A multinational corporation whose timber treatment factory polluted Canberra land with highly toxic chemicals has won a six-year court battle clearing it of contractual responsibility to clean contaminated groundwater.
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Koppers Wood, a US corporation with operations stretching across the Asia Pacific, leased 20 hectares of land on Tralee Street in Hume in January 1989.
For 15 years, they manufactured treated wood products from the Hume factory.
In the process of treating the wood, the company used copper chrome arsenate, a highly toxic compound that easily and often dissolves into soil.
The factory's operation also caused hexavalent chromium, a chemical linked with cancer, respiratory problems, and damage to the kidneys, liver, skin and eyes, to seep into the groundwater.
One report showed some areas were contaminated with up to 24.3mg of chromium for every litre of water, well over the Australian and New Zealand Environment and Conservation Council guidelines of 0.001mg per litre.
In early 2005, the company decided it would end its Hume operation, and entered into negotiations to sell the land to Canberra Hire.
Canberra Hire put up three options for buying the site, offering $5.06 million for a completely clean site that had been rezoned as industrial land, $2.47 million for a site cleaned to the standards of the Environment Protection Authority, or $1.03 million for the site, with no conditions whatsoever.
Koppers, which initially believed cleaning the Hume site would cost just $100,000, went for the second option, and agreed it would clean the land to specific environmental standards at its own cost, and the contract was signed and exchanged on August 8, 2005. But the deal soon soured and the land sale stalled for years, with the government blocking Canberra Hire from using it without addressing the contaminated groundwater. By June 2006, Koppers were told a full-scale remediation of the site would cost an estimated $1million, ten times more than originally thought.Koppers identified what was described in an internal email as a ''legal loophole'', suggesting it did not need to clean the contaminated groundwater at the site. That loophole existed because the environmental standards the two parties had agreed to in their contract were only relevant to soil.
Canberra Hire took them to the ACT Supreme Court, claiming they had breached their contract and their promise to remediate the site.
Koppers claimed Canberra Hire had breached several of its obligations under the contract.
Justice Richard Refshauge, in a 115-page judgment handed down on Monday, found Koppers had no responsibility to further clean the site and was now in a position to rescind the contract. He found the environmental standards referred to in the contract only applied to soil.
Koppers has not yet rescinded the contract, and the sale is still able to go ahead if Canberra Hire still wishes to proceed. The court has given Canberra Hire the opportunity to seek ''specific performance'', or an order from the court requiring Koppers to perform certain acts built in the contract.
