"Arranging For Disposal" Under CERCLA: When Is A Generator Liable?

Suzanne C. Baskin & Phillip D. Reed

Editors' Summary: A close reading of the broad and convoluted liability provisions of the Comprehensive Environmental Response, Compensation, and Liability Act suggests that generators who arranged for the disposal of wastes are not liable for cleaning up subsequent hazardous substance releases to the environment, unless they chose the unsafe sites at which the releases occurred. The legal battles that have been waged over the scope of generator liability under the Act have largely bypassed this issue, concentrating instead on joint and several liability and causation. While those fights are not over, the results to date have been one-sided, in favor of expanding generator liability in accordance with the legislative history and policy considerations of the Act.In two recent cases raising the site selection issue, generator defendants fared no better. While the most recent decision lends some support to the argument that generators that did not choose the leaking disposal site should be exculpated, the court found a way to make the generator potentially liable for cleanup of its toxic wastes.

[15 ELR 10160]

The Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA),¹ enacted in 1980 in response to the revelation that thousands of inactive hazardous substance disposal sites were leaking their deadly contents into the environment,² establishes broad liability for past acts under the principle that those "responsible" for hazardous substance releases from unsafe sites should bear the costs associated with such releases.³ One of the central issues raised by this statute, whose reliance on retrospective liability rather than prospective regulation makes it unique in federal pollution control law, has been how broadly it casts the net of responsibility over those who generated the toxic wastes. CERCLA § 107(a) identifies four categories of responsible parties: present and past owners and operators of leaking sites, those who transported the wastes to them, and, in subsection (a)(3), those who "arranged for disposal or treatment . . . of hazardous substances . . . at any facility . . . containing such hazardous substances . . . from which there is a release, or a threatened release which causes the incurrence of response costs."⁴ The fourth category, universally labelled not "arrangers"but "generators," is the most important. Past owners and operators of chemical waste dumps, and transporters, often were individuals or small companies who cannot be found today or who lack the substantial resources needed to clean up the sites. Present owners, at least, can readily be found, but often are impecunious as well. In contrast, those who generated the hazardous substances now oozing from their disposal sites often are wealthy industrial giants.

The difficulty with this category is proving their connection with a given site. The hazardous waste disposal industry of the last four decades has not been noted for its punctilious record keeping. Fragmentary bills of lading or barely legible labels on rusting steel drums may be the only evidence linking a company's wastes with a particular site. That site may have received wastes that originated at [15 ELR 10161] dozens or even hundreds of different companies, and many of the generators may have no records of their disposal arrangements ten or twenty years ago. The most attractive type of responsible party is thus the most difficult to link with a site. The federal government has aggressively sought to make generator liability under CERCLA § 107 as broad as possible, provoking a legal war. The government has won every battle, persuading dozens of courts that the Act imposes strict liability, and where the injury cannot be apportioned, joint and several liability. It has won to date on its theory that CERCLA requires only limited proof of causation. Finally, it has convinced courts that the third-party defenses in § 107(b) are narrow and exclusive.

In all the flurry of litigation over generator liability, much of which concerns concepts not mentioned in the statute, another question raised by the plain language of § 107(a)(3) has not been addressed. The question, simply put, is whether generators are liable only if they chose the site from which a release and response (cleanup) action subsequently occurred. A strict reading of § 107(a)(3) would result in a major loophole in the Act, since the government would carry the burden of proving that generators selected the site to which the wastes were delivered. Placing this burden on the government would increase the number of cases in which the Superfund, rather than generators, pays for cleanup costs. Was the attenuated linking of the phrases "arranged for disposal" . . . "at any facility" . . . "from which there is a release" intended to require CERCLA plaintiffs to prove this seemingly miminal level of culpability? Or is it enough if the generator arranged to dispose of the substances anywhere and they somehow ended up in a site that now is leaking?

These questions have been squarely presented in only one CERCLA case, though they were touched on in one other instance. In Missouri v. Independent Petrochemical Corporation (IPC),⁵ a federal court held that a state could seek to recover response costs for cleanup of dioxin released at the Minker hazardous waste site, even though the defendant generator's liability was premised on arrangements made to dispose the waste at a different facility.⁶ Unfortunately, the decision's potential precedential value for clarifying the "arranging for disposal" language under CERCLA is limited by the elusive nature of the court's rationale. The court arrives at its decision without directly addressing the question of whether or not generator liability under CERCLA § 107(A)(3) requires that the generator arranged for disposal at the same facility at which release or threatened release results in the incurrence of response costs.⁷ Instead, the court ruled that the removal of the waste to the second site constituted a foreseeable "release." Even in dodging the question, however, IPC does shed useful light on the proper interpretation of § 107(a)(3).

