WATCO, a joint venture comprised of Wayne Todd and Wilson Holdings, LP v. Pickering Environmental Consultants, Inc., a Tennessee Corporation

The plaintiff, a real estate development company, conditionally agreed to purchase real property from a trustee bank if the bank first obtained a satisfactory “Phase I” environmental site assessment of the property. The trustee bank hired the defendant environmental consulting company to perform a Phase I environmental site assessment. After performing an assessment, the defendant prepared a report in which it represented that it had conformed with the applicable professional standard in its assessment, that it had not detected any hazardous materials or environmental concerns at the subject property due to current or past uses of the property, that it had not identified any significant environmental concerns in the surrounding area of the subject property, and that it did not recommend further environmental review of the subject property. The plaintiff purchased the subject property in 1995. During residential development of the subject property in 2004, the plaintiff discovered the remains of a municipal garbage dump which had previously existed adjacent to the subject property, and which extended under a portion of the subject property. The plaintiff had the garbage removed and the land filled, and development was delayed as a result. The plaintiff development company sued the defendant environmental consulting company, alleging professional negligence and negligent misrepresentation. A bench trial was held, and the trial court entered judgment in favor of the defendant. For the following reasons, we affirm.