ELR Citation: ELR 20503
No(s). 90-CV-71519-DT (E.D. Mich. Jul 2, 1991)

The court holds that purchasers of real property may not recover costs of cleaning up contaminated soil from the vendor because the purchasers have contractually waived that right. The purchase contract stated that the purchasers have inspected and bought the property "as is" and have agreed to assume all responsibilities for any damages caused by the conditions on the property. The court first holds that there is no breach of contract because the purchasers have assumed all risks under the "as is" clause. The court finds the exceptions to the general rule of caveat emptor in land sales enumerated in Christy v. Glass inapplicable because Christy did not involve a contractual relationship. Even if Christy applied, the present case is not an exception because there is no evidence of a concealed condition known to the vendor at the time of sale that involves an unreasonable danger. The court also found no fraud in the transaction because the vendor has no actual knowledge of contamination and the purchaser knew that the property was previously used as a gas station and agreed to conduct its own investigation.

The court next holds that the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) is not applicable because the alleged hazardous substances are inherent and indigenous gasoline components precluded from CERCLA coverage by the "petroleum exclusion" in CERCLA §101(14). The court also rejects the purchasers' "contribution" claim under Michigan law. Although the purchasers initiated cleanup actions without being found legally liable, they acted under their obligations as owners of the property instead of volunteers and are generally entitled to contribution from other owners, such as the vendor, under the Michigan Leaking Underground Storage Tank Act (LUST). However, the purchasers waived that right by agreeing to assume all responsibilities in the contract, which is enforceable under LUST. The applicable provisions in LUST are virtually identical to CERCLA §107(e), which does not prevent private parties from shifting CERCLA liability among themselves.

The court then rejects the purchasers' claim of relief under the Michigan Environmental Protection Act, which provides for only injunctive and declaratory relief. In addition to their failure to specify the type of relief they seek, the court holds that the purchasers, having sold the property to Exxon, no longer have standing to require the vendor to take any further action with respect to the property. Lastly, despite the 20-gallon discrepancy between pump records and physical measurement that suggests the possibility of leakage during vendor's operation, the purchasers similarly waived their negligence, nuisance, and trespass claims in the contract.

Counsel for Plaintiffs
Bruce T. Wallace
Hooper, Hathaway, Price, Beuche & Wallace
126 S. Main St., Ann Arbor MI 48104
(313) 662-4426

Counsel for Defendant
Mark F. Miller
Feikens, Foster, Vander Male & DeNardis
1200 Buhl Bldg., Detroit MI 48226
(313) 962-5909