This Comment first looks to the statutory language and legislative history of "arranging for disposal" under CERCLA § 107(a)(3) to discern congressional intent in delineating the scope of generator liability under the Act. Next, the Comment focuses on recent judicial interpretations of the Act's liability provisions, examining generator conduct that lies within the meaning of CERCLA § 107(a)(3), and the narrow range of conduct that falls beyond its parameters. Finally, the Comment compares IPC's interpretation of "arranging for disposal" to other courts' readings of § 107(a)(3) to determine which approach best implements the purposes of CERCLA.

Generator Liability under § 107(a)

EPA interprets § 107(a) broadly. It reads the section to impose strict, joint and several liability on hazardous waste generators,⁸ although those terms were not expressly incorporated into the Act.⁹ A single generator theoretically could be held liable, without fault, for the cost of cleaning up a disposal site that received hundreds of companies' wastes. This reading of § 107 reserves Hazardous Substance Response monies for cleanup of orphan disposal sites for which financially viable generators of hazardous substances cannot be identified.

Statutory Language

The statute states:

(a) Notwithstanding any other provision or rule of law, and subject only to the defenses set forth in subsection (b) of this section — . . .

(3) any person who . . . arranged for disposal or treatment, or arranged with a transporter for transport for disposal or treatment, of hazardous substances, . . . atany facility . . . containing such hazardous substances, . . . from which there is a release, or a threatened release which causes the incurrence of response costs, . . . shall be liable for . . . all costs or remedial action . . .¹⁰

After one struggles through this maze of clauses and phrases, two interpretations begin to emerge. The first, and facially more persuasive, is that the generator must have arranged for disposal at the leaking site. The elements of that equation are connected in a single sentence. If one strips away all the intervening verbiage, "at the facility" "from which there is a release" do modify "arranged for disposal." The splintered phrasing and clumsy construction of § 107(a) do, however, cast a shadow of doubt over the reading. The gloom deepens upon consideration of the implications of the not-so-plain meaning of the provision. Generators who took the trouble to select a disposal site would be inculpated; those who washed their hands of responsibility at the plant gate and told the transporter "I do not want to know what you do with this stuff," would be exculpated. Such an irrational result should not lightly be attributed to Congress, particularly since CERCLA was drafted in great haste.

Generators who arranged for disposal under § 107(a) are not liable if they can establish that the release was caused [15 ELR 10162] by an act of God, an act of war, or an act or omission of a third party, on condition that the generator exercised due care and took precautions against the third party's foreseeable acts or ommissions.¹¹ The third-party defense does not apply to persons with whom a generator defendant directly or indirectly maintained a contractual relationship.

Interpreting § 107(a) in light of § 107(b) can lead in two directions. The express limitation of intervening causes that may serve as generators' defenses to liability under § 107(b) indicates that Congress intended responsible parties to be held liable except in an extremely narrow range of situations. The qualifying language surrounding the third-party defense, which excludes employees or others contractually connected with the generator defendant, and requires not only that the generator exercised due care, but also that it took prophylactic measures against foreseeable conduct of a third party, also indicates legislative intent to limit the use of this defense. One could argue that this section has no bearing on its predecessor, since the defenses only apply to responsible parties, which begs the question of what arrangements must have been made to make a generator responsible. On the other hand, requiring EPA to prove that a defendant chose the specific site would in effect require it to show the absence of a third party intervening cause, which would be anomalous in light of Congress' clear desire in § 107(b) to limit the extent to which third party intervention could be exculpatory. Analysis of § 107(b), at a minimum, adds to the uncertainty about what Congress meant in § 107(a)(3). The splintered phrasing of § 107(a)(3), broken down into a series or segments separated by numerous commas and hyphens, precludes any definite conclusion as to what Congress intended. The subsection could be approached as a series of separate and independent phrases, in which case generators would be liable for arranging for disposal as long as their hazardous substances eventually arrived at the site of the release for which response costs were sought.¹² Alternatively, it could be viewed as a cohesive unit in which each subsequent fragment modifies the precedent phrase. According to this latter reading, a generator defendant could be liable only if it arranged for disposal at the same facility from which there was the release that resulted in incurrence of response costs.

