Contributed By Allen Matkins Leck Gamble Mallory & Natsis LLP
Once on the chain of title, an owner of real property is a potential defendant to subsequent environmental tort claims, regardless of whether or not they were the polluter or discharger. Owners have exposure to liability for pre-existing conditions and events, even after the sale; this exposure needs to be included in the diligence and underwriting. Environmental disclosures are important, and environmental liability insurance should be considered if there are known or suspected conditions. Options and costs need to be identified in the due diligence phase, if not earlier, as they will effect underwriting. There are statutory disclosure requirements relating to known conditions.