The Van der Walle case on waste – a new contaminated land liability?
For some time industry and some environment lawyers have been expressing concern about the breadth of application being given to the EU Framework Directive on Waste 75/442/EEC (as amended). The concern is that waste law is being applied so broadly that it is covering issues originally intended to be dealt with by other legal regimes. On 7th September 2004 in case C-1/03 (Van der Walle and others) the European Court of Justice ("ECJ") for the first time applied the Framework Directive in the area of contaminated land. The case involved petrol leaking from underground storage tanks at a filling station owned by Texaco in the Brussels region of Belgium.
The ECJ ruled that hydrocarbons that are spilled unintentionally and cause soil and groundwater contamination have been discarded and are waste under the definition set out in the Framework Directive on Waste (the "Framework Directive"). It also ruled that soils contaminated by the hydrocarbons are waste even where they have not been excavated. It then went on to rule that the supplier of the hydrocarbons to the filling station (in this case Texaco) can be the producer (and therefore also the holder) of the waste for the purposes of the Framework Directive where the leak is attributable to its conduct.
The case cuts right across the current divisions in UK law between waste on the one hand and ground contamination and water pollution law on the other. At the very least the case seems bound to cause some headaches when analysing liability for contaminated land and water pollution. However, at its broadest the case could mean that the UK has not gone far enough in implementing the Framework Directive and that a new or amended power under waste legislation requiring remediation of contaminated land and water pollution is required. The ruling is also bound to cause difficulties in other Member States.
Background and the Decision
The case involved a petrol filling station owned by Texaco and operated under a contract with Texaco by Van der Walle and others. Hydrocarbons leaked from the underground tanks and contaminated soil and groundwater. The Brussels Region does not have a specific legal regime for the remediation of contaminated land. Therefore, the Belgian courts sought to apply a domestic law designed to implement the Framework Directive in order to allocate liability and establish, in particular, whether Texaco should be liable in relation to the contamination. The Belgian law follows the wording of the Framework Directive closely. The EU has not legislated specifically on the remediation of ground contamination and water pollution. The Water Framework Directive 2000/60/EC and the Environment Liability Directive 2004/35/EC do go some way in this direction but the former does not yet have full practical effect in Member States and the latter has not yet been implemented. However, rather than acknowledging that the issue is outside the scope of current EU legislation and should at present be dealt with by domestic legislation in Member States the ECJ ruled that the leaked hydrocarbons and the impacted soil are waste and therefore the provisions of the Framework Directive apply.
The root of the problem is that the Framework Directive was clearly designed to address mainstream waste management as well as the definition of waste in the Framework Directive. It identifies examples of waste disposal and waste recovery operations which reflect waste management practices that are common or were common. It requires that waste should be recovered or disposed of without endangering human health or in ways which could harm the environment. A further requirement, focussed on by the Belgian courts and the ECJ, is that Member States should take necessary measures to prohibit the abandonment, dumping and uncontrolled disposal of waste. The Framework Directive goes on to require that any holder of waste manages it in accordance with the Framework Directive's requirements.
While the line between flytipping and the intentional or reckless release of contaminants into soil and groundwater is not a clear one, accidental releases of contaminants are not generally considered to be waste management or disposal practices. However, using some back to front reasoning the ECJ decided that accidentally released contaminants that contaminate soil or pollute groundwater must be waste. It reasoned that this must be the case as otherwise the Framework Directive and in particular the prohibition on abandonment, dumping and uncontrolled discharge in the Directive would not apply. The ECJ then went on to decide that the contaminated soil or water must also be "considered waste by the mere fact of its accidental contamination by hydrocarbons. This is the case whether is it excavated or not." Finally the ECJ decided that Texaco was the producer and therefore the holder of the waste if the leak of the hydrocarbons from the storage tank was attributable to any disregard by Texaco of its contractual obligations with the operator or any other actions which could render it liable. This reasoning appears circular. However, it appears that Texaco would, in effect, be the producer and therefore also the holder of the waste if it caused or possibly permitted the leak.
Implications for the UK
The ECJ's decision will certainly cause some difficulties when analysing liabilities for contaminated land. However, it might also imply that the UK has not put in place legislation to fully implement the requirements of the Framework Directive. The decision implies that the UK should have introduced a broad prohibition on the abandonment, dumping or uncontrolled disposal of waste whether intentional or not. It implies further that where the prohibition is breached a positive obligation is required on the producer and/or holder of waste (in this case contaminated soil and groundwater) to excavate and safely dispose of the waste.
The UK does already have a lot of legislation covering these areas. However, it is based around a separation of waste management from contaminated land and water pollution law. Part IIA Environmental Protection Act 1990 on contaminated land falls short as it is a mechanism for the remediation of contaminated land not a prohibition on causing ground contamination. In addition it is risk based unlike the ECJ's interpretation of the Framework Directive. If the ECJ were to apply a test based on risk of harm to human health and the environment it would contradict its other recent decisions on the definition of waste. Sections 33 and 59 of the Environmental Protection Act 1990 set out prohibitions on waste disposal and give powers to the Environment Agency to require the waste to be removed and safely disposed of. On the face of it they could be used to apply the ECJ's recent interpretation. However, they only apply in situations of "knowingly causing or knowingly permitting" rather than to unknown or accidental spills or, again, where there is a risk to human health or the environment. Therefore they too seem to fall short of the ECJ's interpretation of the Framework Directive on Waste.
The list of problems raised by the decision goes on. Does it imply that all land that has been impacted by contaminants is a landfill and therefore is subject to the requirements of the Landfill Directive 99/31/EC? Under the Landfill Directive a landfill is defined as "a waste disposal site for the deposit of the waste onto or into land". This seems to imply that only sites for the deliberate disposal of waste can be landfills. However, that would lead to a split in the way that contaminated land is dealt with depending on whether the "waste" (i.e. spilled or leaked substances) was disposed of there deliberately or by accident.
Conclusions
In this case the ECJ was responding to a specific request from a Belgian court that was trying to apply a law based on the Framework Directive on Waste to a contaminated land issue. So while the ECJ may have assisted in resolving the particular problem at hand in a way that was beneficial for the environment it has potentially created a lot of difficulties for industry and the government in the UK. No doubt the ruling will create difficulties for other Member States as well.
This appears to be a case where the ECJ applied the scope of EU waste law beyond what it was commonly thought to be. It begs the question that if the ECJ is correct and the Framework Directive does apply in this way to ground contamination and water pollution then what is the need for other EU legislation such as much of the Environment Liability Directive and the Water Framework Directive. In addition it suggests that the UK and other Member States have been wasting their time in developing detailed laws on liability for remediation of contaminated land.
For further information please contact Paul Sheridan on +44 (0) 207 367 2186 or at paul.sheridan@cms-cmck.com or Daniel Chappell on +44(0) 207 367 2810 or at daniel.chappell@cms-cmck.com
