A federal court in New York has absolved from liability under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) owners of property adjacent to a church from which groundwater containing contaminants had migrated. Alprof Realty LLC v. Corp. of the Presiding Bishop of the Church of Jesus Christ of Latter-Day Saints, No. 09-5190 (E.D.N.Y. 9/13/12).

Before the church acquired the property in Far Rockaway, New York, releases of solvents and petroleum constituents had occurred there. Over time, contaminated groundwater migrated from the church property to adjacent properties owned by the plaintiffs, two real estate companies. Plaintiffs sued the church to recover the costs of responding to the contamination, and the church counterclaimed, asserting that the plaintiffs were liable under CERCLA as owners of a property where hazardous substances had come to be located.

The church had acquired the property knowing about the past releases and conducted an investigation and remediation, including removal of contaminated soil. In its counterclaim, the church asserted that migration of contaminated groundwater from the church property to the plaintiffs’ properties rendered the three properties a single “facility” for CERCLA purposes. The church argued that plaintiffs therefore were owners of part of the facility and directly liable under CERCLA.

According to the court, the mere presence of contamination on adjacent properties does not make them a single CERCLA facility, unless they were owned and operated together as a single waste disposal facility that released hazardous substances onto all three properties. Finding that the properties had not been managed or operated together, the court held that groundwater migration from a CERCLA facility across property boundaries did not render the neighboring properties part of the original facility for CERCLA purposes. The court therefore dismissed the church’s original CERCLA counterclaims.

Ongoing investigations had identified potentially separate releases on one of the plaintiffs’ properties, and the church filed an amended counterclaim asserting that this owner was liable as the owner of a separate CERCLA facility. The court dismissed this claim, too, finding no evidence that the church had incurred costs to address the alleged releases on the adjacent property. The church also asserted common law unjust enrichment and restitution claims, which the court dismissed for lack of evidence that the church had either undertaken a burden properly belonging to the plaintiffs or bestowed a benefit on them.