Pre-Existing Site Contamination
Pre-existing operations may have caused contamination at a site. Under CERCLA, a property owner could be held liable for the cleanup of the property and any third-party claims resulting from contamination at or migrating from their property, even if they did not cause the contamination. Additionally, contaminants from neighboring facilities could migrate to the property. If the neighboring facility is not properly insured or goes bankrupt, the cost to clean up the contamination or third-party claims for bodily injury or property damage could fall on the property owner.
Chemical Storage
Tenant operations, including storage and use of chemicals, wastewater generation, or toxic or hazardous air emissions, could result in on-site or off-site contamination, third-party injury claims, or natural resource damages. Although the landlord/owner of the property is not responsible for the management of these chemicals, they could still be sued and held liable for cleanup and third-party claims related to contamination at or migrating from their property.
Equipment Chemical and Fluid Leaks
Emergency generators, hydraulic elevators, boilers, and other equipment may be at a facility. Fuels, oils, hydraulic fluids, water treatment chemicals, and other chemicals used in building operations and maintenance may be stored in containers or storage tanks. Leaks or spills of these chemicals from vehicles, equipment, containers, or storage tanks can contaminate soils and groundwater or collect in stormwater run-off, which could result in liability for the property owner. Malfunctioning building equipment or equipment not properly ventilated can produce carbon dioxide or carbon monoxide emissions, which could injure third parties and result in liability for the property owner.
Illicit Abandonment
Illicit abandonment is the illegal dumping of pollutants on a property. It can become the property owner’s burden for cleanup and third-party bodily injury or property damage if law enforcement cannot locate the originator of the waste.
Mold Growth
Inadequate or improperly functioning ventilation systems can lead to mold or bacterial growth within a building. Moisture intrusion can also occur due to storms, flooding, leaking water pipes, irrigation overwatering, sprinklers, and HVAC systems, leading to mold growth in buildings. Mold growth in buildings can require cleanup or result in third-party bodily injury or property damage claims for the property owner.
Legionella
Legionella is a bacterium that causes a form of potentially fatal pneumonia. Legionella can thrive in water-containing systems like misters, air conditioning, heating and cooling, plumbing, and water features. Poorly maintained systems and inadequate corrosion control or sanitation can result in Legionella growth and dispersal through mist and airborne droplets. Exposure can lead to illness and result in bodily injury claims. If a property owner is responsible for maintaining water-containing systems, they could be liable for claims related to legionella.
Asbestos, Lead and PCBs
Buildings may have asbestos-containing materials, lead-based paint, PCB-containing equipment, or building materials. Past renovations or construction operations may have released asbestos or lead to soil or groundwater. Leaks could have occurred from PCB-containing equipment in the past. Current building operations, construction, or renovations could inadvertently release hazardous building materials and cause contamination or injury to third parties. Additionally, if hazardous building materials from renovations are improperly managed or disposed of, the property owner could incur environmental liability or legal consequences.
Non-Owned Disposal Sites
If a tenant operation goes out of business or abandons chemicals or wastes at a property, the property owner could become responsible for the disposal of the chemicals and wastes. Improper waste handling or disposal could lead to environmental liability or legal consequences for violating regulatory requirements. Waste generators can become Potentially Responsible Parties for cleanups at non-owned disposal sites (NODs).
Environmental Pollution Liability Can Provide Coverage For
On-site cleanup of new and pre-existing pollution conditions
Off-site cleanup of new and pre-existing pollution conditions
Third-party claims for cleanup costs
Third-party for bodily injury and property damage
Both sudden and gradual pollution conditions
First and third-party transportation liability
Loading and unloading
Defense costs for third-party claims
Non-owned disposal sites
Mold, bacteria, legionella, and more in buildings
Natural resource damage
Silt and sedimentation
Emergency response costs
Civil fines and punitive damages, where allowed by state law
Business interruption expenses
Illicit abandonment
Aboveground and underground storage tanks
Claims Scenarios & Examples
