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Lord Renton: My Lords, in many circumstances in our statutes we make special provision for defences being raised. When that happens the onus of proof changes generally. Here we have rather complicated circumstances. I think that Parliament should make the position clear in the way that the noble Lord, Lord Northbourne, has suggested. If his way of doing it does not appeal to the Government, I hope that my noble friend will say that they acknowledge that there should be defences of this kind and that he will have suitable amendments inserted in another place.

Viscount Chelmsford: My Lords, I wish to raise another concern. I regret that it comes so late in the proceedings but it was only on Friday night that I discovered that the insurance industry is becoming extremely exercised on the change in responsibilities for pollution. The amendment of the noble Lord, Lord Northbourne, at least gives some opportunity to point out that it would protect against some possibly quite difficult insurance consequences. We have had the great word "superfund" mentioned already and I think everyone knows that on the American scene retroactive decisions by the courts over the years have allowed a whole lot of cases which insurers thought were closed to be reopened, raising considerable problems for the Lloyd's market, which accounts in a particular way at the moment, and, if a lot of very well formed opinion is true, considerable difficulties for American insurance companies over the years to come unless they are bailed out by further legislation.

I am not sure whether what is being proposed would work retroactively in this case. It certainly might. Alternatively, we face the possibility—I have not had time to be briefed by the insurance industry—that innocent landowners will find that they can no longer get general liability insurance which includes pollution

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for fear of the fact that unknown to them there is something underneath the ground for which they can be held liable because no one else can be found. I hope that the Government will pick this one up and think about it. There are potentially some difficult and important problems floating around on the insurance side.

5.30 p.m.

Viscount Ullswater: My Lords, Amendment No. 27 seeks to provide specific defences in any legal proceedings relating to remediation notices. The intention is to protect the position of landowners or occupiers who have not themselves caused or knowingly permitted contamination to occur, although the drafting of the amendment does not state that specifically. Effectively, the amendment seeks to exempt landowners from any responsibility for contamination on their land which they were powerless to prevent or which resulted from the movement of contaminants by natural causes.

As I have stated on previous occasions, the Government did not intend to create new categories of liabilities for owners of land by bringing forward these provisions. In general, we believe that we have not done so. We have reflected the existing position under the statutory nuisance provision in Section 80(2) (c) in Part III of the Environmental Protection Act 1990 which, as the noble Lord, Lord Northbourne, indicated, makes the owner or occupier of premises liable to receive an abatement notice where the person responsible for the nuisance cannot be found.

Those contaminated land provisions reflect also the pattern of powers and duties of local authorities which exist in the statutory nuisance provisions. In both, there is a duty to cause their areas to be inspected. In both, there is a duty to serve a notice, where appropriate, with offences of non-compliance with that notice. They also both contain a power for local authorities to act on the default of the recipient of a notice.

The major difference in approach lies, of course, in the differences of definition between statutory nuisances and contaminated land. However, it is clear that the definitions of statutory nuisances set out in Section 79 of the Environmental Protection Act would, inter alia, include much the same range of problems as what is described under the current provisions as "significant harm". Those parts of the definition of contaminated land which relate to the pollution of controlled waters reflect equivalent provisions in the Water Resources Act 1991, particularly Section 161.

It has been suggested that under the statutory nuisance provisions local authorities have more discretion in determining what is a "nuisance" than they would have in identifying land as "contaminated". Obviously local authorities do not have complete discretion to determine what a "nuisance" is. There is a substantial body of case law on the elements of a nuisance, and if a local authority is satisfied that a nuisance exists on the basis of that case law, it is under a duty to serve an abatement notice.

However, it might be suggested that there is more "discretion", in that there is an element of judgment involved in applying the general principles of case law

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on statutory nuisance to the particular problems of contaminated land. There is also no statutory provision for guidance on the application of the statutory nuisance provisions to nuisances arising from contamination, constraining the extent of steps which might be required to abate that nuisance. But any discretion present in the statutory nuisance provisions cuts both ways and could work to the disadvantage of landowners, or indeed anyone else held to be responsible for abating a nuisance or prohibiting its recurrence.

