action was filed is barred by the statute of limitations.
While there may be cosmetic appeal to the RCRA preemption or exclusivity argument, particularly as projected against the history of this case, it has little support in the statutes or decisionally. The overwhelming evidence is that Congress intended CERCLA to be cumulative and not merely an alternative to RCRA or to be limited in its application to formally designated Superfund sites. See Chemical Waste Mgt. v. Armstrong World Industries, 669 F.Supp. 1285, 1290 (E.D. Pa. 1987); Mardan Corp. v. C.G.C. Music, Ltd., 600 F.Supp. 1049, 1054 (D.C. Ariz.1984). There is no statutory expression that would prevent EPA from recovering costs incurred in supervising a so-called RCRA managed site. Instead, there are strong economic and environmental reasons for authorizing the recovery of such costs. Without a clear statutory statement to the contrary, this CERCLA remedy must be upheld as an available tool of environmental protection. The defense of an implied exclusion of CERCLA remedies must, therefore, be rejected.
Claim preclusion, based on the parties' consent order, is also a flawed defense. Principles of res judicata have been applied to the decision of an administrative agency, but only when it "is acting in a judicial capacity and resolves disputed issues of fact . . . which the parties have had an adequate opportunity to litigate." Astoria Federal Savings and Loan v. Solomino, 501 U.S. , , 111 S. Ct. 2166, 2169, 115 L. Ed. 2d 96, 104 (1991). Here, the ACO was a product of negotiation, not fact finding, and EPA was acting in its enforcement capacity, not as a judicial agency. But assuming that EPA's role were that of administrative fact-finder, the provisions of the ACO expressly repudiate defendants' assertion of claim preclusion.
This consent order shall not be construed as a covenant not to sue, release, waiver or limitation of any rights, remedies, powers and/or authorities, civil or criminal, which EPA has under RCRA, CERCLA, or any other statutory, regulatory or common law authority of the United States.
ACO - Section XIX Reservation of Rights at P2. It is hard to conceive of a more sweeping reservation of rights and remedies, or a clearer statement that resort to CERCLA may be anticipated. A consent decree will not be accorded preclusive effect when, as in this instance, there is an unmistakable reservation of pertinent rights. United States v. Anthlone, 746 F.2d 977, 983 n.5 (3d Cir. 1984); Beehler v. Jeffes, 664 F.Supp. 931, 935 (M.D. Pa. 1986).
As to the specific types of CERCLA response costs claimed, defendants' objections appear to be without merit. Defendants acknowledge that their restrictive reading of the act has not gained decisional acceptance. Department of Justice enforcement costs - in this case, $ 6,523.96 - are recoverable. E.g., United States v. Shaner, 1990 WL 115085, * 3 (E.D. Pa. June 25, 1990); United States v. Conservation Chemical Co., 619 F.Supp. 162, 186 (W.D. Mo. 1985) (government can recover all response costs including ". . . recovery of the costs . . . to enforce the provisions of CERCLA, including the costs incurred for the staffs of the EPA and the Department of Justice"); United States v. Northwestern Pharm. & Chem. Co., 579 F.Supp. 823, 851 (W.D. Mo. 1984) ("CERCLA specifically allows for the recovery of attorneys' fees"); United States v. South Carolina Recycling and Disposal, Inc., 653 F.Supp. 984, 1009 (D.S.C. 1984).
Indirect response costs have also been found to be consistent with the National Contingency Plan and, therefore, collectible under CERCLA.
United States v. R.W. Meyer, Inc., 889 F.2d 1497, 1503-04 (6th Cir. 1989); Ambrogi v. Gould, Inc., 750 F.Supp 1233, 1250 (M.D. Pa. 1990) (expenses incurred for air, water, and soil testing and monitoring, expert and investigative fees held recoverable if consistent with the National Contingency Plan); United States v. Hardage, 750 F.Supp. 1460, 1498-99 (W.D. Okl. 1990).
