Former Green minister cost waste firm millions, court hears
A former Green minister cost a waste company tens of millions of pounds by providing negligent assurances that the Scottish Government’s deposit return scheme would go ahead, a court has heard.
Roddy Dunlop KC said Lorna Slater made no mention to his client, waste firm Biffa, that she required the green light from the UK Government for the scheme to start.
The firm, which has lodged a £166 million compensation claim, has alleged that she made “no reference” to needing an exemption from the UK Internal Market Act (IMA).
Mr Dunlop told the Court of Session in Edinburgh that she withheld “special knowledge” that it was still awaiting IMA approval, and that there was a risk of the scheme not happening.
He said she instead provided written assurances to Biffa, which was “swithering” about becoming involved, resulting in the firm entering into an “onerous contract” that committed it to “tens of millions of pounds” of expenditure.
Mr Dunlop said the firm had received “negligently misrepresented” assurances and it would not have signed the deal if it had known the “truth” of the situation.
Ms Slater must have known Biffa would act upon what she said, he argued, and alleged that the scheme would be “dead in the water” without the company’s involvement.
‘Commercial risk’
Scottish government lawyers told the court earlier this week that Biffa had knowingly taken a “commercial risk” by investing in the scheme and that ministers did not have a “duty of care” to the firm.
But Mr Dunlop argued that this was akin to saying “I know we have set a trap for you and you fell into the trap but that’s just tough”.
SNP and Green ministers wanted to boost recycling rates by forcing buyers to pay an extra 20p deposit on single-use drinks containers, including cans and bottles, that would be refunded when returned.
Every outlet selling takeaway drinks would have been required to act as a return collection point, with reverse vending machines outside supermarkets, community centres and other public places.
Biffa was appointed to collect all the recycled containers across Scotland on a 10-year deal, with the firm expecting to make more than £100 million profit.
But Ms Slater, who was the circular economy minister in Nicola Sturgeon and Humza Yousaf’s governments, failed to get the required IMA exemption before starting work on the scheme.
This was needed for it to apply to drinks containers imported to Scotland from elsewhere in the country. Although the UK Government later said it would grant a conditional exemption, it said glass bottles could not be included.
Firm seeks £166m
Ms Slater then delayed the scheme until at least October 2025 despite Circularity Scotland, the company set up to administer it, making clear it could have gone ahead with just plastic containers and cans.
Biffa has launched legal action in the Court of Session in Edinburgh seeking up to £166.2 million, arguing the Scottish Government was negligent. This includes about £115 million in projected profits that were never realised.
The waste firm has claimed that it relied on personal assurances from Ms Slater, who is the Scottish Greens’ co-leader, when it decided to spend £55 million on vehicles and equipment to prepare for the scheme.
Mr Dunlop told judge Lord Clark that Ms Slater’s letter to the firm contained negligent statements about the state of the scheme.
Speaking on the final day of a two-day hearing into whether the legal action should proceed, he said: “Our position is that we did sign the contract in a situation of the assumption of responsibility. The minister was not required to give an assurance but she voluntarily did.
“She did so because she wanted Biffa on board. She must have known Biffa would act upon what she said. It is writing a letter that provides the assurances that (do) not reflect the actuality of the situation.
“We know why she decided to write that letter. She wrote that letter as she needed the deposit return scheme to have a purpose. She needed a contractor like Biffa, who was swithering about whether to become involved, to become involved.”
Gerry Moynihan KC, acting for the Scottish Government, argued earlier this week that ministers had done everything possible to bring the scheme into being and urged the judge to dismiss the compensation claim.
He said ministers did not owe a duty of care to Biffa “because it conflicts with their duty to pursue the public interest”.
However, Mr Dunlop argued that this was wrong in law and previous similar cases had established that the company could bring legal action against Scottish ministers.
Lord Clark thanked both sides’ lawyers and said he would issue a ruling in the near future on whether the case could proceed.
The Scottish Greens did not respond to a request for a comment.