Who Should Pay For Sick Building Claims?

[Guest guest]

Who Should Pay For Sick Building Claims?

by Lesley Hensell

Once upon a time, developers put up buildings, landlords leased out

space, and nobody feared the big bad " L " word: litigation.

Then, decades ago, things began to change. First, the accident-prone

began suing property owners when they slipped and fell. Next, their

lawyers started branching out, attacking not only the property owner,

but also the landlord, developer, construction firm and anyone else

who ever had anything to do with the site of the accident.

In the 1990s, a real cash cow appeared for those interested in suing

anyone connected with real estate. Sick building syndrome (SBS) has

continued to be a boondoggle for landlords, constructions firms and

others battling to determine whether reported cases are real or

imagined, and who should pay for those that are legitimate.

Most recently, SBS lawsuits and expensive indoor environmental

cleanups have touched off a rash of litigation between property

owners and their insurance companies. This has left the courts to

decide who should pay, with insurance companies arguing they are not

liable. So when an SBS outbreak results in high costs for a property

owner, who should pay? To answer that question, let's first look at a

quick SBS primer.

What is SBS anyway? According to the Environmental Protection Agency,

SBS " describes situations in which building occupants experience

acute health and comfort effects that appear to be linked to time

spent in a building, but no specific illness or cause can be

identified. "

The syndrome can be caused by a wide range of factors, from building

design and maintenance to air circulation and hypochondria. That's

right. SBS often is in the minds of groupthink-seized employees. In

fact, in 1992 more than 40 EPA employees claimed the agency's

headquarters building was making them sick. The government promptly

shut the building down and began testing. But no SBS factors were

ever found, meaning it was literally a figment of employees'

imaginations.

But according to a 1996 study by Cornell University, at least one in

every five occupants working in one of every 35 buildings had

experienced symptoms of SBS. And according to the EPA, indoor

pollution can actually exceed the level of outdoor air pollution by

staggering multiples of two to 100.

As for the real cases of SBS, look no further than the energy crisis

of the 1970s to understand why SBS exists. At the time, fears about

continual energy shortages prompted architects to design energy-

efficient buildings. Meaning air-tight buildings. This led to

recirculated, stagnant indoor air, creating a plethora of indoor

illnesses.

Plus, a growing list of commonly used products now has been put on

the SBS hit list. This includes air fresheners, gas stoves, new

carpeting, hobby supplies, paint, pets, dry cleaning, chemicals and

garage car exhaust. These substances now are considered contributors

to declining indoor air quality, putting them – and homebuilders – at

risk of SBS litigation as well.

But back to the effects of SBS on commercial property owners. Once

SBS is detected, a wide array of expenses can be incurred. These

include everything from consultant fees, personal injury claims, new

roofing, windows, doors and HVAC systems.

When facing these potentially financially devastating bills, most

property owners turn to their insurance companies. But insurance

firms have been attempting to turn claimants away by relying on

something called the " absolute polluter's exclusion. "

The insurance industry started placing this exclusion in its policies

about two decades ago. These clauses were meant to limit liability

from damages resulting environmental pollution – the outdoor kind.

Faced with large claims from indoor pollution, the industry is

understandably attempting to avoid paying out. But they are not

winning their cases. For the most part, courts are siding with

builders, property owners and others trying to stick their insurers

with the bill.

Several cases are currently in the system, however, that may change

this trend. In the meantime, insurance companies will continue to

bear the burden of SBS remediation and litigation.

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Nan

http://www.airbrains.bizland.com