Should I make my offer conditional on a Toxicology Report?

On 29 May 2018, the Office of the Prime Minister’s Chief Science Advisor produced a report on Methamphetamine Contamination in residential properties.  Most of us will remember the various headlines in the newspaper and on the news and social media; “Meth house contamination debunked by PM’s science advisor” or “The Meth House is a Myth”.

Prior to the report toxicology reports, or “meth tests”, were commonplace and seen as an essential part of any purchaser’s due diligence investigation.  Since the report toxicology reports have fallen out of favour.  We have seen a rapid decline in purchasers opting to select “YES” to make their offer conditional on a toxicology report.

What was in the report?

The report mainly relates to health effects of third hand contamination in properties and compares the contamination levels from smoking meth to those from the manufacture of meth.

The report was produced to create discussion around the methods of testing, to establish more guidelines, and states that there is a clear need for more research.

In particular, the report noted that:

• There is evidence of “adverse physiological and behavioural symptoms associated with third hand exposure to former meth labs”.
• Lower levels of meth contamination do not rule out manufacture, and cleaning down to the former standard of 1.5 µg /100cm² may be necessary if you suspect manufacture within the house. However, it is not possible to conclusively determine whether a property has been used for manufacture or smoking based on the levels of meth found.
• That a level of 15 µg /100cm² may be more realistic, compared to the former guideline of 1.5 µg /100cm².
• Decontamination is only recommended for identified former meth labs or properties where excessive meth use, indicated by high contamination, has been determined.

Our advice

Our advice to you as a landlord, purchaser or homeowner, is to still have the property tested for meth. 

You will need to consider:

• The “on sale” aspect of purchasing a contaminated house which may have the stigma of being a “meth house” and could prove harder to sell.
• Your mortgagee/lender and insurance company, and what their requirements are in terms of a contaminated house.
• Whether you (or your tenants) would expect the house to be entirely contamination-free. Occupants with respiratory issues or weakened immunity systems may be more susceptible to health issues associated with meth contamination, even at lower levels.
• If it is an investment property, will a toxicology report be required by your Property Manager?

Putting aside these issues, it may come down to personal choice as to what you would accept as an acceptable standard of contamination, versus what the Ministry of Health guidelines state.  These differences may be vast.

If you are looking at purchasing a house, we suggest that you contact our office so that we can discuss these matters further and if necessary, provide you with a suitable condition to insert in your sale and purchase agreement, to cover your requirements. 

Kerri is a Senior Legal Executive in our Property Team and can be contacted on 07 958 7423.