When many people think of contaminated sites, they think of the usual suspects such as industrial properties and gas stations. They may not think of environmental problems affecting residential properties, but they do. When looking to purchase a home, buyers should consider whether the property may have any environmental risks.
These risks may include, but are certainly not limited to, environmental contamination resulting from a historical use of the property, a spill occurring at the property or nearby property, or the current or former use of any nearby properties. Contamination does not respect property boundaries and in some cases, can migrate a considerable distance depending on the subject contaminant.
Even properties which have been historically residential in use may have risks. For example, if the property is an older home, it may have been heated by oil at some point, which would have required a fuel storage tank on the property. Fuel storage tanks have a risk of leakage or spillage during filling. It is also possible that an underground fuel storage tank has not been properly decommissioned and remains present, posing a risk of ongoing contamination.
Generally, environmental investigations of residential properties are not the norm. The difficulty is that if environmental contamination is discovered after a purchase, as the current owner of that property the purchaser may face liability for that contamination regardless of whether or not they caused it or knew of its existence at the time of purchase. Under the Environmental Protection Act, R.S.O. 1990, c. E.19, the Ministry of the Environment, Conservation and Parks (“MECP”) has the authority to issue orders against the current owner of a property with environmental contamination, irrespective of the fact that the contamination existed prior to purchase. Further, the current owner of a property with historical contamination could potentially face civil liability if that contamination has migrated or is continuing to migrate off-site.
It is important for purchasers of all properties, including residential properties, to consider the environmental risks that the property might be subject to. A purchaser should ask questions about the history of the property, any known environmental issues at the property and the history of the lands around the property. A purchaser may want to consider engaging an environmental engineer to conduct a Phase I Environmental Site Assessment, which is a paper review of the property to assess whether there are any areas of potential environmental concerns which could affect the property. If any concerns are identified, an intrusive investigation of the property may be recommended to assess whether contamination is present. Although an engineering review is an additional expense, if there are concerns about a property, it may be a worthwhile expenditure given the implications of unknowingly acquiring a property which is contaminated.