A local authority could potentially seek to impose conditions which were considerably more onerous than could be justified under the contaminated land proposals if it believed these were necessary to abate a nuisance. There is no requirement under statutory nuisance for local authorities to consider guidance from the Secretary of State or the agency—or indeed from anyone—in determining whether or not something is "prejudicial to health".

In practice, the lack of guidance on the application of the provisions to contaminated land leaves considerable potential for uncertainty and inconsistency in the operation of the statutory nuisance provisions. It was one of the Government's major intentions in bringing forward the contaminated land provisions to improve both certainty and consistency.

There have also been suggestions that the apparent absence of a "best practicable means" defence in the contaminated land provisions represents a deterioration in the position of landowners in comparison with the statutory nuisance provisions. A broadly equivalent effect is, however, achieved in the contaminated land provisions by the fact that a remediation notice may only specify steps which are "reasonable" having regard to the costs likely to be involved and to the seriousness of the harm or pollution of controlled waters in question. The regulations governing appeals against remediation notices will provide for the consideration of whether the requirements in any notice are indeed reasonable.

That will potentially have a broader effect than the "best practicable means" test in statutory nuisance. That defence is available only with respect to industrial, trade or business premises, and even then it does not apply with respect to all of the categories of statutory nuisance which might overlap with the definition of contaminated land. The test under the contaminated land provisions that the remediation requirements must be reasonable would apply in all circumstances and would also involve a direct consideration of the costs which would be involved.

Comparisons have also been made between our proposed statutory provisions relating to contaminated land and the position under various common law torts. What is often missed in those comparisons, however, is any acknowledgement that the two fields of law are seeking to achieve different purposes. Our proposed statute seeks to remove current environmental problems. Actions at common law, by contrast, seek to provide compensation to private individuals and companies for specific damage which they have suffered. We believe that those different objectives and purposes justify different legal tests.

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One way in which, on reflection, we feel that we may have stepped beyond our overall intention of reflecting existing liabilities is in the special case of victims of fly-tipping. We have just put that right through my Amendment No. 23 and Amendment No. 44, which is yet to be moved.

The noble Lord's amendment alludes to a further issue which the Government intend to address when this Bill is discussed in another place, and that concerns water pollution resulting from the migration of contaminants. The noble Lord, Lord Northbourne, alluded to the remarks which I made on Report. That can be both difficult to detect or prevent, and very expensive to remedy, particularly if groundwaters or aquifers have become polluted.

Looking again at the existing provisions, the Government acknowledge that in this particular area the potential liabilities of landowners, where they have not themselves caused or knowingly permitted the water pollution, would be extended by these provisions in comparison with the existing provisions in Section 161 or the Water Resources Act 1991. The Government therefore intend to bring forward their own amendment in this area to restore the status quo.

But this amendment asks for much more. What it is seeking to do is to remove potential liabilities which would fall to landowners under existing provisions. The Government do not believe that that would be justified.

It is important to remember that the definition of contaminated land, and the procedures for dealing with it, relate only to current environmental problems. The system is not punitive in its effects, nor will it necessarily impose some of the very high costs which have been suggested. Any action required to deal with contamination will have to be "reasonable" in terms of the costs and the seriousness of the harm or water pollution involved. The objectives of any remediation required may be to assess and manage any risks and not necessarily to remove all of the contamination on the site if its effects can be controlled in other ways.

The Government believe that it is reasonable for owners of land to bear the responsibility for what they own and the effect it has on others and on the wider environment in cases where no specific polluter can be found. Owners are always ready to reap unforeseen benefits from their land, whether that results from mineral discoveries, planning permissions or increases in value resulting from new transport infrastructure paid for by the public purse. We believe that they should accept their responsibilities as well.

My noble friend Lord Chelmsford asked me about retrospection. The provisions are not retrospective because they would result only in potential liability for significant harm where that is occurring after the provisions have come into force. They will not result in any liability for harm which had occurred previously, before the provisions came into force, and are not currently occurring. I hope that my noble friend is reassured by the words that I have used.

I thought it right to explain in some detail to the noble Lord, Lord Northbourne, the Government's position in relation to the amendment. I hope that I have been able

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to persuade him that the existing pattern of liabilities should not be changed and that, therefore, he will agree to withdraw the amendment.

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