Recovery for Natural Resource Damages Under Superfund: The Role of the Rebuttable Presumption

Mark Menefee

Mr. Menefee is a staff attorney in the Resources Program of the Environmental Law Institute. This article is based on a research report funded by the National Oceanic and Atmospheric Administration (NOAA Grant. No. NA 80RAD00035).

[12 ELR 15057]

The Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA)¹ provides a detailed system for recovery for damage to natural resources that is caused by the release of hazardous substances. Previous federal statutes, such as the Trans-Alaska Pipeline Authorization Act,² the Deepwater Port Act,³ and the Outer Continental Shelf Lands Act Amendments of 1978,⁴ also have established liability for natural resource damages, but CERCLA reaches far beyond the narrow scope of those laws, addressing damage to fish, wildlife, and biota, as well as to air, land, and water, including groundwater and drinking water supplies.⁵ When a hazardous substance release injures or destroys natural resources, as in the case of groundwater contamination or a fish kill, CERCLA authorizes the federal or state governments to assert damage claims for those lost resources against the responsible party or against the statute's "superfund."⁶ CERCLA also mandates the promulgation of regulations for assessing the extent and value of such damage. Completing the resource damage recovery system, CERCLA provides that damage assessments made pursuant to these regulations shall have the force and effect of a rebuttable presumption on behalf of government claimants in a judicial proceeding against the responsible part or in an administrative proceeding against the fund.

The rebuttable presumption probably will be a significant concern of attorneys litigating the natural resource damage issue. Assessments made under CERCLA regulations about the extent and value of damage to natural resources are likely to be disputed vigorously by potentially liable parties because information about injury to or destruction of ecological and hydrological systems such as estuaries and aquifers probably will be both complicated and controversial. The assessment regulations and the rebuttable presumption may simplify claims proceedings. Moreover, on its face the rebuttable presumption appears to make it likely that the federal or state governments will prevail on their claims. However, because neither the statute nor its legislative history clarifies how to apply the rebuttable presumption in CERCLA cases, questions remain as to what effect it will have in judicial and administrative proceedings.

Resource Damage Framework

The resource damage provisions of CERCLA are scatered among three sections of the statute, each of which has a different general function.⁷ Section 107(f) provides that liability for injury to, destruction of or loss of natural resources shall be to both the federal government and to the state which owns or manages the resources.⁸ Section 301(c) requires the promulgation of regulations for the assessment of such damages.⁹ The regulations must identify simple assessment techniques using minimal field observation for minor releases as well as detailed portocols that guide extensive field work for major releases. The language of the liability and damage assessment provisions concerning the injury, destruction, or loss of natural resources is identical.

The third part of this damage recovery system is the rebuttable presumption, found in § 111(h), which refers to both §§ 107(f) and 301(c). Section 111(h)(1) authorizes [12 ELR 15058] federal officials designated under the National Contingency Plan,¹⁰ which is the principal administrative framework for carrying out response and remedial actions under CERCLA, to make damage assessments under the § 301(c) regulations.¹¹ Section 111(h)(2) provides that any such determination or assessment of damages shall have the force and effect of a rebuttable presumption on behalf of any claimant, including a claimant under § 107(f), in a judicial or administrative proceeding under CERCLA.¹² Thus, in order to understand the CERCLA mechanism fully, §§ 107(f), 301(c) and 111(h) must be read together. The following discussion examines each part of this system in detail.

Liability Provisions

Section 107 is the liability section of CERCLA, specifying the parties that may be liable, the scope of liability, defenses to liability, and the statutory limits to liability. Two subsections relate to liability for natural resource damages in particular. Section 107(a) provides that the owner or operator of a "vessel" or "facility," the generator of hazardous substances, and the transporter of such substances shall be liable for the costs of removal or remedial action incurred by the federal or state governments when a release or threatened release occurs. Liability includes "damages for injury to, destruction of, or loss of natural resources, including the reasonable costs of assessing such injury, destruction or loss resulting from such a release."¹³

The remaining liability provisions relating to natural resource damages are found in § 107(f). It identifies the parties to whom liability is owed: "[L]iability shall be to the United States Government and to any State for natural resources within the State or belonging to, managed by, controlled by, or appertaining to such States …."¹⁴ Only governmental entities may assert claims for resource damages. Private persons may not, nor may they assert claims for property damages that are closely tied to natural resources damages, e.g., fishermen's claims for lost harvests that result from destruction of a fishery. The latter claims must be asserted under other federal statutes, such as the Outer Continental Shelf Lands Act,¹⁵ or under state law.

In addition, § 107(f) imposes several constraints upon those parties towhom liability is owed.¹⁶ First, the "President, or the authorized representative of any State, shall act on behalf of the public as trustee of such natural resources to recover for such damages." Thus, the roles of government claimants in resource damage proceedings under CERCLA are consistent with the common law public trust doctrine, which authorizes a sovereign to act on behalf of the public to protect natural resources.¹⁷ A second constraint on a § 107(f) claimant is that the "[s]ums recovered shall be available for use to restore, rehabilitate, or acquire the equivalent of such natural resources by the appropriate agencies of the Federal Government or the State government, but the measure of such damages shall not be limited by the sums which can be used to restore or replace such resources." Thus, a governmental entity, fulfilling its role as public trustee, must make its damage award available for restoration, rehabilitation, or replacement of the destroyed resources. [12 ELR 15059] This is not an absolute constraint, since § 107(f) expressly provides that the costs of restoration or replacement shall not limit the measure of damages.

