A landlord was prosecuted by the Environment Agency (“EA”) in April 2012 for 13 offences of knowingly permitting the operation of regulated facilities without environmental permits. The landlord owned an industrial estate in Essex where he let 16 units for vehicle breaking, skip waste transfer, waste burning and scrap storage. The estate benefited from planning permission for general light and heavy industrial use. However, the units were let with no written agreements and the landlord had not checked whether the tenants had permits for the operations being carried out.
In addition, hazardous waste was being stored at the site which contaminated the ground, rubber and treated wood were being burned illegally which caused a nuisance and the units did not have adequate surfaces or drainage facilities. The landlord had been warned several times about permitting illegal waste activities on his land however he continued to do so. At the time of the hearing, he had however obtained one permit for a unit and had served notices to quit on the tenants who were operating without permits.
The landlord was ordered to pay £207,000 under the Proceeds of Crime Act (“POCA”), representing the profit made from the rent payments, and about £50,000 in fines and costs by Chelmsford Crown Court. The units also required considerable clean-up to remediate the contamination.
In addition, the EA has recently secured the largest POCA ruling against an organised crime boss who has been ordered to repay over £917,000 and will face a prison sentence of four and a half years if he does not do so. The defendant operated a large illegal waste site near Reading and was prosecuted in June 2011 and sentenced to four and a half years in prison for the possession of illegal firearms, four years in prison for money laundering and twenty-two months for waste offences. Profits from the site were laundered by the use of different trading names and aliases and the turnover from the business was a hundred times the amount declared to the Inland Revenue.
These prosecutions highlight the strict approach which is taken by the EA relating to breaches of the environmental permitting regulations and in particular, profits which are made in the course of such activities. It also warns landlords about the risks inherent in failing to undertake due diligence regarding tenants’ use of leased land.