Environmental contamination can take different forms, such as the discharge of toxic chemicals into the soil or water or the emission of harmful gases into the air. Property owners, including landlords and tenants, may be held liable for environmental contamination on their property, regardless of whether they caused or contributed to the contamination. The Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA), commonly known as Superfund, imposes strict liability for environmental contamination and permits the Environmental Protection Agency (EPA) or private parties to file lawsuits against current or former owners or operators of contaminated properties for cleanup costs.
Under CERCLA, liability for environmental contamination is joint and several, meaning that any party found liable can be held responsible for cleaning up all contamination at a site, even if they only contributed a small amount to the overall contamination. However, there are certain limited defenses available under CERCLA that may be used to avoid or reduce liability, including acts of God, acts of war, and the third-party defense. The third-party defense may be used when a responsible party can prove that the release of hazardous materials resulted exclusively from the actions or inactions of an unrelated third party. To use this defense, the responsible party must demonstrate that they took reasonable precautions against potential incidents involving third parties and acted responsibly in handling the hazardous substances in question, despite having no contractual relationship with the third party.
To protect against contamination damages, property owners, including landlords and tenants, may consider including a strong indemnification clause in their lease agreements. An indemnification clause should be clear and unequivocal and should survive the expiration or termination of the lease. In addition to an indemnity for landlord-incurred costs, the landlord may want to impose on the tenant responsibility for the actual cleanup or shift responsibility for the cleanup at the landlord’s discretion.
Environmental contamination can have serious consequences, including harm to human health, damage to property, and financial liability for cleanup costs. Property owners, including landlords and tenants, should take reasonable steps to prevent environmental contamination and be aware of their potential liability under CERCLA. If you are a property owner, it is crucial to consult with an experienced attorney, such as the attorneys at OVB Law & Consulting, to determine your legal obligations and options for mitigating liability. Our experienced attorneys can help you navigate complex environmental regulations and laws to protect yourself and your property.
