ELR Citation: ELR 20769
No(s). 86-0116 (M.D. Pa. Sep 21, 1987)

The court holds that the successor corporation of the seller of a tract of industrial land is not liable to the purchaser for response costs the purchaser incurred under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) in cleaning up asbestos contamination at the site. The court holds that the Third Circuit's decision in Philadelphia Electric Co. v. Hercules, Inc., 15 ELR 20554, requires dismissal of the purchaser's action. The Third Circuit held that where corporations of roughly equal resources contract for the sale of industrial property and there has been no fraud or misrepresentation, the seller is responsible only to the extent it expressly agrees to be responsible. Although Philadelphia Electric involved a cleanup under the Pennsylvania Clean Streams Law, its rationale also applies to CERCLA cleanups. Defendant's predecessor did not conceal the presence of asbestos on the land when it sold the site to plaintiff's predecessor. Plaintiff's predecessor knew of the use of the land, inspected it more than five times, elected not to conduct the tests allowed under the sales agreement, failed to add a provision in the agreement covering any future cleanup costs, and calculated the risk of future cleanup costs into the purchase price. Plaintiff's state-law nuisance, vicarious liability, and indemnity claims also must be dismissed. The court holds that defendant has not been unjustly enriched because plaintiff saved it from incurring response costs. Although defendant was also liable for cleaning up the asbestos, the fact that the Environmental Protection Agency chose plaintiff to perform the cleanup does not mean that defendant was enriched.

[The complaint is digested at ELR PEND. LIT. 65900. Briefs in plaintiff's appeal to the Third Circuit are digested at ELR PEND. LIT. 65990.]

Counsel for Plaintiff
Steven Schibla
Rhodes & Sinon
410 N. 3d St., Harrisburg PA 17108-1146
(717) 233-5731

Counsel for Defendant
Susan P. LeGros
Montgomery, McCracken, Walker & Rhoads
3 Parkway, 20th Floor, Philadelphia PA 19102
(215) 563-0650