On August 31, the Massachusetts Supreme Judicial Court (the highest court in the Commonwealth) decided that the local conservation commission (and presumably the state) can sue a new owner of real estate to require restoration of wetlands filled by a prior owner decades earlier, and that ability to sue a new owner renews for three years after each property transfer forever. Conservation Comm’n of Norton v. Pesa, SJC-13058 (Mass. Aug. 31, 2021). That holding not only enlarges liability, but perhaps complicates the diligence that prudent buyers will undertake.

In Massachusetts, conservation commissions have generally regulated work in wetlands since the 1960s under the Massachusetts Wetlands Protection Act, Mass. Gen. Laws chap. 131, § 40. One can fill or otherwise alter a wetland under an approval known as an “order on conditions.” One must restore a wetland altered without that authorization, and so must a subsequent owner.

The Act includes a three-year statute of repose for that new owner, running from the recording of the deed or the death that transferred title to the new owner. In Pesa, a prior owner, John Texeira, had filled wetlands in an area larger than what was approved on his order of conditions. The last filling occurred in 1984. He never received a certificate of completion. In 1996, he transferred the property to himself and his wife Ann. The Commission did not seek enforcement. John died in 2006, and Ann, then the sole owner, sold the property to Pesas in 2014. Before the transfer, the Commission noted the violation, and requested restoration. The transaction closed nonetheless.

The Superior Court decided that the statute of repose had run as to Ann Texeira, and therefore as to all subsequent owners.

The SJC decided to the contrary. The repose is personal. Each new owner is exposed to enforcement for a prior owner’s wetlands violations, for three years after the transfer. Here, the illegal filling occurred 30 years before the Pesas purchased the property.

The SJC observed that new owners would be on notice if, as here, the conservation commission issued an order on conditions, which would be recorded, but never granted a certificate of completion, which would also be recorded. But not all historical violations merely exceeded the limits of an order on conditions; some had no approval at all. Stay tuned on liability and on how transactional diligence will proceed going forward.