Expert Commentary

Green Building Projects and Environmental Risk

As most construction firms will attest, green building is not a waning fad. Sustainable design is now embedded in our culture as a proven method for conserving water and materials, creating healthier and safer environments, reducing carbon footprints, and saving energy.


Environmental
January 2010

However, the best of intentions as well as the staunchest precautions will not always protect contractors and site owners against the many liabilities that can surface during green building projects. For example, over the past few years, several instances have arisen where contractors were sued during excavation projects that led to the third-party exposure of dust containing hazards, such as asbestos fibers and silica dust. In addition, similar problems have also been created through the release of carbon monoxide, carbon dioxide, methane, and nitrous oxide produced from generators and other equipment operating in improperly ventilated areas.

Unforeseen Risks

Similarly, many devastating environmental lawsuits are also produced through unforeseen risks. The best new example related to the use of newly developed recycled products and materials concerns Chinese drywall, which made numerous headlines in Florida, Louisiana, and Texas throughout the past year. Because of its alleged high-sulfur content, Chinese drywall produces a low-grade sulfuric acid that impairs the integrity of internal structures when exposed to moisture.

Whether the drywall will eventually be found to negatively impact indoor air quality or adversely impact human health, there is little doubt about the damage it has already been found to cause. Although it may not be the next asbestos, which was considered a breakthrough fire retardant 40 years ago, it is causing environmental issues for both owners and contractors.

Furthermore, while the vast majority of contractors may have a great deal of experience working in contaminated conditions, numerous firms possess either little knowledge of the possible risks or are not aware of all the complexities. Even knowledgeable companies can be tempted to accept remedial work as a way of appeasing their clients or expanding their business.

Consequently, environmental risks can be catastrophic when properties are not properly investigated or characterized. Even with today's technology, it is extremely difficult to perform a cursory and cost-effective environmental assessment that yields accurate information.

Environmental Assessments

Unfortunately, too many parties rely on the "phase I" and use it as a determining rather than a contributing factor in managing environmental site risks. This is because environmental assessments performed with little to no intrusive sampling will generate reports offering only information already recorded for that property.

What would happen if the property had been used, historically and possibly illegally, for the disposal of waste oil, waste products and other hazardous products? Or, if it is found to contain unregistered underground tanks and abandoned materials causing residual contamination? These details may not be revealed during the assessment process and, in most cases, are discovered only after actual development and construction had already begun.

Conclusion

There is no doubt that "green" projects are better for the environmental, but just because a property or structure is "green" doesn't mean it's free of environmental liability or related issues. It's likely claims related to green exposures will climb in the coming years as increasingly more contractors and site owners engage in or become pushed into green building practices. However, there is no substitute for knowledge. Armed with the proper education and experience, construction professionals will then be prepared to withstand the challenges of environmental exposure and the resulting financial implications, which can prove extremely costly and disruptive to business practices.


Opinions expressed in Expert Commentary articles are those of the author and are not necessarily held by the author's employer or IRMI. Expert Commentary articles and other IRMI Online content do not purport to provide legal, accounting, or other professional advice or opinion. If such advice is needed, consult with your attorney, accountant, or other qualified adviser.

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