USA - SOUTH CAROLINA Law and Practice Contributed by: Matt Norton and Christian Kolic, K&L Gates
tiation for the price of endorsements. Although not typical, in some transactions the seller will tender a basic title commitment for review by purchaser’s counsel. Surveys Purchasers are advised to obtain new surveys meeting the standards set forth by the American Land Title Association (ALTA) and the National Society of Professional Surveyors, Inc (NSPS). These standards contain a number of option - al survey coverages and certifications; South Carolina counsel will provide guidance as to the optional provisions appropriate to the specific project. Surveys are necessary to adequately identify and locate encroachments (on or off the property), identify and locate easements and other possible title issues, and specifically locate on the property the exceptions identified in the title commitment. Zoning and Entitlement Zoning and entitlement due diligence likewise will be conducted by purchaser’s counsel by direct contact with the applicable planning and zoning officials to obtain a “zoning letter”; this due diligence may be supplemented by a zoning report obtained from a national provider. Environmental Environmental due diligence will consist at a minimum of a Phase I environmental survey fol - lowed by a Phase II environmental survey, as necessary. Properly conducted environmental surveys may provide a purchaser with a defence against unlimited liability for existing contamina - tion on the property, which otherwise attaches to parties in the chain of record title. In order for a purchaser to obtain this defence, there are number of technical requirements that must be complied with in connection with the environ - mental surveys.
With respect to contaminated properties, pur - chasers may enter into a voluntary clean-up contract with the state authorities in order to limit environmental claims. The ability of the purchaser to enter into such a voluntary clean- up contract, however, is subject to a number of technical requirements. For example, the clean- up contract must be in place prior to the time the purchaser obtains title; otherwise, the purchaser may have full joint and several liability for envi - ronmental contamination on the property. Even if an agreement is reached with the state environ - mental authorities, this is no guarantee that the protections in the agreement will be recognised by the federal environmental authorities. Identification of Wetlands Federal and state regulation precludes develop - ment of or damage to many kinds of wetlands and regulates the discharge of stormwater runoff into the wetlands. Wetland regulations are high - ly technical; the purchaser may be required to restore damaged wetlands (typically at consider - able expense) if rules are not fully complied with. Should wetland impairment be necessary for an economically viable development, such impair - ment may be permitted if the purchaser makes an appropriate investment in a “wetland bank” that ensures the preservation of a comparable amount of wetlands located elsewhere. Physical Condition Due diligence as to the physical condition of the property is typically undertaken by engineers or consultants retained by the buyer or by way of a property condition report. If construction is contemplated, geotechnical soil tests will be conducted to determine the suitability of the site for construction.
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