LEAD-BASED PAINT ABATEMENT:
DEVELOPING LIABILITY ISSUES
by Denise E. Farris, Esquire*
In 1980, it was reported that over 800,000 workers were exposed to airborne lead in the workplace, resulting in such health risks as kidney damage, as well as damage to the peripheral and central nervous systems. [i] In response to the health hazards associated with exposure to airborne lead in the workplace, the Occupational Safety and Health Administration (“OSHA”) developed regulations designed to protect workers from excessive lead exposure.[ii] In addition, contractors working on older project renovations are also subject to compliance with a myriad of other regulatory and statutory requirements designed to protect the worker and public from lead poisoning.
Until recently, the majority of cases addressing liability issues relative to abatement of lead-based paint occurred in the residential landlord/tenant relationship. Unlike its environmental cousins, polychlorinated biphenyls (“PCB”) and asbestos, lead-based paint has remained a relatively unnoticed and remarkably low-key issue in residential and commercial construction. However, numerous medical studies now conclusively link overexposure to lead-based paint to serious long-term health problems.[iii] These studies, viewed in conjunction with the prevalence of lead-based paint in virtually all buildings constructed prior to 1978, render lead based paint abatement a construction liability issue potentially exceeding that raised by asbestos nearly a decade ago. This article addresses construction liability issues related to lead-based paint activities in the residential and commercial construction context, with a particular focus on statutory, regulatory and contractual obligations, licensing requirements, and disclosure requirements.
II. FEDERAL STATUTORY AND REGULATORY ISSUES
Understanding the developing litigation issues related to lead based paint abatement requires an understanding of the various pieces of Federal legislation governing the treatment of lead-based paint and/or lead products. For the past 15 years, the Environmental Protection Agency (“EPA”) and the Consumer Product Safety Commission (“CPSC”) have aggressively banned or significantly reduced lead in gasoline, paint and plumbing products.[iv] This legislation was followed by additional legislation aimed at disclosure of lead-based paint hazards, abatement training, and testing, summarized below.
A. Housing and Community Development Act of 1987
This Act required the Department of Housing and Urban Development to undertake a comprehensive program for testing and abatement of lead-based paint in all public and Indian housing units built before 1978.[v]
B. Residential Lead-Based Paint Hazard Reduction Act
Also known as Title X, §1018 of this law directed HUD and EPA to require the disclosure of known information on lead-based paint and lead-based paint hazards before the sale and lease of most housing built before 1978.[vi] Subtitle B of Title X concerns training and certification of contractors working with lead-based paint hazards.[vii] Under Title X, the Occupational Safety and Health Administration (“OSHA”) developed standards for exposure to lead and protection from exposure to lead for construction workers.[viii]
C. HUD Lead Paint Disclosure Regulations
HUD regulations regarding the disclosure of lead-based paint hazards are found at 24 CFR 35, entitled “Lead Based Paint Poisoning Prevention In Certain Residential Structures”. The regulations target residential dwellings that were constructed prior to 1978, including common areas in multifamily housing structures and dwellings commonly used by children, such as a child care centers. The effective dates of the regulations are September 6, 1996 and December 6, 1996 for owners of 5 or more dwellings and owners of 1 to 4 dwellings, respectively. The disclosure requirements assure that purchasers and tenants of housing constructed prior to 1978 are notified of the hazards of lead-based paint which may exist on the dwelling; of the symptoms and treatment of lead-based paint poisoning; and of the importance and availability of maintenance and removal techniques for eliminating such hazards. Sellers, agents and lessors must retain documentation of compliance for no less than three years. [ix]
The penalties for non-compliance include fines of up to $10,000 for civil infractions; fines of up to $25,000 and one year in jail for criminal violations; and treble damages plus attorneys fees in private civil suits. Violation of the regulation does not invalidate the sale or lease contract.
