A city inserts lease language that "transfers" river-flood risk to riverside residents, even though residents cannot operate or fund the levees. Why is this transfer inappropriate?
Select an answer to reveal the explanation.
Short Explanation
You can't "transfer" the job of holding back a river to people who don't own the levees or the pumps. Transfer has to land on someone who can actually do something about the exposure — or truly finance it.
Full Explanation
Contractual transfer is effective only when the receiving party has meaningful ability to manage, finance, or control the exposure. Pushing flood responsibility onto residents who cannot operate river levees misaligns accountability and leaves the public exposure poorly treated. Organizations should assign transfer to capable parties or retain and reduce what only they can control.