The PCS Nitrogen Case: A Chilling Effect on Prospective Contaminated Land Purchases

Abstract

The Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) requires that all potentially responsible parties, including current and former land owners, contribute to the costs of cleanup of contaminated property. CERCLA includes a provision that grants bona fide prospective purchaser (BFPP) status and exemption from liability to land owners if liability under CERCLA is based solely on owning the land. In PCS Nitrogen v. Ashley II of Charleston, the U.S. Court of Appeals for the Fourth Circuit refused to grant BFPP status to Ashley II and suggested that a high standard of due care is required to obtain such status. This Comment argues that the court’s decision, and its suggestion that a high standard of due care is necessary to avoid liability, will make it more difficult for purchasers of contaminated land to avoid joint and several liability under CERCLA. The court’s decision will deter businesses from purchasing contaminated land with the intention of remediation and redevelopment.