A recent case has highlighted that many local authorities will not have liability for the actions of their predecessors under the contaminated land regime.
The recent Court of Appeal case of Powys v Price & Hardwick means many local authorities will not have inherited the Class A liabilities of their predecessors under Part 2A. Under the contaminated land regime a local authority can be a Class A Person (and have primary liability) if it caused or knowingly permitted the contamination. In the Powys case the Court of Appeal have confirmed that a successor local authority will not have inherited P2A liability if they were created before Part 2A came into force (1st April 2000 in England and 15 September 2001 in Wales). When deciding if a local authority has liability as well as checking the date they were formed it is also important to look at the precise wording the Order creating the new authority.
This is good news for many local authorities who thought they inherited liability from their predecessors for landfill and other sites under P2A. It is bad news for landowners who anticipated that the local authority would pay for any future liabilities for contamination.
It also reinforces the need for careful due diligence when purchasing sites which may have historic contamination as the current owner occupier may well have liability rather than those who ‘caused’ the pollution.