What is a typical pollution lawsuit?

If you own contaminated property you have a problem.  Most likely the state you live in will require you to clean it up even if the contamination was caused by someone else.  Unfortunately, the remediation costs can cost millions of dollars and last several years preventing you from selling your property or otherwise developing it in a way that would maximize its value.  The contamination is usually from industrial operations on your neighbor’s property or from operations that occurred on your property prior to your ownership which was not disclosed to you when you purchased the property. 

Oftentimes, owners first discover the contamination when they are trying to sell their property.  That is because prospective purchasers are required by a bank to obtain a Phase I Environmental Site Assessment which uncovers the contamination.

The historic operations that led to the contamination varies greatly.  However, it is not uncommon to find soil and groundwater contamination due to industrial chemicals spilled on the ground or which have leaked from underground storage tanks that included either: (1) petroleum hydrocarbons (PHCs) such as gasoline, or diesel; or (2) chlorinated solvents such as the dry cleaning chemical tetrachloroethylene (perchloroethylene, or PCE) and the degreasing solvents trichloroethylene (TCE), 1,1,1-trichloroethane (TCA), and PCE. 

Once the contamination is discovered, the deal usually falls apart and the owner is then left wondering what to do next.  Most states have a Voluntary Cleanup Program which enables the owner to clean up the property without fear that the state will seek an enforcement action against them.  Upon completion of the program, the owner obtains a Certificate of Completion. 

Some states also permit an owner to enter their property into the Innocent Owner Operator Program, Dry Cleaners Remediation Program or programs concerning Leaking Underground Storage Tanks where the owner obtains a No Further Action Letter upon completion.  Some states also permit an owner to obtain a Municipal Setting Designation on their property as part of the remedial activities.

While each of these programs might satisfy the owner’s obligations to the state, they usually do not protect them for claims made by others due to the contamination, and they certainly do not compensate the owners for past costs they incurred in remediating their property.  In addition, none of the programs provide protection from vapor intrusion issues which are increasingly a major concern with environmentally impacted properties.

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