Even if you weren’t around back in 1980, you may still have heard of a place called Love Canal. One of the worst environmental disasters in the country, and a major catalyst for the legislation that brings us to where we are today.

Love Canal was originally meant to be a dream community. That vision belonged to the man for whom the three-block tract of land on the eastern edge of Niagara Falls, New York, was named–William T. Love.

Love felt that by digging a short canal between the upper and lower Niagara Rivers, power could be generated cheaply to fuel the industry and homes of his would-be model city.

But despite considerable backing, fluctuations in the economy and Nikola Tesla’s discovery of how to economically transmit electricity over great distances by means of an alternating current doomed the dream to failure, and by 1910, it was over. All that was left to commemorate Love’s hope was a partial ditch where construction of the canal had begun.

It was soon after this that the seeds of the nightmare were planted. The canal was turned into a municipal and industrial chemical dumpsite and, although landfills can be an environmentally acceptable method of hazardous waste disposal, assuming they are properly sited, managed, and regulated, Love Canal will always remain a perfect historical example of how not to run such an operation.

From 1942 to 1953, the Hooker Chemical Company, with government sanction, began using the partially dug canal as a chemical waste dump. At the end of this period, the contents of the canal consisted of around 21,000 tons of toxic chemicals, including at least twelve that are known carcinogens (halogenated organics, chlorobenzenes, and dioxin among them).  In 1953, Hooker capped the 16-acre hazardous waste landfill with clay and sold the land to the Niagara Falls School Board for one dollar, and attempted to absolve itself of any future liability by including a warning in the property deed.

It was a bad buy.

By the late ’70s, about 800 homes and a school were built at the site. Not William T. Love’s model city, but a solid, working-class community nonetheless.

For a while.

Consecutive wet winters and record amounts of rainfall triggered leaching of toxic waste up through the soil and into the community, including the school playground. A series of inexplicable illnesses and abnormally high rates of birth defects sparked public awareness, and the eventual involvement of the government.

What Happened Next?

Common sense tells us that if someone made an environmental mess, then that someone needs to be responsible for cleaning it up. It’s sensible, right? I know I don’t object to the idea.

Congress didn’t object either, and in response to realizing that the United States was starting to have a problem with highly contaminated properties, they created the Comprehensive Environmental Response, Compensation, and Liability Act, or CERCLA, commonly known as Superfund. Originally the act created a Federal “Superfund” to clean up uncontrolled or abandoned hazardous waste sites, as well as accidents, spills, and other emergency releases of pollutants and contaminants into the environment. As well, the EPA, through CERCLA, was given the power to seek out those parties responsible for any release and assure their cooperation in the cleanup

One prime component of this act, and this is an extreme simplification, is that if you contaminate a site, you’re on the hook for cleaning it up.

It’s not always as simple as that though. Let’s say you bought a site and later find out it’s contaminated. First off, shame on you, because that means you didn’t get a Phase I done. Second, you’re probably wondering who’s going to clean up this mess? Guess what, it’s you!

That’s right people, and this is where it gets hairy. If you didn’t go through the very detailed, specific process of investigating the present and past uses of the property, and the potential presence of environmental contamination of the property, then YOU are responsible for the cleanup! That’s the way the law is written, and you can’t fight it.

This isn’t legal advice, or an in-depth regulatory analysis, but if you conduct your Phase I in accordance with AAI standards (which I’ll discuss below) then you might not be responsible for clean-up costs at your facility. Conducting a Phase I can provide you with certain protection in this situation. Meaning, you probably will not be liable for the cleanup.

All Appropriate Inquiries Rule

The EPA’s All Appropriate Inquiries rule governing the scope of Phase I Environmental Site Assessments went into effect on November 1, 2006 and provided specific scope requirements for a Phase I ESA to meet the requirements of CERCLA’s Innocent Land Owner defense.

In our environmental risk practice, we help buyers meet the legal requirements for the CERCLA innocent landowner defense and we provide practical business advice on environmental liability to our clients.