The difference between a Closed and Surrendered Landfill Licence is more than you think…

Background

Landfill regulation has evolved significantly over the years, improving incrementally with each phase.This process has left a legacy. For property transactions involving landfill sites, operational permit risks are a major consideration.  

The challenge 

Getting a clear understanding of a landfill licence status and the responsibilities associated with each phase of a landfill’s lifecycle is essential during a transaction. This is because the terminology can be misleading. A Closed Landfill can sound somewhat innocuous, yet it’s a crucial phase of landfilling – fulfilling the role of ensuring that the site is recovered and that any significant issues are resolved – therefore it holds potential for more liabilities than a Surrendered Landfill. So when purchasing a Closed Landfill, understanding the responsibility and liability is essential. Below is an example that explains why this is the case. 

An example: Understanding Landfill Status in practice 

A farmer sold part of his property through a compulsory purchase for an infrastructure project, so he was looking for a replacement plot. He identified land for sale in the right location that met his needs for arable fields. 

As part of the standard conveyancing process, he received a Groundsure Agricultural report which reported Closed and Surrendered landfills on site.  

The report revealed that the filling activity dated back to the 1980’s. It was licensed to accept ‘non-biodegradable waste’ and was filled in stages before being licensed for ‘deposit of waste to land as a recovery operation’. The Groundure report listed the status of the different landfills as both Closed and Surrendered, which at first glance, appears to be a similar description, but this apparent similarity had a significant impact on the transaction- potentially putting it under threat. 

Some key facts

• Closed landfill – the phase after active waste disposal has ceased. It is the phase that includes activities such as capping, restoration, monitoring and aftercare. The aim of the phase is to ensure that the environmental risks associated with the site are minimised and have been reduced to an acceptable level. The phase can run for decades – depending upon what is required.
• Surrendered licence – will be provided when the Regulator is satisfied that the remaining risk posed by the landfill is acceptable, because the Regulator becomes responsible for the site liabilities. They will ensure that any monitoring or active management is minimal and/or no longer required.
• Buying a closed landfill – buying land that contains a closed landfill carries certain risks that need careful consideration. It’s essential to understand the following: whether the responsibility for ongoing closure and monitoring will transfer to the new owner or reside with the vendor or another organisation, and how clearly these obligations are defined, (so the route to surrender is clear), and whether the Regulator has secured sufficient financial provisions to cover the site’s eventual surrender.

An example: Land with several Closed and Surrendered landfill sites

An example of this is a farmer who planned to buy land with several closed and surrendered landfill sites. Initially, there was surprise upon discovering the significant liabilities tied to the closure status. Additionally, further regulatory inquiries revealed that the original operator had gone into liquidation – before completing the surrender of the licence. This meant that the current owner was required, at their own expense, to place an additional 300 to 400 millimeters of cover soil to address the uneven settlement caused by exposed bricks and fill materials. Ultimately, the solution was to exclude the closed landfill area from the purchase and secure indemnity insurance to cover the remaining surrendered landfill sites.

Conclusion

In our Commercial Search (property) Reports, we identify the status of any landfills present and strongly advise further investigation during transactions. It’s also vital to establish who holds responsibility for the site and understand the compliance obligations involved. This due diligence helps ensure the transaction is well-informed and avoids any unexpected complications. 

Find out more about our Commercial Search Reports here. Our Agricultural report and our Review report covers landfill status – which saves you both time and resources.  

To find out more information, contact Ceri Sansom Groundsure Projects