D. Lead Based Paint Poisoning Prevention Act (LBPPPA) 42 U.S.C. 4822
Enacted in response to the 1989 HUD Independent Agencies Appropriations Act, the LBPPPA establishes guidelines for testing abatement, cleanup, and disposal of lead-based paint in public and Indian housing. It requires the housing authority to conduct random sample of dwellings and common areas where children live or are expected to live.
E. Worker Safety
The OSHA standards for occupational safety, health and environmental controls, found at 29 C.F.R. §1926, were amended in 1993 under new §1926.62, containing employee protection requirements for construction workers exposed to lead. The OSHA construction standard applies, but is not limited to, (1) demolition or salvage of structures where lead or materials containing lead are present; (2) removal or encapsulation of materials containing lead; (3) new construction, alteration, repair or renovation of structures, substrates, or portions containing lead or materials containing lead; (4) installation of products containing lead; (5) lead contamination from emergency cleanup; (6) transportation, disposal, storage or containment of lead or materials containing lead on the site or location at which construction activities are performed; and (7) maintenance operations associated with construction activities described above.[x]
The Amendment sets maximum limits of exposure to workers, referred to as the Permissible Exposure Limit (“PEL”). No employee may be exposed to lead at airborne concentrations greater than 50 ug/m3 (50 micrograms of lead per cubic meter of air) averaged over an 8 hour period.[xi] If an employee is exposed to lead for longer than an eight hour period in any work day, the employee’s permissible exposure should be reduced by 400 divided by the total number of hours worked in the day.[xii]
The amendment also establishes an “action level”, above which the employer must perform monitoring. If there is any lead presence in the workplace, the employer is required to make an initial determination by monitoring the employee’s exposures to determine whether the employees are exposed to lead in excess of the action level. The action level is equal to thirty micrograms of lead per cubic meter of air averaged over an eight hour day.[xiii] If employee exposure is above the action level and PEL level, the employer must monitor quarterly, continuing until two consecutive measures are at or below the PEL. Employees must also be advised in writing of the employee’s exposure assessment results within 5 working days after its receipt.[xiv] Until the monitoring reflects that exposure limits are at or below the PEL, the employer is required to treat employees performing certain tasks as though they are exposed to lead in excess of the PEL, and to provide those employees with respirators, protective clothing and biological monitoring.[xv]
F. EPA Regulations
EPA’s regulations include, among other requirements, a mandate that all lead inspections, lead hazard screens, risk assessments and abatement activities be conducted by certified personnel in accordance with specific work practices designed to inform and protect the individuals most likely to be exposed to lead.
Recently, the EPA revised its regulations concerning abatement work practices to add a “de minimus” rule which excludes certain small scale projects involving lead handling.[xvi] Under regulations that went into effect on March 6, 2001, EPA exempted certain projects from the work practice requirements (i.e. occupant protection procedures, clearance testing, use of certified personnel and other similar specialized lead hazard control practices and procedures) for conducting lead-based paint activities under both EPA’s regulations and HUD’s regulations. The exempted projects are those where the paint-lead hazards are less than:
1) Two square feet of deteriorated lead-based paint per room or equivalent;
2) Twenty square feet of deteriorated paint on the exterior building; or
3) Ten percent of the total surface area of deteriorated paint on an interior or exterior type of component with a small surface area.
G. Other Federal Regulations
In addition, building contractors should be aware that separate federal regulations may have an overriding application to construction projects based upon the ultimate intended use of the facility. For example, building renovations designed to house children of head-start age (i.e. 3 to 5 years old), are subject to 45 C.F.R. 1304.53(a)(8) and (a)(10)(ix), which mandate that any day care center receiving federal funding must be lead-free, or in the alternative, the lead presence must be in an amount deemed “non-hazardous” to the minor occupants.
H. State and Local Lead Abatement Laws
1. Missouri Lead Abatement Statutes and Regulations
Missouri currently requires lead abatement contractors for any lead abatement project to be licensed. Missouri has also enacted notification and work practice requirements for lead inspection and abatement projects.
