When an individual or business buys a piece of real estate, they generally look around the property first to see if it will meet their needs. However, a walk-through inspection of a building will not reveal defects and problems that lie inside the walls, roof, floor or other key elements.
In an effort to head off litigation after the sale is closed, sellers of residential and commercial real estate have the legal obligation to make certain disclosures to the buyer. When it comes to commercial property, perhaps the most well-known disclosure requirements have to do with environmental issues.
Applicable laws include the Superfund, officially the federal Comprehensive Environmental Response, Compensation and Liability Act or CERCLA. Sellers may have to meet the requirements of the Clean Air Act, Clean Water Act and laws and regulations related to hazardous waste. In addition, sellers must be aware of possibly relevant regulations imposed by the Environmental Protection Agency.
For buyers, these laws are meant to ensure that the piece of property they are buying does not contain hidden environmental hazards that could cause health problems and be expensive to clean up. For sellers, knowing whether they are in compliance with the law can be difficult, especially if they are not experienced with the complexity of real estate disclosure laws.
That is why any business considering a commercial real estate transaction would likely benefit from legal advice. Having a lawyer during the purchase process can help you avoid expensive and time-consuming litigation in the future.
