13th September 2021
A business’ environmental credentials have hardly ever been of greater value, nor under such scrutiny, as they are today. For example, a recent survey carried out in the US  found that 78% of consumers were more likely to buy a product if it had ‘green’ credentials; that 75% of millennials would pay more for a green product; and that 76% of people would even switch from a preferred brand for sustainability. Investors and shareholders alike are increasingly demanding effective, positive action on the part of corporates and their suppliers/counterparties to help tackle climate change and to achieve Net Zero. A business’ sustainability therefore has an impact on its bottom line like never before.
Alongside the risks associated with ‘greenwashing’ , the case of MDW Holdings Ltd v Norvill  highlights why accuracy in relation to green claims – in this context, made in environmental warranties in a sale and purchase agreement (SPA) and in responses to due diligence enquiries – is essential.
Whilst the business in this particular case was a waste management company, sustainability and environmental impact are key issues of concern to all businesses. The practical takeaways from the case are therefore applicable across the board.
The seller in this case had warranted that it had complied with all environmental obligations and that there had been no investigations, prosecutions or proceedings issued or threatened against it. That was not true. In response to the buyer’s due diligence process, no disclosures were made against those environmental promises. In a post-acquisition claim brought against the seller for breach of warranty and misrepresentation, the High Court found for the buyer and the following key takeaways arise.
Businesses today, whether or not they are operating within the environmental/waste sectors, face commercial, legal, regulatory and consumer protection drivers to ensure accuracy and transparency when it comes to environmental and sustainability commitments.
Walker Morris’ Planning, Environmental and Commercial Dispute Resolution specialists can assist from the outset, whether it be with the clear and effective drafting of environmental obligations or warranties, advising on the environmental aspects of large-scale projects or ESG  strategies, or providing comprehensive, cross-disciplinary advice and transactional assistance. Our cross-disciplinary teams can also offer risk management and effective dispute resolution advice if/when any warranty/misrepresentation claim or any other type of environmental litigation queries or concerns arise. Finally, Walker Morris can provide tailored training to staff at all levels within a business on any green-related area or issue.
If you would like any further advice or assistance in relation to any of the issues covered in this article, please do not hesitate to contact Alison Ogley or Claire Acklam, who will be very happy to help.
 GreenPrint survey, February 2021
 That is, the practice of making claims (often exaggerated) about a business’ environmental credentials and the sustainability of its products, services and environmental impact. See our recent briefing here on how can businesses ensure that their ‘green’ claims comply with consumer protection legislation for further information and advice in this area
  EWHC 1135 (Ch)
 This article focuses on the breach of contract/warranty aspects of MDW Holdings v Norvill. Please see our separate article for practical advice arising from the misrepresentation aspects of the case.
 deliberate action on the part of a wrongdoer which involves dishonest conduct is seen by the law as being so serious that fraud can invalidate a contractual agreement, carve-out or any other legal bar or limitation
 Environmental, Social, Governance. See our recent briefing on addressing ESG challenges for further information and advice, and see also Claire Acklam’s development-focused briefing on the green agenda.