Asbestos In Commercial Property
Asbestos can present a challenge in commercial property transactions. Contravention of the regulations can result in criminal charges, yet many commercial property owners and managers remain unaware of their responsibilities. Make sure that you are aware of the law and your obligations.
What is asbestos?
Asbestos is the generic name given to 6 different types of naturally occurring silicate minerals. At microscopic level, asbestos is made up of tiny sharp barbed fibres. This structure makes asbestos dangerous if inhaled, as the fibres lodge in the soft tissue of the lungs, eventually causing chronic inflammation and scarring (asbestosis), leading to other related serious illnesses. These minerals were extensively mined and processed into building and utility materials and products during the 19th and 20th centuries, although their historical use spans thousands of years.
Why was asbestos used in buildings?
Asbestos was widely used in buildings because of its low cost and impressive material properties; fire-resistance, noise-dampening and thermal and electrical insulation. Due to its historical popularity, it can still be found in many older buildings throughout the UK.
When is asbestos dangerous?
Asbestos does not present a health risk unless the structure of the material is degraded or broken and the fibres become airborne and inhalable. An intact piece of asbestos insulation board, for example, is not dangerous if left in situ. The danger arises when the material breaks down or is disturbed.
Asbestos in commercial property
The Control of Asbestos Regulations 2012 (CAR 2012) apply throughout the UK, imposing a duty to identify and manage asbestos in non-domestic buildings. Regulation 4 imposes an obligation on the ‘dutyholder’ in non-domestic properties to:
- determine whether asbestos is present in a building, or is likely to be present; and
- manage any asbestos that is or is likely to be present through an Asbestos Management Plan (AMP).
Who is a dutyholder?
The definition of ‘dutyholder’ under Regulation 4 of the Control of Asbestos Regulations 2012 is broad, and can extend to owners, landlords, tenants, licensees and even managing agents in certain cases. In complex cases, the responsibility may be shared between dutyholders relative to their individual obligations.
Asbestos in a commercial property transaction
In a commercial property transaction, the buyer’s solicitor should raise enquiries with the seller to ascertain whether the duties described under the CAR 2012, above, have been complied with by the designated dutyholder.
By law, the dutyholder should have determined the presence of asbestos. The buyer’s solicitor should request an asbestos survey report or an AMP to be provided before exchanging contracts. If the transaction completes and asbestos is later discovered, the new owner may be liable under CAR 2012 in the event that the duty passes on the date of completion.
The Health and Safety Executive (HSE) enforces asbestos control, and contravention of the regulations in non-domestic property can lead to criminal liability of the dutyholder. Discovery of asbestos may also compromise the operability of a commercial premises, or negatively impact the profitability of property development or change of use. Establishing the presence of asbestos is therefore a critical consideration before committing to a commercial property purchase and should always be investigated at the searches and enquiries stage of the transaction.
At Burtons when we act on behalf of a commercial buyer or tenant will ensure that specific enquiries are raised at an early stage to establish whether there is an existing Asbestos Report and what management measures are in place if any Asbestos is identified.
When acting for the Seller of a commercial property or a landlord granting a new lease, we will ensure that you have carried out an Asbestos Report as this will be required to be sent to the buyer’s/tenant’s solicitors.
Please contact us at Burtons if you require further assistance on any commercial transactions.