Because § 107(f) states that liability is owed to both the federal government and state governments, a question arises concerning how and to what extent governments will be able to asset their claims, due to interrelated and overlapping responsibilities that they may have for managing and protecting fish, wildlife, and other natural resources. On its face, § 107(f) appears to establish liability to the federal government and a particular state in equal proportion. Yet frequently the interests of the prospective claimants may differ and, indeed, conflict. For example, the federal government may have a greater legal responsibility for a species protected by the Endangered Species Act¹⁸ than a state. Conversely, a state may have more regulatory authority over sport fish than the federal government. Or both the state and the federal government may have joint management responsibility for certain wildlife, such as migratory waterfowl. If government damage claims under CERCLA are based upon legal responsibility for owning, managing, or controlling certain natural resources (i.e., their public trustee responsibility), then it is likely that complexities of federal and state law may lead to overlapping or conflicting claims.¹⁹

Similar problems could arise between state governments. For example, if a fish kill occurred in a river serving as the boundary between two states, both states might assert claims for damage to the same aquatic resources. Or one state might assert a claim for the destruction of fish species A, while the other asserts a claim for fish species B which feeds upon A. This strong potential for conflicting or overlapping claims for natural resource damage requires clear guidance in the regulations that are to implement CERCLA claims procedures.²⁰

Damage Assessment Regulations

Once the liable parties and the parties to whom liability is owed are established, the extent and value of damage must be determined. Section 301(c) requires federal officials designated under the National Contingency Plan to promulgate regulations for the assessment of damages for injury to, destruction of, or loss of natural resources that result from the release of a hazardous substance.²¹ The regulations are also to apply to claims under the Federal Water Pollution Control Act (FWPCA) for oil releases even though CERCLA itself does not impose liability for the release of oil.²²

Section 301(c)(2) specifies two different types of damage assessment techniques. Type A assessments are intended for use on minor releases and will use standard procedures for simplified assessments that require minimal field observation. They should "require as little fieldwork as possible, and rely on a combination of habitat values, tables of values for individual species, and previously conducted surveys and laboratory studies, related to units of discharge or units of affected area."²³ Type B assessments, in contrast, are intended for use for major releases where "the extent of natural resource damage is substantial and extensive field work becomes necessary."²⁴ These regulations

would be employed in large or unusually damaging releases [12 ELR 15060] and would be used to guide the site-specific damage assessment. Such a regulation would contain protocols for field assessment of the type and extent of short- and long-term damage and methodologies for determining their value.

The protocols for field assessments should provide uniform instructions that will allow for thorough site investigation in a cost effective manner. Sampling and statistical procedures should be clearly defined. The methods for determining the geographical extent of damage should also be enumerated.²⁵

Mindful of the many variables that could be present in the investigation of major and minor releases, the Senate Environment and Public Works Committee sought to standardize the measurement of damages through type A and B procedures.

The Rebuttable Presumption

1. Statutory Language

Section 111(h)(1) provides that federal officials must make resource damage assessments in accordance with the regulations promulgated under § 301(c).²⁶ In addition, § 111(h)(2) states that the assessments "shall have the force and effect of a rebuttable presumption on behalf of any claimant (including a trustee under section 107 of this Act or a Federal agency) in any judicial or adjudicatory administrative proceeding under this Act or section 311 of the [FWPCA]."²⁷ Creation of a rebuttable presumption clearly bolsters a claimant's efforts to prove its case, but how and to what extent is far from clear. Neither the language of CERCLA nor its legislative history provides many clues as to the effect of the rebuttable presumption in a resource damage proceeding.

A presumption is a rule of evidence: one takes a basic fact, which has been established, and infers from it the existence of the presumed fact. For example, suppose a plaintiff seeks to prove that a defendant received plaintiff's letter. Plaintiff may produce evidence that the letter was mailed, that it was properly addressed to defendant and included a return address, and that it was never returned. In most jurisdictions such evidence would be held to raise the presumption that defendant received that letter.²⁸ Typically, a presumption applies to a reasonably well defined basic fact and derives a single, reasonably well defined presumed fact. In the above example, the basic facts of addressing and mailing the letter are clear, as is the presumed fact that defendant received the letter.

However, the situation under CERCLA is more complicated. A final agency determination of natural resource damage will be the sum of many lesser, discrete damage determinations, including perhaps separate assessments for various species and habitats, for long- and short-term effects, for direct and indirect effects, and for aesthetic or recreational values of each particular resource. CERCLA's presumption applies to "any determination or assesment of damages." A literal interpretation of this provision is that the presumption applies to each and every determination or assessment of damage that is made with regard to a given release of a hazardous substance. Another interpretation is that the presumption applies only to the final or total assessment. Since either interpretation seems plausible, the regulations should clarify the matter.

In Some cases a damage assessment may be straightforward, similar to the presumption about receipt of a letter. For example, suppose that a hazardous substance is released into a river, killing fish, and that federal officials apply the § 301(c) regulations for minor spills to determine how many fish were killed. Suppose further that the officials take a small survey of dead fish and, using some prior studies of similar river habitats and fish populations, determine that 1,000 fish of species X were killed as a direct result of the release. A rebuttable presumption applied in the typical manner will take the survey and prior studies as the basic facts and derive the figure of 1,000 fish killed as the presumed fact. Thus, the CERCLA presumption in a simple case would fiffer little from the presumption used for receipt of a letter.

