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Amland Properties Corp. v. Aluminum Co. of Am.

Citation: 19 ELR 21180
No. No. 86-1830, 711 F. Supp. 784/29 ERC 1538/(D.N.J., 04/18/1989)

The court holds that the current owner of a site contaminated with polychlorinated biphenyls (PCBs) that brought a private Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) action against the original owner failed to comply with the National Contingency Plan (NCP) and thus may not recover its response costs. The current owner purchased an industrial manufacturing plant where PCBs had been used and discovered the presence of PCB contamination years later, and incurred removal and response costs. The court first holds that CERCLA applies retroactively to actions between private parties. The court next holds that disposal within a plant is disposal "into or on any land or water" within the meaning of CERCLA, and thus any spills or leaks of PCBs within the plant caused by the original owner are disposals within CERCLA. The court further holds that the PCBs in the concrete flooring of the plant constitute a threatened release under CERCLA.

The court holds that a plaintiff in a private cost recovery action must plead and prove consistency with the NCP to establish liability. The court holds that even though the erection of fencing and hiring of a security guard for the plant clearly constitute removal actions, these costs cannot be recovered because they were incurred before plaintiff became aware of the presence of PCBs. The court next holds that initial monitoring and assessment of the threatened release of PCBs are included within the statutory definition of removal actions, and because the detailed NCP provisions governing remedial actions cannot reasonably be applied to these preliminary actions, those costs are compensable under CERCLA. The court next holds that private parties must adhere to the specific requirements of the NCP in order to recover response costs, absent a showing that one or more of those requirements are inappropriate under the particular circumstances. The court holds that the NCP's requirement of compiling a Remedial Investigation/Feasibility Study is applicable to a private party response. The court next holds that while the cleanup standard was set consistently with the NCP, the remedial method arrived at to achieve that standard was incomplete because the current owner failed to consider eleven factors called for by the NCP, failed to document why certain alternatives were not chosen, and no opportunity for public comment concerning the remedial action to be selected was offered. The court concludes that because the current owner failed to fulfill NCP requirements, and failed to satisfactorily explain why it did not, the response costs are not recoverable.

The court next addresses four pendant state-law claims. The court first holds that the current owner's claim, that the original owner is strictly liable for the abnormally dangerous operations and condition in which it left the plant, must be weighed against the factors of 520 of the Restatement (2d) of Torts, and because questions of fact remain, summary judgment for either party is premature. The court next holds that the prior owner is not liable for a private nuisance. State courts have read private nuisance to encompass only instances of danger to the public or interference with use of adjoining land, and the nuisance complained of affects only the land the new owner purchased. The court next holds that the new owner has no standing to assert a public nuisance claim against the original owner because the damage the new owner has suffered is not from pollution to land or water, but instead impacts only the new owner's private property rights. Finally, the court holds that neither the Restatement (2d) of Torts or state case law recognizes a duty to warn buyers of any hazardous condition on the property that involves an unreasonable risk.

Counsel for Plaintiffs
Robert A. Wayne
Robinson, Wayne & LaSala
1 Gateway Center, Newark NJ 07102
(201) 621-7900

John Quarles
Morgan, Lewis & Bockius
1800 M St. NW, Ste. 700N, Washington DC 20036
(202) 467-7000

Counsel for Defendant
Frederick B. Lacey
LeBoeuf, Lamb, Leiby & MacRae
1 Gateway Center, Newark NJ 07102
(201) 643-8000

Grant S. Lewis
LeBoeuf, Lamb, Leiby & MacRae
520 Madison Ave., New York NY 10022
(212) 715-8000