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Reliance Ins. Co. v. United States

Citation: 12 ELR 20636
No. No. 146-79L, 677 F.2d 844/17 ERC 1886/(Ct. Cl., 04/21/1982)

The court holds that plaintiff insurer may not recover from the government under § 311(i) of the Federal Water Pollution Control Act oil spill cleanup costs paid to an insured since the insured's actions were a contributing cause of the spill. Insured caused a discharge of oil into the Alameda Estuary when it unknowingly disturbed an underground deposit of an oily pollutant during dredging operations. The court rejects plaintiffs argument that, because its insured acted with reasonable care by testing for subsurface pollutants before dredging, the spill was "caused solely by" a third party within the meaning of § 311(i). It holds that any conduct of an owner or operator contributing to a spill precludes recovery under § 311(i) whether or not the conduct is negligent. Since it was the actions of plaintiff's insured which allowed the oil to be discharged, those acts were a contributing cause of the spill.

Counsel for Plaintiff
Kevin P. Nolan
100 Bush St., San Francisco CA 94104
(415) 956-5841

Counsel for Defendant
Nancy L. Long; Carol E. Dinkins, Ass't Attorney General
Land and Natural Resources Division
Department of Justice, Washington DC 20530
(202) 633-5260

Counsel for Third-Party Defendant
John A. Reding
Crosby, Heafey, Roach & May
1939 Harrison St., Oakland CA 94612
(415) 834-4820

Before FRIEDMAN, Chief Judge, KUNZIG* and BENNETT, Judges.