Reducing Environmental Risk

No Asbestos, PCBs, USTs

It may be appropriate to add specific representations on individual contaminants or areas of concern to buyer or lender. In addition to those listed, formaldehyde and radon may be of concern to the buyer.

1. The representation may be: “There is not now at, on, or in the property or any portion thereof (a) any asbestos-containing material as defined by the Toxic Substance Control Act; (b) any polychlorinated biphenyls (PCBs) used in hydraulic oils, electrical transformers or other equipment; or (c) any underground storage tanks.”

2. Because of the proliferation of asbestos construction materials over the last several decades, an absolute representation that there is no asbestos on the property may be inappropriate. The asbestos of concern is generally “friable” asbestos, which can dust and create a hazard to occupants. Asbestos may be present at very low levels as a component of other materials. For the buyer who has concern with friable asbestos, the representation might state: “Except as specified in schedule x.x, there is not now at, or in the property or any portion thereof, any asbestos in any form which has become or threatens to become friable.”

3. With respect to PCBs, their presence in dielectric fluid becomes a regulatory concern at levels exceeding 50 ppm. The representation might therefore refer to the absence of “any PCBs or transformers, capacitors, ballast, or other equipment that contains dielectric fluid containing PCBs at levels in excess of 50 ppm.

4. With respect to underground storage tanks, in the interest of full disclosure the representation might be expanded to include USTs, sumps, underground pipelines or water wells.

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