Source: https://www.freeths.co.uk/2018/01/04/environmental-bulletin-winter-2017-18/
Timestamp: 2020-04-02 16:12:56
Document Index: 782071145

Matched Legal Cases: ['EWCA ', 'art 1', 'art 2', 'art 1', 'art 2', 'art 1', 'art 2', 'art 2', 'art 2', 'art 2']

Environmental Bulletin - Winter 2017/18 | Freeths
Articles Environmental Law	4th Jan 2018
Environmental Bulletin – Winter 2017/18
We are the Freeths’ Environment team, part of Freeths’ Planning and Environment Group. We are a strong team of environmental lawyers, using our experience and expertise to advise both public and private sector clients across a wide range of environmental matters including protected species and habitats, environmental permitting, waste, planning issues/Environmental Impact Assessment, contaminated land, corporate and real estate transactions and environmental crime defence.
Amendments to the water abstraction regime
Two air quality / planning cases
Changes to fixed penalty notices
Breach of environmental law and director’s personal liability
Defra proposals for a National Policy Statement for water resources
Confiscation order for illegal waste
Templates for Brownfield Land Register
News: Round-up of Environmental News in Winter 2017/18
Update on water abstraction licences: Announcement on 31 October 2017 that certain abstraction licence exemptions will be removed
In general, under the Water Resources Act 1991, you must have a licence from the Environment Agency if you abstract water from surface waters or ground water. However, until now, abstractors have been able to benefit from certain exemptions from the requirement for a licence in certain circumstances.
There have been proposals to remove these exemptions since 2003 (following the Water Act 2003) but removal has been postponed regularly since then. However in 2016 the Government ran a consultation called “Changes to Water Abstraction Licensing Exemptions in England and Wales: New Authorisations”. In October 2017, Defra published their response[1], which said, “Further to the consultation, we now set out our proposed final plans for changing exemptions to the licensing system in England and Wales by commencing the Water Act 2003 provisions. Our plans balance the needs of those currently exempt and the rights and responsibilities of all for creating a sustainable water abstraction licensing system.”
Accordingly the Water Abstraction and Impounding (Exemptions) Regulations 2017 and the Water Abstraction (Transitional Provisions) Regulations 2017 came into force on 1 January 2018. In addition, the Water Act 2003 “exemption removal” provision has now come into force.
This will mean that, subject to some very narrow exemptions which are being retained / have been created under the new rules (the Water Abstraction and Impounding (Exemptions) Regulations 2017), anyone currently abstracting under an existing “abstraction licence exemption” will now need to apply for a licence. We explain the timescales later in this note.
One of the very narrow exemptions is the “small scale activities” exemption, which will continue to be available under the new rules. This allows an exception for abstraction of 20m3 per day or less from any particular source supply. This is clearly too limited an amount to be of much practical use for many abstractors.
Beyond the “small scale activities” exemption, other exemptions may be available depending in the nature of your operations. We consider below the position for:
Mineral operators; and
Those working in agriculture.
Developers often need to abstract groundwater or surface water to prevent interference with building / engineering works. In the past, developers of land have benefitted from an abstraction licence exemption in these circumstances.
Once the new rules take effect, a developer will need to apply for an abstraction licence except where the following (or the small-scale exemption) applies:
If the works are, in the course of building / engineering works, to dewater a sump or excavation then the restriction on abstraction does not apply if:
The abstraction / series of abstractions are temporary and in any event carried out over a period of less than six consecutive months beginning with the commencement of the first abstraction; and
The abstraction does not cause or is not likely to cause damage to a conversation site or to protected species; and
The water abstracted is either discharged immediately to a soakaway; or the volume of water abstracted is less than 100m3 per day in total and there is no intervening use before discharge (or less than 50m3 per day if within 500m of a conservation site or within 250m of a spring, well or borehole to supply water for any lawful use).
If the water abstraction relates to surface water in the course of building or engineering works then the restrictions do not apply if the following are met:
The abstraction / series of abstractions are temporary and in any event carried out over a period of less than six consecutive months beginning with the first abstraction; and
The water abstracted is discharged immediately downstream of the building / engineering works.
Mineral Operators
Mineral operators often need to dewater their quarries. They have in the past benefitted from an exemption from the need for an abstraction licence for dewatering activities.
Dewatering mines and quarries will in general now need an abstraction licence except where the following (or the small-scale exemption) applies:
Dewatering of an isolated groundwater / surface water; and
Dewatering of wholly or mainly rainwater from an excavation (potentially – please speak to us directly if this is of interest).
There is also the possibility that mineral operators could use the “temporary building / engineering works” exemption described under “Developers” above, if the works in question could be described as “engineering works”.
Landowners or farmers often need to abstract for irrigation purposes. They have in the past benefitted from an exemption for all forms of irrigation (except spray irrigation, for which a licence is already required).
Once the new rules take effect, a landowner or farmer will need an abstraction licence, except where the small-scale exemption applies, for:
All forms of irrigation and the use of land drainage systems in reverse (including transfers into managed wetland systems) to maintain field levels; and
Warping (abstraction of water containing silt for depositing onto farmland as a fertiliser).
Key issues for all those needing an abstraction licence due to the removal of exemptions
As long as you have been abstracting under an exemption during the “qualifying period”, ie in the seven years before 1 January 2018, then The Water Abstraction (Transitional Provisions) Regulations 2017 apply to you if you want to continue that abstraction.
Under The Water Abstraction (Transitional Provisions) Regulations 2017 there will be a period of two years from 1 January 2018 to apply for an abstraction licence from the Environment Agency (“EA”) for the abstraction activity which was previously exempt. The EA will then have three years to determine the applications they receive. This means that it will be five years before the new licencing system is fully operational.
Under The Water Abstraction (Transitional Provisions) Regulations 2017 you are permitted to continue your abstraction during the two year application process and until your licence is determined or, if no such application is submitted, until 31 December 2019.
