Environmental Law News Update

In this latest Environmental Law News Update, Christopher Badger, Charles Morgan and Mark Davies consider the EU’s packaging and waste targets, the treatment of “fluff” within the landfill system and what happens when a mattress recycling business abandons its premises and several hundred tonnes of mattresses.

The EU’s Circular Economy Package and Waste Targets

On 18 April, following long-running discussions between the EU Commission, Council and Parliament, MEPs voted to approve the EU’s Circular Economy Package (“CEP”).

Under the CEP, Member States will have to reach a 55% municipal recycling rate by 2025, 60% by 2030 and 65% by 2035. For context, in 2015, the EU average for municipal waste that was recycled was 32%, with the UK above average on 46%.

The CEP does not just cover municipal recycling, but also, amongst other aims, contains specific targets for packaging recycling by 2030: 85% of paper and cardboard; 80% of ferrous metals; 75% of glass; 70% of all packaging; 60% of aluminium; 55% of plastic; and 30% of wood. Member States must additionally ensure, by 2030, that all waste suitable for recycling or other recovery is not accepted at landfill sites, excepting waste for which disposal by landfill is the ‘best environmental outcome’.

Looking at the timeframes for the CEP, one might be forgiven for thinking that post-Brexit the UK will be able to forge its own path on recycling targets. However, it has been widely reported that DEFRA have confirmed in writing that the country will be supporting the CEP irrespective of our departure from the Union.

If it is truly the case that the UK will be supporting the CEP after exit day, it seems curious that there is no more than one, solitary mention of the circular economy idea within the 25 Year Environment Plan, with that coming in reference to the ‘Industrial Strategy’ section and the goal of zero avoidable waste by 2050. Admittedly the goal of zero avoidable waste by 2050 is not necessarily in conflict with the proposals in the CEP, but it will be interesting to see whether the government (and successive governments) continue to back the European project as its milestone goals are first in time by some measure.

‘Fluff’ is subject to landfill tax

Back on 11 April 2018, in Devon Waste Management Ltd & ors v HMRC [2018] UKFTT 181 (TC) the First-Tier Tribunal Tax Chamber determined a number of appeals that centred on the use of ‘fluff’ (mainly black bag waste) in the construction of landfill cells. The fluff had been specifically selected as part of a base layer designed to protect the liner of the landfill cell.

The appellants argued that deposits of ‘fluff’ in the cells of their landfill sites amounted to a “use” of that material and accordingly had not been disposed of as waste or by way of landfill and as a result was not subject to landfill tax. They argued that the black bag waste formed an integral part of the landfill containment and barrier system and had been specifically selected and inspected, and its placement supervised, for that purpose. In this way, the ‘fluff’ was indistinguishable, from a legal point of view, from the daily cover that the Court of Appeal found in Waste Recycling Group Ltd v HMRC [2008] EWCA Civ 849 was not waste.

HMRC argued in response that the use of ‘fluff’ was no more than the careful management of material deploying waste deposit procedures which were appropriate for black bag domestic waste.

The Tribunal found that there were two main questions to be decided. Firstly, was the ‘fluff’ disposed of as waste, in particular whether the disposal was made “with the intention of discarding” it. The second was whether the disposals were “by way of landfill”.

It held that, while in one sense, the black bag waste was “used” to protect the lining system, this was not the end of the matter. All of the material was destined for landfill, in the main body of landfilled waste if it was not to be ‘fluff’. ‘Use’ was not considered to be an antonym for ‘discard’ – the fact that the material continued to serve a useful function after it had been disposed of did not affect this conclusion.

Secondly, while the simple act of depositing material on the ground anywhere in a landfill site could not amount to a “disposal by way of landfill”, the phrase “by way of landfill” was a qualification that allowed a filter of common sense to be applied, to exclude deposits that were clearly not by way of landfill on any sensible interpretation. The deposit of black bag waste which was intended to remain in the landfill permanently was not intended to be an exception.

The full judgment can be found here

A very similar appeal, Biffa Waste Management Ltd v HMRC [2018] UKFTT 199 (TC), concerning the deposit of shredded waste deposited at the top of landfill cells, also failed. The Tribunal held that the various deposits were all made with the intention of discarding it as waste and were all made by way of landfill. The linked appeal can be found here

Letting Sleeping Mattresses Lie

The almost metaphysical striving for the meaning of the vocabulary of waste law continues with the case of Stone and Salhouse Norwich Ltd. v Environment Agency [2018] EWHC 994 (Admin). Mr. Stone is a director of Salhouse Norwich Ltd., which owns a site in Norwich which was let to a mattress recycling business which lacked any environmental permit. The Agency served an enforcement notice on the tenant, who immediately ceased to trade and vacated the site, leaving the landlord to address the problem of the 471 tonnes of mattresses remaining there. The landlord did little beyond engaging in preliminary discussions with the Agency. The Agency then charged the landlord and its directors with the offence of knowingly permitting storage of waste without authorisation under the Environmental Permitting (England and Wales) Regulations 2010.

The 2010 Regulations derive their force and meaning from the Waste Framework Directive, which defines ‘storage’ so as to include storage pending disposal or recovery operations, in each case constituting a ‘waste operation’ requiring authorisation. The defendants argued that they had not been carrying out any such ‘waste operation’. The defunct business had not been theirs and any subsequent events on site should be regarded as merely the first steps in a remedial clean-up operation; nor had they ‘knowingly permitted’ anything, since they had been unaware of the service of the enforcement notice and had simply ‘passively suffered’ the mattresses to remain. The Agency contended that there was a continuing waste operation after service of the enforcement notice which the landlord had knowingly permitted, with the ‘consent or connivance’ of its directors or in a manner attributable to their neglect (as required for the conviction of the directors: regulation 41 of the 2010 Regulations).

The Magistrates Court convicted and the High Court dismissed an appeal by way of case stated.

Nicol J. held that the Magistrates had been correct to find that there had been a continuing ‘waste operation’ after the departure of the tenant and that the landlord had ‘knowingly permitted’ it. It had failed to prevent the waste from remaining on site; no positive act was required. The posited distinction of ‘passive sufferance’ was meaningless.

This is a tough decision for commercial landlords; rather than requiring the prosecution to prove positive steps as an ingredient of ‘knowingly permitting’, it requires the defendant owner of land to demonstrate either ignorance of the unauthorised activity or the taking of some positive steps on its part to prevent the storage from continuing. Passivity is not enough.

The full judgment can be found here. Nicholas Ostrowski of Six Pump Court acted for the Agency.

We published our Environmental Law Video Newscast last week – a monthly round-up of the latest developments in environmental law.

Chambers UK Guide to Environmental Law 2018 was published this month and written by Six Pump Court’s Environmental Law Team. You can also use this link to access the full-text pdf version. The Guide provides easily accessible information to help navigate environmental law in the UK and covers the environmental regulatory framework, environmental protection, developments in policy and law, enforcement, liability and disclosure requirements as well as the law as it relates to contaminated land, waste, asbestos, climate change and emissions.

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