England and Wales Court of Appeal (Civil Division) Decisions

United Kingdom Renderers Association Ltd. & Anor v Secretary of State for the Environment Transport & Regions [2002] EWCA Civ 749 (23rd May, 2002)

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM

		Royal Courts of Justice Strand, London, WC2A 2LL
		23rd. May 2002

Lord Justice SCHIEMANN:

1. This is the judgement of the court. Rendering animal by-products has the potential to create highly offensive smells. It is a prescribed process which cannot be carried on without an authorisation issued by a Local Authority. Authorisations may be granted subject to conditions, provided that those conditions can be complied with. The Environmental Protection Act 1990 sets out the powers which govern the issue of authorisations and the conditions which can be imposed. The Secretary of State for the Environment, Transport and the Regions has an appellate role in relation to refusals of authorisations and conditions imposed on authorisations granted by Local Authorities. The Local Authorities are obliged to have regard to any guidance which he may issue as to the techniques for preventing or minimising the release of harmful odours.
2. The Secretary of State has issued a Process Guidance Note 6/1(00) as amended by an “Additional Guidance Note” AQ3(00). The claimant appellants sought to persuade Ouseley J. that the Secretary of State acted beyond his powers in issuing the Process Guidance Note. They failed and appeal to us with the Judge’s permission.
3. The United Kingdom Renderers Association represents the majority of British Renderers who are affected by the Process Guidance Notes. There are only 25 substantial rendering plants in the United Kingdom, many of which are specialist plants. John Pointon & Sons Ltd. are a Stoke-on-Trent rendering company. These two bodies were the claimants and are the appellants in these proceedings by which they challenge the lawfulness of particular parts of the Secretary of State’s Process Guidance Notes.
4. The appellants object to those parts of the Process Guidance Note which recommend the imposition on the generality of authorisations of a condition (‘an odour boundary condition’) which would make it an offence for a person to carry on the prescribed process in circumstances where offensive odours go beyond a boundary to be drawn around the process site (“The Process Boundary”) unless that person is able to show that it has used all due diligence and taken all reasonable steps to prevent the escape of that odour. Their root concern is, as we understand it, that local authorities on reading the Guidance will conclude that it is appropriate to impose an odour boundary condition in every case and that this will inhibit the normal carrying on of their businesses.

The Statutory Framework

5. Section 6 Authorisations: general provisions

(1) No person shall carry on a prescribed process … except under an authorisation granted by the enforcing authority and in accordance with the conditions to which it is subject.

(2) ........

(3) Where an application is duly made to the enforcing authority, the authority shall either grant the authorisation subject to the conditions required or authorised to be imposed by section 7 below or refuse the application.

(4) An application shall not be granted unless the enforcing authority considers that the applicant will be able to carry on the process so as to comply with the conditions which would be included in the authorisation.

(5) The Secretary of State may, if he thinks fit in relation to any application for an authorisation, give to the enforcing authority directions as to whether or not the authority should grant the authorisation.

Section 7 Conditions of authorisations

(1) There shall be included in an authorisation –

(a) subject to paragraph (b) below such specific conditions as the enforcing authority considers appropriate, when taken with the general condition implied by subsection (4) below, for achieving the objectives specified in subsection (2) below;

(b) such conditions as are specified in directions given by the Secretary of State under subsection (3) below; and

(c) such other conditions (if any) as appear to the enforcing authority to be appropriate; but no conditions shall be imposed for the purpose only of securing the health of persons at work … .

(2) Those objectives are –

(a) ensuring that, in carrying on a prescribed process, the best available techniques not entailing excessive cost will be used –

(i) for preventing the release of substances prescribed … into [the air] or, where that is not practicable by such means, for reducing the release of such substances to a minimum and for rendering harmless any such substances which are so released; and

(ii) for rendering harmless any other substances which might cause harm if released into [the air]; [it is apparent from s. 1(4) that ‘harm’ in the present context means something which causes offence to the nose and ‘harmless’ has a corresponding meaning]

(b) compliance with any directions by the Secretary of State given for the implementation of any obligations of the United Kingdom under the Community Treaties or international law relating to environmental protection;

(c) compliance with any limits or requirements and achievement of any quality standards or quality objective prescribed by the Secretary of State under any of the relevant enactments;

(d) compliance with any requirements applicable to the grant of authorisations specified by or under a plan made by the Secretary of State under section 3(5) above.

