ELR Citation: ELR 21274
No(s). 87-101- (E.D. Va. May 27, 1988)

The court holds that a federal three-year statute of limitations for tort actions does not apply in a Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) response cost action, and the doctrine of laches is inapplicable since the United States has brought suit in its sovereign capacity. The court first denies certification for interlocutory appeal of its earlier ruling, 18 ELR 21272, that the statute of limitations in CERCLA §113(g) does not apply to response costs incurred before its enactment. The court then holds that the three-year limitations period in 28 U.S.C. §2415(b) is not applicable. Prior to the enactment of §113(g), it was generally held that the doctrine of laches, rather than a statute of limitations, was applicable to CERCLA cost recovery actions given their equitable nature. Although this action was brought after Congress enacted §113(g), there is no reason to depart from this rule. Even if a statute of limitations were to apply, however, it would be the six-year limitations period in 28 U.S.C. §2415(a) for implied-in-law contracts, which has been held to apply to the similar cost recovery provision in the Federal Water Pollution Control Act. The court holds that laches is inapplicable to this case since the United States has brought suit in its sovereign capacity.

The court holds that the federal government has consented to defendants' assertion of counterclaims under the doctrine of recoupment. The counterclaims assert that the United States improperly removed personal property during the course of its cleanup activity and allege breaches of contract and warranty involving materials that allegedly caused the environmental damage upon which the government's action is based. The counterclaims thus assert claims arising out of the same transaction that is the subject matter of the government's suit. Defendants' counterclaims against the Department of Defense (DOD) for indemnity and contribution are also permissible, since CERCLA establishes rights for both and the court has yet to determine the respective liabilities of the parties. The court holds that DOD is subject to a contribution action under CERCLA §113(f)(2). An agreement between DOD and the Environmental Protection Agency is not an administrative settlement within the meaning of §113(f)(2), since there has been no public comment period and an impartial arbiter has not determined whether the settlement was reasonable in light of DOD's potential liability. Moreover, a settlement between two federal agencies, precluding contribution claims by private parties later sued for costs by the government, is not what Congress envisioned under §§113(f)(2) and 122(h)(4). Finally, the court declines to realign DOD from its designation as a plaintiff in this action to a defendant.

Counsel are listed at 18 ELR 21272.