When an Insolvency Practitioner (IP) can become personally liable for breaches of environmental law
Produced in partnership with Ashurst LLP
When an Insolvency Practitioner (IP) can become personally liable for breaches of environmental law

The following Restructuring & Insolvency guidance note Produced in partnership with Ashurst LLP provides comprehensive and up to date legal information covering:

  • When an Insolvency Practitioner (IP) can become personally liable for breaches of environmental law
  • Sources of environmental liability
  • How could liability under these regimes attach to an IP?
  • How could liability in relation to nuisance claims from neighbours attach to an IP?
  • Specific risks in relation to different types of IP
  • Pre-pack sales
  • Share sale and asset sale

Sources of environmental liability

There are three main sources of potential personal liability under environmental law that IPs should be aware of. These are:

  1. contaminated land legislation (Contaminated Land Regime)

  2. other regulatory regimes, and

  3. neighbour claims

Contaminated Land Regime

Local authorities are subject to a duty to investigate the presence of contamination in, on, or under land within their area, identify any sites that fall within the statutory definition of ‘contaminated land’ and also identify those who are responsible (known as ‘appropriate persons’ who caused or knowingly permitted the contaminating substances to be there or if they cannot be found the current owner or occupier) and require remediation where appropriate to a standard suitable for its current use. The contaminated land regime is a last resort regime so liability under other liability regimes described below may be more likely as the process of identifying contaminated land and identifying appropriate persons is complicated and except in very serious and obvious cases, is likely to take several years.

To fall within the definition of contaminated land, it will be necessary to show that as a result of any contaminating substances in on or under the land, there is a risk of significant harm to people, property or protected species/habitats being caused or is likely to be caused, or significant pollution to a water