(3) Except as respects the general condition implied by subsection (4) below, the Secretary of State may give directions to the enforcing authorities as to the conditions which are, or are not, to be included in all authorisations, in authorisations of any specified description or in any particular authorisation.

(4) Subject to subsections (5) and (6) below, there is implied in every authorisation a general condition that, in carrying on the process to which the authorisation applies, the person carrying it on must use the best available techniques not entailing excessive cost –

(a) for preventing the release of substances prescribed … into [the air] or, where that is not practicable by such means, for reducing the release of such substances to a minimum and for rendering harmless any such substances which are so released; and

(b) for rendering harmless any other substances which might cause harm if released into [the air].

(5) …

(6) The obligation implied by virtue of subsection (4) above shall not apply in relation to any aspect of the process in question which is regulated by a condition imposed under subsection (1) above.

(10) References to the best available techniques not entailing excessive cost, in relation to a process, include (in addition to references to any technical means and technology) references to the number, qualifications, training and supervision of persons employed in the process and the design, construction, lay-out and maintenance of the buildings in which it is carried on.

(11) It shall be the duty of enforcing authorities to have regard to any guidance issued to them by the Secretary of State for the purposes of the application of subsections (2) and (7) above as to the techniques and environmental options that are appropriate for any description of prescribed process.

Section 15 Appeals as respects authorisations and against variation, enforcement and prohibition notices

(1) The following persons, namely –

(a) a person who has been refused the grant of an authorisation under section 6 above;

(b) a person who is aggrieved by the conditions attached, under any provision of this Part, to his authorisation;

(c) a person who has been refused a variation of an authorisation on an application under section 11 above;

(d) a person whose authorisation has been revoked under section 12 above; may appeal against the decision of the enforcing authority to the Secretary of State (except where the decision implements a direction of his).

(7) On determining an appeal against a decision of an enforcing authority under subsection (1) above, the Secretary of State –

(a) may affirm the decision;

(b) where the decision was a refusal to grant an authorisation or a variation of an authorisation, may direct the enforcing authority to grant the authorisation or to vary the authorisation, as the case may be;

(c) where the decision was as to the conditions attached to an authorisation, may quash all or any of the conditions of the authorisation;

(d) where the decision was to revoke an authorisation, may quash the decision; and where he exercises any of the powers in paragraphs (b), (c) or (d) above, he may give directions as to the conditions to be attached to the authorisation.

Section 23 Offences

(1) It is an offence for a person –

(a) to contravene section 6(1) above;

Section 25 Onus of proof as regards techniques and evidence

(1) In any proceedings for an offence under section 23(1)(a) above consisting in a failure to comply with the general condition implied in every authorisation by section 7(4) above, it shall be for the accused to prove that there was no better available technique not entailing excessive cost than was in fact used to satisfy the condition.

6. From the foregoing, at times rather convoluted, legislation and from the general law, a number of things are apparent and are common ground or, in any event, seem to us to be beyond serious argument :-

i) S.6(3) gives the authority power to refuse a specific application. It could do so, for example, on the basis that it considered that (a) the carrying out of the process on that site would entail a risk that offensive odours would go beyond the process boundary, and (b) it thought it undesirable to grant that application in those circumstances. The Secretary of State is given the same power by s.15(7). That power exists even where the use of best available techniques not involving excessive costs could not prevent an escape of odours from the site in question unless the site boundaries were enormously wide.

ii) An enforcing authority could have a policy in general not to grant authorisations in those circumstances. The Secretary of State would also be entitled to have such a policy and be entitled to notify enforcing authorities that this is his policy.

iii) Where such a policy is in existence, the enforcing authority, as the decision making body, must nevertheless consider each application on its merits and must consider the imposition of each condition on the merits of the imposition of that condition on the authorisation in question.

iv) Although s.7(11) only imposes a duty on authorities to have regard to any guidance given for the purposes of the application of subsections (2) and (7), the Secretary of State can give guidance for other purposes and authorities can have regard to such guidance for such other purposes.

v) The Secretary of State is entitled by virtue of s.7(3) to direct enforcing authorities to include in all authorisations an odour boundary condition and enforcing authorities would, by virtue of s.7(1)(b), be bound to include such a condition in any authorisation which they gave.

