I’m curious how others address the issue of testing a project for hazardous materials like asbestos and lead based paints with new clients before you begin tearing things up. I have this clause in my contract:
Article 10. General Provisions <!—-><!—-> <!—->
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10.1 If conditions are encountered at the construction site which are subsurface or otherwise concealed physical conditions or unknown physical conditions of an unusual nature, which differ naturally from those ordinarily found to exist and generally recognized as inherent in construction activities, the Owner will promptly investigate such conditions and, if they differ materially and cause an increase or decrease in the Contractor’s cost of, and/or time required for, performance of any part of the Work, will negotiate with the Contractor an equitable adjustment in the contract sum, contract time or both. <!—-> <!—->
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Article 11. Hazardous Materials, Waste And Asbestos<!—-> <!—->
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11.1 Hazardous Materials. During the period of Owner’s ownership of the Property, Owner has undertaken no activity and has no knowledge of any activity upon the Real Property which has produced, and the Real Property has not been used in any manner for the storage of, any Hazardous Materials (defined below), or the discharge, deposit, dumping, or contamination, whether of soil, ground water or otherwise, which violates any Environmental Laws (defined below).<!—-> <!—->
Both parties agree that dealing with hazardous materials, hazardous waste or asbestos requires specialized training, processes, precautions and licenses. Therefore, unless the scope of this Agreement includes the specific handling, disturbance, removal or transportation of hazardous materials, waste or asbestos, upon discovery of such hazardous materials by Contractor, the Contractor shall notify the Owner immediately and allow the Owner/Contractor to contract with a properly licensed and qualified hazardous material contractor(s). Any such Work shall be treated as a Change Order resulting in additional costs and time considerations and shall be conducted by licensed and qualified hazardous materials contractor(s) solely at Owner’s expense. Owner hereby agrees to defend indemnity and hold Contractor and are licensees, invitees, agents or employees from any claims arising from the presence of Hazardous Waste, Hazardous Materials or Asbestos, or from any violation of Environmental Law, including, without limitation, Contractor’s attorney’s fees and costs.<!—-><!—->
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As used in this Agreement, the term “Hazardous Material†shall mean any substance or material now or hereafter defined or regulated as a Hazardous Material, hazardous waste, toxic substance, pollutant, lead based paint or contaminant under any Environmental Law. The term “Hazardous Materials†specifically includes, but is not limited to, petroleum, petroleum by-products, and asbestos. As used in this Agreement, the term “Environmental Law†shall mean any federal, state, or local law, regulation or ordinance governing any substances that could cause actual or suspected harm to human health or the environment.<!—-> <!—->
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The question I struggle with is there a law requiring me to do a pre construction test for these things or is it just prudent to do it before I proceed? I’ve called Washington State L&I to ask the question and was put on ignore for 30 minutes before I hung up in frustration.
I’m bidding a remodel of a house built in 1904 and I’m sure it’s got to be crawling with cooties but HO’s generally don’t want to pay for those kinds of tests and generally they’d prefer not to want to know. Don’t ask, don’t tell…. .But on the other hand I could see the potential for a lawsuit if I don’t test before proceeding and go ahead and start ripping things up then find out later that contaminated dust was suspended in the air and thus exposing the HO then all legal hell breaks loose too.
Anybody care to weigh in?
Thanks
BjR
Replies
Not a lawyer but your operative language should read 'indemnify, hold harmless and defend' ... and their licensees, invitees, etc.
This -
Owner hereby agrees to defend indemnity and hold Contractor and are licensees, invitees, agents or employees from any claims
Doesn't read well.
In 10.1 you leave it to the Owner to investigate but in 11.1 you indicate that it is the Contractor who is doing the discovering. Also, you do not indicate that the specialized training means that the Contractor is not expected to identify hazardous materials - usually an important aspect of such a clause.
Jeff
Edited 1/8/2008 11:05 pm ET by Jeff_Clarke
Thanks for the input Jeff. I see what you mean.
I'll send it back to my attorney and see what she thinks since since she wrote it and I spent 5 grand to have her spiff up my contracts this year.
But can you weigh in on what and how you deal with stose and toxic issues with clients?
BjR
Re: read 'indemnify, hold harmless and defend' ... and their licensees, invitees, etc.
Consider whether you want that "defend" word: it seems to mean that the Owner will conduct the defense for the contractor should any action arise against the contractor.
I'd want just the indemnity (being sure it includes coverage of "reasonbable" attorneys' fees.)
Looks like your lawyer's paralegal cut and pasted from another "precedent" document and your lawyer was a bit too hurried during proof reading.
Since the indemnity and hold harmless clause is (i) standard and (ii) important, I'd wonder why it was 'butchered.'
Maybe just minor carelessness because it is such a standard provision.
May your whole life become a response to the truth that you've always been loved, you are loved and you always will be loved" Rob Bell, Nooma, "Bullhorn"
"We Live" http://www.youtube.com/watch?v=7kuBgh0VCqI&mode=related&search
And Annie Ross's "Twisted" http://www.youtube.com/watch?v=8lqivrCIRGo&mode=related&search=
ITA agree on the use of the word 'defend' - makes it really unpalatable for the Owner.
Jeff