways (ie the routes to the pollution). In this situation, it was decided that it was the erection of the homes that was the relevant ‘pathway’ and thus it was the developer who should be held liable under the legislation. The message for developers is clear:

• it is not necessary for a developer to have introduced polluting substances in order to be liable under EPA 1990;
• if the developer knows about the contaminating substances and fails to remove them, or otherwise prevents a pollutant linkage from occurring, then the developer can be fixed with primary liability and thus have to pay the costs of remediation;
• it made no difference in this case that the developer had sold off the developed site several years before the question of liability arose. Liability, on the facts, remained with the developer because it was the construction of the dwelling houses that was the critical factor and that is why the developer was liable;
• in future cases there is likely to be a lot of time spent on the question of 'knowledge'. If a site is known to be contaminated (even if the specific contaminants are not known), or if details of contamination are available on a public register, or indeed could have been revealed by an investigation, then the site owner or developer will almost certainly be held to have the requisite 'knowledge'. This approach puts even more emphasis upon the importance of obtaining comprehensive environmental reports, and on the need to carry out due diligence inquiries.

In practice, cases of this sort are likely to be relatively rare. It is, after all, an extremely complex area, but the warning messages are clear – developers who build on contaminated land can remain liable for remediation costs. The wise developer will therefore always make full environmental inquiries (or risk being deemed to have ‘knowledge’ of any contamination). Conversely, a landowner who is selling to a developer may feel reassured by this decision, but should bear in mind that he could still end up being the ‘appropriate person’ if, for instance, the developer could not be pursued (perhaps because he has subsequently gone out of business). For introductory articles on Circular Facilities v Sevenoaks DC [2004] (unreported) see [2004] NLJ 1678 and [2004] The In-House Lawyer November p48. © Practical Lawyer