Contaminated Land - Indemnity Policy

chrisgriff6191

Good Afternoon

I am looking for some help and hope someone in the forum can put my wife and I at ease

We are buying a house in Wigan and have hit a stumbling block with the Environmental Report. Due to past industrial use/filing in land due to pit/quarry etc we have not received a Pass certificate. Despite contacting the Council for further information we have not got the certificate we ideally need. Basically to enable a Pass, we need to know whether the contaminated land has been remediated. If not is the contamination at a level that is sufficient levels and/or will the Council ever be investigating and clean up (which without Indemnity the homeowner would be liable to pay the cost)

Options are;

1) Buy the house (with indemnity policy) which would cover us when/if the council ever decides to clean up the area
2) Pull out
3) Pay for pricy Invasive land investigation

Our solicitor maintains have pointed out it lending criteria changed and lenders request an environmental certificate as standard we may not be able to sell our house, potentially. Our mortgage broker on the other hand indicates that this is more and more common and indemnities are being taken out more and more as due to fairly recent legislation that means more people are finding this to be the case

Would welcome comments from out across the Forums. How common is this? Do you have experience of this? What would you do?

Thanks in advance of any help you could provide

Chris

Richard_Webster

When was the house built?

What did the Council say in reply to the enquiry?

chrisgriff6191

Hi Richard

Thanks so much for your reply. According to the survey the house wad built in 1988. The follow up enquiry to the Council didn't reveal a great deal and was not sufficient to result in a Pass certificate. In brief the further report referred to map data from the 1890s to present along with some duplication of the Environmental Search. Slightly puzzled in the report as it stated "the Property is nor currently registered on the Council's Contaminated Land register"

I am led to believe that this is becoming increasingly common and that indemnities, whilst not the norm, are the way to prevent against expensive clean up costs etc

Thanks

Chris

Aaron

I've had something like this. RPS Group did the search. They are an interesting company if you look at their websites. Not sure why an environment certificate from them would matter? In my case, they're now insisting on a £60 letter from the district council before they consider issuing a certificate. The county council is responsible for the nearby former tip, not the district, so that seems like a box-ticking waste of money to me. Mortgage providers would have to be crazy to require such worthless certificates... solicitor bum-covering? But then again, it wouldn't be the first time mortgage providers did something crazy...

buddabudda

I may be able to assist you (Ive previously worked as a contaminated land consulatant AND a contaminated land officer for a local council.... though obviously not at the same time).

The council is required by law to maintain a register of land which they believe meets the legal definition of contaminated land. They are also required to have conducted a survey of their area and draw up a list of sites which could potentially meet this definition. So what exactly was the councils response... did they says its not currently considered as meeting the definition of contaminated land or did they say its not currently on their list of sites which might meet the definition.

The legal definition is that the site must represent "significant risk of significant harm", however proving that it is or isnt contaminated is sort of beside the point. If the site for whatever reason is suspected by the council of meeting the definition of contaminated land then your house value drops to zero until remediation is completed.

In general, for a site to even be suspected as meeting the legal definition of contaminated land there needs to be something of note happened there in the past. For example the siting of a chemical works, gas works, petrol station etc etc.

I'm happy to help with this so let me know if you have any more questions

RobMoz

Hi

I am having a similar problem with the purchase of a leasehold flat. It is located next door to a petrol station, that was previously a general motor works. My environmental search has been returned with a "Further action" result.

The vendor has offered an indemnity policy but I understand that a condition of taking that is that we cannot make further enquiries with the Council because to do so would void the policy (because that would increase the risk of the insurers having to pay out). So the issue would still be there when I come to sell.

Any thoughts welcome!

G_M

I don't see how an indemnity policy helps you if the land IS contaminated.

I suppose it might pay for private medical treatment, but personally I'd rather not get sick........

Richard_Webster

The council is required by law to maintain a register of land which they believe meets the legal definition of contaminated land.

Yes, but actually few councils have got very far with detailed investigations so the register is pretty meaningless and is largely non-existent in lots of areas.

If the house was built in 1988 there is a good chance that when it was built there were planning conditions requiring soil investigations and the carrying out of remedial works. So I would be asking about whether there were nay such conditions and whether they were complied with. Proof compliance should result in a "pass".

RobMoz

G_M wrote: »

I don't see how an indemnity policy helps you if the land IS contaminated.

I suppose it might pay for private medical treatment, but personally I'd rather not get sick........

Indeed - but there are people living in the flats without problems and I'm assuming that the planning permission wouldn't have been granted if there was an actual problem