Over the weekend, there was a good blog post on Schnapf LLC Blog discussing which Phase I standard lawyers and consultants should use for at least the rest of 2013. Due to an unanticipated reversal by U.S. EPA, there is a gap right now between the current ASTM standard and EPA's recognized standard for Phase I's for compliance with the "All Appropriate Inquiries" Standard (AAI).
On November 6th, ASTM officially recognized E1527-13 as the new standard for conducting Phase I environmental assessments. As a practical matter, this means ASTM E1527-13 represents current best practice in the industry.
However, as discussed in a prior post, U.S. EPA reversed course and withdrew a direct final rule that would have recognized both E1527-13 and E1527-05 as meeting AAI. As a result, the only standard EPA currently recognizes as satisfying AAI is E1527-05.
The post discussed the quandary caused by the current gap between sanctioned standard and the most up-to-date standard:
So what is a consultant to do for transactions requiring a phase 1 prior to EPA formally recognizing E1527-13? On the one hand, by publishing E1527-13, ASTM is essentially saying that the new version now represents good commercial practice. Thus, a consultant failing to use the most current version of E1527 could expose a consultant to professional negligence claim if, for example, the consultants fails to identify a REC because it did not do a file review or fails to evaluate the soil gas pathway. This would seem to tip the decision towards using E1527-13.
However, E1527-13 is not yet recognized as an acceptable method of satisfying AAI. Thus, if the purpose of the phase 1 is to comply with AAI, a consultant stating that its phase 1 complies with AAI could be subject to breach of contract or claims of misrepresentation since only E1527-05 is currently recognized in the AAI rule.
The biggest differences between the two standards is the more defined requirements pertaining to file reviews and analysis of the vapor intrusion pathway. It is pretty clear the E1527-13 requires additional work. Arguably, a Phase I that meets E1527-13 should also be consistent with E1527-05.
For an attorney, you will want the consultant preparing the Phase I report to state it meets the current EPA recognized standard- E1527-05. Without such a reference it is possible your client hasn't satisfied AAI.
A consultant will want to comply with the standard recognized in the industry as the best practice- E1527-13. Otherwise, one may argue the consultant isn't utilizing current best practice.
It may be best to discuss the issue with your consultant and see if they are comfortable stating in the report that the Phase I meets both standards. That may be the best alternative until EPA officially sanctions E1527-13.