2. Kansas City Ordinance, Chapter 34
Kansas City’s “Lead Poisoning Control” Ordinance, Sec. 34-401 et seq., applies to all buildings or portions of buildings occupied or inhabited by humans. It prohibits the construction, erection, remodeling, or alteration of any dwelling that has exposed lead-bearing substances; or repairing, renovating, or demolishing any dwelling that might result in any person being exposed to lead bearing substances or their dust, debris, or contaminants. It is unlawful to apply any lead-bearing coating (including paint) on any interior or exterior surface of a dwelling, any toy, piece of furniture, or to sell any lead-bearing coating.
The city has the right to enter into any dwelling to inspect for the presence of lead-bearing substances and has subpoena power to enter in the event that access is denied. If a violation is determined, the owner must submit, within 14 days of notification, a plan acceptable to the Kansas City health authority for remediation of the lead paint. If the plan is rejected, a hearing can be requested. Failure to remediate can lead to prosecution. The penalties can include declaration of the building as a nuisance (including ordering the building to be vacated until remediated), fines up to $500 and imprisonment up to 180 days.
IV. 1997 AIA A201 GENERAL TERMS AND CONDITIONS
In the past, lead-based paint was not considered a “hazardous material” per se. As a Massachusetts court recently held: “[L]ead paint is not hazardous when it remains embedded in a wall; it becomes so only when it is somehow released from the wall and ingested by humans.”[xvii] Reflecting this traditional viewpoint, the 1987 version of the American Institute of Architects AIA A201 General Terms and Conditions, Commercial Construction Contract, defined hazardous materials as including only asbestos and polychlorinated biphenyls (PCB’s). If either asbestos or PCB was discovered by the contractor, the contractor was entitled, upon written notice to the owner, to stop work until the materials were removed or rendered harmless.[xviii] The contractor would also be entitled to recover performance extension and delay damages for the interrupted time. Prior to 1997, no similar provisions existed relative to the discovery of unanticipated lead based paint. This left the contractor in the position of incurring significantly higher performance costs to comply with OSHA regulations on projects with lead based paint, with no corresponding contractual remedy save that of arguing, after the fact, a “changed condition”. Many contractors would also be unable to perform this work for lack of appropriate licensing, or applicable hazardous material insurance coverage.
This problem has largely been remedied through modifications made in the 1997 AIA’s model Construction Contract, A201 General Terms and Conditions. Specifically, the Terms and Conditions have been expanded to broadly include in their definition of hazardous material asbestos, PCBs, or “any other hazardous material”. If discovered, the Owner, following written notice by the contractor, must:
1. Retain a licensed laboratory to verify presence of hazardous material
2. Render the hazardous material harmless
3. Verify that it has been rendered harmless
4. Permit an extension of contract performance time, and
5. Allow the contractor “reasonable additional costs of shut-down, delay and start-up.” [xix]
Contractors who do not use the AIA A201 General Terms and Conditions and are performing on a pre-1978 structure should be sure to check the “hazardous material” definition clause in the contract, to ensure the definition includes lead-based paint.
The treatment of lead based paint in commercial construction remains subject to continued argument and modification. The “de minimum” exceptions play an important role in determining if or when abatement procedures must be followed. Sometimes these guidelines are ambiguous when applied to specific circumstances. However, contractors are urged to remember that good business practice stresses the importance of safety to the contractor’s workers, as well as to the general public. Accordingly, when facing lead based paint issues, the safest route is resolution of the issue in favor of maximum safety to all involved.
This article provides general coverage of its subject area. It is provided free, with the understanding that the author does not intend this article to be viewed as rendering legal advice or service. If legal advice is sought or required, the services of a competent professional should be sought. The author shall not be responsible for any damages resulting from any error, inaccuracy or omiss
* Ms. Farris acknowledges the assistance of Courtney Lieb in the preparation of this article. Ms. Lieb is a 1st year law student at the University of Missouri – Kansas City School of Law.
[xix] AIA A201 General Terms and Conditions, §§10.3.1; 10.3.2; 10.3.3 (1997). See also, Erickson , David R. and Bumb, Cathleen S., “Lead-Based Paint Regulations: A New Concern?”, 18 CONST. LAW. 4 (Oct. 1998).
