{"id":1004110592,"date":"2015-01-07T10:17:04","date_gmt":"2015-01-07T18:17:04","guid":{"rendered":"https:\/\/www.commercialsearch.com\/news\/?p=1004110592"},"modified":"2022-12-06T05:11:31","modified_gmt":"2022-12-06T13:11:31","slug":"five-steps-to-help-buyer-obtain-cercla-liability-protection","status":"publish","type":"post","link":"https:\/\/www.commercialsearch.com\/news\/five-steps-to-help-buyer-obtain-cercla-liability-protection\/","title":{"rendered":"Five Steps to Help Buyer Obtain CERCLA Liability Protection"},"content":{"rendered":"<p style=\"text-align: left\" align=\"center\"><i>By J. Michelle Hickey, Of Counsel,\u00a0<\/i><i>Pircher, Nichols &amp; Meeks<a href=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2015\/01\/Hickey.png\"><img decoding=\"async\" data-attachment-id=\"1004110594\" data-permalink=\"https:\/\/www.commercialsearch.com\/news\/five-steps-to-help-buyer-obtain-cercla-liability-protection\/hickey\/\" data-orig-file=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2015\/01\/Hickey.png\" data-orig-size=\"576,379\" data-comments-opened=\"1\" data-image-meta=\"{&quot;aperture&quot;:&quot;0&quot;,&quot;credit&quot;:&quot;&quot;,&quot;camera&quot;:&quot;&quot;,&quot;caption&quot;:&quot;&quot;,&quot;created_timestamp&quot;:&quot;0&quot;,&quot;copyright&quot;:&quot;&quot;,&quot;focal_length&quot;:&quot;0&quot;,&quot;iso&quot;:&quot;0&quot;,&quot;shutter_speed&quot;:&quot;0&quot;,&quot;title&quot;:&quot;&quot;}\" data-image-title=\"Hickey\" data-image-description=\"\" data-image-caption=\"\" data-large-file=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2015\/01\/Hickey.png?w=576\" loading=\"lazy\" class=\"alignright size-thumbnail wp-image-1004110594\" alt=\"Hickey\" src=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2015\/01\/Hickey.png\" width=\"150\" height=\"150\" \/><\/a><\/i><\/p>\n<p>The Comprehensive Environmental Response, Compensation, and Liability Act (\u201cCERCLA\u201d) imposes joint and several liabilities on owners and operators of real property regardless of fault.\u00a0 Purchasers of property, even those that have reason to know of contamination on the property, may be able to obtain protection from such liability by conducting \u201call appropriate inquiries\u201d (\u201cAAI\u201d) and meeting other requirements.\u00a0 Unfortunately, many purchasers falsely believe that they need not be actively involved in the AAI process, even gladly handing over control to another party.\u00a0 Such practice can leave a purchaser with a Phase\u00a0I report that does not adequately identify or address environmental concerns and provides no CERCLA liability protection.\u00a0 Such risk can be reduced by taking the following simple steps.<\/p>\n<p><span style=\"text-decoration: underline\">Negotiate control of the Phase I process<\/span>:\u00a0 A purchaser is the party that will ultimately have to rely on the Phase I report to claim CERCLA liability protection and may need such report to obtain financing or to lease the property.\u00a0 Accordingly, if feasible, a purchaser should hire the Phase I environmental consultant.\u00a0 Hiring such consultant gives the purchaser the ability to shape the final Phase I report, including discussing any preliminary conclusions.\u00a0 The purchaser does not want another party in the position to influence the environmental professional\u2019s judgment on such important issues as determining what conditions rise to the level of a \u201cRecognized Environmental Condition\u201d (\u201cREC\u201d) and what, if any, Phase II work is required to address such REC.\u00a0 Finally, by hiring the consultant, the purchaser is able to negotiate important contract terms, including terms concerning the scope of work, liability of the consultant, disclosure obligations, and insurance.\u00a0 If it is not feasible to hire the consultant directly, the purchaser should negotiate the ability to discuss the conclusions of the Phase I report with the consultant and to review the consultant\u2019s underlying contract and scope of work.<\/p>\n<p><span style=\"text-decoration: underline\">Make sure the purchasing entity is covered by the Phase I report<\/span>:\u00a0 Phase I reports may be completed prior to determining (or even forming) the actual entity that will purchase the property.\u00a0 Addressing the Phase I report to the purchasing entity or obtaining a reliance letter, however, is necessary to safeguard such entity\u2019s ability to claim CERCLA liability protection in the future.<\/p>\n<p><span style=\"text-decoration: underline\">Make sure that an environmental lien search has been conducted<\/span>:\u00a0 The AAI standards require that the purchaser obtain an environmental lien search.\u00a0 Since many environmental consultants do not include the environmental lien search as part of the Phase I scope of work, this prerequisite to obtaining CERCLA liability protection is often missed.\u00a0 Accordingly, the purchaser must either include the search in the consultant\u2019s scope of work or otherwise obtain such search.<\/p>\n<p><span style=\"text-decoration: underline\">Provide information requested by the environmental consultant<\/span>:\u00a0 The environmental consultant usually asks the purchaser to provide information regarding any discount in the purchase price due to environmental conditions and the purchaser\u2019s specialized knowledge of conditions and operations at the property.\u00a0 This request for information can be confusing to a purchaser since the purchaser often does not have such information.\u00a0 However, the AAI standards require that the purchaser independently inquire about such topics.\u00a0 Accordingly, the purchaser should provide such information if within its possession or confirm that it does not have any specialized knowledge and is not aware of any discount in the purchase price due to environmental conditions.\u00a0 If the purchaser does not, the consultant will likely note the failure to disclose in the Phase I report, casting doubt on whether the purchaser met its duty to independently conduct the above inquiries.<\/p>\n<p><span style=\"text-decoration: underline\">Make sure that the Phase I report is not too old<\/span>:\u00a0 The AAI standards require that interviews, records searches, and inspections used in the Phase I report be conducted no more than 180 days prior to purchase.\u00a0 Often the Phase I report itself is dated weeks or even months after the interviews, records searches, and inspections were conducted, leading the unwary to believe the report falls within the 180-day rule when it does not.<\/p>\n<p>Although not exhaustive, the above simple steps will further ensure that the purchasing entity has met the AAI requirements and can obtain CERCLA liability protection if needed.<\/p>\n<p style=\"text-align: left\" align=\"center\"><i><br \/>\n<\/i><\/p>\n","protected":false},"excerpt":{"rendered":"<p>By J. Michelle Hickey, Of Counsel, Pircher, Nichols &amp; Meeks: How do you obtain protection from contamination liability for your building? Read on.<\/p>\n","protected":false},"author":1500,"featured_media":1004110594,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[37301],"tags":[],"class_list":["post-1004110592","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-uncategorized"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v28.0 (Yoast SEO v28.0) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Five Steps to Help Buyer Obtain CERCLA Liability Protection - Commercial Property Executive<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.commercialsearch.com\/news\/five-steps-to-help-buyer-obtain-cercla-liability-protection\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Five Steps to Help Buyer Obtain CERCLA Liability Protection\" \/>\n<meta property=\"og:description\" content=\"By J. 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