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Contamination, environmental due diligence and site assessments

On Behalf of | Dec 7, 2020 | Real Estate |

Before selling commercial real estate to you, the owner should conduct an environmental site assessment to ensure that there is no hazardous substance contamination. According to FindLaw, even if you insist that the seller conducts an assessment, you may also want to order a site assessment.

If an environmental condition comes to light later and you cannot show your site assessment results, you may not have a defense that protects you from liability in court.

CERCLA requirements

If you do discover an issue during the assessment, you will need to report it. The Comprehensive Environmental Response, Compensation and Liability Act may consider you jointly liable for cleanup costs along with the past owners and operators if you have not reported that hazardous substances are present on your property. You must notify the National Response Center immediately if you learn of a reportable quantity or a release of more than 1 pound of a hazardous substance during a site assessment. You must also report it to the Environmental Protection Agency.

Innocent landowner defense

After you have the site assessment and have satisfied CERCLA requirements, you may be free of cleanup liability in the case of a later discovery of contamination. Your eligibility for the innocent landowner defense depends on your establishing that you have made all required attempts to reveal issues that the prior ownership and use of the property may have caused.

A seller who knows of contamination or the potential for contamination and does not disclose this to you may lose his or her own opportunity to claim the innocent landowner defense. He or she has the duty to disclose this information to you.


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