Is it usually the buyer or the seller who pays for a Phase 1 Environmental Site Assessment in Ontario?

There's no fixed rule requiring either side to pay; who arranges and pays for a Phase 1 Environmental Site Assessment is a matter of negotiation between the parties, and practice varies by deal. Most commonly, a buyer arranges and pays for the Phase 1 as part of their own due diligence, since the report is being obtained to protect the buyer's decision about whether and on what terms to proceed, and a report commissioned by the buyer is typically more useful to the buyer's lender as well.

In some transactions, particularly where a seller wants to make a property more marketable or a lender requires proof of environmental condition before listing, a seller may commission a Phase 1 in advance and share it with prospective buyers, sometimes with an agreement that the buyer can rely on it directly or obtain their own reliance letter from the consultant. Buyers relying on a seller-commissioned report should have their own lawyer confirm they can legally rely on its conclusions, since a report addressed only to the seller may not automatically protect a buyer who didn't commission it. Cost allocation, and reliance terms, are worth addressing explicitly in the agreement of purchase and sale.