Environmental Advisory Bulletin
U.S. Supreme Court Denies Recovery of Cost Incurred
in Performing Independent Remedial Action
By Ame
C. Wellman
[December 2004]
As a result of a United States Supreme Court ruling
last week, private parties who perform independent remedial actions
may be barred from recovering such costs from other potentially
responsible parties (PRPs). Absent a cleanup order from the government,
private parties who perform cleanup actions may not be able to seek
contribution from other PRPs.
The Aviall Decision
On Dec. 13, 2004, the U.S. Supreme Court issued a
decision that may curtail private contribution actions under the
Comprehensive Environmental Response, Compensation, and Liability
Act of 1980 (CERCLA), also known as Superfund. In Cooper Industries,
Inc. v. Aviall Services, Inc., Case No. 02-1192, 543 U.S. _____
(2004), the Supreme Court interpreted CERCLA as specifically limiting
contribution actions brought by private parties under § 113(f)(1).
The court ruled that a party may only bring a § 113(f)(1) contribution
action to recover costs from other PRPs when the United States or
a state has taken action against it under § 106 or § 107.
In Aviall, contaminated aircraft engine maintenance
sites in Texas were sold by Cooper Industries to Aviall. Aviall
subsequently discovered that the sites were contaminated by the
onsite operations of Cooper and Aviall. A Texas agency notified
Aviall that it was in violation of Texas environmental laws and
directed it to clean up the property or risk having an enforcement
action brought against it. Accordingly, Aviall voluntarily remediated
the property under agency supervision and filed a contribution action
against Cooper for its allocable share of the clean-up costs.
The Supreme Court held that Aviall could not seek
contribution from Cooper under § 113(f)(1) because Aviall had
not been the subject of an action brought by the United States or
Texas under CERCLA. The Court read the language of § 113(f)(1),
which states that a party “may seek contribution…during
or following any civil action” brought under § 106 or
§ 107…”, to mean that contribution actions are
allowed only when the government has asserted such a claim
against the party seeking contribution. Notably, the Supreme Court
declined to rule on two additional issues: (a) whether a PRP can
recover response costs for a voluntary cleanup under § 107;
and (b) whether there is an implied right of contribution under
§ 107. Some courts, including the Ninth Circuit, have held
that a PRP cannot bring a § 107 action because such claims
may only be brought by government agencies and "innocent"
plaintiffs (i.e., those parties without any culpability
or liability).
Potential Impacts of Aviall
Aviall flies in the face of conventional
interpretations of CERCLA. Prior to this decision, most courts allowed
private parties who voluntarily cleaned up a contaminated site to
bring a contribution suit under § 113(f)(1) to recover their
costs from other PRPs. While many parties will likely still have
a right of contribution for voluntary cleanups under state Superfund
laws, this new interpretation of CERCLA may result in a number of
notable impacts, such as:
- Private parties may be disinclined to clean-up contaminated
properties if it is possible that they will not be able to recover
those costs from responsible parties. As a result, cleanup actions
may be delayed until government enforcement actions force PRPs
to perform a cleanup.
- State Superfund statutes may be interpreted to limit private
contribution actions in the same way, particularly if the state
statutory language is similar to CERCLA.
- The Aviall decision may spur a call to amend CERCLA
to provide for contribution actions by private parties who voluntarily
clean-up contaminated properties.
For More Information
Davis Wright Tremaine has successfully
assisted clients in disputes involving liability for hazardous substances,
including contribution and cost recovery actions, involving facilities
throughout the western United States. We have the expertise and
experience to help you develop an effective strategy for dealing
with these disputes. We welcome the opportunity to meet with you
and discuss your individual legal needs.
For further information, contact:
Lynn
T. Manolopoulos, Bellevue, (425) 646-6146, LynnManolopoulos@dwt.com
Richard
M. Glick, Portland, (503) 778-5210, RickGlick@dwt.com
Lawrence
B. Burke, Portland, (503) 778-5239, LarryBurke@dwt.com
This Environmental Law Advisory is a publication of the Environmental
Law Department of Davis Wright Tremaine LLP. Our purpose in publishing
this Advisory is to inform our clients and friends of recent developments
in environmental law. It is not intended, nor should it be used,
as a substitute for specific legal advice as legal counsel may be
given only in response to inquiries regarding particular situations.
Copyright © 2004, Davis Wright Tremaine
LLP.
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