When issuing abstraction licences, there will be some flexibility for the EA to relax the requirements for volume limits on “transfer licences” (these are used where there is no intervening use of the water) – this is better than had been expected.
Abstraction licences granted will be time limited and these limits will not match any relevant planning permissions. A long 24 year licence would only be available in “exceptional circumstances”.
The new licences will contain a “hands-off flow” condition which will protect rivers during times of low flows and drought by restraining abstraction during these periods.
The Government has confirmed that a “light-touch, risk based approach” will be taken to licensing those abstractions that are currently exempt. However, they have not yet clarified what they mean by this or how it will be achieved.
Under the Water Abstraction (Transitional Provisions) Regulations 2017, financial compensation will potentially be available to you only in very limited circumstances, eg where you suffer loss / damage as your licence is either refused or where it is granted but restricts abstraction to a greater extent than was permitted in the qualifying period. However compensation will not be paid where the abstraction licence is refused or limited to protect, from serious damage, inland waters, underground water, flora / fauna.
The Water Abstraction (Transitional Provisions) Regulations 2017 will not apply to “currently planned” abstractions (ie abstractions planned but not happening before 1 January 2018). For these you will have to make a brand new application under the normal legislation i.e. the Water Resources (Abstraction and Impounding) Regulations 2006 (with no prospect of compensation if the application is refused). Defra does however provide a little comfort here: “We do not expect the Regulator to limit sustainable economic growth unnecessarily and will apply the principles of better regulation to license planned abstraction. We expect the Regulator to use any relevant information, such as environmental reports used as evidence to support other permissions already in place for planned works, so that it aligns its abstraction licence decisions, as far as possible.”
How to apply for a licence under The Water Abstraction (Transitional Provisions) Regulations 2017
Before you apply for a licence to abstract water, you must have or expect to have a right of access to the land directly adjoining the surface water; and the land the aquifer containing the groundwater is on. A licence cannot be granted until you have the rights of access.
An application form will need to be completed and submitted to the EA, along with any fee payable.
The application must include details of any abstraction from the source of supply that is the subject of the application, as carried out in the seven years prior to 1 January 2018 and any other information (including maps) as may “reasonably be required” to determine the application.
It has been indicated that the EA will produce guidance on the licence application process during the application period. We would hope that this will clarify what other information can be “reasonably required” by the EA to determine the application.
What happens if you don’t apply for a licence for abstraction that, until now, you have been carrying out under an exemption?
Enforcement action may be taken against you if you do not apply under The Water Abstraction (Transitional Provisions) Regulations 2017 within the two-year transitional application period (1 January 2018 to 31 December 2019) and where you nevertheless continue to abstract after 31 December 2019.
If you wish to commence new abstractions (from 1 January 2018) for previously exempt activities or increase your abstraction rates then you need to apply for a licence under the Water Resources (Abstraction and Impounding) Regulations 2006. Failure to do so would also risk enforcement action.
[1] https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/656121/water-abstraction-consult-gov-response.pdf .
Something in the air – a review of two air quality/planning cases in Shirley and Gladman
In the Spring 2017 edition of our Environmental Bulletin, we reported on the consideration of air quality in the context of Habitats Regulations Assessment following the High Court decision in Wealden District Council v Secretary of State for Communities and Local Government, Lewes District Council and South Downs National Park Authority [2017] EWHC 351. Please click here for a copy of our article.
Since Wealden the issue of air quality has gained significant momentum in the legal arena. We have seen recently that the assessment of air quality was the pivotal ground on which planning decisions turned. In the High Court case of Gladman Developments Ltd v Secretary of State for Communities and Local Government [2017] EWHC 2768 (“Gladman”) the High Court dismissed a challenge by a property developer, Gladman Developments Ltd, to build two related residential developments (for 330 new homes and for 140 new homes plus 60 extra care unit) in Newington, Kent, due to air quality concerns.
A few months prior to Gladman, the High Court resolved a judicial review challenge brought by objectors against the Secretary of State’s (the defendant) decision not to call-in a planning application in R (on the application of Shirley) v Secretary of State for Communities and Local Government [2017] EWHC 2306 (“Shirley”). The crux of this challenge focussed on the quality of evidence on air quality assessment submitted by the developer in support of a planning application for an urban extension to Canterbury comprising 4,000 houses.
We review of the implications of these decisions in this article.
The High Court’s dismissal of Gladman’s application accords with the planning inspector’s earlier decision, which refused this application because the development would adversely impact air quality in two air quality management areas (AQMAs) of Newington and Rainham. This was in spite of the fact that the local planning authority themselves had not objected to this ground when the application was first considered.
By way of background, local authorities are under a duty to review air quality in their respective areas and assess whether the air quality standards specified in the National Air Quality Strategy are being achieved[2]. Where the National Air Quality Strategy standards are not being met, or are not likely to be met, local authorities are required to designate AQMAs and must then publish an air quality action plan for the AQMA[3].
Application of the Client Earth case
Gladman contended that the inspector, in refusing its application, had failed to explain how Gladman’s proposed mitigation was inconsistent with the local air quality action plan for the AQMAs, and that the inspector had failed to apply the High Court decision in Client Earth (No.2) Claimant v Secretary of State for the Environment, Food and Rural Affairs [2016] EWHC 2740 (“Client Earth“).
In particular, Gladman argued that, under the Air Quality Directive 2008, the UK Government is required to comply with standards for ambient air quality (notably nitrous dioxide (NO2)) by the “soonest date possible”; which meant the inspector should have assumed that the UK Government (including local authorities) will have in place a compliant plan to achieve NO2 emission reductions. It is worth noting that, at the at the time of the inquiry, it was not known what measures the new draft National Air Quality Plan would contain, or what the final version would contain following public consultation. In light of this fact, the High Court in Gladman was satisfied with the inspector’s conclusion that, on the evidence, a satisfactory level of air quality would not be achieved. The inspector could not know how any new national measures would relate to local measures, nor did he know what “the soonest date possible” would be for the new National Air Quality Plan to be complied with.