A variety of liability issues regarding lead-based paint have been addressed in case law since the specific federal, state, and local statutes, regulations, and ordinances were enacted. The following summarizes some of the more recent cases dealing with abatement of lead-based paint in residential and limited commercial settings.
A. Actions Under Federal Tort Claim Act
Lancaster v. United States, 927 F.Supp. 887 (D. Maryland 1996). Tenant of VA Hospital staff housing brought action under Federal Tort Claim Act based on child’s exposure to lead paint. The Court granted the Government’s motion to dismiss finding: (1) prior hospital memo to residents established a policy regarding the lead-paint problem was general and thus did not deprive hospital officials of discretion, and (2) the decision regarding the scope of a subsequent warning to residents was a discretionary one grounded in economic and policy considerations.
B. Actions Against Lead Paint Manufacturer
City of Philadelphia v. Lead Industries Association, Inc., 994 F.2d 112 (3rd Cir. 1993). City and PHA sued lead paint manufacturers to recover costs associated with lead based paint abatement, asserting claims for product liability, negligent product design, strict product liability, negligent failure to warn, breach of warranty, fraud and misrepresentation, indemnification, restitution and punitive damages. The District Court granted Defendants’ motion to dismiss. Affirming on appeal, the court held that that Pennsylvania law would not permit recovery under theories of market share liability, alternative liability or enterprise liability.
C. Actions Against Landlords and Realtors
Williams-Ward v. Pitts, Inc., 908 F. Supp. 489 (D. Mass. 1995). A minor sued the manager of a HUD-owned apartment building for injuries that allegedly resulted from lead paint ingestion. The claims were asserted under the Massachusetts Lead Paint Act and the Court held that the Act was not preempted by any federal law. The Court further found that, under the Act, the manager was not the “owner” and that there was a genuine issue of fact as to the manager’s knowledge that a child under six years of ages resided at the premises that precluded summary judgment.
Davis v. Philadelphia Housing Authority, 121 F.3d 92 (3rd Cir. 1997). A minor, injured by lead poisoning, and his mother sued their landlord and the city housing authority under the Lead-Based Paint Poisoning Prevention Act and Pennsylvania state law. The District Court dismissed the case for lack of prudential standing. However, the Court of Appeals reversed the dismissal and held that the plaintiffs, as successors to the intended beneficiaries of the Act, satisfied the “zone of interest” test for prudential standing.
Chapman v. Mutual Service Casualty Insurance Company, 35 F. Supp. 2d 699 (E.D. Wisconsin 1999). A minor and his parents brought a negligence suit against real estate agency and vendor alleging faulty inspection of their home for lead-based paint. Overruling defendants Motion for Summary Judgment, the court held that (1) the residential real estate contract’s “as is” clause did not bar claims against the agency for the negligent hiring, supervision, and inspection of contractor hired to paint house in connection with the mortgage loan approval process; (2) the “as is” clause barred claims against the agency for failure to investigate and warn about the presence of lead based paint, but only to the extent those claims were based on duties not imposed by statute or regulation; (3) a genuine issue of fact remained as to whether the agency violated its statutory duty to investigate and warn; (4) that vendor did not have a duty to investigate or warn purchasers about the presence of lead based paint; and (5) vendor did not have a duty to exercise reasonable care in hiring and supervising the contractor hired to paint the house.
D. Actions Against Housing Authorities
Elliott v. Chicago Housing Authority 2000 WL 263730 (N.D.Ill.) Feb. 28, 2000. Mothers of lead-poisoned children brought putative class action against Chicago Housing Authority (“CHA”) for alleged “pervasive and systemic violations” of the federal lead-based paint statutes by failing to inspect for lead paint, to enforce lead paint abatement, and to notify tenants of potential lead-based paint .Plaintiffs were granted (1) mandatory injunctive relief requiring CHA to comply with the federal lead-based paint regulations and (2) an order requiring CHA to establish a fund to medically monitor children exposed to lead-based paint hazards as result of CHA’s failure to comply with federal lead based paint statutes and regulations.
