Recent court decisions in the Illinois district court and in the Seventh Circuit have established new ground as to who can be held liable under CERCLA and RCRA, and how CERCLA liability will be apportioned.
Somebody in the Bank May Be in Need of Dry Cleaning Services
A bank in Illinois foreclosed on a residential property adjacent to a former dry cleaner site. The bank had failed to perform a proper environmental site assessment (ESA) and therefore missed that the adjacent site was a known to be a part of Illinois’ Voluntary Site Remediation Program. Post-foreclosure testing revealed that the plume of tetrachlorothylene (also known as perchloroethylene, or “perc”) and other contaminants from the dry cleaner’s 35 years of operations had migrated onto the property now owned by the bank. (Perc is known to be a potent carcinogen.) After much litigation, the dry cleaner was recently held responsible under CERCLA and RCRA for past response costs and for the declaratory judgment claim regarding future response costs, but it remains to be seen whether the decision will be upheld, and, if so, whether the bank will be able to collect. Forest Park National Bank & Trust v. Ditchfield, 2012 WL 302832, Case No. 10-C-3166 (N.D. Ill. July 24, 2012). Available here.
In for a Dime, in for a Dollar
Meanwhile, in the Seventh Circuit, the court followed §433A of the Restatement of Torts, which states that apportionment is not available whenever each tortfeasor’s contribution is independently capable of causing the harm, in holding that a party which contributed only 9% of the PCBs polluting a river can be held liable for the entire cost of remediation. The court relied on the classic example of individual fires that later merge before burning a building. Just as each fire starter would be found joint and severally liable, so would each corporation that discharged PCBs (polychlorinated biphenyls) into the Fox River in Wisconsin. To the dismay of NCR Corporation, the defendant in this case (and to those hoping that the Supreme Court in Burlington Northern had established the rule that volume could always be used as a basis for apportioning CERCLA liability), the court held NCR liable for all costs of remediating the river. The Court reasoned that the underlying harm is not divisible; therefore, it is irrelevant that NCR’s discharge of PCBs contributed to only 9% of the harm. In other words, the percentage of PCBs discharged in the river did not equate to percentage of harm, and therefore did not equate to the percentage of liability. (Full Court Opinion available here.)