It becomes more difficult to gauge the effect of a presumption when additional damage assessments are made for the same hazardous substance release. Suppose that in the above example an additional fish, species Y, is found in the river. In addition, suppose that Y are known to feed at least in part on X, and further that Y are not directly killed by the release. Moreover no prior studies of Y are available. To determine the losses for Y, then, one must take as the basic facts a survey of dead Y, the percentage of Y's diet that is comprised of X, and the degree to which Y can find substitutes for X. And, most important from the legal standpoint, one must take as a basic fact the number of X that were killed by the release, since this represents a net loss of food for Y. Then one can derive the presumed fact, i.e., the number of Y that were killed indirectly by the spill.

In this sort of damage determination, however, some of the basic facts actually are the presumed facts from [12 ELR 15061] other determinations. In other words, the number of X that were killed, 1,000, is the presumed fact when one determines the losses for X but is the basic fact when one determines the losses for Y. This latter case is really a presumption based upon another presumption, the validity of which has been questioned by scholars of evidence.²⁹ In such situations, which are likely to be encountered in damage assessment cases, the complex interrelationships of an ecosystem will often make it difficult for attorneys to sort out the proper use of the rebuttable presumption.

2. Forums for Resource Damage Claims

Under § 112(a),³⁰ which concerns claims procedures generally, a claimant for resource damages must first present its claim to the owner, operator, or guarantor of the vessel or facility from which a hazardous substance was released. If the claim is not satisfied within sixty days, the claimant may either commence an action in court against the owner, operator, or guarantor, or it can present the claim to the CERCLA fund in an adjudicatory administrative proceeding.³¹ If the claimant elects to sue in federal district court, the Federal Rules of Evidence (FRE) will apply. But if the claimant presents the claim to the fund for payment, the FRE might not apply, because under § 112(b)(4)(c) "the rules of evidence prevailing in judicial proceedings need not be required."³² Administrative decisions can be appealed to federal district court but "shall be considered binding and conclusive, and shall not be overturned except for arbitrary or capricious abuse of … discretion."³³ Thus, § 112(b)(4)(c) suggests that the FRE will not apply in administrative proceedings against the fund, unless the § 112 regulations specify otherwise.

A claimant has a clear choice. Either it can assert its claim for natural resource damages in federal court, where the FRE apply, or it can present its claim in an administrative proceeding, where the FRE probably will not apply. The advantage for the claimant choosing federal court over an administrative proceeding is that Rule 301 of the FRE, which governs rebuttable presumptions, may control the application of CERCLA's rebuttable presumption.³⁴

Rebuttable Presumptions Under the Federal Rules of Evidence

If a claimant chooses the federal court option for presenting its CERCLA damage claims, the FRE will apply. However, it is not clear that Rule 301 applies to CERCLA's rebuttable presumption because the Rule contains an exception for all civil actions and proceedings "otherwise provided for by Act of Congress or by these rules." While some statutes that contain rebuttable presumptions specify the effects of those presumptions or expressly allow courts to determine their effects, others create the presumption without specifying its effect. CERCLA falls in the latter category, at least with respect to proceedings in court. One authority notes that

[a]s to those statutory presumptions that do not specify what effect they are to be given and that have not been judicially construed, there seems to be no good reason for exempting them from the operation of Rule 301. Since Congress did not trouble to give them any greater effect when they were enacted, it is unlikely that applying Rule 301 would offend any deeply felt Congressional policy. Applying Rule 301 has the advantage of providing uniformity and certainty with respect to the effect of such presumptions. As to any subsequently adopted presumptions of unspecified effect, it is reasonable to suppose that they are enacted with the expectation that Rule 301 will govern.³⁵

This argument is persuasive. The best interpretation of § 111(h)(2) is that since the "force and effect" of a rebuttable presumption is not explicated in the statute or its legislative history, it should be assumed tat Congress intended for Rule 301 to apply in court proceedings.³⁶

Effect of Rebutting Evidence Upon Rule 301 Presumptions

Rule 301 provides that

[i]n all civil actions and proceedings not otherwise provided for by Act of Congress or by these rules, a presumption imposes on the party against whom it is directed the burden of going forward with evidence to rebut or meet the presumption, but does not shift to such party the burden [12 ELR 15062] of proof in the sense of the risk of nonpersuasion, which remains throughout the trial upon the party upon whom it was originally cast.³⁷

Widely analyzed and criticized, the Rule lies somewhere between two traditional theories about the effect of rebutting evidence upon presumptions. Legal scholars generally agree that a presumption applies to either of two types of burdens borne by a litigant with respect to evidence: (1) the burden of producing evidence (or the burden of going forward with the evidence) and (2) the burden of proof (or the burden of persuasion).³⁸ To satisfy the burden of producing evidence, a claimant "will seek to introduce enough evidence so that the judge will permit the case to get to the jury …"³⁹ while to satisfy the burden of proof a claimant will seek to introduce "enough evidence to convince the jury to find in his favor."⁴⁰ The two traditional theories would shift these evidenciary burdens in different ways when a presumption is met by rebutting evidence.

The "Thayer-Wigmore" theory follows the "bursting bubble" view of presumptions. According to this view, a presumption is merely a procedural convenience that operates only in the absence of any evidence of the presumed fact. The presumption vanishes in the face of rebutting evidence, so that the issue goes to the jury if the proponent can put on further evidence of the presumed fact, but if not, then the opponent is entitled to a directed verdict against the proponent.⁴¹ Under the Thayer-Wigmore theory, a presumption satisfies only the burden of producing evidence; when evidence is introduced to rebut the presumption, the presumption vanishes, leaving the proponent to produce evidence of the presumed fact if it is to get to the jury.

