ELR Citation: ELR 20936
No(s). 91-1775 (4th Cir. May 29, 1992)

The court holds that an owner of contaminated property may recover Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) response costs from the original owner and other previous owners who owned the facility when hazardous substances were leaking, but not from previous tenants would did not actively participate in the disposal of the hazardous substances at the site. The current landowner brought a CERCLA cost recovery suit against all former owners and tenants of the property to recover $226,000 in cleanup costs it incurred in removing leaking underground storage tanks (USTs) from the property. The court first holds that the former tenants are not liable for CERCLA cleanup costs because they did not operate the contaminating facility and did not have the authority to control operations or decisions involving the USTs. Although the tenant defendants did not have to exercise actual control to qualify as operators under CERCLA §107(a)(2), so long as they had the authority to control the "facility," narrowly defined by the court to include only the USTs, the tenants conduct did not establish control and the tenants' leases did not confer authority over the USTs. The court next holds that the officers and directors of the corporate original owner are not personally liable as operators because they lacked decisionmaking authority to control the facility's daily operations. The court next holds that the other previous owners of the facility are liable for CERCLA cleanup costs because they owned the facility at times when hazardous substances were spilling or leaking. CERCLA §107(a)(2) imposes liability for active involvement in the dumping or placing of hazardous waste and for ownership of a facility when hazardous waste is spilling or leaking. CERCLA §101(29) defines "disposal" by incorporating by reference the Resource Conservation and Recovery Act (RCRA) §1004(3) definition of "disposal," which includes passive participation in contamination. Moreover, both CERCLA and RCRA aim to encourage the cleanup of hazardous waste contamination, and "disposal" includes active conduct, the reposing of hazardous waste, and its subsequent migration through the environment. To condition CERCLA liability on active participation would frustrate CERCLA's policy of encouraging voluntary private action to remedy environmental hazards, because a previous owner who never used the USTs would have no liability while the current owner would be liable, even absent use of the USTs. There is a presumption that leaking is not a sudden event, but the result of a gradual and progressive course of environmental contamination that includes interim periods of ownership. Moreover, the storage of raw material for active use constitutes disposal of waste at the point at which the facility is abandoned.

[A previous decision in this case is published at 22 ELR 20079.]

Counsel for Appellant
Gina Monath Zawitoski
Piper & Marbury
Charles Center South, 36 S. Charles St., Baltimore MD 21201
(301) 539-2530

Counsel for Appellees
Pamela Joyce White
Ober, Kaler, Grimes & Shriver
120 E. Baltimore St., Baltimore MD 21201
(301) 685-1120

Before Williams and MacKenzie, JJ.