Search Site
Menu
Sellers verbal assurances

May 2006

Verbal Environmental Assurances

Real Estate Weekly
The Daily Sentinel

You are buying your dream home. It’s great and everything is perfect – except for one small thing: the seller tells you that an old oil tank leaked several years ago and an environmental cleanup has been performed and is completed. Is this the end of the story?

Probably not. Certainly not if you are my client.

Its not that sellers are dishonest. Rather, it is the reality that if the seller is wrong, even accidently wrong -this is going to be your problem after your purchase the home. And since oil tank leaks can cost a lot of money you need to be careful. Usually, that means doing your own evaluation.

The extent of evaluation that you should undergo depends on a lot of things. You and your real estate professional should evaluate the matter and determine how far you need to go.

Perhaps a copy of a municipal approval and a seller’s sworn statement will do. Or you may decide that the other extreme is required-meaning that you hire a consultant who will actually engage in confirmatory environmental sampling. This is actual soil and perhaps water sampling necessary to prove that no environmental problems have been overlooked.

Should you need to retain the services of an environmental consultant, I recommend not using a company recommened to you by the seller. You want a professional who is 100% neutral.

And if the seller’s real estate agent makes the recommendation, I would generally shy away from the testing company. There is a good chance that the company will be motivated not to give bad news, because that might kill this deal and dry up future referrals.

Ask your real estate professional or your lawyer for recommendations. You may also ask your state regulatory agency if tank remediation companies are regulated in your state. In that case, perhaps you might want to pick some one from that approved list.

Your consultant should be given a copy of everything the seller gave to you relating to the leaking tank problem. Your consultant will propose a few tests which should confirm the representation that the leaking tank is no longer a problem. And hopefully that is how it will turn out.

Often, the news will be good – the problem has been fully dealt with. However, based on my experience I can tell you that many times consultants find that former leaking tank locations that are reported to be clean really are not clean. In that case, often more site cleanup will be required.

If you learn that the tank problem has not been adequately addressed, you will need to engage in additional negotiations with the seller. To do this, I suggest that you see your lawyer once again. This can be a costly proposition if not handled correctly and you should have a professional handle the discussions.

Here are the important points. If a tank problem is reported to have once existed, obtain iron clad proof that it has been adequately addressed. This can mean anything from a written assurance to all out testing. You and your advisor need to determine how far you need to go.

If a problem still does exist, it does not have to kill the deal. There are many creative ways in which to handle this situation. Perhaps money can be escrowed, perhaps the seller’s insurance company may commit to the cleanup, or perhaps the closing will have to await the completion of the cleanup. Other possibilities exist as well. You and your lawyer need to be protective and creative: if you are, the deal can be saved.

In my opinion, no real estate transaction should ever be killed because of a leaking tank. While lawyers must provide their clients with complete protection, where there is a will, the deal can be saved -and should be saved.

Our Attorneys

Recent Twitter Posts

  • New Jersey sets emergency water standards for new chemicals. https://t.co/trgaaLL1mD
    5 months ago
  • How will New Jersey manage stormwater as the climate changes and flooding increases? https://t.co/dhVLALyzZ2
    5 months ago
  • Unprecedented storms are slamming NJ – learn how to be the best advocate for your clients when the next flood hits.… https://t.co/TicH6iAjP0
    5 months ago
  • Trenton Water Works has removed 25 percent of lead pipes throughout its service area. https://t.co/KUvhMsJlvU
    5 months ago

Recent Blog Posts

Supreme Court concludes that attorney review period is not a requirement of absolute auction contracts

On June 9, 2022, the New Jersey Supreme Court unanimously decided that attorney review period is not a required contractual provision for a residential real estate sale by absolute auction.
Read More
Supreme Court concludes that attorney review period is not a requirement of absolute auction contracts

It Depends on the Language – The Non-Disparagement Clause

How enforceable is a non-disparagement clause in an agreement? As is always the case with any contract or agreement, it depends on the language. On May 31, 2022, the Appellate Division
Read More
It Depends on the Language – The Non-Disparagement Clause

DCA Tries Again to Use RSIS to Limit Municipal Stormwater Controls

By Michele Donato, Esq. and Stuart Lieberman, Esq. In the 1990’s, developers claimed that municipal residential development ordinances lacked uniformity, increased development costs, and caused uncertainty in the development process. In
Read More
DCA Tries Again to Use RSIS to Limit Municipal Stormwater Controls

Previous Property Manager Charged with Embezzling and Laundering Stolen Funds from Hamilton Park CO-OP.

Nicolas DePaola of Ewing New Jersey was indicted on twelve charges for embezzling and laundering stolen money from his prior client, Hamilton Park CO-OP. On April 1, 2022, a Mercer
Read More
Previous Property Manager Charged with Embezzling and Laundering Stolen Funds from Hamilton Park CO-OP.

In The Media

  • Gulf Coast Town Center facing foreclosure

    Naples Daily News, September 16, 2015

    Wells Fargo filed a lawsuit Sept. 8 against an affiliate of CBL & Associates, the owners of the decadeold, 1.2 million-square-foot mall in south Fort Myers for a $190.9 million unpaid loan. The center has 94 stores on 204 acres, with such anchors as Super Target, Belk, Best Buy, Dick’s Sporting Goods, Marshalls and Costco...

    Read More
  • Town liable for private company's leaking underground tanks, court rules

    NJ.com Jul 26, 2017

    CRANFORD -- A couple that owned a businesses in town and became sick from leaking underground tanks owned by an adjacent business can sue the township for damages because the tanks were partially ...

    Read More
  • Dark Waters: How a Class Action Catapulted NJ to Forefront of 'Forever Chemicals' Battle

    NJ Law Journal Jan 09, 2020

    As property owners become increasingly aware of PFAS contamination, and as individuals exposed to PFAS learn of the health risks associated with exposure, liability will likely affect entire supply chains.

    Read More
  1. 1
  2. 2
  3. 3
  4. 4
  5. 5
Contact Our Firm

Quick Contact Form