Another theory is the "Morgan-McCormick" view, which gives greater effect to presumptions, emphasizing that they are usually created for substantive policy reasons rather than mere procedural convenience. The Morgan-McCormick theory would either treat presumptions as shifting not only the burden of producing evidence, but the burden of proof as well, or at least would require juries to be instucted about the presumption and told that they could find contrary to the rebutting evidence.⁴² Thus, under the Morgan-McCormick view, when rebutting evidence is introduced the presumption does not simply vanish; the proponent may have the judge inform the jury about the existence of the presumption as well as instruct the jury that they could find contrary to the rebutting evidence.

The Supreme Court's proposed Rule 301 would have followed the Morgan-McCormick line of thought. However, when Congress passed the Federal Rules of Evidence it obscured the issue considerably by expressly rejecting the Morgan-McCormick view but without clearly adopting the alternative traditional view, the Thayer-Wigmore bursting bubble.⁴³ Most legal scholars now believe that the final version of Rule 301 is somewhat closer to the Thayer-Wigmore view than the Morgan-McCormick view,⁴⁴ yet it is difficult to assess the practical significance of the similarity of Rule 301 to either traditional view. After all, a litigant can only tell whether an evidenciary burden has been met when either the judge has ruled on any motions to take the case from the jury or the jury has returned its verdict. Consequently, a party must put on as much evidence as is believed necessary to support its contentions.⁴⁵

Application of Rule 301

The following example illustrates the effect of Rule 301 in a suit brought for natural resource damages under CERCLA. Suppose polluter (P) releases a hazardous substance into a river, causing damage to aquatic life. In a subsequent jury trial in federal district court on the issues of the scope and value of natural resource damages, the federal government (G) presents the following evidence:

(1) There is a statutory rebuttable presumption in favor of its damage assessment, which was made according to § 301(c) regulations for major releases;

(2) Its field survey indicates that 50,000 eight-inch crappie died because of the released substance;

(3) According to its fish table the value of that size and species of fish is $1.00 per fish, based on replacement costs at local hatcheries.

Four key questions concerning Rule 301 are raised by this scenario.⁴⁶

(1) What is the procedural effect of an unrebutted assumption?

Under Rule 301, a proponent's proof that a presumption exists satisfies his burden of producing evidence. But if the opponent produces no rebutting evidence, the proponent is not entitled to a directed verdict in his favor, in contrast to the Thayer-Wigmore theory. Instead, the proponent is entitled only to an instruction that the jury "may presume the existence of the presumed fact; the presumption has no mandatory effect on the jury."⁴⁷ Assuming that P introduced no evidence to rebut G's final assessment, it is clear that G's proof of the presumption satisfied its burden of producing evidence. But since [12 ELR 15063] G is not entitled to a directed verdict in its favor, it may receive only an instruction that the jury may presume the presumed fact. Thus, G's evidence regarding the number of fish killed and the reliability of its fish value table still must satisfy the burden of persuading the jury to find in its favor.

(2) What is required to rebut the presumption?⁴⁸

Curiously, the legislative history of the FRE concerning this question is vague. The Conference Report mentions only "evidence contradicting the presumed fact" and "no evidence." Under one reading of Rule 301, the court may allow any evidence to rebut a presumption, even if that evidence would be insufficient to support a finding of the nonexistence of the presumed fact. A more circumscribed approach, which legal scholars prefer,

would be that the judge acquires discretion over the presumption instructions only when the evidence would support a jury finding of the nonexistence of the presumed fact. The Report does not consider the possibility that the opponent's evidence might be so strong as to entitle him to directed verdict on the nonexistence of the presumed fact, but the refernece to the fact that the presumption is only sufficient to survive a directed verdict "at the end of his case-in-chief" presupposes the pssibility of a preemptory ruling at a later point.⁴⁹

For example, suppose P introduces some rebutting evidence, e.g., that the crappie are worth only $0.25 each, according to a fish farm supply catalogue. Under the former interpretation of Rule 301, P has rebutted G's evidence. But under the preferred interpretation, the judge acquires discretion over the jury's instructions on the presumption only when P's evidence is strong enough to support a finding of the nonexistence of the presumed fact; otherwise, the judge must instruct the jury that it may presume the presumed fact. Thus, ifG's foundation evidence for its field survey and fish value table is relatively weak, the judge would have discretion over the jury instructions, but if the foundation evidence was strong, the judge would have no discretion over the jury instructions.⁵⁰

(3) Who decides if the presumption is rebutted?

Under Rule 301 the judge decides if the presumption is rebutted. The Rule provides a less drastic consequence of rebuttal than does the Thayer-Wigmore bursting bubble approach, because regardless of the relative weights of the evidence presented by G and P, the decision concerning rebuttal still would lie with the judge.

(4) What is the effect of rebuttal on the operation of the presumption?

Under the Thayer-Wigmore theory, a rebutted presumption has no further effect. Under the Morgan-McCormick theory, rebutting evidence only satisfies the opponent's burden of proof; it does not "burst the bubble." Thus, the issue still would go to jury, and the judge would be required to instruct the jury about the presumption. Under Rule 301, "the jury is no longer instructed that it may presume the existence of the presumed fact, but only that it may infer it. Unlike the Morgan-McCormick viewpoint, the instruction is discretionary with the judge, not mandatory."⁵¹

Applying this reasoning to the hypothetical, P's proof of rebutting evidence as to the value of the fish would not dissipate completely the presumption in favor of G. That presumption would still take the issue to the jury unless P's rebutting evidence was so strong that no reasonable jury could disbelieve it. If the issue went to the jury, under Rule 301 the jury would be instructed that it may infer the existence of the presumed fact, i.e., the assessed value of the damage. Such instruction would be discretionary with the judge, not mandatory. The judge's exercise of discretion probably would turn on such factors as the relative strengths of the evidence, the complexity of the fact issues, and the nature and extent of the damage.

