Real Estate Investor Magazine South Africa September 2013 | Page 50
LEGAL MOVES
BY PATRICK FORBES
Environmental Indemnification
Look a little closer at the laws
O
ver the past 15 yea rs since the
promu l g at ion of t he Nat iona l
Environmental Management Act
(NEMA), there has been an array of further
environmental litigation that has entered our
legal landscape. This raft of laws has however
created a highly reg ulated env ironment
within which to operate, and business has
accordingly sought to identif y the risks
associated with falling foul of such legislation
and to identify the necessary means to avoid
those risks where possible.
The reaction from the market place to the
onslaught of “green law” has been varied,
depending largely on the sector in which a
particular business operates, but there has
certainly been a clear acceptance by business of
the legislation that has been passed to regulate
and control our interaction with the natural
environment around us.
Part of this acceptance by business is evident
from property agreements relating to purchase
and sale transactions, leases and mortgage
bonds amongst others, in which there is a
proliferation environmental indemnification
clauses in one form or another. These clauses
are drafted, depending on the nature of the
agreement, with a view to minimising the
risk to one or other party entering into the
agreement, for environmental damage and the
costs that may be associated with remedying
any such damage. But how effective are these
indemnifications, and do they adequately cover
the parties for the risk posed?
Part of this raft of green legislation is the
National Environmental Management Waste
Act (NEMWA), which deals with, amongst a
number of other aspects, the classification, the
disposal, the recycling and the treatment of
waste. When NEMWA was brought into force
there were, however, certain provisions that
were not brought into operation at the time the
act was promulgated and will only to be in force
at some unknown later date. Nonetheless,
consideration of these provisions may reveal
48
September 2013 SA Real Estate Investor
certain shortcomings in the
legislation and it is therefore vital to
ensure that indemnifications serve
their purpose for the party seeking to be
indemnified.
Sections 35 - 41 of NEMWA, the remediation
or contaminated land provis [??[ ?Y???? Y][????K\?H ?] ??X??YHY??X?]?B?] ??YH]\?]K?\?H ??\?[??[? Z\???\??[? ??[?? ?[[???? [H ??B?\ YY ?] ???X?]?[ K[??\? ?? ??\ X?X?H ??\??[\?[??\? ]X^H]?B?Z?[? X?H ?[? ? H]?X? X[ H??Z[??[??Y??X? ?\?\? [?\?X[[?HY?[??^ ??]]YX[?? ]?H\????Y ? Z?B????\?[??H???? ?]\?[?[?Y\? B? ??\?[??X^H]?H[?[\X? \?X?[?Z?[??????[?[? H \? ??[??\? ? [?\??[? H?] \?H???[??[?[[?] H ?[? ?[?? ??YH H ??X?[????Y? ?H?YY ??\?? ?^[Z[?H?? B?? ????Y??[Z[?]Y?[? ??\?[?? ?[?\?]K??H ??\?[??[???? HZ[?\?\??? HQP? ?Y[?Y?H??[Z[?]Y?[??H ?^H?H??X?H ??H X?\?Y?[? H??\??Y[??^?] K?H??X?H ?B?\?X?[\? \??? ?Y[?Y?H ?]\? \?YY?[?8?'[??\?Y?][?\?Xx?'K???H H[??\?Y?][??\?XH\?\?X?\?Y HZ[?\?\??QP?X^B?[??]\?HH ?]H[??\?Y?][? ? Z?H X?B??H\?X?[??Z]\? H??\?? H ??\? B??][? ?X? H[??\?Y?][?\?XH\???]Y ?? H \????? X?[?? HX?]?] H ]\??]\?Y?X^H]?H?]\?Y H??[Z[?][? ??? X?H ?]H\??\??Y[? ???HH ?]H\??\??Y[???\?\??Y[???\]Y???Y\?Y \?B?\?H??\?? [??]?Z[X?H ? HZ[?\?\???QP?[? ?\?X?? H[??\?Y?][?\?XK?JB]?X?\?H]H ?\?? ] ?\??[? ?[[YYX]B??[YYX][???B]?X?\?H]H ?\?? ] ?\]Z\?\? ?[YYX][???\?H ?X?Y?YY \?[? ???˜?Z[XY????B??