Steps for success: managing contamination risk

Whilst contamination risks for buyers and developers of contaminated land attract a lot of attention,* the general position of land owners and occupiers can be overlooked.

Owners and occupiers, particularly councils and those with several properties in their portfolio, are often unsure about what they could and should be doing to minimise their risk and cost exposure with regard to contamination.  No development may be planned. No imminent sale proposition may exist. The lease may have years to run.  

Should we be comfortable?  In short, no.  

Top tips: back to basics

Here are my three top tips for owners and occupiers***

  1. Get a grip on the basics – what is known about contamination risk and in which jurisdiction are your sites located? If you are unsure, consider engaging an environmental consultant and lawyer to help you develop a sensible plan for investigating any contamination risk at your site (including risks from surrounds). Such a plan will take into account considerations such as the invocation of legal professional privilege and/or use of voluntary environmental audits and legal notification requirements relating to notifying contamination to the environment regulators.  
  2. Understand where your legal risk is coming from: regulatory requirements and civil liability.  Exercise due diligence. Although perhaps not immediately apparent, environmental law may impose legal requirements (and offences) in relation to pollution and contamination management and liability (on-site and off-site).  You may also be at risk from civil claims for damages by people affected by contamination, and your handling of it.  Claims arising from negligence, nuisance and trespass are, in my opinion, becoming “live” issues for many clients.  Don't be fooled by the lack of case law - such cases are often settled out of court. Finally, what is your contractual exposure to liability, under leases, licences and other commercial contracts (e.g. for the supply or storage of a potentially contaminating product)?
  3. Create a smart plan to manage your risk, prioritise sites and budget for any investigation or remediation works, given the risks identified.  Keep a watching brief on factors that could affect your risk profile, such as residential encroachment, delineation of areas for investigation of emerging contaminants, and of course, any sales and purchases of land in your portfolio. 

I recently addressed industry landowners and occupiers, councils, and regulators at the Australian Environment Business Network’s Managing Contaminated Land Workshop.   In October, I also presented to contamination professionals at the Australasian Land and Groundwater Association’s “When things go legal” session.  The contemporary risk landscape for dealing with contamination is changing (not least the long-mooted changes to the mandatory contaminated land notification regime in Victoria and the risks created by emerging contaminants such as PFAS/PFOS/PFOA)  and those who take prudential steps to understand and manage their risk, will in my view, fair better than those who adopt a business as usual or “do nothing” approach.  

Aside from any upcoming regulatory changes (which would be reason enough to warrant reviewing contamination risk), there are often solid practical reasons to take early action.  First, contamination dealt with at an early stage may be cheaper than attempting to investigate and remediate contamination down the track (depending of course on the type of contamination). Second, if you were not the original polluter of the land, there may be recourse to recover damages from the original polluter (or another party), but such cases are often time-limited, so delay may not assist you. 

Strategic thinking and a comprehensive understanding of your risks may significantly help to minimise cost and legal exposure.  For an abridged version of my recent presentation on this topic click on the presentation below. 

*That’s no surprise, given that the key regulatory drivers for identification of contamination, and the task of remediation, often arise in the context of a change of land use and/or on an acquisition.

**absent a transaction or development – in which case, you will probably need some more specific legal help

Next steps

If you would like an opportunity to discuss your organisation's approach to contaminated land management, please get in touch.  I will work with you to develop a sophisticated pathway forwards.  

If you would like a tailored briefing on risks applicable to your organisation in 2018, please contact me to book in for a fixed fee briefing. 

This presentation and Environment Express bulletins are intended only to provide a summary and general overview on matters of interest. It is not intended to be comprehensive nor does it constitute legal advice. Whilst attempts have been made to ensure that the content is current, Guthrie Legal does not guarantee its currency. You should always seek legal or other professional advice on specific cases and before acting or relying on any of the content.