Hurt v. Philadelphia Housing Authority, 806 F. Supp. 515 (E.D. Pa. 1992). Low income housing tenants brought class action against Philadelphia Housing Authority, the City of Philadelphia, HUD, Pennsylvania Department of Health, manufacturers and sellers of lead pigment and paint, and related trade associations to recover damages for lead poisoning. The Court held that (1) the tenants could sue the PHA, but not the City, to enforce the Lead Based Paint Poisoning Preventing Act and the United States Housing Act; (2) the tenants were the intended beneficiaries of annual contribution contract between HUD and PHA; and (3) theories of enterprise liability and market share liability could not be used in suit against manufacturers and sellers.
E. Actions Against Cities
Santiago v. Hernandez and City of New York, 1999 WL 279512 (E.D. NY 4/29/99). Mother brought suit, against New York City and her landlord, on behalf of herself and her infant child for injuries related to child’s lead poisoning. Claims were alleged under the Lead Based Paint Poisoning and Prevention Act, the Housing and Community Development Act; and common law. The City moved to dismiss the claim against it and the Court held that, even through the City was a recipient of federal funds designed to address such hazards, it had no duty to remove lead-based paint hazards in Plaintiff’s home when those hazards were more appropriately dealt with by the landlord.
F. Actions Against Insurers
Campbell v. Metropolitan Property and Casualty Insurance Company (200 WL 297174 (S.D.N.Y.) March 21, 2000). When there are elevated levels of lead in a child’s blood during a time period for which the landlord has liability insurance, the child is deemed to have suffered bodily injury during the policy period and is entitled to policy coverage.
Chapman v. Mutual Service Casualty Insurance Company, 35 F. Supp. 2d 693 (E.D. Wisconsin 1999). A minor, son of the purchasers of home, developed lead toxicity and brought a negligence action against the real estate broker and insurer that issued business-owner’s policy. The Court held that the policy’s “professional services” exclusion did not exclude coverage for broker’s alleged negligence in selecting painter, inspecting his work, and failing to warn purchasers about presence of lead-based paint.
G. Actions Against Contractors: Hazardous Waste Disposal
In Re: Leon Sloan, Sr., J & L Renovation Company and Jimmie L. Furby, 1996 WL 506267, HUDBCA No. 96C106D3, HUDBCA No. 96-C107-D4, HUDBCA No. 96C-108-C5 (1996). HUD suspended, and considered debarring, contractors as a result of alleged (1) irregularities surrounding the clean-up of waste from a lead-based paint abatement project; (2) improper disposal of debris from the project; and (3) failure to adhere to HUD regulations concerning proper protective gear for workers involved in the project. The contractors requested a hearing, at which the Government withdrew the third charge based on changes to the contract. The first charge was dismissed by the judge because the clean-up, although hazardous, was not deemed unsafe due to high levels of lead, which was the basis for the HUD charge. The second charge was also dismissed because the contractors were able to persuade the judge that they would not have improperly disposed of the construction debris if they had known of a recent change in the law that prohibited the dumping. As a result of the hearing, no contractor was debarred and their suspensions were terminated.
H. Contract Disputes
TDS Painting and Restoration, Inc. v. Cooper Beech Farm, Inc., 699 A.2d 173 (Conn. App. 1997). TDS entered into a contract with Cooper Beech Farm for renovation of the main building on the farm. The contract did not set forth lead abatement requirements; however, the majority of the work required exterior painting, with the required work areas to be “covered thoroughly and cleaned up daily”. The owner subsequently withheld payment when contractor allegedly allowed dust and chips from the lead paint to contaminate the surrounding property. The contractor took no lead abatement precautions, other than using tarpaulins and other coverings, but the owner was unable to prove that this was a deviation from industry standards. The Court held that the contractor was not liable for the lead contamination.