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Posted on: 25 June 2018

Environmental Law News Update

In this latest Environmental Law News Update, Christopher Badger and Charles Morgan consider the issues raised at this weekend’s UKELA Conference, a Government review into organised waste crime, and misrepresentations in enquiries before contract and non-reliance clauses.

UKELA debates the future of environmental law

UKELA has just held its annual conference at the University of Kent, Canterbury, under the title ‘Past Reflections and Future Horizons: Environmental law in a post-Brexit World’.

The conference threw up a number of significant issues that are likely to heavily influence the development of environmental law in the years ahead:

• The UK needs a clear and ambitious waste strategy. At present, there is insufficient infrastructure to support greater recycling of waste and insufficient capacity in the UK for energy recovery.
• Whilst the environmental principles are to be written into law, their meaning is to be identified in the accompanying policy statement. Is it to be proposed that this policy statement will refer to the extent that future ECJ case law can be taken into account? What will happen in five years’ time when the ECJ potentially delivers a judgment impacting on the meaning of the precautionary principle?
• The new Environmental Watchdog will need to be highly selective as to which complaints it investigates. It is intended that the Watchdog will be in a position to consider the actions of local authorities but can only report on those activities to Government, who would then be expected to take the necessary action.
• Individual responsibility and stewardship are to be key factors in driving environmental improvements.
• There is scope for the further development of the Environmental Tribunal and for mandatory targets to be put into law, against which progress towards the aims and targets of the 25 Year Environment Plan can be assessed.

One of the most impactful speeches of the conference saw Emma Lui confidently describe the generational transition towards caring for the environment and the awareness of the need to improve environmental standards. Also featuring highly was the cross-over between environmental law and other fields, in particular infrastructure planning, corporate responsibilities and the health and well-being agenda. There was common agreement that this is an extremely exciting time to be involved in environmental law.

Government launches review into organised waste crime

The government has announced a review into serious and organised crime in the waste sector. The purpose of the review is to enable DEFRA to make actionable recommendations for a strategic approach to waste crime, to be published in a new resources and waste strategy. It is intended that the review will:

• consider the extent and nature of crimes being committed, and the types of organised crime groups involved;
• consider the environmental, community and economic impacts of serious and organised waste crime;
• consider how the Environment Agency is responding to the threat;
• consider the ability of the Environment Agency, other organisations, and the law enforcement system as a whole, to work together to tackle the threat;
• make recommendations for a strategic approach to serious and organised waste crime; and
• make recommendations for the future direction of work.

At present, an online questionnaire consisting of 18 questions has been published. The questions are phrased in an extremely open manner and leave themselves open to a wide range of responses. For example, question 16 reads:

“16. What would most help develop effective partnerships to tackle serious and organised waste crime?”

This doesn’t indicate that DEFRA have, at this stage, fully grasped how they should attempt to tackle the problem of organised waste crime or at this stage have any initial views on a clear strategy. No doubt they would respond that identifying the most effective method of combating waste crime and its protagonists is part of why this review has been launched.

The questionnaire can be found here

No More Reliance on Non-Reliance Clauses?

Misrepresentations in enquiries before contract and non-reliance clauses revisited.

Many readers of this blog are involved in the negotiation of transactions in which actual or potential environmental liabilities loom large. The recent decision of the Court of Appeal in First Tower Trustees Ltd. v CDS (Superstores International) Ltd [2018] EWCA Civ 1396 is of importance to all such practitioners.

CDS leased four industrial units which transpired to be so contaminated with asbestos as to be dangerous to enter. Before entering into the leases it had made enquiries before contract using the Commercial Property Standard Enquiries form. Enquiry 15 contained questions related to environmental matters, the gist of most of the answers given being to the effect that the buyer should satisfy itself. Enquiry 15.7 asked for details of actual or potential environmental problems, to which the answer given was that the landlords had not been notified of any such problems but, again, the buyer should satisfy itself. It was accepted that this was in fact a misrepresentation because, whilst true at the date of the actual reply, prior to exchange/completion the landlords had become aware of actual or potential asbestos contamination. The Enquiries imposed in their interpretation section an obligation upon the landlords to notify CDS of anything arising during the intervening period which might cause any reply to be incorrect. The landlords had not done so.

CDS sought damages for misrepresentation in reliance upon section 3 of the Misrepresentation Act 1967. The landlords invoked in response two principal arguments: (1) that the non-reliance clauses to be found in both the leases and agreements for leases applicable to the various units were “basis of contract” clauses delimiting the parties’ primary obligations in a manner which prevented section 3 being engaged at all (2) that even if section 3 was engaged, the non-reliance clauses had the effect of excluding liability. CDS in return alleged that the clauses failed to satisfy the requirement of reasonableness found in section 11 of the Unfair Contract Terms Act 1977.

Both the deputy High Court Judge and the Court of Appeal found in favour of CDS. The judgments of both Lewison and Leggatt LJJ (with both of whom Sir Colin Rimer agreed) are lengthy and repay full reading. In essence the court held (1) that the non-reliance clauses did engage section 3 of the 1967 Act and thus the test of reasonableness in section 11 of the 1977 Act; (2) that the non – reliance clauses did not satisfy the requirement of reasonableness.

At the heart of the first conclusion was the proposition that the liability under section 3 is a statutory liability arising by operation of law independently of anything in the contract which was induced by the representation. As to the second, having considered all the relevant factors, Lewison LJ concluded that: “Although there might be a case where, on exceptional facts, a clause which precludes reliance on replies to enquiries before contract might be held to satisfy the test of reasonableness even where those replies have in fact been relied on, I find it very hard to imagine what those facts might be.”

This significant decision, which at the very least severely curtails the scope for deployment of any “basis of contract” argument in this context and further strongly protects the integrity of the process of enquiries by contract, seems likely to lead, either in the case under consideration or some future one, to a visit to the Supreme Court to settle the matter and to clarify the relevant legal principles, which are of very widespread application.

The full judgments can be found here.

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Friday 13th July – Regulatory Law Conference 2018 (Birmingham)

Six Pump Court is very pleased to be hosting its Regulatory Law Conference 2018 which will take place in Birmingham on 13th July. The event will cover a variety of topics providing essential updates on specialist areas, informative discussion on topical issues and practical tips for those acting in regulatory matters. Click here for more information and to book.