vi) One of the objectives referred to in s.7(1) – namely that specified in s.7(2)(a) - is that of ensuring that, in carrying on the prescribed process, the best available techniques not entailing excessive cost (for which the acronym BATNEEC is in common use) will be used in order to achieve the aims specified in s.7(2)(i) and (ii); the aims themselves are not the objectives referred to in s.7(1). S.7(10) makes clear that the concept of best available techniques embraces not only hardware but also management and operational practices.

vii) It was Parliament’s intention – manifested in the interrelation of subsections (1), (4) and (6) of s.7 – that authorisations should contain specific conditions aimed at ensuring that in carrying on the process to which the authorisation applies the BATNEEC are used. Thus if the BATNEEC for any particular process involves the erection of a 100 foot tower then a specific condition would be imposed requiring such a tower to be erected – so avoiding arguments in the magistrates court as to whether BATNEEC prescribes a 90 foot tower rather than a 100 foot tower.

viii) It was Parliament’s intention – manifested in s.7(4) and s.25– that by law there is automatically imposed on every authorisation a general condition that, save in relation to any aspect of the process which is regulated by a specific condition, the person carrying on the process must use the BATNEEC and that the onus should be on that person to show that there was no better available technique not entailing excessive cost than was in fact used to satisfy the condition.

The Guidance

7. Part I is headed Introduction and contains the following:-

“This Note is issued by the Secretary of State as a guide to Local Enforcing Authorities on the conditions appropriate for the control of air pollution in relation to animal by-products rendering processes, blood processing and animal by-product dealers in order to achieve the objective set down in section 7 (2)(a) of the Environmental Protection Act 1990. ....”

Part 2 of the Note contains general guidance on a number of matters concerning the imposition of appropriate conditions under section 7(1) of the 1990 Act.

Part 3 contains specific technical guidance under section 7 (11) of the 1990 Act on the techniques that are appropriate for the purposes of the application of section 7 (2)(a) of that Act.

The guidance in Part 3 is based on an assessment of best available techniques as qualified by the requirement not to entail excessive costs..... In accordance with section 7 (11), enforcing authorities are required to have regard to any guidance issued to them under that section for the purpose of determining appropriate techniques in relation to the section 7 (2)(a) objective.

This note also (where appropriate) gives information about any direction, limits, requirements, quality standards or quality objectives which were enforced on the date that this note was published and which must be complied with in carrying on these processes in accordance with section 7 (2)(b) and (c) of the Act.

The Secretary of State will treat the whole of this Guidance Note as one of the material considerations when determining any appeals made against a local enforcing authority decision.

..............

Local Enforcing Authorities must always, of course, have regard to the individual circumstances obtaining in each case. This Note can only give guidance on what, in the generality of circumstances, constitutes BATNEEC and the conditions that will be appropriate - individual circumstances may make alternative BATNEEC judgments and conditions appropriate.

8. Part II is headed General Guidance and contains paragraph 13 the legality of part of which is in issue in these proceedings. For ease of reference we have inserted sequential numbering for various sub-paragraphs. It is sub-paragraph (ii) which has given rise to the appellants’ concern.

13(i) Authorisation should include specific technical conditions in accordance with this Guidance to prevent or minimise the escape of offensive odour across the process boundary. As discussed below, whether the emphasis should be on prevention or on minimisation depends on the type of process (and thus the type of odour) under consideration.

Animal Rendering

(ii) Subject to what is said below, in the case of animal rendering – which gives rise to odours that are particularly offensive – conditions should be imposed preventing (rather than just minimising) the escape of offensive odour beyond the process boundary. In these cases the specific technical conditions imposed to prevent such escapes should be supplemented, as a back-up measure, with a general condition (‘odour boundary condition’) requiring emissions to be free from offensive odour outside the process boundary.

(iii) When imposing an odour boundary condition local authorities should take account of the fact that there may be circumstances where offensively odourous emissions are released for reasons which are beyond the direct control of the process operator, for example where there is a total break-down of arrestment equipment through no fault of the operator. Allowance should be made for such occurrences by providing in the authorisation that it will not be a breach of the condition in any particular case if the operator can show that he or she took all reasonable steps and exercised all due diligence to prevent the release of offensive odours.