Under defendants' scheme, EPA would not be entitled to oversight costs in any case in which it allowed an owner to perform a RCRA cleanup under its supervision. The unrealistic construct inherent in that proposition is self-evident.
Section 107(a) of CERCLA provides, in part:
Notwithstanding any other provision or rule of law, and subject only to the defenses set forth in subsection (b) of this section -
(1) the owner and operator of . . . a facility,
(2) any person who at the time of disposal of any hazardous substance owned or operated any facility
. . .
from which there is a release, or a threatened release which causes the incurrence of response costs, of a hazardous substance, shall be liable for -
(1) all costs of removal or remedial actions incurred by the United States Government . . . not inconsistent with the national contingency plan.
42 U.S.C. § 9607(a).
As an owner of the landfill facility, defendant Chemical Properties, Inc. is a responsible party. See United States v. Tyson, 25 E.R.C. (BNA) 1897; 17 E.L.R. 20527 (1986) (present owners liable under section 107 of CERCLA although no hazardous substances were disposed of after purchase of property).
Chemical Properties claims to be entitled to "the benefit of [the third party defense] set out in [§ 107(b)(3)],"
There shall be no liability under subsection (a) of this section for a person otherwise liable who can establish by a preponderance of the evidence that the release or threat of release of a hazardous substance and the damages resulting therefrom were caused solely by -
(3) an act or omission of a third party other than an employee or agent of the defendant, or than one whose act or omission occurs in connection with a contractual relationship, existing directly or indirectly, with the defendant . . . if the defendant establishes by a preponderance of the evidence that (a) he exercised due care with respect to the hazardous substance concerned, taking into consideration the characteristics of such hazardous substance, in light of all relevant facts and circumstances, and (b) he took precautions against foreseeable acts or omissions of any such third party and the consequences that could forseeably result from such acts or omissions . . . .
42 U.S.C. § 9607(b)(3). As stipulated, Chemical Properties, in 1968 and 1971, acquired a 10.94 acre portion of the site from Rohm & Haas by conveyance. See finding 6 supra. Under CERCLA, the transfer of title to land by deed comes within the definition of "contractual relationship."
The term 'contractual relationship', for the purpose of § 9607(b)(3) of this title includes, but is not limited to, land contracts, deeds or other instruments transferring title or possession, unless the real property on which the facility concerned is located was acquired by the defendant after the disposal or placement of the hazardous substance on, in or at the facility, and one or more of the circumstances described in clause (i), (ii) or (iii) is also established by the defendant by a preponderance of the evidence: (i) At the time the defendant acquired the facility the defendant did not know and had no reason to know that any hazardous substance which is the subject of the release was disposed of on, in, or at the facility.
42 U.S.C. § 9601(35)(A). See CPC Inter. Inc. v. Aerojet-General Corp., 777 F.Supp. 549, 581 (W.D.Mich. 1991).
This defense, as CERCLA makes clear, involves two parts. § 107(b)(3). Defendant must prove, first, that the contamination was caused solely by a third party, and, second, that it was a third party with which defendant did not knowingly have a disposal-related contractual relationship. Here, as to the first prong, Chemical Properties concedes that its trucks were used to haul chemicals. Thereafter, the trucks were cleaned and maintained at a wastewater pretreatment plant located on Chemical Properties' portion of the site. See finding 49 supra. These facts themselves would negate the defense.
As to the second prong, the existence of the contractual relationship will not itself preclude the defense unless it is "in connection with" disposal-related activity. § 107(b)(3). See Westwood Pharmaceuticals, Inc. v. National Fuel Gas Distribution Corp., 1992 U.S. App. Lexis 4159, *6 (2d Cir. March 11, 1992). If such a contractual relationship is made out, defendant must show that it "did not know and had no reason to know that any hazardous substance which is the subject of the release or threatened release was disposed on, in, or at the facility." 42 U.S.C. § 9607(35)(A).