Legislative History

The haste with which the Act was rushed through Congress has meant that its legislative history is scantier than that of most statutes. Although the 96th Congress considered over twenty proposals concerning liability and compensation for environmental pollution,¹³ only three were reported out of committee. S. 1480, the broadest and most important of these bills, provided for strict, joint and several liability, and included provisions to cover pollution-caused private injuries and medical costs.¹⁴ The purpose of these provisions was "to induce potentially liable persons to voluntarily mitigate damages."¹⁵ When pressing time considerations made passage of any of the three bills unlikely before the close of the 96th Congress, Senators Stafford and Randolph proposed a compromise bill, based on provisions of S. 1480.The Stafford-Randolph Compromise Bill,¹⁶ which retained the concept of strict liability¹⁷ but not joint and several liability, due to industry objections, formed the skeletal structure of CERCLA.¹⁸ This bill is the key to the current liability provisions. Three early bills contained language pertinent to the legislative history of "arranged for disposal;"¹⁹ none originally incorporated that language. S. 1341, which died in committee, extended liability to "owners, lessees and operators of inactive or abandoned waste disposal sites," and to "other persons who caused or contributed to the release at such disposal sites, including but not limited to prior owners, lessees, and generators or disposers."²⁰ The bill's general purpose was to authorize governmental response actions to oil and hazardous waste pollution of navigable waters.²¹

[15 ELR 10163]

Liability under H.R. 7020, which was reported out, also extended to "any person who caused or contributed" to a release or threatened release, and called for strict liability for "costs, damages, and losses."²² The liability provisions of the bill, however, were completely replaced by the Stafford-Randolph Compromise Bill, which incorporated verbatim the liability provisions of S. 1480 that now constitute CERCLA § 107. Therefore, the legislative history behind the S. 1480 liability provision is the key to understanding generator liability provisions under the Act.

S. 1480, as introduced on July 11, 1979, extended liability to "any person who caused or contributed" to a release or threatened release of hazardous substances.²³ This language survived the drafting of S. 1480 Working Paper No. 1, of February 1, 1980.²⁴ In this working paper, the Senate Committee on Environmental and Public Works retained language imposing joint, several and strict liability on "any other person who caused or contributed or is causing or contributing to such discharge, release, or disposal" and deleted the phrase "including but not limited to prior owners, lessees, and generators, transporters, or disposers of such hazardous substances."²⁵

Three months later, on June 2, 1980, the Committee drafted a second working paper, which altered language affecting liability under the proposed legislation.²⁶ The Committee dropped the "caused or contributed" language, and instead imposed liability on "any person who by contract, agreement, or otherwise arranged for disposal, treatment or transport for disposal or treatment."²⁷

S. 1480, as reported out, retained the "arranged for" language, later incorporated into the Compromise Bill, and then into the Act itself. The reasons for Congress' preference for "arranged for" over "caused or contributed to" are not easy to divine, but there are some indications that the change was meant to reduce the causal nexus necessary to find a generator liable.²⁸ That the change addresses causation and not culpability is made clear by the fact tat the legislative history unambiguously sets out strict liability. Since "caused or contributed to" evokes established common law considerations of proximate causation of the damage and "arranged for disposal" does not, it seems likely that Congress intended a looser causal connection.

This interpretation does not resolve the question of whether the generator had to have chosen the site. It suggests, as EPA has successfully argued, that liability does not depend on proof that a generator defendant's wastes are present in the release. While this does not directly concern choice of the site, it does raise the question why, if generator liability is to accrue without fault and on the basis of miminal causation, Congress would have limited it on the fairly arbitrary basis of whether the generator chose the site.

Judicial Interpretation of "Arranged for Disposal"

Few courts have delved specifically into the "arranged for" language of § 107(a)(3). The courts that have, have done so primarily in two situations. First, courts have found it necessary to examine this language when generators arguably have arranged for something other than disposal or treatment at a facility. The second set of circumstances under which the "arranged for" language has been at issue is where generators unquestionably arranged for "disposal," but did not select the facility at which the release occurred and response costs were incurred. These courts have had to seek the point on the causation continuum at which the connection between a generator defendant and a release of hazardous substances at a site has become so attenuated that the generator cannot be held liable under § 107(a)(3).

