Can I include an oil tank condition in my Ontario offer?
Yes, if a property has or may have had an above-ground or underground fuel oil storage tank — commonly used in older homes for heating before the switch to natural gas — including an inspection condition is advisable. An underground oil storage tank that has leaked can cause significant soil contamination, and remediation costs can run from tens of thousands to hundreds of thousands of dollars depending on the extent of contamination.
An above-ground oil tank should be inspected for condition, age, and any signs of leakage. Underground tanks — even decommissioned ones — may have leaked without any visible evidence. A qualified environmental inspector can test the soil around buried tanks. You may also want to ask the seller directly whether any tanks exist or were ever removed, and include that disclosure as a warranty in the offer.
In Ontario, environmental contamination of soil can create liability for the property owner, even if the contamination occurred before their ownership. A lawyer can help you understand your exposure and whether the inspection results are serious enough to walk away.
Key takeaways
- Fuel oil storage tanks can cause costly soil contamination if they have leaked.
- Include an inspection condition for any known or suspected tanks on the property.
- Underground tanks can leak without visible evidence — environmental testing may be needed.
- Environmental liability can follow the property to a new owner; seek legal advice if contamination is found.