The defendant must have undertaken, at the time of acquisition, all appropriate inquiry into the previous ownership and uses of the property consistent with good commercial or customary practice in an effort" to minimize liability. For purposes of the preceding sentence the court shall take into account any specialized knowledge or experience on the part of the defendant, the relationship of the purchase price to the value of the property if uncontaminated, commonly known or reasonably ascertained information about the property, the obviousness of the presence or likely presence of contamination at the property, and the ability to detect such contamination by appropriate inspection.
42 U.S.C. § 9601(35)(B).
Chemical Properties did not sustain this burden of due inquiry. It offered no evidence of having investigated the prior uses or previous ownership of the property. Additionally, as a hauler of hazardous substances, it must have been aware when it acquired the property that Rohm & Haas had maintained the site as a chemical landfill over many years.
For each of these reasons, Chemical Properties cannot rely on the third-party defense. It is doubtful whether the contamination was caused solely by Rohm & Haas, and there was a relevant contractual relationship. Chemical Properties does not qualify as an innocent third party in terms delineated by CERCLA. Westwood Pharmaceuticals v. Nat. Fuel Gas Dist., 767 F.Supp. 456 (W.D.N.Y. 1991); International Clinical Laboratories v. Stevens, 710 F.Supp. 466 (E.D.N.Y. 1989); see e.g., United States v. Serafini, 706 F.Supp. 346 (M.D.Pa. 1988); United States v. Hooker Chemicals & Plastics Corp., 680 F.Supp. 546 (W.D.N.Y. 1988).
Defendants also assert that claims for costs arising before November 1987 are barred by CERCLA's three-year statute of limitations. 42 U.S.C. § 9613(g)(2). The limitations period begins to run as of the time when all contamination has been removed. However, "removal" is not confined to on-site removal. United States v. Allen, slip op. at 12 (W.D. Ark. November 9, 1990) ("Clearly, the term removal is not limited to on-site activity and includes the time needed to dispose of the removed material as well as time needed to evaluate the need for further activity.").
Here, the complaint was filed on November 25, 1990, and the physical removal of contaminated soil by Rohm & Haas was completed in July 1987. Nevertheless, EPA did not propose to eliminate the site from the Superfund List until June 24, 1988. It was stipulated that EPA "continues to monitor, assess and evaluate the release and threat of release of hazardous substances and Rohm & Haas DVI's activities at the site." See finding 27 supra. Even after this lawsuit was begun, it could not be said that complete "removal" under CERCLA had occurred. Given these facts, the statute of limitations defense is unavailing.
The following conclusions of law are entered:
1. Plaintiff United States of America is entitled to recover from defendants $ 401,348.78 for response costs under CERCLA and any other appropriate and proper response costs shown to be due after the filing of this action and in the future.
2. Plaintiff's claim is not precluded, barred, or diminished by -
a. EPA's management of the site under RCRA or the nonplacement of the site on the Superfund List;
b. The Administrative Consent Order of February 6, 1989;
c. Inclusion of enforcement costs and indirect costs;
d. As to Chemical Properties, Inc., the third-party defense under § 107(b)(3); or
e. The three-year statute of limitations.
Edmund V. Ludwig, J.
ORDER UNDER FED.R.CIV.P. 52(a) - April 24, 1992, Filed
AND NOW, this 24th day of April, 1992, upon motion and a hearing, declaratory judgment is entered in favor of plaintiff United States of America and against defendants Rohm & Haas Company, Rohm and Haas Valley Inc., Chemical Properties, Inc., and Bristol Township Authority, and each of them, for response costs of $ 401,348.78, as of June 18, 1991, plus interest from that date, together with liability for all costs properly incurred under CERCLA thereafter.
Edmund V. Ludwig, J.
Note : The order entered March 30, 1992 is hereby superseded by the present order
Edmund V. Ludwig, J.