As such, the inspector was entitled to conclude, on the evidence, that Gladman’s air quality assessments predicted adverse impacts. This was assessed against the background that the latest monitoring data from 2015 showed that the current concentration of NO2 for the relevant AQMAs already exceeded the value threshold: “it seemed optimistic on the face of it to expect that NO2 concentrations will fall by the substantial amounts predicted because they assumed substantial reductions in the background concentration of nitrogen dioxide.”
The High Court also found that the developer has failed to demonstrate effective measures for mitigation. Gladman sought to reduce NO2 emissions caused by its proposed scheme by offering to make financial contributions towards mitigation measures (which includes, among others, the provision of electric vehicle charging points, contributions to highway improvement to reduce local traffic congestion and provision of enhanced public transport serving the site). The amount of contribution proposed would be equal to, or exceed, the value of air quality impact predicted by the emission factors (based on Defra’s damage-cost model). Agreeing with the inspector, the Court found that the financial contributions proposed “had not been shown to translate into actual measures likely to reduce the use of private petrol and diesel vehicles and hence reduce the forecast NO2emissions.” Crucially, Gladman was required to provide specific evidence of likely effectiveness of the proposed mitigation measures.
This is a reminder to future developers wishing to rely on the DEFRA damage-cost model that any proposal to fund measures to mitigate “significant adverse effect on human health” must be based on practical measures that can demonstratively reduce the impact of air emissions (for instance, using evidence from past successful projects).
As noted above, Shirley related to proposals by a developer to build 4,000 houses to the south west of Canterbury; which happens to be a city with a record for breaching the NO2 limits under the Air Quality Directive. As such, the local authority had designated AQMA to address the high concentrations of NO2. In their application, the developer submitted an air quality assessment which concluded that the proposed development would have a negligible effect on air quality at the site and the city centre as the threshold value for NO2 would not be exceeded. The quality of the developer’s evidence was challenged by objectors, on the basis that the traffic modelling which underpinned the assessment was flawed. In response, the local planning authority commissioned their own expert consultant to conduct a peer review of the assessment, and found that NO2thresholds would not be exceeded. The local authority subsequently granted planning permission subject to obligations under a section 106 agreement[4] (which included a requirement to spend £3.7m on air quality mitigation measures).
The claimant objectors applied to the Secretary of State requesting him to call in the planning application for his own determination. This High Court case focussed on challenging the Secretary of State’s refusal to call-in the application, which left the final decision to Canterbury City Council.
Turning to the Client Earth decision, the Claimant argued that, as the “competent authority”, the Secretary of State was under an obligation to achieve specified air quality values and that in failing to exercise the discretion to call in the planning application, he also failed to comply with the Air Quality Directive 2008.
The High Court refused the claimant’s judicial review application, concluding that the Secretary of State’s duty under the Air Quality Directive 2008 was to produce an air quality plan to ensure that breaches of air quality limits are kept as short as possible. Mr Justice Dove emphasised that “There is in my view simply no room within the scheme set out in the AQD for any freestanding responsibility to take any specific actions in relation to permits or development consents as a consequence of the AQD’s requirements.”[5]
The outcome of this case clearly demarcates the remit of the local authority’s power from that of the Secretary of State’s. We are reminded that the day-to-day planning control remains the responsibility of the local planning authority. However, in reaching this position the Court stressed that “the question of air quality and the exceedance of any limit values or thresholds is clearly and obviously a material consideration in the decision as to whether or not to grant planning permission”.[6] The fact that the local planning authority sought reassurance on air quality assessments confirms that this is becoming a central issue in planning applications.
The above judgments suggest that planning authorities and interested parties will likely examine future planning applications for evidence of satisfactory air quality assessments, particularly where a proposed development falls within an area subject to AQMA. Developers seeking to make planning applications would be wise to address air quality concerns from the onset, and ensure that any proposed mitigation measures are supported by robust evidence in anticipation of potential objections.
[2] Section 82 Environment Act 1995.
[3] Sections 83 and 84 Environment Act 1995.
[4] pursuant to the Town and Country Planning Act 1990.
[5] Paragraph 49 of the judgment.
[6] Paragraph 63 of the judgment.
Liability for flooding: the consequences of flood risk management projects: Hall v Environment Agency (2017)
The Water Resources Act 1991 (“WRA”) provides a scheme of compensation for those whose property is adversely affected by specified work carried out by the Environment Agency, such as flood risk management or drainage works. Claims for compensation, if not resolved through negotiation, are determined by the Upper Tribunal (Lands Chamber).
In the recent case of Hall v Environment Agency [2017] EWHC 1309 (TCC) a question arose as to whether the existence of this statutory scheme precluded a claimant from bringing a common law claim in negligence.
The case involved implementation of the Environment Agency’s flood alleviation scheme for Morpeth, Northumberland. As the case digest explains[7], part of the scheme involved replacing a section of the roof of a culvert in the vicinity of Mr Hall’s home. In March 2010, contractors removed a section of the roof and left the culvert uncovered for a fortnight. During that time, a period of heavy rainfall, the stream that passed through the culvert overflowed and flooded Mr Hall’s property, damaging the building and its contents. Mr Hall brought a claim (initially in the County Court, but subsequently transferred to the Technology and Construction Court High Court List) alleging negligence by the Environment Agency, claiming for his financial losses and damages for physical inconvenience and discomfort.
The Environment Agency argued that the court should strike out the claim, on the basis that it should have been brought in the Upper Tribunal Lands Chamber under the statutory scheme.
The question for the court was whether the statutory scheme provided an exclusive remedy and precluded an action at common law for negligence.
