A regular inspection of the site in March 2003 by the Scottish Environment Protection Agency found leachate leaking through a bund into a tributary of the Lochar Water.
The council also failed to provide SEPA with groundwater, surface water and landfill gas monitoring data by the required deadlines.
The council pleaded guilty to causing or knowingly permitting noxious or polluting matter to enter controlled waters, contrary to section 30F(1) of the Control of Pollution Act 1974. It also admitted failing to comply with the conditions of its waste management licence, contrary to section 33(6) of the Environmental Protection Act 1990. It was fined £1,000 for each offence.