(iv) (Local authorities will need to investigate incidents where offensive odour escapes across the process boundary to establish whether there has been a breach of any odour boundary condition with the reasonable steps/due diligence allowance set out above. The Secretary of State would expect that if a rendering process is properly managed, with the operator taking all reasonable steps and exercising all due diligence, there should be very few escapes of offensive odour beyond the process boundary. Certainly he would expect local authorities to investigate very carefully whether an operator was taking all reasonable steps and exercising all due diligence if there were more than two such occurrences in any 12-month period. In the event of any occurrence the operator should immediately take remedial action to prevent any further escape of offensive odour and he should expect this to be effective within at most 2 hours in many cases. Again, the Secretary of State would expect local authorities to investigate with particular care the management of a rendering process where remedial action had not been effective within 2 hours.)

(v) There may be cases of animal rendering where the escape of offensive odours beyond the process boundary would be unlikely to cause any harm (for example, because the area potentially affected by the release of any offensive odour is uninhabited countryside). In such cases it would not be appropriate to require an operator to ensure that no such odours cross the process boundary and no odour boundary condition should be imposed.

9. Part III of the Guidance is headed – Statutory Guidance under section 7 (11) on appropriate techniques. It contains some 40 paragraphs giving guidance as to various management and other techniques which the Secretary of State considers will minimise offensive odours.

The position adopted by the Secretary of State.

10. The attitude of the Secretary of State appears from the first witness statement of Mr. Michael Etkind on his behalf. The presently crucial paragraphs are the following:

“22. In outline, releases of offensive odour generally come from 2 sources: (1) routine emissions from chimney stacks comprising air collected from the operation of the plant and machinery and from the storage and processing areas – I will refer to these as “Contained Emissions”; and (2) emissions from the delivery, storage and processing areas which are not collected nor kept within the confines of those areas, and where failures in working practices and/or management are the more likely causes ("Fugitive Emissions”).

23. Contained Emissions can, in normal operating conditions, be controlled within the guidelines contained in PG6/1 (00) by the use of technology which is currently available and in use in many rendering plants......

24. Fugitive Emissions generally arise not from the intrinsic nature of the operation or the process but from failures to comply with the best management and/or operational practices...... there is no reason why, in normal operating conditions, Fugitive Emissions should result in the escape of offensive odours beyond the boundary if a plant is properly managed and operated.

26. ...... many plants in the UK do operate in such a way as to ensure that under normal operating conditions no offensive odours resulting from either Contained or Fugitive Emissions escape beyond the process boundary.

27. Government Guidance is not therefore requiring plants to achieve anything which they cannot already achieve under normal operating conditions.

28. Of course, plants do experience escapes of offensive odours on occasion for reasons which are beyond the direct control of the operator. It is for this reason that paragraph 13 excludes from its ambit releases of offensive odour which the operator had taken all reasonable steps and exercised due diligence to avoid.

29. Thus, for a well designed, well built and well managed plant there is no reason why in normal operating conditions release of offensive odours beyond the boundary should occur.

30. Where releases do occur which are for reasons beyond the control of the operator – such as because operating conditions are, for some reason, not normal – and the operator has exercised due diligence to avoid those releases, there will be no breach of the condition.

31. It is the avoidable releases which occur because of inadequacies in the plant and machinery and its maintenance and use or because of errors in management and operational practice at which the Guidance is directed and which would constituted a clear breach of the condition.

38. The Secretary of State having considered his statutory duties and the BATNEEC requirements, is of the view that these releases which are avoidable should be avoided and there is no reason why local residents should have to endure the consequences of management or operational failings.

39. The Secretary of State’s aim is to protect members of the public from having to endure releases of exceptionally offensive odour which could be avoided through a standard of controls which comply with BATNEEC. That aim is not controversial and is, in any event, a statutory requirement.