"Arranging for Disposal or Treatment . . . At a Facility:" The Vendor Cases

Several courts have wrestled with the problem of interpreting what generator conduct constitutes arranging for disposal or treatment at a facility. Three cases in particular, United States v. A & F Materials, Inc.,²⁹ New York v. General Electric,³⁰ and United States v. Westinghouse Electric Co.,³¹ have dealt directly with this problem.

In A & E Materials, a generator's sale of spent caustic solution to a chemical recycler for use in neutralizing acidic recycled oil at the recycler's facility constituted arranging for disposal of a hazardous substance at a facility.³² Impressed with the broad language of § 107(a)(3), the court found dispositive the fact that, for the generator, the arrangement served the purpose of disposal, and that the facility contained hazardous waste.³³ The court found the marketplace nature of the transaction to be irrelevant to the Act's liability provisions.³⁴ The court agreed with the [15 ELR 10164] government's position that generator liability under CERCLA does not depend on whether the spent caustic had commercial value, or on whether its transaction with A & F was a "sale," but on whether "by contract, agreement, or otherwise" the generator arranged for disposal or treatment.³⁵

Relying on the same principle elucidated in the A & F Materials decision, the General Electric court held that a generator's sale of waste oil contaminated with hazardous substances to the operator of a dirt race track for use as a dust suppressant, constituted arranging for disposal of hazardous waste at a facility.³⁶ Focusing its attention on both the proper interpretation of "facility" under the Act, and the precise meaning of the phrase "containing such hazardous substances," the court rejected the defendant's argument that § 107(a)(3) only contemplates facilities already containing hazardous substances, since such a construction would require a conclusion that "first-time" dump sites could never be covered.³⁷ In this case, as in A & F Materials, the court ruled that under § 107(a)(3) a generator may be held liable for arranging for disposal at a facility even when "arranging for disposal" involves chemical sales, and when the "facility" does not function principally as a hazardous waste dump.³⁸

The third case, Westinghouse, held that PCB manufacturer Monsanto was not liable under § 107 for arranging for disposal at a facility as a result of its sale of PCBs to Westinghouse, which subsequently dumped waste PCBs.³⁹ In this third-party complaint by Westinghouse against Monsanto, the court characterized the transaction between the two as a manufacturer's bona fide sale of a commercial product, not as a generator's arrangement for disposal.⁴⁰ Distinguished by the court in A & F Materials, the Westinghouse decision stands for the proposition that a manufacturer's purely commercial sale of a product does not constitute "disposal."

The case differs from both A & F Materials and General Electric in two important ways. First, the transaction was different from the point of view of the hazardous substance "generator;" it was a sale for profit, not an effort to be rid of unwanted materials. Second, Monsanto did not arrange for disposal at a facility containing hazardous substances, because the PCBs were used in manufacturing, not discarded at the Westinghouse facility.⁴¹ Westinghouse later disposed of waste PCBs off-site. Had the PCBs been unwanted inventory of an unmarketable product and has Westinghouse decided not to use them in manufacturing capacitors any longer and added them to an on-site disposal facility, the result probably would have been different. In any event, while the differences among the three cases illuminate the meaning of "arranging for disposal at a facility," they do not shed light on whether the generator must have chosen the ulimate repository of the substances. Two other cases have addressed that issue.

Arranging for Disposal at the Site at Which the Release Occurs and for Which Response Costs Are Sought

Two federal district courts have faced, in different contexts, whether "arranging for disposal . . . at any facility" under § 107(a)(3) must be read in conjunction with "from which there is a release . . . which causes the incurrence of response costs," the language that follows § 107(a)(4). In one case the generator sought to be absolved of liability because a transporter chose the site; in the other the argument was based on the fact that the operator of the waste site chosen by the generator chose to move the material to a second site. Both courts rejected the arguments.

