Duty of Disclosure - Asbestos

25-Aug-2014

Back in the late 1960's and throughout the 1970s a company called Mr Fluffy was kept busy installing deadly loose amosite asbestos insulation in at least 1000 canberra properties.

While these properties were the subject of a $100 million clean-up program between 1988 and 1993, the ACT Government recently indicated loose asbestos may still remain in wall cavities, sub floor spaces and underneath cornices.

Letters have now been sent to property agents warning of their legal responsibility to disclose any asbestos risk to prospective buyers and tenants.

Real Estate Institute of ACT chief Ron Bell has told 666 ANC Canberra that agents could face fines of up to $1.1 million, leading the institute to commission lawyers to draft questions or agents to include in property management and sale agreements.  The questions will specifically ask if the property is a Mr Fluffy house and if asbestos has been removed.

The issue of asbestos is unfortunately not limited to the ACT.  While each state and territory has different obligations specifically related to disclosure of material facts, real estate offices should also be aware of their more general duty of care to both employees and other persons including tenants.

Originally thought to be an incredible product, the dangers of asbestos have been well documented since the early 1980's. While asbestos-related health issues can take many years to develop, employees or tenants who are exposed to asbestos may well have grounds for a lawsuit against the landlord and/or agent in the future.

Properties constructed after 1983 are unlikely to contain asbestos but for older properties, property managers should ideally exercise due diligence by conducting a risk assessment.  This would include asking the owner during the initial inspection: The property's age; the date of any renovations and whether the landlord is aware of any asbestos on the property. If there is any doubt the owner should be strongly encouraged to engage and expert to assess the property.

If asbestos products are identified on the property, to minimize future risk, property management agencies will need to ensure they have appropriate strategies to ensure the health and safety of staff and tenants.