Environmental Liabilities Associated With Leased Properties

The question of liabilities associated with leased properties comes up frequently. The question usually takes two forms – first, what are my liabilities associated with site contamination during and after the lease period?, and second, who is responsible for permits while I operate on a leased property?

Contamination Liabilities. The liabilities associated with environmental releases and site contamination are not significantly different if properties are leased. If a site is found to be contaminated, you may be considered a Responsible Party. This is true even if contamination is caused by future Owners or Occupants; especially if you can not document the property condition at the time you vacated the property.

Compliance Liabilities. The issue of environmental compliance tends to be less straight forward, and can be effected by specific terms agreed to in a lease. However, in the absence of other information, it is best to assume that all permits associated with your processes are your responsibility.The compliance obligations for equipment or processes that are maintained by the property Owner, or shared services with other occupants often become less clear – but should to be defined. One example might be an emergency generator used to supply power to several tenants in a building.

For further information contact Caltha LLP at
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Caltha LLP Website