The Court followed a four point test set out in the earlier case of Marriage v East Norfolk Rivers Catchment Board [1949] 2 All ER 1021 (a case dealing with the Land Drainage Act 1930, a predecessor or the WRA 1991). The test for determining whether, in any given case, the statutory compensation scheme was to be construed as the exclusive remedy is as follows:
Was the act (the flood alleviation works, in this case) which occasioned the injury authorised by statute?
Did the statute (the WRA in this case) contemplate that the exercise of the powers might cause injury?
Was the injury complained of (flooding, in this case) an injury of the kind contemplated by the statute? and
Did the statute provide compensation for this kind of injury?
If the answer to all 4 questions is yes, statutory compensation should be the exclusive remedy and there will be no parallel claim in negligence.
The court in Marriage went on to define the “limits outside which the ordinary rights of action remain”. These limits were similarly applied in Hall. Paraphrasing:
The injury suffered must be the product of the Environment Agency’s powers, as opposed to some negligent act occurring in the course of the Agency’s work but not in itself the act that the Agency was authorised to do. The court gave the example of the negligent driving of a delivery vehicle, bringing materials to the work site. Such driving would still give rise to a claim in negligence, rather than a claim under the statutory scheme, as it was not of itself the activity authorised by the statute.
The injury suffered must be the result of the act the EA intended to carry out, and not an unintended consequence of acting negligently. Again, the court gave an example. If, by digging a drain, the EA deprives a riparian owner of a full supply of water to which he is entitled, he will be compensated under the Act. However, if by digging the drain the EA negligently undermines and breaches a dyke, causing flooding, it is likely that the owner of flooded land could bring a claim in negligence rather than a claim under the Act.
Finally, the operation must not be so unreasonable or so fraught with manifest danger that no reasonable Agency, acting rationally and not recklessly, would have undertaken it. Reckless conduct is likely to leave the EA open to claim in negligence, rather than a claim under the Act.
Drawing together the threads of all the cases it considered, the court emphasised that the starting point is to construe the statutory scheme in question to discern whether, expressly or by necessary implication, it was designed to cover all cases of negligence and nuisance as well as imposing strict liability. The court concluded that the compensation scheme in the WRA does not “clearly embrace nuisance and negligence”. The next step, then, is to consider whether the act in question satisfies each stage of the 4 step test set out in Marriage, and whether the claim is within the three parameters described in that same case.
In Hall, the court held that the statutory compensation scheme was not an exclusive remedy and a claim could be brought in nuisance because:
Leaving the roof off the culvert for 2 weeks, so that it remained exposed and susceptible to flooding, was not a necessary or inevitable part of the flood management works authorised under the WRA and could not have been an intended or contemplated consequence of the works;
The flooding was an unintended consequence of removing a section of the roof of the culvert. The Environment Agency’s engineers should have been aware of the risk, particularly given that a notice had been set into a manhole cover just upstream which said “Warning: this culvert runs surcharged. Plate should only be removed if the culvert is depressurised. Ensure plate is refitted and bolted down after use.”
It is not clear why, in this case, Mr Hall chose to pursue a claim in negligence rather than a claim under the statutory scheme. It was fortunate for him that his claim could proceed, though, because he was beyond the statutory time limit that might have allowed him to start a new claim in the Upper Tribunal.
There may well be cases that fall outside the statutory scheme and must be brought in negligence – such as the example of negligent driving given by the court in Marriage. There may also be cases where the remedy provided by the statutory scheme is not sufficient. The scheme in the WRA, for example, provides only for payment of compensation. It does not provide for other remedies such as an injunction to prevent further damage. Therefore, there may be cases where a claim in common law negligence has to be made out to found an application for the appropriate remedy.
Either way, practitioners will have to consider their cause of action – and the appropriate court or tribunal – very carefully.
[7] [2017] All ER (D) 182 (May).
Changes to Fixed Penalty Notices for Environmental Offences
On 30th October 2017 new regulations were passed amending the current regulations relating to Fixed Penalty Notices for Environmental Offences such as littering, graffiti, fly posting and fly tipping.
The new regulations, the Environmental Offences (Fixed Penalties) (England) Regulations 2017 (the Regulations”), will come into force on 1st April 2018.
Fixed Penalty Notices (“FPNs”) are a civil enforcement sanction and are used by Local Authorities and some other authorised persons including Police Community Support Officers, Environment Agency and National Park Authority, as an alternative to prosecution for certain offences. FPNs usually specify a fixed fine but can offer a discounted fine if payment is made early; the Regulations refer to this as the “lesser penalty”.
Consultation for the new regulations took place between April and June 2017. The consultation focused on fines not having been changed since 2006, fines not being consistent with other parts of the UK, and fines not being consistent with similar types of offending, such as dog fouling.
The regulations make the following changes to the levels of penalties:
remove the requirement for the Secretary of State to approve training courses for Parish Council’s relating to officers issuing FPNs; and
revoke the Environmental Offences (Fixed Penalties) (England) Regulations 2007. This means that the restrictions relating to how Councils can use income from FPNs for littering, graffiti and fly posting have been removed.
It is often perceived that Councils use FPNs as an income-generating tool. The Department for Environment, Food and Rural Affairs (Defra) has committed to consulting on improvements to the guidance, available to Councils, relating to the proportionate use of FPNs as an enforcement tool.
If you would like advice relating to FPNs for environmental offences, please contact a member of our team.
Breach of environmental law: director’s personal liability
In our summer bulletin, we discussed the concept of “piercing the corporate veil”, explaining that the courts can, in certain circumstances, look behind the guard of the incorporated company. We discussed the consequences of attempting to use a corporate structure to conceal the identity of those truly undertaking certain acts and the potential liability of different companies within a group structure.
In this article, we give further consideration to when individual company directors, officers and managers may face conviction for environmental offences, including a recent case in which a number of directors were handed prison sentences. A separate article in this bulletin discusses a recent case in which the sole director of a company was subject to a confiscation order following waste offences.
