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Statutory environmental torts - an underused but powerful resource

October 2005 - Environment. Legal Developments by Burges Salmon LLP.

More articles by this firm.

Most lawyers will be aware of the common law routes for claiming damages that result from environmental harm (such as nuisance, negligence and the rule in Rylands v Fletcher). However, a number of statutory torts may also be used and, because they are forms of strict liability, may be a more powerful tool for claiming for such losses.

Although in theory there is no real link between these torts, in practice the courts are likely to use thinking from any reported cases when considering other statutory torts.

This article examines the liability imposed by the Nuclear Installations Act 1965 (the 1965 Act) that has been used most frequently, considers claims under s73(6) of the Environmental Protection Act 1990 (EPA) and, in brief, sets out the requirements of the remaining statutory torts.

Nuclear Installations
By the 1960s scientific knowledge and understanding of nuclear processes enabled nuclear power-generation on a large scale. However, it was recognised that nuclear installations posed unprecedented levels of risk in that the escape of radioactive material could be catastrophic and lead to massive liabilities for the operators.

Although it was acknowledged that exposure to radiation could cause severe health problems, with symptoms that would not appear for many years following exposure, such installations provided social and economic benefits. Therefore, the international community sought to strike a balance between these conflicting factors.

The result was the Vienna Convention on Civil Liability for Nuclear Damage, implemented into UK law as the 1965 Act. Section 7 of the 1965 Act imposes a strict tortious liability on anyone licensed to operate a nuclear installation for 'injury to any person or damage to any property of any person other than the licensee' that results from the radioactive, toxic, explosive or other hazardous properties of nuclear matter or ionising radiation.

The 1965 Act also provides the following:

  • insurance against liability is compulsory for all licence holders;
  • a cap on the quantum of damages at £20m; and
  • a limitation period of 30 years in which to bring claims due to the long incubation period of harm caused by radioactive substances (although the government rather than the licensee will meet the claim if it is brought after a period of ten years).

There are a limited range of defences to a claim under s7 of the 1965 Act that include:

  • if the occurrence is attributable to a hostile act in the course of armed conflict (it is a moot point whether this defence would be available following a terrorist attack); and
  • a limited form of contributory negligence.

This statutory tort has been used in several reported cases that have highlighted two issues:

  • the types of loss that are recoverable; and
  • the evidential issues to prove causation resulting from the difficulty of collating scientific evidence to back up a claim.

Merlin v British Nuclear Fuels Plc
The claimants were in the process of selling their house when it was discovered that the house had high levels of radiation caused by the presence of radioactive dust from the defendant's Sellafield Nuclear Installation.

The knowledge became public and the first sale fell through. The claimants eventually sold their house at a greatly reduced price. As a result, they sought to use the statutory tort to claim compensation for both the reduction in value of their house due to radioactive contamination and the risk of harm to their children from being exposed to the radiation.

The High Court dismissed the claim on both grounds. The Court held that radioactive dust could not be 'property damage' because the radioactive dust did not change the molecular structure of the property. This was in spite of the fact that, although the radioactive dust could be removed, its presence in the atmosphere would ensure subsequent recontamination shortly afterwards. Equally, an increased risk of cancer was not physical injury and could not be claimed under a normal interpretation of the 1965 Act.

This strict interpretation of 'property damage' has been criticised and subsequent cases have widened its scope.

Blue Circle Industries Plc v Ministry of Defence
In this case, plutonium escaped from the Atomic Weapons Establishment at Aldermaston when storm waters caused ponds on that site to overflow and contaminate a neighbour's marshland. Once the contamination came to light, the claimant had to spend considerable sums of money in decontaminating the soil and the vegetation.

The defendant argued that, following Merlin, there had been no change to the molecular structure of the land and therefore no damage had been caused pursuant to the statutory tort.

The Court of Appeal did not accept the defendant's arguments. Instead, it accepted that there had been physical damage to the soil as it had become radioactive waste and was therefore less valuable.

Merlin was distinguished as being a pure economic loss case concerning the devaluation of the house. There is some dispute as to whether Merlin was truly a case of pure economic loss. Nevertheless, the Court of Appeal's decision has widened the category of physical damage that is recoverable and now includes the costs incurred in decontamination.