Jury Versus Nonjury Trials

A significant feature of Rule 301 is that it increases the power of the jury in deciding fact issues by decreasing the judge's discretion over presumptions.⁵² If so, the rule has [12 ELR 15064] importanttactical implications for the cholice between administrative and judicial forums for litigating damage assessment issues under CERCLA, since the latter forum allows jury trials while the former does not. Thus, a claimant could in effect choose whether Rule 301 will apply by selecting the appropriate forum.

Even if Rule 301 applied in administrative proceedings against the fund, the Rule would be of little consequence because of the absence of juries.⁵³ Because the judge decides the fact issues in a nonjury civil trial, jury instructions cease to be important and the distinction between the burden of producing evidence, which relates to the judge, and the burden of proof, which relates to the jury, is blurred. In other words, the allocation of power between judge and jury becomes irrelevant in a nonjury trial. These consequences would seem to apply with equal force to adjudicatory administrative hearings before an arbitrator under CERCLA. Thus, a government claimant seeking to assert a claim for natural resource damages under CERCLA must choose between forums that differ significantly in their treatment of rebuttable presumptions. In effect, the choice is not only whether Rule 301 is to govern the presumption, but also whether decisionmaking authority is to be divided between judge and jury.

Conclusion

CERCLA has established a comprehensive system for the recovery for damage to natural resources. Section 107(f) authorizes federal or state governments to assert claims for damages to a broad range of natural resources, and § 301(c) mandates the promulgation of regulations that will standardize damage assessments. Section 111(h) will play a crucial role in this system; by establishing a rebuttable presumption in favor of § 301(c) assessments, it helps a government claimant prove its claims about the extent and value of natural resource damages. In addition, this statutory presumption should help make the damage recovery process more consistent than it would be using common law presumptions. While most early suits under CERCLA have focused upon recovery for costs of response or remedial action, it can be expected that resource damage claims will begin appearing either in new cases or as amendments to existing suits.

1. 1.42 U.S.C. §§ 9601-9657, ELR STAT. 41941.

2. 43 U.S.C. § 1653(a)(1), (c)(1), ELR STAT. 41431.

3. 33 U.S.C. § 1517(d), ELR STAT. 41705.

4. 43 U.S.C. § 1813(b)(3), ELR STAT. 42475.

5. CERCLA defines "natural resources" as

land, fish, wildlife, biota, air, water, ground water, drinking water supplies, and other such resources belonging to, managed by, held in trust by, appertaining to, or otherwise controlled by the United States (including the resources of the fishery conservation zone established by the Fishery Conservation and Management Act of 1976), any State or local government, or any foreign government.

CERCLA § 101(16), 42 U.S.C. § 9601(16), ELR STAT. 41943.

The Federal Water Pollution Control Act (FWPCA), 33 U.S.C. §§ 1251-1376, ELR STAT. 42101, does not establish liability for resource damages. Rather, it establishes liability for the actual costs of removing oil or hazardous substances. 33 U.S.C. § 1321(f)(1), ELR STAT. 42134. While such costs are broadly defined in § 1321(f)(4) as "any costs or expenses incurred … in the restoration or replacement of natural resources damaged or destroyed as a result of a discharge," they are distinct from damages. A government could recover under CERCLA for natural resource damages without having to incur any removal costs. But see Commonwealth of Puerto Rico v. S.S. Zoe Colocotroni, 628 F.2d 652, 673-78, [10 ELR 20882] (1st Cir. 1980) (primary standard under Puerto Rican law for environmental damages caused by oil spill is the reasonable cost of restoring or rehabilitating the affected area without grossly disproportionate expenditures).

6. These claims are in addition to possible claims for the costs of governmental response or remedial actions to mitigate harm to public health or the environment. CERCLA § 107(a), 42 U.S.C. § 9607(a), ELR STAT. 41947. CERCLA established the "superfund," a revolving fund derived from taxes on chemicals producers and from general revenues, to pay for cleanup costs. This system enables the government to act expeditiously to protect public health and the environment, and then recover its costs as well as resource damages from the responsible parties.

7. CERCLA's resource damage system originated in two sections of S. 1480. See S. 1480, 96th Cong., 2d Sess. §§ 4(b) and 6(e) (1980). Section 4(b), which was modified to exclude from liability those releases occurring wholly before enactment of CERCLA, became CERCLA § 107(f). Section 6(e) of S. 1480 was broken into two parts; § 6(e)(1)(A)-(C) became CERCLA § 301(c)(1)-(3) and § 6(e)(2) & (3) became CERCLA § 111(h)(1) & (2). The only substantive modificiation concerned the designation of the agencies responsible for promulgating regulations and making damage assessments. S. 1480 assigned responsibility to certain agencies expressly, but Congress instead chose to leave such assignment to presidential discretion. See generally SUPERFUND: A LEGISLATIVE HISTORY, VOL. 1 (H. Cohn Needham and M. Menefee, eds. 1982) (forthcoming publication of the Environmental Law Institute).

8. 42 U.S.C. § 9607(f), ELR STAT. 41948.