Consent, connivance or neglect
Environmental legislation often provides that, where an offence has been committed by a limited company but with the consent or connivance of, or due to the neglect of, a company officer, the individual officer also commits an offence. That officer faces the prospect of criminal conviction in his or her own right and the full range of possible sanctions, including a fine, imprisonment and/or director disqualification.
This principle applies to, for example, many environmental permitting, waste and environmental damage offences. The key concepts are further explained in caselaw as follows:
Consent – where the director is well aware of what is going on and agrees to it;
Connivance – where the director is aware of what is going on and, while not actively encouraging it, allows it to continue; and
Neglect – where the director fails to perform a duty he or she knows, or ought to know, about.
In this context, a company officer includes a director, chief executive, manager, secretary or similar officer, or anyone purporting to act in any such capacity. The objective is to hold responsible those who are controlling the activities of the company, including those who could and should have stepped in to prevent criminal activity as well as who positively allowed or encouraged it.
Importantly, the regulator does not have to prosecute the company and the company officer(s). It could choose to proceed against the officer(s) alone. This can be significant where, as in the case we address below, the company has gone into liquidation in the course of any criminal investigation.
In a recent case in Sheffield Crown Court, six directors of two recycling companies pleaded guilty to “consent and connivance” offences under environmental permitting legislation.
One of the two companies had continued to offend following conviction in 2011 and both companies’ offending came despite repeated warnings from the regulator. It was observed that the companies offending had been for financial gain – such as avoiding higher rates of landfill tax – although the individuals involved had not made personal gains.
Large stockpiles of waste were said to be creating significant risk to the environment and harm to human health, with the criminal activity causing five fires on one of the sites in 2013 and 2014.
There was documentary evidence that the directors were fully aware of the illegal operations. The sentencing judge noted that the conduct of four directors was deliberate, whilst a fifth director was negligent and a site manager reckless in aiding and abetting the offending.
The Judge handed down various sentences to each director, which included an immediate custodial sentence of 21 months for one director and disqualification from directorship for 7 years, prison sentences for three directors suspended with a requirement to undertake community service, community service orders for the remaining to individuals and costs orders totalling £21,500.
This case highlights the courts attitude towards breaches of environmental permitting requirements, particularly where there is a significant risk to the environment or human health and/or clear individual culpability.
Practical steps for directors
Environmental compliance is, of course, the responsibility of the company and those who run it. It is advisable to have systems in place to prevent breaches of environmental law, to demonstrate to regulators such as the Environment Agency that the company takes environmental compliance seriously and to avoid any suggestion of individual culpability. As a starting point:
Consider commissioning an environmental compliance audit of the company and its properties. Take prompt action to regularise any identified issues.
Adopt an environmental management and compliance plan for the company. This should include an action plan for dealing with an environmental incident or emergency. Plans should be regularly monitored and updated where necessary.
Choose a designated person who will be responsible for ensuring compliance with environmental law. They will report to the board and ensure that all staff are briefed on important aspects of compliance. The person allocated to this role should have sufficient authority and knowledge to effectively manage environmental compliance.
The environmental team here at Freeths is able to offer a bespoke approach to compliance with environmental law. The environmental team is also able to represent you or your company in any type of environmental litigation.
National Policy Statement for Water Resources – round 1 of consultations closed
The Department for Environment, Food and Rural Affairs (“Defra”) recently held the first-round consultation proposing to develop a National Policy Statement specifically for water resources infrastructure in England. The consultation, which ran from 13 November 2017 until 22 December 2018, also sought views on proposals to amend the definition of “nationally significant water infrastructure” under the Planning Act 2008.
While the outcomes of the consultation remain to be seen, this development is likely to present new opportunities to developers and investors specialising in infrastructure projects who would benefit from more streamlined planning policies in respect of the water sector.
The Planning Act 2008 (“the Act”) introduced a bespoke planning process for large scale infrastructure projects in England and Wales in the fields of energy, transport, water supply, wastewater and waste. Under the current regime, a developer proposing to construct a scheme in one of these fields would be required to obtain a development consent order from the Secretary of State if, based on the type and scale of the proposed development, the project would fall within the definition of a “nationally significant infrastructure project (“NSIP”)” under the Act.
Integral to the NSIP planning process are “National Policy Statements” (“NSIPs”), which are essentially statements of planning policy that have been designated (i.e. published), following a public consultation and parliamentary scrutiny, by the Secretary of State for specific types of infrastructure projects. The government “establishes the need” for particular types of infrastructure in an NPS by presenting national evidence base and demand for new infrastructure as a matter of policy. An NPS also provides detailed policy on how the impacts of proposed developments are to be assessed, as well as how negative impacts can be mitigated[8]. Crucially, decisions on whether to grant a development consent order for an NSIP will be based on the policy set out in an NPS.
Following a review of evidence on the demand for water and available supplies in England in 2016[9], the government has identified the need to improve resilience of public water supplies to address the projected increase for water demand across the UK by 9% by 2050 due to population and economic growth.
According to Defra, adopting an NPS for water resources infrastructure will support the delivery of future large supply projects which have been identified by water companies (through water resource management plans) as necessary to close the supply-demand gap.
The future adoption of an NPS for water resources would simplify and accelerate the process of gaining planning consents for larger water infrastructure projects in England.
The consultation document was divided into the following three parts:
The three draft principles that will form the basis for the detailed development of the NPS;
Proposals to amend how “nationally significant” water supply infrastructure is defined under the Planning Act 2008; and
Scoping reports that describe how the Assessment of Sustainability and Habitats Regulations Assessments that accompany the NPS will be implemented in respect of water supply infrastructure.
Defra has put together high level principles that will underpin the development of the final NPS. The consultation sought views on how the following draft principles, which will be unique to the NPS for water resources, could work in practice through an NPS:
Principle 1: Defra will set out the need for water infrastructure in the NPS as part of a “twin track” approach to managing water resources.