Magnohard Ltd and others v UKAEA and another
This case, heard in the Court of Session, confirmed the Blue Circle definition of property damage.

The claimant owned a private beach that was being polluted by radioactive material from the defendant's nuclear power station. The claimant sought a declaration that the United Kingdom Atomic Energy Authority (UKAEA) was in breach of its statutory duty. It also wanted the Court to order the implementation of a more stringent monitoring programme for the presence of radioactive particles on the beach. It reserved the right to claim damages and pursue a claim under the Human Rights Act 1998 at a later stage.

The Court granted the declaration that there had been a breach of duty and, applying the Blue Circle definition, held that this breach had resulted in property damage to the claimant's property. However, because the 1965 Act did not precisely describe the nature of the duty, the Court did not grant an order for the performance of a new monitoring programme.

This judgment allowed the claimant to return to court with its claim for damages, and also with its Human Rights Act claim. A recent press release suggests both parties are attempting an out-of-court settlement, so the issue of damages may not become public knowledge.

Reay and another v British Nuclear Fuels Plc
The case of Reay demonstrates the difficulty in proving causation despite the strict statutory liability imposed by the 1965 Act.

The claimants alleged that paternal pre-conception irradiation had mutated the fathers' sperm and was a material contributory cause of their daughters' leukaemia and non-Hodgkin's lymphoma.

The claimants relied on epidemiological research showing pockets of the illness in the locality of the plant. However, the judge was critical of the survey and found it difficult to isolate the effects and exposure to radioactivity from the other potential causes of cancer in the environment. He held that the claimants had failed to prove the necessary causal link on the balance of probabilities.

Claims for personal injury of this sort brought pursuant to this statutory tort may be difficult as the causes of illnesses such as leukaemia are not easy to prove.

Deposit of Waste
Section 73(6) of the Environmental Protection Act 1990 (EPA) creates a statutory tort allowing a claimant to claim for losses caused by the unlawful deposit of waste.

Section 33(1) of the EPA establishes a criminal offence for depositing waste outside of the terms of a waste management licence, and s63(2) of the EPA establishes a further criminal offence for depositing waste that is not 'controlled waste' but that would be 'special waste' if it were 'controlled waste'.

In addition to these criminal offences, s73(6) allows any person who has suffered 'damage' following those criminal offences to claim their remedy in tort. The definition of damage is not specific and is potentially very wide. The definition of damage in s73(8) states that it includes 'death and injury including any disease and any impairment of physical or mental condition'. However, the EPA does not specify whether pure economic loss or loss of amenity are included within this definition. Commentators believe that the latter could be recoverable by comparison to the common law of nuisance, but there are no recorded cases on this point.

Liability under s73(6) is strict, subject to the limited defences available. The EPA states that it is a defence to show that the damage was wholly due to the fault of the claimant and the claimant voluntarily accepted the risks arising from the unlawful deposit of waste, and s73(9) provides that contributory negligence is available as a partial defence. It is also possible for a defendant to rely on the defences available for the criminal offence of depositing waste such as taking all reasonable precautions to avoid the commission of the offence.

There is only one reported decision in which s73(6) was pleaded. This is somewhat surprising. There is no exclusion in the EPA to prohibit concurrent common law actions, so the statutory tort can be pleaded alongside nuisance and negligence. Further, s73(6) would avoid some of the evidential problems associated with common law environmental torts.

C (A Child) v Imperial Design Ltd
A child was injured as a result of playing with waste that had been carelessly discarded by the defendant. In the resulting litigation, the claimant pleaded negligence as well as a breach of s73(6).

At first instance the judge found both a breach of statutory duty and a breach of a duty of care in negligence. The Court of Appeal agreed that there had been a breach of the duty of care in negligence and therefore avoided discussing s73(6) in any detail.

Potential scenarios for s73(6)
It is surprising that s73(6) has not been used more often. It appears to be an extremely powerful weapon in a claimant's armoury and avoids many of the pitfalls in claims under the common law rules. It can be used in many potential scenarios, such as the following two examples.

1) Landlord and tenant
The landlord has leased a parcel of land to a tenant and the tenant has proceeded to pile vast quantities of waste on the land, outside of the terms of a waste-management licence. At the end of the lease the landlord is left with the significant costs of disposing of such waste, which can include transport costs and landfill tax.

