Circular Facilities (London) Ltd v Sevenoaks District Council

On a statutory appeal concerning a remediation notice, a company cannot be held liable merely because a soil report was available on a public planning register. The decision-maker must make clear findings about who knew the relevant facts and explain the legal route by which that knowledge is attributed to the company.

An agent’s knowledge may, depending on the circumstances, be imputed to the company even if its controlling mind had no personal knowledge. Where the evidence and applicable legal principles could support liability, the High Court may order a retrial.

For the statutory deeming provision concerning substances produced by a chemical reaction or biological process, knowledge of the original substance is sufficient. Awareness of the potential harm or of the resulting process is not required.

Sevenoaks District Council served Circular Facilities (London) Ltd with a remediation notice under Part IIA of the Environmental Protection Act 1990. The Council alleged that the company had caused or knowingly permitted organic material to remain in or under land which had later generated methane and carbon dioxide.

The Magistrates’ Court upheld the notice, finding that the company must have known of the organic material and gas because a soil investigation report had been available and had been used in the development. The company appealed to the High Court under regulation 13 of the Contaminated Land (England) Regulations 2000.

The central issues were whether the necessary knowledge had been established, whether knowledge could be attributed through the company’s agent, and whether the statutory concept of knowingly permitting required knowledge of potential harm.

1. Appeal allowed. The Magistrates’ Court had not made sufficiently clear findings about whether Mr Ketteringham personally knew of the organic material or gases, whether Mr Scott knew of the soil report, or whether Mr Scott submitted it to the Council.
2. The judgment failed to disclose the chain of reasoning by which knowledge was attributed to Circular Facilities. If Mr Ketteringham’s evidence was rejected, the District Judge needed to say so and give reasons. The mere availability of the report on the planning register was insufficient, by itself, to impute knowledge of its contents to the company.
3. Mr Scott appeared, on the evidence, to have acted as an agent of the company rather than as Mr Ketteringham’s personal agent. Depending on the circumstances, his knowledge might therefore have been imputed directly to the company. The legal basis for that conclusion required investigation and disclosure. The reference to the directing mind and will of a company did not prevent that mind and will from residing in different persons for different activities, as illustrated by El Ajou v Dollar Land Holdings plc and Another [1994] 2 All ER 685.
4. The evidence and applicable legal principles could support a legitimate conclusion that the company was an appropriate person. The matter was therefore to be retried, subject to representations from the parties. The age and difficulty of the evidence did not justify excluding judicial inquiry.
5. By way of clarification, the statutory deeming provision required knowledge of the original substance, such as organic material. It did not require knowledge that a chemical reaction or biological process might produce a further contaminating substance or cause potential harm.

• High Court (Administrative Court): appeal from the Magistrates’ Court allowed under regulation 13 of the Contaminated Land (England) Regulations 2000; retrial contemplated.