WE ARE concerned that our old septic tank may put off a buyer

Whether you have a legal, tax, insurance, management or land issue, Farmers Weekly’s Business Clinic experts can help. Here, Rebecca Stanton, looks at what to do if you are concerned about an old septic tank.

Q. We are selling our farm and are concerned that our old septic tank may cause a delay or even put off a buyer, as we know there have been some changes to the regulations and requirements recently. How can we check it complies? If it does not, what are our options and what will they cost?

A. Although we do not know how old your septic tank is, or how it operates, an important legal position to be aware of here is that owners of properties with a septic tank that discharges into surface water (including a stream, river, lake or estuary), were required to have plans in place to carry out upgrade works within a reasonable time (usually 12 months) from 1st January 2020.

This is as a result of Environment Agency (“EA”) guidance published at the time, and the Environmental Permitting Regulations 2016, which came into force on 1 January 2017 and regulate discharges to groundwater and surface waters. The EA no longer considers waste water from septic tanks to be clean enough to flow straight into watercourses without causing pollution. Septic tanks that discharge directly to surface water can therefore now be unlawful, and in the event of contamination of soil the Environment Agency can fine the user, require a compulsory upgrade of the system or a replacement tank altogether.

Owners of such tanks discharging into surface water can apply for an EA permit to do so instead, but those are only granted in exceptional circumstances. The EA also published what are known as general binding rules, which set out conditions to be met in order to qualify for an exemption from the requirement for a permit. However, the requirements are extensive and not available to domestic septic tanks or small domestic package sewage treatment plants that discharge to groundwater.

Because of these changing regulations, on the sale of your land it is somewhat inevitable that the buyers’ conveyancers will ask questions of the tanks’ regulatory position in their due diligence. Fortunately, the property information form which you should complete as part of the sale process, should offer you the opportunity to provide details of any off-mains waste system (including the tank), the date of its installation and when it was last serviced. Delays can be avoided by clarifying these matters early with your conveyancer, to give the buyer reassurance and head off any potential further queries. It is important to provide written information to the buyer stating whether you have a small domestic sewage discharge onto the land, describing the septic tank and setting out maintenance requirements.

If your septic tank discharges straight into a watercourse or otherwise breaches the relevant regulations, the seller may ask you to seek a price reduction to reflect the cost of putting in a new system themselves. Responsibility for any necessary replacement or upgrade should be discussed between the buyer and seller as a condition of sale, and this negotiation has the potential to cause delays in the conveyancing progress. It is worth talking to your solicitor for a referral to a specialist engineer or environmental consultant to work out your options, and the best route to take in terms of cost implications. For example, it may be possible to bring an older system up to standard by installing a new drainage field, subject to access rights over the relevant land, connect to a public sewer where available, or replace the tank with a small sewage treatment plant.

You should also anticipate questions about whether the tank complies with planning legislation and building regulations, whether it is defective, and whether there are appropriate rights to access it if not located on your property. The best way to avoid delays in your sale is to take specialist legal advice on your tank to ensure that you are compliant with relevant regulations anyway, rather than wait for the buyer to discover issues themselves in the conveyancing progress, or even for the EA to identify you as being in breach of them.

If you would like to know more about any issues raised in this article please contact Rebecca Stanton.