In order to achieve long-term resilience of water supplies, the NPS will emphasise not just the demand for the new water resources, but also the need to improve water use efficiency and reduction of leakages.
Principle 2: the NPS will reinforce and make clear the role of water companies’ water resource management plans in identifying the most appropriate water resources schemes, including new water resources infrastructure.
In its consultation, Defra recognises that the existing statutory process which require water companies to develop water resource management plans (“WRMPs”) every five years is appropriate for identifying water resources options to meet local needs. For background, the process of developing a WRMP requires a water company to estimate baseline supply and demand of water resources, to determine potential periods of supply-demand balance deficit and to consider options for managing any expected deficit. We are reminded in the consultation that “if a WRMP has been adopted that includes large new infrastructure that meets the definition of an NSIP, the NPS is intended to guide the detailed design of these projects and provide the policy framework for assessing and determining individual DCO applications. The NPS will not alter the role of WRMPs in determining the appropriate options to meet future resilience needs”.
Under this proposed principle, the NPS will establish the “national need” for new water resources infrastructure, but will not identify specific schemes or sites that will meet that need. Potential water infrastructure schemes will continue to be identified in WRMPs, which are the responsibilities of water companies.
Principle 3: the NPS will reiterate the importance of developing and designing water resources schemes that meet the government’s objective to enhance the environment.
Any scheme identified by a water company’s WRMP as an appropriate option will be subject to statutory environmental assessments, including a habitats regulations assessment (“HRA”) and a strategic environmental assessment (“SEA”).
It is anticipated that under this principle, Defra will build on the current statutory processes by requiring companies to “demonstrate how they value nature in the development of water resources schemes” through complying with ‘good design’ requirements set out in an NPS.
Currently, the provisions of the Planning Act 2008 that specify the types of water projects that would qualify as an NSIP will come into force in 2018. These definitions, set out in sections 27 and 28 of the Act, include:
Dams or reservoirs where the volume of water to be held back by the dam or stored in the reservoir is expected to exceed 10 million m3;
The alteration of a dam or reservoir where the additional water held back or stored will exceed 10 million m3; and
Water transfers where the volume of water to be transferred as a result of the development is expected to exceed 100 million m3.
Alongside its plan to develop the NPS, Defra is reviewing whether the above definitions in the Act remain appropriate in light of the types and scale of infrastructure projects that may be required to address long-term demands for water in the future.
Defra notes for instance that the current threshold of 100 million m3 for “water transfers” is high in light of a review of 2014 WRMPs which suggests that there may be water transfer projects below this threshold that would benefit from the NSIP planning process[12].
Any potential amendment to the definition is likely to widen the scope of projects that would fall within the definition of NSIP, and thereby benefit from the streamlined planning process.
In addition to the main consultation document, Defra has sought comments on two separate reports:
A scoping report on the appraisal of sustainability (“AoS”), to ensure that the likely environmental and socio-economic effects of a draft NPS would be identified, described and evaluated.
A HRA methodology report, which sets out Defra’s proposed approach to undertaking a HRA of the NPS for water resources. By way of background, the NPS itself is subject to requirements under Article 6(3) of the Habitats Directive (92/43/EEC) and requirements of the Conservation of Habitats and Species Regulation 2017. These instruments require competent authorities to assess whether there are any ‘likely significant effects’ on any European sites as a result of the implementation of the NPS (on its own or in-combination with other plans or projects). A HRA is required to consider the effects of the NPS on European protected sites and assess alternatives to remove or compensate for those effects.
This third section of the consultation is largely targeted at statutory consultees (such as the Environment Agency and Natural England) and selected specialist consultees (which water companies).
This is one of two consultations which will be held by Defra as it develops the NPS for water resources, and potentially amend the definitions of nationally significant water infrastructure projects. The next consultation is due to be launched in the summer of 2018.
Subject to the outcome of the consultation, the draft NPS (which will be produced in 2018) will be laid before Parliament together with any amendments to the definition of NSIP in the Planning Act 2008.
Our Environment Team at Freeths will continue to monitor future outcomes of this consultation.
[10] Para 24 of the consultation document.
[11] Defra noted at page 14 of the consultation document that “it is our ambition to include the need to establish net environmental benefit as part of demonstrating ‘good design’ of water resources infrastructure”.
[12] Paragraph 56 of the consultation document.
Scrapyard boss to pay £1.99 million confiscation order for illegal waste
The owner (and sole director) of a scrapyard and recycling company in Wiltshire has been ordered, to pay £1.99 million for profits made through illegal waste operations in Melksham. Lee Hazel appeared before Swindon Crown Court for the confiscation hearing in July 2017, when the judge also held that failure to pay would mean the director will face eight years imprisonment.
In November 2015, Lee Hazel and his company, Melksham Metals Recycling Ltd, pleaded guilty to five charges relating to unauthorised treatment of waste between 2004 and 2008 at his Station Yard premises, a facility which was being operated without a permit. The defendants were also found guilty of four charges relating to illegally dumping stone off-cuts and sludge at a farm beside the Wiltshire to Berkshire canal. The court heard that Melksham Metals Recycling Ltd had secured a contract to remove waste stone from a local stonemasons yard, therefore the waste should have been taken to a licensed site and not deposited at Queenfield Farm.
In February 2016, Lee Hazel received an 18 months prison sentence, which was suspended for two years. The operating licence at the Melksham Metals Recyling site was also revoked by the Environment Agency which resulted in the site being closed down.
The confiscation order, which followed this sentence, had been reduced from the original figure of £2.74 million under the ‘slip rule’, which allows the court to correct accidental slips or omissions in orders at any time. This reduction was applied for by the defendant’s representatives who successfully argued that the VAT element and invoices for ferrous metals should be excluded when calculating the amount of benefit recoverable from Mr Hazel.