The Submissions

11. Mr Neil King Q.C. who appears with Mr David Park for the appellants submits that the Guidance is directed at conditions to be imposed under s.7(2)(a) and not (b) or (c) and that the imposition of an odour boundary condition has nothing to do with the use of BATNEEC or any other techniques but is concerned with the achievement of aims. He submits that general guidance could not recommend that an odour boundary condition be imposed in every case under s.7(1)(c) because that subparagraph is directed to a condition which was specifically considered appropriate by the authority for a specific authorisation for a specific site. He submits that in any event, the Secretary of State does not appear to have had s.7(1)(c) in mind when formulating the Guidance. No-one has suggested that (b) is of present relevance and, he submits, that therefore the Secretary of State went beyond his powers in giving guidance which was inviting authorities to do that which they had no power to do. He submits that the Secretary of State was not entitled to issue Guidance in a form which would side-step the requirement of BATNEEC that excessive cost must not be involved. He submits that there was no evidential basis for what he claimed was the view of the Secretary of State that an odour boundary condition could invariably be achieved. He submits that, while the Secretary of State could have directed the attachment of such a condition under s.7(1)(b), he has not done so.

Conclusion

12. Given that there is no legal objection to a policy of refusing authorisations unless the emission of offensive odours beyond the process boundary will be avoided, we find it difficult to see why there should be a legal objection to the grant of authorisations subject to a condition that the emission of offensive odours beyond the process boundary must be avoided unless the best available techniques not entailing excessive costs have been used to avoid such emissions. One can describe such a condition as a qualified odour boundary condition. The latter policy is less onerous for the operators. Indeed, Mr King did not in terms submit that the imposition of such a condition would be unlawful.
13. Instead of providing in paragraph 13 (iii) of the Guidance that it would not be a breach of the odour boundary condition if the operator can show that he employed the BATNEEC, the Secretary of State chose to say that it would not be a breach of the odour boundary condition if the operator can show that he took all reasonable steps and exercised all due diligence to prevent the release. Mr David Elvin Q.C., who appeared with Mr David Forsdick for the Secretary of State, indicated to us that by this new phrase the Secretary of State did not intend to impose any different test from that implicit in the statutory phrase. This indeed appears from paragraph 39 of Mr Etkind’s statement which we quote in paragraph 10 above. In those circumstances it would have been better if the same phrase had been used. On the basis that the expression used in the Guidance means that it would not be a breach of the boundary odour condition if the operator can show that he employed the BATNEEC the failure to use that phrase does not make the guidance illegal.
14. It can be said that such a specific condition phrased in such a way adds nothing to what is already contained in the general condition which would, if there were no specific condition, be implied by s.7(4) coupled with section 25 into every authorisation. That is true, as Mr Etkind in effect acknowledges in his paragraph 39. However we can see no legal objection in advising local authorities to include specifically such a condition in their authorisation. The effect of doing so is, by virtue of s.7(6), to render the general condition inapplicable and to substitute the specific condition for it. Since the specific condition only begins to bite at the process boundary it is less onerous for the operator than the general condition. Including such a specific condition is also a useful way of drawing the point to the attention of operators.
15. In our judgment, the Secretary of State is entitled to have a policy and to draw its existence to the attention of authorities in relation to what conditions they should in general include in authorisations. He is not obliged to identify for them which subparagraph gives them the power to impose such a condition. In our judgment the condition in question could have been imposed under either subparagraph (a) or (c).
16. It is clear from the last paragraph quoted in paragraph 7 above that the Secretary of State recognises, as he must by law, that his guidance is guidance and does not intend to fetter the discretion of authorities.
17. It is clear from reading paragraphs 13(ii), (iii) and (v) together that the Secretary of State is not telling authorities that an absolute prohibition on the escape of odours beyond the boundaries is either invariably feasible or desirable.
18. In so far as Mr King submitted that there was no material upon which the Secretary of State could come to the conclusion that the imposition of a qualified boundary condition was in the public interest we are not persuaded by it. Manifestly in principle such a condition is desirable unless the result of its imposition would be to render it so difficult or expensive to operate such plants that they would not continue in existence in appropriate places. The evidence before us does not indicate that this is the case - see Mr Etkind’s statement quoted in paragraph 10 above.
19. We see nothing legally objectionable either in the imposition of a qualified odour boundary condition by authorities or in the Secretary of State advising them to do so in the generality of cases.
20. This appeal is therefore dismissed.
Order:
21. Appeal dismissed
22. The Appellants do pay the Respondents costs of this appeal to be subject to detailed assessment if not agreed (including the costs of the application for permission to appeal)
23. Permission to appeal to the House of Lords refused.
(Order does not form part of the approved judgment)