Environmental law is relatively new. Although federal and state laws have defined many of the liabilities involved, common law is being used for further interpretation. Real estate licensees and all others involved in a real estate transaction must be aware of both actual and potential liability.
Sellers often carry the most legal liability exposure. Innocent landowners might be held responsible, even though they did not know about the presence of environmental hazards. Purchasers may be held liable, even if they didn’t cause the contamination. Lenders may end up owning worthless assets if owners default on the loans rather than undertaking expensive cleanup efforts. Real estate licensees could be held liable for improper disclosure, therefore, it is necessary to be aware of the potential environmental risks from neighboring properties such as gas stations, manufacturing plants, or even funeral homes.
Discovery of Environmental Hazards
Real estate licensees are not expected to have the technical expertise necessary to discover the presence of environmental hazards. However, because they are presumed by the public to have special knowledge about real estate, licensees must be aware both of possible hazards and of where to seek professional help.
The most appropriate people on whom a real estate licensee can rely for sound environmental information are scientific or technical experts. Environmental auditors (or environmental assessors) are scientific or technical experts who can provide the most comprehensive studies.
Not only do environmental experts detect environmental problems, they can usually offer guidance about how best to resolve the conditions. Although environmental audits or assessments may occur at any stage in a transaction, they are most frequently a contingency that must be satisfied prior to closing.
