Dealing with contaminated land in contracts of sale

Authored by Chris Camillin, Partner, Aitken Partners (Vic); Simon LaBlack, Director, LaBlack Lawyers (Qld); Eric Ross-Adjie, Principal and Andrea Keri, Principal, Warren Syminton Ralph (WA); Philip Page, Retired Partner, Mellor Olsson Lawyers (SA); Tim Tierney, Principal, Tierney Law (Tas); Lyn Bennett, Consultant, Minter Ellison (NT); Christine Murray, Partner, Meyer Vandenberg Lawyers and Duncan Webber, Partner, Moray & Agnew (ACT). Updated by the LexisNexis Legal Writer team.

Transacting with contaminated land (whether known to be contaminated or not) poses difficulties and risks for vendors and purchasers.

Vendors will need to take care to meet any disclosure requirements, not make any misrepresentations, and comply with any environmental duties pending completion of any contract.

As disclosure requirements vary between states and territories, purchasers need to conduct suitable levels of due diligence and understand the risks and responsibilities that arise from acquiring actual or potentially contaminated land.

More general information on contaminated land can be found in Subtopic: Contaminated land.

Conveyancing practice

New South Wales

The Contaminated Land Management Act 1997 (NSW) is the predominant legislation dealing with contamination.

The Contaminated Land Management Act 1997 (NSW) does not allow parties to contract out of their statutory liabilities. However, parties are still free to allocate and transfer the risk and costs of contamination between themselves through contractual methods. It is therefore imperative that due diligence is carried out properly and that the parties’ contractual obligations and responsibilities for contamination are clear.

Vendor’s key obligations

When selling land, the key obligations of a vendor which may be relevant to issues of contamination are as follows: