A seller of property is required, under the Environmental Protection Act 1994, to notify a buyer if the land:
- is subject to a notice issued under the Environmental Protection Act 1994 because the land has historically been used for an activity which may have caused contamination of the land, and that land is registered on the Environmental Management Register (EMR) or the Contaminated Land Register (CLR);
- or if a magistrate issues an order under the Environmental Protection Act 1994 enabling an environmental officer to conduct investigations or conduct work on the land.
This process may sound easy, however, it is common that EPA Notices are issued incorrectly, which renders the EPA Notice void.
In most circumstances, an EPA Notice is invalid because it fails to identify all of the land that is intended to be sold under the Contract. This is because, commonly, property is made up of several separate lots of land, each with its own registered plan and title reference. If an EPA Notice does not identify each and every separate lot from which a property is made, then the notice is not sufficient to satisfy the requirements under the Environmental Protection Act 1994.
The consequence of an EPA Notice being void is that a buyer may rescind their purchase contract, at any time up to the settlement date, without penalty. Additionally, a seller may be liable for penalties for failing to disclose the contamination or environmental management position of the Property to the Buyer.
Following the amendment of the Environmental Protection Act 1994 contracts entered into after 30 September 2015 allow a seller to issue an EPA Notice or a corrected EPA Notice to a buyer after failing to do so prior to the signing of the Contract. However, a buyer is still entitled to rescind the contract within 21 days of receiving the new or corrected EPA Notice from the Seller.
Similarly, for buyers, it is important that thorough property investigations are undertaken to identify:
- whether the seller has failed to provide a valid EPA Notice; and
- the buyer’s responsibilities as the property owner if the land is purchased and remains on either the EMR or the CLR.
If the land is registered on the EMR and CLR then the registered owner of the land may be required to conduct various remediation works to remove the contamination from the land. The cost to undertake this type of remediation works may be significant, and failure to consider this issue could be extremely costly for the buyer as a new owner of the land.
If you suspect that the property that you own (or that you are considering buying or selling) may be contaminated, then we can assist you in advising your rights and responsibilities in relation to the land. Please feel free to contact Nicholsons Solicitors on 07 3226 3944.