Update: EPA´s New All Appropriate Inquiry Rule Makes Important Changes in Due Diligence on Contaminated Properties for Prospective Purchasers

Originally published Winter 2005

This update aims to inform prospective purchasers of properties challenged by real or threatened environmental contamination of new opportunities and obligations with regard to pre-purchase due diligence examination of the subject properties.

In January 2002, President George W. Bush signed into law the "Small Business Liability Relief and Brownfields Revitalization Act" ("BRA"). Among other important provisions, the BRA amended the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA" or "Superfund," 42 U.S.C. §§ 9601 et seq.) to provide protection against liability under that statute to prospective purchasers of properties with actual or threatened environmental contamination (the "innocent purchaser" defense). 42 U.S.C. § 9607(r)(1). The BRA also required the U.S. Environmental Protection Agency ("EPA") to issue regulations that would set standards for "all appropriate inquiry" ("AAI")—i.e., the due diligence exercise