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In re In re Oklahoma Ref. Co.

ELR Citation: 16 ELR 20998
Nos. No. BK-84-2763-A, 63 Bankr. 562/(Bankr. W.D. Okla., 07/31/1986)

In an action under §554(a) of the Bankruptcy Code, the court grants a trustee's motion to abandon part of a former oil refinery, despite the contention of Oklahoma agencies that hazardous substances are leaching from the land into the local aquifer in violation of state hazardous waste laws. The court interprets the U.S. Supreme Court's decision in Midlantic National Bank v. New Jersey Dep't of Environmental Protection, 16 ELR 20278, to require the bankruptcy court to consider, but not be strictly bound by, state environmental laws and regulations when deciding whether to permit abandonment. The court holds that strict compliance with Oklahoma's closure and monitoring laws where there is no threat of immediate harm to the public and the refinery is in compliance with all consent agreements and orders would unreasonably delay administration of the estate.

[For analysis of this issue, see Morris, State Enforcement of Environmental Laws Against Bankrupt Entities, 16 ELR 10146 (June 1986) and Drabkin, Moorman, and Kirsch, Bankruptcy and the Cleanup of Hazardous Waste: Caveat Creditor, 15 ELR 10168 (June 1985).]

Counsel for the State of Oklahoma
Jimmy D. Givens
Oklahoma State Department of Health
1000 NE Tenth, P.O. Box 53551, Oklahoma City OK 73152
(905) 271-5600

James R. Barnett
Oklahoma Water Resources Board
1000 NE Tenth St., 12th Fl., P.O. Box 53585, Oklahoma City OK 73152
(405) 271-2555

Counsel for Trustee
Gary Morrissey
Kenan & Peterson
P.O. Box 2036, Oklahoma City OK 73101
(405) 232-8137