Country
United States of America
Sources
InforMEA
Tagging
Liability, Torts, Burden of Proof, Contract, Precaution, Evidence, Inspections, Property, Damages
Abstract
he Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) is designed to promote the cleanup of hazardous waste sites and to ensure that cleanup costs are borne by those responsible for the contamination. In 1960, Brown & Bryant, Inc. (B&B), an agricultural chemical distributor, began operating on a parcel of land located in Arvin, California. B&B later expanded onto an adjacent parcel owned by petitioners Burlington Northern and Santa Fe Railway Company and Union Pacific Railroad Company (Railroads). As part of its business, B&B purchased and stored various hazardous chemicals, including the pesticide D-D, which it bought from petitioner Shell Oil Company (Shell). Over time, many of these chemicals spilled during transfers and deliveries, and as a result of equipment failures. nvestigations of B&B by the California Department of Toxic Substances Control and the federal Environmental Protection Agency (Governments) revealed significant soil and ground water contamination and in 1989, the Governments exercised their CERCLA authority to clean up the Arvin site, spending over $8 million by 1998. Seeking to recover their costs, the Governments initiated legal action against Shell and the Railroads. The District Court ruled in favor of the Governments, finding that both the Railroads and Shell were potentially responsible parties under CERCLA--the Railroads because they owned part of the facility and Shell because it had "arranged for disposal ... of hazardous substances," through D-D's sale and delivery. The District Court apportioned liability, holding the Railroads liable for 9% of the Governments' total response costs, and Shell liable for 6%. On appeal, the Ninth Circuit agreed that Shell could be held liable as an arranger under §9607(a)(3) and affirmed the District Court's decision in that respect. Although the Court of Appeals agreed that the harm in this case was theoretically capable of apportionment, it found the facts present in the record insufficient to support apportionment, and therefore held Shell and the Railroads jointly and severally liable for the Governments' response costs. Overturning the Ninth Circuit Court of Appeals, the Supreme Court held that Shell could not be held liable as an arranger of disposal of hazardous waste, where the evidence failed to show that Shell took any intentional steps to dispose of its hazardous sales product during the transfer of its product from a common carrier to B&B's storage tanks. Shell's selection of the common carrier and mere knowledge of continued accidental spills during the transfer process did not constitute a plan for intentionally arranging for the disposal of a hazardous waste, particularly where Shell took intentional steps to reduce accidental spills through issuing instructions and providing financial incentives for B&B to reduce the likelihood of transfer spills. The Supreme Court overturned the Ninth Circuit's finding of joint and several liability for the Railroads and affirmed the factors the District Court used as its reasonable basis for apportioning and limiting the Railroads' liability to 9% of the total $8 million clean up costs. Although the evidence adduced by the parties did not allow the District Court to calculate precisely the amount of hazardous chemicals contributed by the Railroad parcel to the total site contamination or the exact percentage of harm caused by each chemical, the evidence showed that fewer spills occurred on the Railroad parcel and that not all of them crossed to the B&B site, where most of the contamination originated, thus supporting the conclusion that the parcel contributed only two chemicals in quantities requiring remediation.