Contaminated Land

[flyingsnow]

If a land is contaminated, is this contamination registered on title? Dave mentioned in another post that there were 100,000 tires buried in an eastern Ontario rural land up for tax sale, was this information showed on title search?

I checked the Ontario Land Registry government website, and it says that "Environmental warnings and restrictions are not title related and as such are not acceptable for registration in the land registration system as documents..." This includes ground contamination.

If contamination is not registered on title, where is this information kept? or the only way to find out is by obtaining an environmental audit?

Your first hand information is appreciated.

[Dave2]

If a land is contaminated, is this contamination registered on title? Dave mentioned in another post that there were 100,000 tires buried in an eastern Ontario rural land up for tax sale, was this information showed on title search? 

Flyingsnow:

I will defer to the more experienced members of the board but my own personal experience is sometimes.  I have a personal beef with some municipalities that sell former dumpsites on tax sale for example. 

In general that is why I do title and execution searches before the tax sale and a much more intensive one after if I am the winning bidder.

It is also why I will not touch some properties like former gas stations or
in general industrial properties. 

Bottom line is that in some cases in this business there is real risk.  I just hope I am fortunate enough to avoid it and not get into trouble with my boss.  Of course some members of this board like this guy  have nice mild mannered bosses or more likely I have yet to discover the secret of boss control.

[ChrisCentral]

Anyone on the board ever been lured into a cont. land or does anyone know anyone who was in this situation??

[netpred]

People don't like to speak of their losses. I do know for a fact that some members here decided to walk away from their deposit rather than to risk closing where there appeared to be environmental issues.

The best way to check for potential environmental problems is to do a site visit and then to use some common sense. For example, oil drums are not a good sign.

[ruok]

I agree with Dave2 on this one. Normally you have to disclose certain environmental issues particularly with contaminated land. The municipality seems to hide behind a very brief ,blanket statement that they are not liable if there is a problem with the house, land, boundaries etc. Who else can sell a property and not disclose an environmental defect without recourse ? Let the buyer beware!!!

[netpred]

There has been much discussion about this issue here. In most instances it would be unrealistic for the municipality to make any representations about these issues, and other issues, that it has no knowledge of. The land may be contaminated and the municipality may not know.

Some municipalities do disclose this information if they have it available. I have wondered whether this is a good practice since if they then don't disclose because they don't know, if the purchaser relies on the silence and it turns out to be toxic, the municipality may face a lawsuit for not disclosing something that it does not know.

All the municipality wants is that the taxes be paid up in full. Most municipalities take no pleasure in selling a taxpayer's property. You can bet your bottom dollar that no municipality wants to be sued as a result of disclosing or not disclosing information on a tax sale.

Besides, if municipalities were required to make complete and full disclosure then I believe that it would remove much of the risk and fun of this hobby. It would also result in higher tenders.

[Dave2]

Anyone on the board ever been lured into a cont. land or does anyone know anyone who was in this situation??

Chris:

In general I agree with Netpred that an onsite inspection is worth its weight in gold; particularly as once you are the winning bidder while technically you are trespassing, you can usually work your way out of a challenge except for an occupied site.

(Of course the best solution is to have a beautiful girlfriend like Worldjohn.  Then you can get into any site before or after the sale. Frankly that is why I think women have an advantage in this business and I am surprised we do not have more female members.)

I think it is also important to differentiate between different types of contamination.  I have bought and sold former grow-ops but mainly involving land in which buildings were a throw away at tax sales in which I disclosed to a purchaser the existence of a former grow-op.

Its not all bad because chances of redemption decrease when the former owner is getting a free vacation courtesy of the state.  

In one case a neighbour continued to use my land even after a tax sale and I became the owner   and lets say we had a discussion about his continued use of my land.  

More serious cases are a different matter; especially the one that sticks in my craw of municipalities selling former (city operated) dumpsites.  No specifics will be given as I don't need the hastle of getting sued.  

Of course the greater the risk the greater the potential reward.  Its like buying an occcupied building.  Generally I don't touch them, because I don't have enough experience in this business yet, but I do know some very experienced people who do.  It is not for new players and you had better have very deep pockets
  

 

[flyingsnow]

Thanks everyone for the great info.

I am asking because there are a few lands currently up for tax sale, which are all owned by the same company in scrap business. Those lands have been in the company's possession for quite a while. I won't be surprised if there is soil contamination or scrap burial in some of those lands. Walk on site thoroughly and close up visual inspection should be helpful if you are not caught trespassing . PM me if you need more details.

[Dave2]

Thanks everyone for the great info.

I am asking because there are a few lands currently up for tax sale, which are all owned by the same company in scrap business. Those lands have been in the company's possession for quite a while. I won't be surprised if there is soil contamination or scrap burial in some of those lands. Walk on site thoroughly and close up visual inspection should be helpful if you are not caught trespassing . PM me if you need more details.

Just the type of site I avoid.  Ever thought of how much oil, and other fluids is in the average car.  If I was so inclined at least I have the advantage of being a non smoker and not worrying if I threw away my burning cigarette.

[David1010]

I believe you're looking for what is called the Brown Fields Registry.

http://www.ene.gov.on.ca/environment/en/subject/brownfields/STDPROD_086237.html

A great idea.  The flaws, from what little experience I've had with it is, that a piece of land will only get registered after an environmental study and the registry doesn't have much ancient history in it.  Then I think everything about the property gets listed.

The other place where you may find some information, regarding fuel storage, is TSSA.  This is a weird one, because they don't want to deal with the public, you're allowed one question and they will give you a yes or no answer (literally). Do you have any records for address such and such, and they'll respond back yes or no.  I guess from a research point of view, you may have a starting point.

I talked with some MPP staff and MOE staff about whether townships were allowed to sell contaminated lands and what is their responsibility, ie does the Municipal Act trump the Environmental Protect Act.  They were supposed to get back to me, never did.

A very smart gentleman who does environmental studies, said in cases like what I was dealing with, the tanks are very rarely removed, just filled with sand and the ground plowed over.  He also said that a cleanup of that kind (location, shallow water table, proximity to a body of water) would easily run into the 100s of thousands if there was leakage from the tanks.

[flyingsnow]

Dig a little more into the city's archived documents and found out there are a lot of brownfield in the city and they are part of former foundry, former armoury etc., very likely the sites up for tax sale are part of them. A similar size former foundry site (it's hard to tell just by look, the land is levelled, and with grass) as estimated by the city will cost $500,000 for remedy on top of ESA I & II costs.

If there is no buyer after a couple of tax sales, the city have to vest it then it becomes the city's responsibility to clean it. You can make an offer at this point to the city because they have more brownfield in hand than they can deal with. And the city will pay your ESA costs, give you grant to clean it even wave your development costs. 

Apparently there are other contaminated sites up for tax sale now, topped with crown lien, like the one in eastern Ontario. 

[ruok]

Thanks. Great information.