Separately, the company itself was ordered to pay £100 fine for each of the seven offences to which it pleaded guilty. Given the size of the confiscation order, the court deemed that only a nominal amount of the fine was necessary.
The confiscation regime
Under the Proceeds of Crime Act 2002, confiscation must be considered if either the prosecutor (in this case the Environment Agency) requests the Crown Court to make for an order, or if the court itself thinks that confiscation may be appropriate, to deprive the defendant of the proceeds benefited (usually a monetary gain) from the commission of a criminal offence.
A confiscation order will be granted if the court finds that the defendant has benefited from the criminal conduct and that the benefit amounts to a particular sum which is recoverable from the defendant. The aim of the regime is to deprive a defendant of any benefit gained through an offence, before imposing a punishment for the crime (such as a fine). In respect of waste crimes, the “benefits” can include any operating costs and expenses which would have been payable if the defendant operated a legitimate business (such as licensing costs, landfill taxes, surveys and engineering works) as well as any fees taken for the illegal waste activities.
The court will impose a period of imprisonment in default of payment of the confiscation order. The defendant will be given a set time to make the payment. If the confiscation order is not paid and the period of imprisonment is invoked and served, the debt will not be satisfied and remain payable by the defendant. This means that even if Mr Hazel goes to prison, his will still be required to pay off the entire sum of the confiscation order.
Confiscation must be dealt with before any other fine or financial order (with the exception of compensation orders, which are made to compensate a victim for any personal injury, loss or damage resulting from an offence).
This case confirms that the Environment Agency continues to focus on tackling waste crimes: “This case should serve as a warning to anyone in the waste industry who thinks they can flout the law. Where we have the evidence, we won’t hesitate to prosecute offenders.” (Environment Agency spokesman)
The amount imposed in this case also serves as a reminder that the Environment Agency is ready to engage in confiscation procedures, particularly where they have evidence of individuals (e.g. directors) being intrinsically involved in an offence. Since the Environmental Offences Definitive Guideline was introduced in July 2014, the direction of travel has been towards tougher sentencing for individuals and companies (see for instance R v Thames Water Utilities Ltd [2015] EWCA Crim 960), and this case follows that trend. Readers are reminded that, where illegal waste activities have taken place, HMRC will also have powers to recover landfill taxes on illegally deposited waste from April 2018. This will be in addition to existing enforcement powers exercisable by regulators.
Little Perceptible change despite publishing of Brownfield Land Registers
We have reported previously on the introduction of brownfield land registers (“BLRs”) as part of the new “Permission in Principle” (“PIP”) mechanism under the planning regime. The Government have now provided a template for the BLRs and guidance for local planning authorities (“LPAs”) on the information that is required in the BLRs. Also, on 31 December 2017, the deadline for LPAs to publish their BLRs passed. We look below at the changes to date for LPAs and developers.
The PIP regime came into force in April 2017 and applies to “housing-led” development of land, where the provision of housing is the main purpose of the development. Obtaining PIP does not enable the land to be developed – following the grant of PIP, an applicant must obtain technical details consent in order to commence development. However, PIP does establish the principle of housing development of a particular scale on the site and was intended to speed up the development of sites.
In conjunction with the PIP regime, the Town and Country Planning (Brownfield Land Register) Regulations 2017 (“BLR Regulations”) came into force on 16 April 2017. The BLR Regulations require every LPA to prepare, publish and maintain a register of all brownfield land suitable for housing in their respective areas by 31 December 2017. The land must be at least 0.25ha or capable of supporting at least 5 dwellings. This information is contained in Part 1 of the BLR. Part 2 of the BLR lists those sites from Part 1 that the LPA decides would be suitable for PIP, following publicity, notification and consultation. The land on Part 2 of the BLR is automatically granted “permission in principle” by a development order.
Guidance on PIP and on BLR Regulations
When the PIP regime and BLR Regulations came into force, the government promised further guidance to support this. This was published in July 2017 with further technical guidance in October 2017. This has left many LPAs little time to prepare their BLRs to meet the 31 December 2017 deadline. 73 LPAs (including many of the large urban centres) were involved in the 2016 pilot of BLRs, which has assisted in their preparatory work. However, the lack of sanctions for failure to publish BLRs, may mean many LPAs have not met the deadline, as may become evident in the weeks ahead.
The published guidance requires the LPAs to provide the data in a particular format (csv), as allowed for in the BLR Regulations. CSV format is an “open” format that allows for access to the data using non-proprietary software. The unified format should also allow developers to easily gather and process the information from locations of interest. LPAs can also publish the data in other formats if they wish, such as Excel, pdf etc and the BLRs must be updated annually.
The data held on Part 1 of the BLR for each suitable brownfield site identified includes, site location, size of site, ownership status, deliverability of the site within 5 years of entry on the register, planning status, the minimum and maximum net number of dwellings and (where the site is being considered for entry onto Part 2 of the register), a note of this fact. For each site on Part 2 of the BLR, the data includes the minimum and maximum net number of dwellings which the LPA considers the land is capable of supporting and, where the development includes non-housing development, the scale and use of such development. Much of this data is similar to that already published by the LPAs in relation to their Strategic Housing Land Availability Assessment (“SHLAA“) and in fact, many LPAs are viewing the BLRs as sub-sets of the SHLAA dataset.
Impact of BLRs on development
In our previous article, we raised the question of whether this new mechanism would in fact unlock any additional brownfield land for redevelopment. We noted that most of the suitable brownfield land was likely to have been previously allocated for housing through local plans. In addition, the fact that any development that would require EIA (environmental impact assessment) is prevented from benefitting from PIP means that BLRs are unlikely to assist in any schemes of any significant scale.
