ELR Citation: ELR 21547
No(s). CV-91-4146 (CPS) (E.D.N.Y. Mar 30, 1993)

The court holds that the corporate successor of the former owner of a contaminated site is liable under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) to the current site owner for past and future response costs that conform to the national contingency plan (NCP) and are not contractually barred. In its contract with the former owner for the purchase of the site, plaintiff current owner agreed that it was taking title to the site subject to any notices of violations of law, municipal ordinances, or state or municipal orders issued after the contract date. The court first rejects the defendant successor's argument that the site can only be remediated pursuant to an order of the New York Department of Environmental Conservation (DEC) and that any site remediation thus falls within the contract's assumption provision. The applicable New York statute does not require the current owner to remediate the site, although the law does require that the DEC take some action and authorizes the DEC to require the responsible party to bear the cost of the remediation. Also, no city ordinance requires plaintiff to clean up the site. Plaintiff will have a duty under the City Environmental Quality Review (CEQR) regulations to remediate the site only if it pursues a development project approved by the New York City Board of Estimate. Furthermore, although regulations implementing §27-1313(3)(a) of the New York Environmental Conservation Law allow for voluntary cleanups conducted in agreement with and under the auspices of the DEC, voluntary arrangements not embodied in a consent order cannot be characterized as an order or requirement issued by the DEC. In addition, the court holds that plaintiff's CERCLA claims are ripe, because CERCLA specifically provides for a private cause of action even where the extent of the response costs are uncertain, remediation has yet to occur, and plaintiff is as yet under no government order compelling remediation.

Turning to plaintiff's motion for summary judgment on defendant's CERCLA liability, the court notes that defendant concedes that the site is a facility, that a release or threatened release of a hazardous substance occurred there, that the release or threat of release caused plaintiff to incur response costs, and that those costs conform to the NCP. The court holds that CERCLA §107(a)(2) encompasses as responsible parties previous owners of contaminated property who disposed of hazardous substances on the site in such a way that they could enter the environment. Thus, there is no need to show that during the previous owner's tenure the discharged hazardous substances actually entered the environment. Therefore, the court holds that defendant is a covered person under §107(a)(2). Defendant's offer of evidence that the source of contaminants on the site may be plaintiff's activities is not relevant to whether defendant is liable under §107(a)(2) because CERCLA creates strict liability for the classes of persons described in §107(a). The court notes that defendant does not contest the fact that it owned the site at a time when hazardous materials were disposed of there, and plaintiff has established a sufficient nexus between defendant's waste and the site contamination. The court notes that defendant has not raised a possible affirmative defense in opposition to plaintiff's motion and nothing in the current record establishes such a defense.

The court next holds that plaintiff's attorney fees are not recoverable under CERCLA because it is apparent from the legislative history that Congress intended to enable government entities to recover legal costs associated with site remediation but did not grant the same privilege to private parties. The fact that Congress did not avail itself of the opportunity to correct courts that had denied recovery of attorney fees when it amended CERCLA in 1986, supports the conclusion that Congress did not intend to extend the privilege to private entities. Finally, the court rejects defendant's argument that plaintiff contractually assumed the response costs that plaintiff incurred before it entered into an order on consent with the DEC. The CEQR does not require plaintiff to remediate the site, and plaintiff's participation in developing an environmental impact statement for its proposed development project was not undertaken pursuant to an order.

Counsel for Plaintiff
Mark A. Chertok
Sive, Paget & Riesel
460 Park Ave., New York NY 10022
(212) 421-2150

Counsel for Defendant
Peter J. Sacripanti
Dewey Ballantine
1301 Avenue of the Americas, New York NY 10019
(212) 259-8000