Purchasing Property with Environmental Contamination

September 20th, 2013 - Carmichael Clark

Environmental pollution is regulated by many different levels of government, such as local, state and federal levels. Also, depending upon the type of pollutant and where that pollutant is found, more than one set of laws can apply. This makes determining who is responsible for environmental clean-up time consuming, expensive and frustrating.

The havoc that laws relating to environmental pollution can inflict is illustrated by the liability imposed by the Washington Model Toxic Controls Act (“MTCA”). The MTCA allows a person to bring a private action against any person liable under the MTCA. Persons liable or responsible for clean-up under the MTCA include current and past owners of real property that owned the contaminated property. This means that even if environmental contamination is unbeknownst to a property owner, if said pollution is discovered, the current property is owner is liable for clean-up. There are of course exceptions to this rule. One such exception is where the property owner had no knowledge of the contamination after performing the appropriate inquiry before purchasing the property.

Yet once discovered, eventually someone has to pay for the clean up the contamination.  The best course is to try and limit the potential for ownership of contaminated land and reduce the risk of liability. Prospective purchasers should do their homework before buying property which may contain contamination and then try and address the issue prior to purchase. It is possible to apportion liability in real estate agreements as between the buyer and seller before transfer of contaminated property. However, the problem is that this agreement will not shield property owners from third party lawsuits or an enforcement action instituted by the Washington Department of Ecology. While the MTCA does allow for a settlement type agreement with the Washington Department of Ecology prior to purchasing the property, this is a lengthy process. Even so, dealing with these issues before purchase will greatly reduce the confusion, headache and cost that could result by putting it off.


Simi Jain, Attorney

Disclaimer: This article and blog are intended to inform the reader of general legal principles applicable to the subject area. They are not intended to provide legal advice regarding specific problems or circumstances. Readers should consult with competent counsel with regard to specific situations.

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