9. 42 U.S.C. § 9651(c), ELR STAT. 41954.

10. 40 C.F.R. pt. 300, 47 Fed. Reg. 31180 (July 16, 1982), ELR REG. 47401 (revised National Contingency Plan).

11. 42 U.S.C. § 9611(h)(1), ELR STAT. 41950. See Comment, EPA Proposes Court-Ordered Contingency Plan Revisions Under "Superfund"; Stresses "Flexible" Cleanup Standards, 12 ELR 10040 (1982).

12. 42 U.S.C. § 9611(h)(2), ELR STAT. 41950.

13. 42 U.S.C. § 9607(a), ELR STAT. 41947.

14. 42 U.S.C. § 9607(f), ELR STAT. 41947. It provides:

(f) In the case of an injury to, destruction of, or loss of natural resources under subparagraph (C) of subsection (a) liability shall be to the United States Government and to any State for natural resources within the State or belonging to, managed by, controlled by, or appertaining to such State: Provided, however, That no liability to the United States or State shall be imposed under subparagraph (C) of subsection (a), where the party sought to be charged has demonstrated that the damages to natural resources complained of were specifically identified as an irreversible and irretrievable commitment of natural resources in an environmental impact statement, or other comparable environment analysis, and the decision to grant a permit or license authorizes such commitment of natural resources, and the facility or project was otherwise operating within the terms of its permit or license. The President, or the authorized representative of any State, shall act on behalf of the public as trustee of such natural resources to recover for such damages. Sums recovered shall be available for use to restore, rehabilitate, or acquire the equivalent of such natural resources by the appropriate agencies of the Federal Government or the State government, but the measure of such damages shall not be limited by the sums which can be used to restore or replace such resources. There shall be no recovery under the authority of subparagraph (C) of subsection (a) where such damages and the release of a hazardous substance from which such damages resulted have occurred wholly before the enactment of this Act.

15. 43 U.S.C. § 1813(a)(1) & (2), ELR STAT. 42479.

16. Section 107(f) also creates two exceptions to liability. One is that no liability for natural resources damages shall be imposed

where the party sought to be charged has demonstrated that the damages to natural resources complained of were specifically identified as an irreversible and irretrievable commitment of natural resources in an environmental impact statement … and the decision to grant a permit or license authorizes such commitment of natural resources, and the facility or project was otherwise operating within the terms of its permit or license.

Another exception is for situations where both the natural resource "damages and the release of a hazardous substance from which such damages resulted have occurred wholly before the enactment of this Act." 42 U.S.C. § 9607(f), ELR STAT. 41947.

17. See generally Sax, The Public Trust Doctrine in Natural Resource Law: Effective Judicial Intervention, 68 MICH. L. REV. 471 (1970). See also W. RODGERS, ENVIRONMENTAL LAW 172 (1977). The foundation of public trust law is Illinois Central R.R. Co. v. Illinois, 146 U.S. 384 (1892). See also Sierra Club v. Dep't of the Interior, 376 F. Supp. 90, 4 ELR 20444 (N.D. Cal. 1974), further proceedings 398 F. Supp. 284, 5 ELR 20514 (N.D. Cal. 1975); In re Stewart Transportation Co., 495 F. Supp. 38, 10 ELR 20278 (E.D. Va. 1980) (federal government and Virginia could recover under the public trust doctrine for the value of approximately 30,000 migratory waterfowl killed by an oil spill); Maryland v. Amerada Hess, 350 F. Supp. 1060, 2 ELR 20606 (D. Md. 1972) (state could sue as trustee for harm to water quality that resulted from an oil spill); Puerto Rico v. S.S. Zoe Colocotroni, 628 F.2d 652, 10 ELR 20882 (1st Cir. 1980) (Puerto Rico has a statutory right to seek recovery for environmental harm caused by an oil spill).

18. 16 U.S.C. §§ 1531-1543, ELR STAT. 41825.

19. See, e.g., In the Matter of Allied Towing Corp., 478 F. Supp. 398 (E.D. Va. 1979), where the court, in discussing the issue of liability for oil removal costs under the FWPCA, stated that "the actual costs incurred by the states for the restoration or replacement of their resources, as distinguished from similar costs incurred by the Federal Government on the state's behalf, may be recovered only by the states." 478 F. Supp. at 402. Courts should avoid a similar interpretation regarding resource damage claims under CERCLA because it needlessly complicates damage recovery efforts. The federal and state governments should delegate their claims authority to each other in CERCLA proceedings. Such delegation should not be considered a breach of a public trustee's duty, especially when done in the context of general cooperation in removal and remedial efforts.

20. As one author observed, "with a reasonable degree of cooperation between federal and state governments on restoration planning and implementation, the task of such an allocation [of claims] might be permanently avoided." See S. Bleicher, The Impact of Superfund on Government Claims for Damages to Natural Resources, ENVTL. PROTECTION REP. 5 (Aug. 1981) (National Governors Association).

21. 42 U.S.C. § 9651(c), ELR STAT. 41954. It provides:

(c)(1) The President, acting through Federal officials designated by the National Contingency Plan published under section 105 of ths Act, shall study and, not later than two years after the enactment of this Act, shall promulgate regulations for the assessment of damages for injury to, destruction of, or loss of natural resources resulting from a release of oil or a hazardous substance for the purposes of this Act and section 311(f)(4) and (5) of the Federal Water Pollution Control Act.

