Title 23
Health and Safety

Chapter 19.14
Industrial Property Remediation and Reuse Act

§ 23-19.14-7. Exemptions to liability.

The following parties are not responsible parties and shall not be held liable for costs or damages associated with a release of hazardous material and/or petroleum:

(1) Persons otherwise liable who can establish by a preponderance of the evidence that the release, or threat of release, of a hazardous substance and the damages resulting from that release, or threat of release, were caused solely by an act of God or an act of war;

(2) Bona fide prospective purchasers of, or tenants on, properties for which the following have been issued:

(i) A remedial decision letter and are actively engaged in implementing the remedial action approved therein; provided, that the remedial action is being diligently pursued to completion in accordance with approved work schedules;

(ii) A letter of compliance confirming successful completion of a remedial action approved by the department;

(iii) An enforceable settlement agreement under § 23-19.14-10; or

(iv) Correspondence from the department to the tenant acknowledging that the tenant leased the facility after January 11, 2002, and that the tenant has certified to each of the following criteria:

(A) Evidence that all disposal at the facility took place before the tenant leased the facility (through due diligence);

(B) The tenant made “all appropriate inquiry” into the prior uses and ownership of the facility in accordance with generally accepted good commercial and customary standards and practices (standard for due diligence);

(C) The tenant will provide all legally required notices for any discovery or release of hazardous substances at the facility;

(D) The tenant will exercise appropriate care to stop ongoing releases, prevent threatened future releases, and prevent or limit human, environmental, or natural resource exposure to any previously released hazardous substance;

(E) The tenant will cooperate with, assist, and provide access to those performing remedial work at a facility;

(F) The tenant will comply with, and will not impede the effectiveness or integrity of, any institutional controls at a facility; and

(G) The tenant has no affiliation with any responsible party and was not created through a reorganization of a business entity that was a responsible party.

(3) Persons who maintain an indicia of ownership solely to protect a secured interest in land and are not operators;

(4) Persons who are not operators and who act solely as custodial receivers or who can establish by a preponderance of evidence that they are an innocent landowner and the release or threat of release were caused solely by an act or omission of a third party, other than an employer or agent of the defendant, or whose act or omission occurs in connection with a contractual relationship, existing directly or indirectly, with the defendant if the defendant establishes:

(i) He or she exercised due diligence in the acquisition of the site at the time of purchase and exercised due care with respect to the hazardous material and/or petroleum concerned, taking into consideration the characteristics of the hazardous material, in light of the facts and circumstances; and

(ii) He or she took precautions against foreseeable acts, or omissions of any third party, and the consequences that could foreseeably result from those acts or omissions;

(5) A unit of state or local government which acquired ownership or control involuntarily through bankruptcy, tax delinquency, abandonment, or other circumstances in which the government involuntarily acquires title by virtue of its function as sovereign; provided, however, that the unit of state or local government did not cause or contribute to the release or threatened release of a hazardous material at the site; and

(6)(i) A person that owns real property that is contiguous to, or otherwise similarly situated with respect to, and that is, or may be, contaminated by a release, or threatened release, of a hazardous material from real property that is not owned by that person shall not be considered to be a responsible party for the site solely by reason of the contamination if:

(A) The person did not cause, contribute, or consent to the release or threatened release;

(B) The person is not:

(I) Potentially liable, or affiliated with any other person that is potentially liable, for response costs at the site through any direct or indirect familial relationship or any contractual, corporate, or financial relationship (other than a contractual, corporate, or financial relationship that is created by a contract for the sale of goods or services); or

(II) The result of a reorganization of a business entity that was potentially liable;

(C) The person takes reasonable steps to:

(I) Stop any continuing release;

(II) Prevent any threatened future release; and

(III) Prevent or limit human, environmental, or natural resource exposure to any hazardous substance released on or from property owned by that person;

(D) The person provides full cooperation, assistance, and access to persons that are authorized to conduct response actions or natural resource restoration at the site from which there has been a release or threatened release (including the cooperation and access necessary for the installation, integrity, operation, and maintenance of any complete or partial response action or natural resource restoration at the site);

(E) The person:

(I) Is in compliance with any land-use restrictions established or relied on in connection with the response action at the site; and

(II) Does not impede the effectiveness or integrity of any institutional control employed in connection with a response action; and

(F) The person provides all legally required notices with respect to the discovery or release of any hazardous substances at the facility.

(ii) To qualify as a person described in this subdivision, a person must establish by a preponderance of the evidence that the conditions in subparagraphs (i)(A) through (i)(F) of this subdivision have been met.