Review and Evaluation of Lead Contamination Sources and Remediation Costs

The Challenge

The client required technical assistance in evaluating the nature and sources of lead contamination encountered in soil being excavated during their insured’s redevelopment of residential properties for construction of a new student housing complex and academic buildings.

The Solution

Vertex was retained by an international property and casualty insurance carrier to assist them in their review of environmental impacts and claimed damages for alleged remediation costs submitted by an insured pursuant to an environmental/pollution insurance policy. The claim pertained to a redevelopment project being performed by a university in which residential houses were being demolished for the construction of a new student housing complex and academic buildings.

In conjunction with excavation of soil for the redevelopment, testing of the soil showed levels of lead to depths of up to 3-feet that exceeded regulatory standards allowing for reuse. This resulted in portions of the excavated soil having to be disposed of at properly permitted off-site facilities, with associated costs incurred.

The Outcome

Vertex‘s review distinguished between lead related to lead based-paint fragments found to be present in the upper 6-inches of soil, attributed to demolition of the houses on the site, and lead found at greater depth which Vertex concluded was historic in nature and not related to the recent house demolition. Because the Insured’s policy did not provide coverage for historic contamination, only new pollution conditions, Vertex’s analysis resulted in a reduction of the claimed costs, and the carrier’s liability, of approximately 50%, in accordance with the terms of and coverage provided by the Insured’s pollution policy.