judgement to assist a client in completing a remediation thoroughly and cost-effectively. For this reason, when interviewing a prospective LSRP one should inquire about the LSRP’s use of professional judgment. Questions about how the individual used professional judgment at other sites are appropriate, as well as questions about how professional judgment may be applied at your site. If the LSRP cannot provide cogent answers about professional judgment, consider a different LSRP.
The LSRP contract
Because of the requirements that apply to an LSRP’s services, a standard consulting contract is frequently not sufficient to protect the party engaging an LSRP from potential problems. Likewise, an LSRP is likely to want terms and conditions beyond those contained in a typical consulting contract as recognition of the added obligations that come from being an LSRP. Contract terms to pay particular attention to are: • Insurance provisions • Record retention requirements • Confidentiality provisions • Indemnity provisions and time limits Many consulting firms provide standard insurance language that would apply to both LSRP and non-LSRP work. In some instances, it is important to look at the amount of errors and omissions coverage relative to the expected cost of the remediation For large projects, the amount of this coverage should reflect the anticipated costs of the cleanup. And in all cases, consultants, including LSRP’s doing work on a remediation, should have Contractors Pollution Liability Coverage. There should also be consideration to an obligation to maintain the agreed upon coverage until after the end of the NJDEP’s three year audit period discussed above. LSRPs are also required to become the repository of records for sites where they are overseeing the remediation. The contract language should reflect this requirement and make sure that access is available to these records even after the contract term is over. Many consulting contracts contain confidentiality provisions. However, these may not work when an LSRP is engaged. In certain circumstances, an LSRP has an independent duty to report information to the NJDEP. Because of this, one cannot assume that communications with an LSRP are confidential. In addition, discussions including an LSRP and legal counsel are not necessarily protected by the attorney-client privilege. Special attention should also be paid to the indemnity provisions in an LSRP agreement. Standard indemnity provisions may not be sufficient to address concerns related to the unique role of an LSRP. As with insurance language, there needs to be some forethought given to the potential of an RAO being overturned as a result of an audit by the NJDEP. This may include a need to have the indemnity survive at least until the end of the audit period.
There also continues to be some confusion about whether the LSRP’s reporting obligation is triggered if the individual is not engaged as the LSRP of record with the NJDEP to oversee the remediation of the site in question. If an LSRP is not involved directly in the due diligence process, it is important that the environmental professional performing the work do so in a manner that an LSRP may rely upon in the future. This may lead to having a consulting firm engaged to perform the due diligence where there are both LSRP’s and non-LSRP’s involved. The non-LSRP consultants should be able to produce work that an LSRP employed by the same consulting firm feels comfortable relying upon. These are among the more significant considerations that have arisen as the LSRP program has become fully implemented. Although the program has been in existence for a number of years, it is still evolving. LSRPs will begin to make more and more decisions. The LSRP licensing board will make more decisions in more cases. Parties who need to engage an LSRP should be aware of these and other issues as they evolve and engage the LSRP with these issues in mind. Dennis M. Toft is a member of the 130 attorney firm of Chiesa Shahinian & Giantomasi of West Orange, NJ where he co-chairs the environmental practice. Mr. Toft was actively involved in the process of developing and implementing the Site Remediation Reform Act on behalf of the regulated community. He can be reached at (973) 5302014 or by email at dtoft@csglaw.com.
Due diligence
Because an LSRP has statutory obligations to report certain circumstances to the NJDEP, sellers of potentially contaminated property frequently seek to prohibit a buyer from using an LSRP to conduct due diligence. On the other hand, buyers frequently like the protection of having an LSRP evaluate potential cleanup costs and obligations. MEADOWLANDS USA
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