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Environmental Due Diligence When Inheriting Real Estate

What type of environmental due diligence should you do prior to taking title to real estate that is given to you?   Is doing a Phase I Environmental Site Assessment a bit like looking a gift horse in the mouth?

A Connecticut woman recently inherited a commercial property that had formerly been a gas station and, as reported by environmental lawyer Larry Schnapf, she is being held responsible for the cleanup. Larry also reported on another story from Vancouver about a woman who is going to have to deal with a leaking home heating oil tank at her mother’s home that she inherited: inheriting environmental liability story.

I advise clients to consider three reasons to do environmental due diligence prior to taking title to free real estate:

1)            Avoid environmental liability in the worst-case-scenario.

2)            If there is environmental liability, you may get your appraiser and environmental consultant to work together to reduce your inheritance taxes.

3)            You need to assess the real estate sooner or later anyway so you might as well do the environmental assessment on the front end.