(2) Such regulations shall specify (A) standard procedures for simplified assessments requiring minimal field observation, including establishing measures of damages based on units of discharge or release or units of affected area, and (B) alternative protocols for conducting assessments in individual cases to determine the type and extent of short- and long-term injury, destruction, or loss. Such regulations shall identify the best available procedures to determine such damages, including both direct and indirect injury, destruction, or loss and shall take into consideration factors including, but not limited to, replacement value, use value, and ability of the ecosystem or resource to recover.

(3) Such regulations shall be reviewed and revised as appropriate every two years.

These regulations are due December 11, 1982, but the Department of the Interior, which was assigned responsibility for their promulgation under Exec. Order No. 12,316 of Aug. 14, 1981, 46 Fed. Reg. 42237, has not begun drafting them.

22. Through these regulations, Congress intended to create a fair and expeditious standardized damage assessment system. The Senate Committee on Environment and Public Works stated that its investigations.

revealed the need for an improved, fair and expeditious mechanism for dealing with natural resource damages caused by releases of hazardous materials. The principal hindrance to attaining such a mechanism was the absence of a standardized system for assessing such damage which is efficient as to both time and cost.

S. REP. No. 96-848, 96th Cong., 2d Sess. 85 (1980). The Committee's emphasis on fairness suggests the desire for an accurate, noncontroversial data base. Its emphasis on efficiency in terms of time and cost reflects the desire for simple yet effective techniques for damage measurement.

23. Id. at 86.

24. Id. at 85-86.

25. Id. at 86.

26. 42 U.S.C. § 9611(h)(1), ELR STAT. 41950. It provides:

In accordance with regulations promulgated under section 301(c) of this Act, damages for injury to, destruction of, or loss of natural resources resulting from a release of a hazardous substance, for the purposes of this Act and section 311(f)(4) and (5) of the Federal Water Pollution Control Act, shall be assessed by Federal officials designated by the President under the national contingency plan published under section 105 of the Act, and such officials shall act for the President as trustee under this section and section 311(f)(5) of the Federal Water Pollution Control Act.

27. The provision states:

An determination or assessment of damages for injury to, destruction of, or loss of natural resources for the purposes of this Act and section 311(f)(4) and (5) of the Federal Water Pollution Control Act shall have the force and effect of a rebuttable presumption on behalf of any claimant (including a trustee under section 107 of this Act or a Federal agency) in any judicial or adjudicatory administrative proceeding under this Act or section 311 of the Federal Water Pollution Control Act.

42 U.S.C. § 9611(h)(2), ELR STAT. 41950. Section 311 of the FWPCA has been interpreted to provide for a rebuttable presumption. See United States v. Chevron Oil Co., 583 F.2d 1357, 8 ELR 20847 (5th Cir. 1978) ("Sheen test" set out in § 311(b)(4) regulations, which specifies those quantities of oil discharges that cause a "film or sheen upon or discoloration of the surface of the water," interpreted to be a rebuttable presumption such that a discharge which produces a sheen is presumed harmful, and hence defendant is subject to the civil penalty provisions of § 311(b)(6), unless the defendant can prove that the discharge actually caused no harm).

28. See McCORMICK, EVIDENCE 820 (E. Cleary 2d ed. 1972).

29. Id. at 820 n.32.

30. 42 U.S.C. § 9612(a), ELR STAT. 41951.

31. Upon receipt of the claim, the Environmental Protection Agency (EPA) shall notify affected parties and attempt to arrange a settlement. Exec. Order No. 12316 of Aug. 14, 1981, 46 Fed. Reg. 42237, delegated to EPA the authority under CERCLA § 111(a) to pay claims out of the fund. If the claimant and an alleged liable party agree on a settlement it shall be final and binding and the claimant no longer will have recourse against the fund. CERCLA § 112(b)(2)(A), 42 U.S.C. § 9612(b)(2)(A), ELR STAT. 41951. If a liable party is unknown or cannot be determined, the claimant and EPA shall attempt to arrange a settlement against the fund. EPA may promulgate regulations governing proof and procedures and is authorized to award and pay a settlement out of the fund. CERCLA § 112(b)(2)(B), 42 U.S.C. § 9612(b)(2)(B), ELR STAT. 41951. If no settlement is reached within 45 days of filing of a claim, EPA may make and pay an award. If a claimant is dissatisfied with the amount, it may appeal to federal district court. And if EPA decides not to make any award, it shall then submit the claim to an arbitrator who, after a hearing, may make a final decision regarding the claim. CERCLA § 112(b)(3), (4), 42 U.S.C. § 9612(b)(3), (4), ELR STAT. 41951.A claimant may appeal an arbitrator's decision in federal district court, but the decision shall not be overturned unless it is an "arbitrary or capricious abuse of discretion." CERCLA § 112(b)(4)(G), 42 U.S.C. § 9612(b)(4)(G), ELR STAT. 41951.

32. 42 U.S.C. § 9612(b)(4)(C), ELR STAT. 41951.

33. 42 U.S.C. § 9612(b)(4)(G), ELR STAT. 41951.

34. FED. R. EVID. 301.

35. C. WRIGHT AND K. GRAHAM, 21 FED. PRACTICE AND PROCEDURE § 583 (1977) [hereinafter referred to as WRIGHT AND GRAHAM].

36. The Senate Environment and Public Works Committee, which amended and reported out S. 1480, was mindful of this issue. Section 4(c)(3)(A) established a presumption that a claimant's exposure to a hazardous substance caused or significantly contributed to the claimant's injury or disease. Section 4(c)(3)(B) provided that this presumption "affects only the burden of going forward with the presentation of the case. Nothing in this paragraph shall affect the burden of proof which shall remain with the claimant in accordance with rule 301 of the FEDERAL RULES OF EVIDENCE." See S. REP. No. 96-848, supra note 22, at 108-15 (supplemental views of Senator Stafford). Unfortunately, the personal injury provisions of S. 1480, including the presumption of causation, were dropped by Congress when it enacted CERCLA. While the presumption regarding natural resource damage was retained, neither the Committee nor Congress made any reference to Rule 301.