In addition, from a developer’s perspective, there is no right of appeal against a failure to include a site on the BLR. Consequently, for such sites, developers will have to use the traditional planning routes. As such, it seems unlikely that the BLRs will result in a sea change in terms of brownfield redevelopment.
We are still in the early days of the new regime but there is little evidence of major progress in housing delivery yet. Whilst many Councils have published their BLRs to meet the New Year’s Eve deadline, there is little evidence of a deluge of PIPs. We note, for example that Birmingham City Council published its BLR in 2017 listing 384 sites. However, it has not yet identified any sites on which to grant PIP. Similarly, Leeds City Council and Manchester City Council have not placed any sites on Part 2 of their BLRs. In their report to the Manchester City Council Executive on the preparation of the 2017 BLR[13], officers recommended that no sites be placed on Part 2 of the register since mix of uses and quality of design “cannot be as effectively managed [under PIPs] as is currently achieved through current planning applications”. This LPA view does not bode well for the role of PIPs in delivering housing targets.
Still the pressures for additional housing continue, and as 2018 unfolds, we will see whether PIPs can improve housing delivery on brownfield sites.
[13] Report for Resolution – Report to Executive 15 November 2017 (Item 7); Subject: Brownfield Land Register Update.
Natural England consultation on fees for licensing
Natural England recently released a consultation inviting views on its proposals to introduce charges for protected species licences. Until now, the wildlife licencing service has been funded by public resources. Charges will also include the cost for compliance monitoring by Natural England. This will affect licences granted under:
The Conservation of Habitats and Species Regulations 2017;
The Wildlife and Countryside Act 1981 (as amended); and
The Protection of Badgers Act 1992.
Natural England is seeking views on:
the proposal to charge for wildlife licences;
the charging structure; and
the proposed exemption for charging.
The consultation began on 11 December 2018 and will be open until 5 February 2018. Comments on the consultation can be submitted via Defra’s website.
Abstraction licence consultation
Defra recently published plans to reform the water abstraction system on 15 December 2017[14]. This is completely separate from the changes to exemptions for abstraction which is the subject of the article in this bulletin.
Among other proposals, Defra has confirmed that it will introduce secondary legislation under the Water Act 2014 to bring the current abstraction and impoundment licensing system into the environmental permitting regime in 2020. This would effectively align abstraction licences with other environmental permits. As part of this move, Defra does not intend to amend pre-existing conditions on abstraction licences to ensure that, following the proposed regulatory change, abstractors will have permits which would be equivalent to previous licences.
It is further proposed that once the regime change takes effect in 2020, the Environment Agency will consult on changes to abstraction charging schemes with a view to making the charges “financially sustainable, equitable and transparent”. Details of the proposed charges have not yet been determined, but will be reviewed in line with the aims of the wide-ranging Strategic Review of Charges[15].
Freeths LLP will continue to update on this topic when further details are released.
Consolidation of the Habitats Regulations
By way of reminder, the Conservation of Habitats and Species Regulations 2017 entered into force on 30 November 2017 (“the 2017 Regulations”). These Regulations apply to England and Wales (including the adjacent territorial sea), as well as Scotland and Northern Ireland in respect of reserved and excepted matters. The 2017 Regulations consolidate various amendments previously made to the Conservation of Habitats and Species Regulations 2010 (“the 2010 Regulations”), which had been amended ten times since it entered into force, and revoke the 2010 Regulations.
The 2017 Regulations transpose the Habitats Directive (Directive 92/43/EEC) and the Birds Directive (Directive 2009/147/EC), which set out the rules for protection, management and exploitation of European Protected Species and Habitats.
The 2017 Regulations were introduced without a formal public consultation as we are told that this piece of legislation does not introduce new policy changes or additional regulatory burden. However, the 2017 Regulations’ Explanatory Memorandum states that the new Regulations do introduce a number of minor amendments, which include:
Adding the River Tweed Commission to the list of Relevant Authorities for European sites and European marine sites.
The new Regulation 71 of the 2017 Regulations include references to section 57 (2A) of the Town and Country Planning (Scotland) Act 1997, which were not included under the previous Regulations 7 and 68 of the 2010 Regulations.
Removed references to “regional strategies” and “responsible regional authorities” to ensure consistency with planning laws in England following changes made by the Localism Act 2011.
Updating the penalty provisions to take into account the changes made by the Legal Aid, Sentencing and Punishment of Offenders Act 2012 (under section 85 of this statute, the statutory maximum level of fine which can be imposed by the magistrates’ court is no longer capped at £5,000).
Correcting a previous omission. The new Regulation 65(2) of the 2017 Regulations now includes a reference to Regulation 63(8) (this reference to the previous Regulation 61(8) of the 2010 Regulations was omitted from Regulation 63(2) of the 2010 Regulations).
Introducing Regulations 70 and 71 in the 2017 Regulations (which deal with the review of planning permission) in replacement of Regulations 68 and 69 of the 2010 Regulations. Regulation 71(2)(a) of the 2017 Regulations refer to both local development orders and neighbourhood development orders (whereas the previous Regulation 69(2)(a) of the 2010 Regulations only referred to a development order).
Introducing Regulation 89 of the 2017 Regulations, in replacement of Regulation 86 of the 2010 Regulations, to clarify the circumstances in which the review provisions do not apply to consents to construct, extend or operate electricity generating power stations.
Introducing Regulation 111 of the 2017 Regulations, in replacement of Regulation 107 of the 2010 Regulations, to remove the defunct references to unitary development plans in the definition of “land use plan”.
[14] https://www.gov.uk/government/publications/water-abstraction-plan-2017/water-abstraction-plan-abstraction-licensing-service.
[15] For background, this is a programme of work to reform the Environment Agency’s charging schemes for 2018-23, which aims to shift the cost of services provided by the regulator to businesses (from the public purse)( https://www.gov.uk/government/news/strategic-review-of-charges-consultation-launched).
Author: Penny Simpson
Author: Emma Tattersdill