National Grid Gas Plc, R (on the application of) v The Environment Agency

Under Part IIA of the Environmental Protection Act 1990, primary responsibility for contaminated land rests with the original polluter. Where that undertaking has been replaced through statutory transfer schemes, the word “person” may include the continuing entity formed by its statutory successors. The successor may therefore be liable even though it did not itself cause or knowingly permit the contamination.

Transfer provisions referring to “liabilities” may include potential liabilities arising under legislation enacted after the transfer, where the liability relates to the transferor’s past activities. Liability under Part IIA does not depend on proving that the land previously constituted a statutory nuisance or that a pre-existing liability had crystallised. The judicial review claim was dismissed.

National Grid Gas plc, formerly Transco plc, sought judicial review of the Environment Agency’s decision that it was an “appropriate person” under Part IIA of the Environmental Protection Act 1990 in relation to contaminated land at a former gasworks site.

The contamination had resulted from activities of statutory predecessors in the gas industry. Transco argued that it had not itself caused or knowingly permitted the contamination, that no liability had existed at the time of statutory transfers under the Gas Act 1948, Gas Act 1972 and Gas Act 1986, and that those transfers could not transmit a liability created later by Part IIA.

1. Statutory construction. The claim failed on the principal issue. In the context of Part IIA, “person” is sufficiently flexible to include the undertaking comprising successive statutory successors where a continuous chain of statutory transfers has transferred property, rights and liabilities. This construction gives effect to Parliament’s intention that the polluter, rather than innocent owners or the public purse, should bear primary responsibility ([2006] EWHC 1083 (Admin), paras 57–66).
2. The court was entitled to adopt a purposive construction. The statutory context made the meaning of “person” ambiguous or obscure in relation to statutory successors, and the ministerial statements relied on under Pepper v Hart clearly indicated that successors to bodies such as British Gas and British Coal were intended to bear responsibility for contamination caused or knowingly permitted by their predecessors (paras 61–65).
3. Absence of prior liability. It was unnecessary and inappropriate to determine whether the contamination had previously constituted a statutory nuisance or whether a liability to abate such a nuisance had crystallised. Part IIA superseded statutory nuisance as a means of securing remediation of contaminated land, but the two regimes were not identical. Making Part IIA liability depend on proving a historical statutory nuisance would be artificial and evidentially problematic (paras 67–72).
4. Transfer of future liabilities. A liability under Part IIA is capable of relating to activities undertaken long before the regime came into force. Although the legal obligation to remediate arises when the statutory machinery is engaged, the exposure associated with having caused or knowingly permitted the contamination is sufficiently real to fall within statutory transfer provisions. “Liabilities” therefore included potential liabilities under future legislation where those liabilities arose from the transferor’s past activities (paras 73–88).
5. The court followed and applied Walters v Babergh District Council and confined Nash v Rochford Rural District Council to its highway-authority context, where the doctrine concerning nonfeasance materially influenced the decision. The application was dismissed (para 89).