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One vital consideration that many real estate and business owners overlook is assessing environmental risks and acting with due diligence before buying or selling property.
The Canadian government has instituted laws that can now result in real estate or business owners being held responsible for any contamination found on land, regardless of whether or not they caused it. In turn, this can prove quite costly in terms of environmental liability on their part.
For this reason, it is always best to consult with a knowledgeable real estate lawyer who can assess the risks associated with any proposed transaction. If you are considering a real estate transaction and want more information about environmental considerations and due diligence, contact our law offices to schedule a consultation.
Why Do Real Estate Sellers and Purchasers Need to Be Concerned About Environmental Considerations?
Many individuals mistakenly assume that because they did not cause contamination issues that may be found on the property, they will not be held responsible. However, under the law, environmental liability can spring from having “care and control” of contamination found on a property.
Furthermore, if it can be proven that the person who owns or controls the land permitted it to be contaminated, they will be held liable. However, in some instances, the new property owner can be tasked with the bill for cleaning up the land.
As a result of environmental laws and the debate on who should be held liable, anyone who intends to sell or purchase property should always meet with a lawyer who can assess the risks and potential financial burden that may accompany the transaction.
What is the Due Diligence Process?
When discussing due diligence regarding the environment and real estate, it means all the steps a buyer should take to ensure all structural and zoning concerns before the agreement is finalized.
Through due diligence, the buyer and their legal representative can identify potential environmental risks through several methods. However, one of the easiest methods often includes researching the property’s history and surrounding properties.
For example, through research, a buyer may learn that a property was once a dump site or has a previous record of contaminants being found there. Some other environmental issues to be watchful of when researching the history of a property include:
- The property was once used to store hazardous materials.
- Records that indicate the property held above ground or underground storage tanks.
- Similar conditions have been found on neighboring properties.
What Are the Most Common Environmental Problems in Real Estate?
When determining what is the most common environmental problem in terms of real estate, the first answer that comes to mind is land contamination. However, buyers should determine which contaminate they may be dealing with before agreeing to buy.
Some of the most common contaminants include:
- Excessive pesticides used in the farming process.
- Polluted water
- Road salt
- Petroleum products
- Lead
- Asbestos
If any contaminants are found on a property a buyer intends to purchase, it could result in a hefty clean-up bill that would not necessarily be the seller’s responsibility.
That being the case, potential buyers should always exercise due diligence when considering a real estate purchase. Environmental remediation, removing pollution or chemicals from water or soil, can be costly and leave the landowner with a potential financial crisis.
One of the easiest ways to avoid later surprises when purchasing real estate is to hire an experienced lawyer who can assist you with researching the land and assessing any potential environmental risks.
When Should I Hire a Real Estate Lawyer?
If you are even considering a property purchase, consulting with a real estate lawyer is always a good idea. A real estate lawyer will sit down with you and explain various legal issues that can arise from a real estate purchase,
However, and more importantly, a highly skilled lawyer can advise you of your legal rights and help you assess any risks and benefits associated with the proposed sale. Aside from protecting your interests, some other essential services a real estate lawyer can provide clients include:
- Professional handling of all necessary contracts and legal paperwork.
- Act as your legal advocate in negotiations and any disputes that may arise.
- Save clients valuable time and money.
If you are still trying to figure out how environmental considerations can affect real estate transactions, contact the Calgary lawyers of JK Law by calling us at 587-742-2136 to schedule a consultation.
