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Montville Township v. Woodmont Builders, Ltd. Liab. Co.

ELR Citation: 37 ELR 20213
Nos. No. 05-4888, (3d Cir., 08/08/2007)

The Third Circuit, in light of the U.S. Supreme Court's decision in United States v. Atlantic Research Corp., 127 S. Ct. 2331, 37 ELR 20139 (2007), affirmed in part and reversed in part a lower court decision dismissing a town's cost recovery action against the owners of a contaminated tract of land. The Court held in Atlantic Research that §113(f)(1) of the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) authorizes a contribution action to potentially responsible parties (PRPs) with common liability stemming from an action instituted under §106 or §107(a), while §107(a) permits cost recovery (as distinct from contribution) by a private party that has itself incurred cleanup costs. In other words, a PRP can sue another PRP for contribution under §113(f), but can only sue under §107(a) for reimbursement of its own cleanup costs. Accordingly, the lower court in the instant case was correct in concluding that the town could not sue for contribution under §113(f) because it faced no liability under CERCLA §§106 or 107(a). But the lower court was incorrect in concluding that the town could not sue to recover costs under §107(a) because it was a PRP. The lower court's decision was therefore remanded.