Most commercial leases will contain covenants requiring the tenant to clear the site at the end of the lease and, if it fails to do so, the landlord has a claim in damages. However, being contractual in nature, such a clause will have no effect if, for example, the tenant is a company in liquidation. In those circumstances s73(6) could be used in an action against a director or other employee of the insolvent company if the waste deposited constitutes a criminal offence within the EPA and the director could be shown to have had a degree of personal involvement in the deposit of waste.

2) Landfill
Another example would be a dispute between neighbouring landowners over the operation of a landfill. The statutory tort allows a landowner to recover compensation for the damage caused by the owner of adjacent land who is operating an illegal landfill or operating a landfill outside of the terms of a waste-management licence. The land could be 'blighted' as a result of the mere presence of the landfill or, for example, smells arising from it. A claim could be brought under s73(6). This has the advantage over a claim in nuisance because of the strict liability nature of the statutory tort.

Issues arising from s73(6) EPA
There are a number of unresolved issues surrounding the use of s73(6) of the Environmental Protection Act 1990, such as:

What type of damage is recoverable?
It is thought that the courts would be more likely to follow the reasoning in Blue Circle and Magnohard than Merlin. However, the definition of damage is wide and other heads of loss may be reasonable.

Who might be liable?
This is likely to be the person who unlawfully deposited waste on the land (ie the operator of any vehicles) or the person who directed the waste to be dumped (ie the director of any relevant company).

Is civil liability dependent on a prior criminal conviction?
It is thought that no prior criminal conviction is necessary to rely on s73(6) in the civil courts, although it might be necessary to prove the offence on a criminal standard of proof.

Other Statutory Torts
As well as the two statutory torts mentioned above, there are several others to be considered in environmental liability claims.

Section 14 of the Gas Act 1965 creates a strict tortious liability on a public gas transporter for the damage done by the escape of that gas in certain circumstances. This statutory tort is unusual in that it specifically defines the term 'damage'. There are also defences if damage is suffered as a result of the claimant's own fault and there are contributory negligence provisions.

Section 209 of the Water Industry Act 1991 creates a statutory tort that places water undertakers under strict liability for any loss or damage caused by water escaping from a pipe. Only a limited range of defences apply and these defences are similar to those in the Gas Act 1965. Unlike the Gas Act 1965, damage is not specifically defined and is subject to judicial interpretation.

Section 22 of the Water Industry Act 1991 creates a statutory tort against sewage undertakers. The sewage undertaker will be caught by this provision if it has failed to comply with an enforcement order issued by the Secretary of State or by the Director General of Water Services. Anyone who suffers loss or damage can claim under this statutory tort.

A new statutory tort came into force on 1 April 2005, following the enactment of the Water Act 2003. It imposed a new statutory tort on those that abstract water from inland waters or underground strata by inserting a new s48A into the Water Resources Act 1991.

The new provision allows for civil remedies for loss or damage arising from such water abstraction. The section prohibits concurrent civil proceedings for damages with the exception of breach of contract claims or negligence claims. There is also a limitation on the available remedies, as an injunction cannot be granted if that would risk interrupting the supply of water to the public.

The Merchant Shipping Act 1995 contains statutory environmental torts for losses arising from the escape of oil and other hazardous and noxious substances from sea vessels.

Conclusion
Statutory environmental torts are rarely used by claimants who have suffered environmental harm. However, they are useful tools in that they impose strict liability regimes and therefore sidestep the difficulties involved in proving fault on the part of the defendant.

We have recently used the statutory tort arising from the unlawful deposit of waste to obtain a six-figure settlement for a client in circumstances where there was no other realistic possibility of recovery. Awareness of these statutory torts is important, to ensure that opportunities to recover losses are not missed.

 
Case references
Rylands v Fletcher (1868) LR 3 HL 330

Merlin v British Nuclear Fuels Plc [1990] 2 QB 557

Blue Circle Industries Plc v Ministry of Defence [1999] Ch 289

Magnohard Ltd and others v UKAEA and another [2004] Env LR 19

Reay and another v British Nuclear Fuels Plc [1994] Env LR 320

C (A Child) v Imperial Design Ltd [2001] NLR 33

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