King & Wood Mallesons

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Dealing in contaminated land — traps for the inexperienced

In Canberra Hire Pty Ltd v Koppers Wood Products Pty Ltd, the ACT Supreme Court interpreted clauses of a contract for the sale of land that allocated liability for site contamination and remediation. As a result of the way in which the clauses were drafted, the vendor (Koppers) was responsible for remediation of soil, but not for remediation of groundwater and the purchaser did not get the clean site it thought it was buying. 

The ACT Supreme Court recently handed down judgment in the matter of Canberra Hire Pty Ltd v Koppers Wood Products Pty Ltd & Ors [2013]. The case concerned the interpretation of a contract for the sale of land. The site in question had previously been used by Koppers for the manufacture of treated wood products. The treating process involved use of a number of chemicals, some of which were toxic and had a high capacity to dissolve into soil.

The contract between Canberra Hire and Koppers included a requirement that Koppers undertake remediation of the site. The standard of remediation to be achieved was specified as the Health Investigation Level F (known as HIL F) determined under the National Environmental Protection (Assessment of Site Contamination) Measure 1999 (Site Contamination NEPM), which was the level appropriate for contaminated in soil on land used for an industrial use…

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