About forty years ago, property buyers in the United States started to undertake studies which resemble today's Phase iI site assessments. The purpose of their studies was to asses any potential risk of owning a commercial property if it was on a site where toxic chemicals were used and/or disposed.
These studies often were used to determine the nature of the costs associated with cleaning up the property - especially if the property under consideration was going to be redeveloped, or if its land use was going to be changed.
Then in 1980 the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (CERCLA) was passed. As a result the demand for this type of investigation dramatically increased.
That's because the courts in the United States now held that a lessor, buyer, or lender could be held responsible for remediation of hazardous substance residues, even if the contamination was caused by a previous owner.
Consequently, when a potential buyer now has a Phase I Environmental Site Assessment performed he, she, or the corporate entity creates a safe harbor. This has come to be known as the "Innocent Landowner Defense" and, in the eyes of the court, will help to protect new purchasers and/or their lenders.
In 1988 a hydrogeologist working for the HTS Environmental Group of Columbia, Maryland, registered a "Due Diligence Inquiry Checklist" and other information with the US Copyright and Trademark Office. The checklist was designed to address everything that would be required to satisfy the court's interpretation of the "innocent purchaser defense."
This work apparently became the basis of the modern ASTM E1527 Standard Practice for Environmental Site Assessments: Phase I ESA.
A decade later the Superfund Cleanup Acceleration Act of 1998 was passed. With this act congress underscored the necessity of performing a Phase I Environmental Site Assessment prior to the purchase of any commercial property. In order to satisfy the "Innocent Landowner Defense" the Phase I1 study would have to meet the specific standard of ASTM E1527 Process.
More recent legislation requires has become known as the EPA's "All Appropriate Inquiry" (AAI). This rule, called "Standards and Practices for All Appropriate Inquiries" 40 Code of Federal Regulations, Section 312, was based on ASTM E1527-05.
Although anyone who is considering purchasing any commercial property should have a Phase I Site Assessment done by a qualified professional, there are also certain "user responsibilities" that must be fulfilled by the individual who has commissioned the Phase I, including conducting an environmental lien search and providing the professional with any specialized knowledge they have about the site.