37. FED. R. EVID. 301.

38. There are several distinctions between the two burdens.

First, the burden of proof is in practice largely a question of the proper phrasing of jury instructions; the burden of producting evidence determines whether the case is to be decided by the judge or the jury.Second, the issue of burden of proof arises only at the time of jury instructions, while the burden of producing evidence is at issue any time one or the other of the parties asks for a preemptory ruling from the court; i.e., on motions for nonsuit, directed verdict, or judgment notwithstanding the verdict. Third, the burden of proof can be shifted only as the result of the proof of a presumption, while the burden of producing evidence can switch from one side to the other as the result of the introduction of evidence as well as by operation of a presumption.

WRIGHT AND GRAHAM, supra note 35, at 558.

39. Id.

40. Id.

41. Id. at 564.

42. Id. at 564-65.

43. Id. at 571, 572-73.

44. See, e.g., McCORMICK, supra note 28, at § 345 (1978 Pocket Part) and WRIGHT AND GRAHAM, supra note 35, at 573.

45. WRIGHT & GRAHAM, supra note 35, at 558-559.

46. The questions are from WRIGHT AND GRAHAM, supra note 35, at 571-572.

47. Id. at 571.

48. At least one case under § 311(b)(3) of the FWPCA, the civil penalty provision, has addressed the effect of rebutting evidence on a presumption. See U.S. v. Chevron Oil Co., 583 F.2d 1357, 8 ELR 20847 (5th Cir. 1978). The Coast Guard's oil sheen test of the harmfulness of an oil discharge was treated as a rebuttable presumption. See note 27, supra. The court allowed the defendant to rebut the presumption with the testimony of an expert witness that the discharge was not harmful. It found for the defendant, reasoning that

Evidence of a sheen thus provides a sufficient basis for the government to assess the section 1321(b)(6) civil penalty unless a defendant proves that its spill was not harmful under the circumstances. If a defendant introduces such evidence, as Chevron did here through Dr. Mackin, the Government must rebut with evidence that defendant's spill was of a harmful quantity under the circumstances.

583 F.2d at 1364, 8 ELR at 20850 (emphasis in original). Although the court did not discuss Rule 301 or the competing legal theories about presumptions, its holding appears closer to the Thayer-Wigmore "bursting bubble" than the Morgan-McCormick view.

49. WRIGHT AND GRAHAM, supra note 35, at 572.

50. It is interesting to speculate how a defendant might attempt to rebut a claimant's damage assessment made according to type A as opposed to type B procedures. Would the same rebutting evidence, such as a recently conducted onsite survey of fish and animal populations, better rebut a claimant's type A assessment, which uses value tables and prior studies but minimal field observation, or its type B assessment, with its protocols and onsite field investigations? Since CERCLA requires type A assessments to use minimal field observation, such assessments might not be easily rebutted by a defendant's onsite field survey. A defendant might find it easier to rebut a type B assessment with its onsite study, since type B assessments also utilize onsite field investigations. Rebutting a type A assessment with onsite studies probably will depend upon the strength of the presumption. If the presumption is too strong, even recent and reliable field studies might not rebut older, perhaps less reliable studies and tables.But if the presumption is too weak, type A assessments would rarely withstand attack.

51. WRIGHT AND GRAHAM, supra note 35, at 572.

52. Wright and Graham emphasize the rule's allocation of authority between judge and jury:

It is apparent from this summary that Rule 301, while it has some features that would appeal to both schools of thought, creates a presumption that is neither Thayer-Wigmore nor Morgan-McCormick. Since the effect of Rule 301 is to increase the number of cases that are decided by the jury rather than the judge, it leans toward the Morgan-McCormick point of view. On the other hand, the mandatory effect of the rule 301 presumption is limited to taking the case to the jury; thereafter, it has only such effect as the jury chooses to give it. In this respect, the Rule may be said to resemble the true Thayer-Wigmore theory. Since the rule contemplates telling the jury about the presumption in most cases, it adopts a policy advanced by Professor McCormick. But in attempting to find a middle ground between the two extremes, Congress has developed a presumption doctrine that is novel only in its sweeping application…. But if the exact details are not clear, the policy is; Rule 301 is designed to increase the power of the jury in deciding factual controversies by reducing the authority of courts to create and enforce presumptions that would take the case from the jury or require that it be decided in a particular way. The Rule 301 presumption operates only against the judge; insofar as the jury is concerned it is simply an authorized inference.

Id. at 572-73.

53. Wright and Graham ask:

What is the effect of a Rule 301 presumption in a nonjury trial? If it is assumed that the rule applies, the answer would seem to be: very little. Since there are no instructions, this aspect of the presumption is meaningless in a court trial. The notion that the presumption "takes the case to the jury" would also seem to be without meaning; since in passing on a motion for an involuntary dismissal the judge weights the evidence, he presumably would have the same freedom as the jury to disregard the presumption …. Perhaps the only possible effect of the presumption in a court trial is to insulate a finding supported by a presumption from appellate reversal on grounds of lack of evidentiary support.

Id. at 612-13. See also 576-77.