* Wade. In United States v. Wade,⁴² generator defendant contracted with the ABM Disposal Company to remove hazardous substances.⁴³ The Wade site was selected solely by ABM.⁴⁴ The decision revolved principally around whether the United States had to prove that substances traceable to the generator had been released from the site and contributed to the threat that prompted the government response action. The issue of selection of the site barely made it into the opinion, and got the generator no mileage at all. In a footnote, the court recognized that a generator has made the argument and dismissed it summarily as without support in the statute.⁴⁵ The court added that the transfer of ownership of the chemical wastes to the transporter at the time of pickup for disposal did not change the result.⁴⁶

The Wade court's casual rejection of the site selection argument is obviously a direct product of its acceptance of the government's argument that CERCLA § 107 requires only a limited showing of causation. Under this three-pronged causation test,⁴⁷ generators who arranged for "disposal" at any "facility" could be liable if their hazardous substances arrived at any facility, there was a release of any hazardous substance from that facility that prompted a response action, and substances of the type [15 ELR 10165] disposed of by the generators were in the facility at the time of the release.⁴⁸ The court reasoned that Congress did not intend to burden the government with a stringent causation standard,⁴⁹ as evidenced by congressional rejection of the "caused or contributed to" language in early versions of what became CERCLA in favor of the "arranged for disposal" language.⁵⁰ The court apparently concluded that these rulings vitiated the site selection argument as well, since it offered no explanation.

It is clear that Wade stands for the proposition that the "from which the release occurs" language following § 107(a)(4) does not modify "disposal at a facility" in § 107(a)(3). Indeed, it would have made little sense for the court to accept the limited causation argument of the government and the site selection argument of the generator. If Congress intended to place the burden of cleaning up old hazardous chemical dumps and hazardous substance releases on those in any way responsible by imposing strict, joint and several liability on generators and relaxing causation requirements, why would it have built in a rather arbitrary limitation on generator liability that bears little relationship to whether or not they were careful in handling the dangerous materials they were turning loose?

* IPC. In IPC, the most recent decision to interpret "arranged for disposal," the court held that a state could seek to recover response costs from a generator for wastes released at one site, even though the generator arranged for their disposal at another.⁵¹ The IPC court applied a rationale entirely different from that of the Wade court.⁵² In so doing, it may have breathed a little life into the generators' site selection argument.

On November 23, 1983, the State of Missouri filed suit against the Independent Petrochemical Corporation in response to the highly publicized discovery of dioxin-contaminated soil at the Minker/Stout Romain Creek (Minker) site. Missouri's claims against gernerator Syntex Agribusiness, Inc. (Syntex) for response costs associated with cleanup of the Minker site were rooted in CERCLA § 107(a)(3). Missouri alleged that Syntex arranged for the disposal or treatment of dioxin at the Bubbling Springs Ranch facility,⁵³ from which it was reasonably foreseeable that the hazardous substance would have to be removed, and from which removal to the unsafe Minker site could have been prevented.⁵⁴

Two years later, deleterious effects of the dioxin-contaminated soil on animals at the Bubbling Springs Ranch did necessitate removal of the soil from Bubbling Springs to Minker, where the soil was used as fill material.⁵⁵ Missouri's suit against Syntex for recovery of response costs incurred at the Minker site hinged on Syntex's initial arrangement to have the dioxin removed from its own holding tanks, and sent to Bubbling Springs.

Syntex argued that it could not be held liable under § 107(a)(3) because the connection between those initial arrangements and the subsequent release of dioxin from the Minker site was too attenuated.⁵⁶ Syntex arranged with Independent Petrochemical Corporation (IPC) to have the dioxin removed from its premises and sent elsewhere; IPC arranged with transported Russell Bliss for disposal of the dioxin; Russell Bliss accepted the dioxin and transported it to Bubbling Springs; owners or operators of Bubbling Springs excavated and removed the dioxin-contaminated soil from its ranch grounds; and finally, acceptors of the waste at Minker used it as fill material.⁵⁷ Although Syntex did not dispute that it arranged for disposal of wastes at Bubbling Springs, the Corporation maintained that it did not arrange for disposal at Minker, the site at which the release occurred and for which response costs were incurred.⁵⁸

Syntex insisted that under CERCLA § 107(a)(3) a generator's arrangement for disposal is not "left dangling in the abstract;"⁵⁹ the arrangement must involve the site of release.⁶⁰ Characterizing Missouri's claim as "novel under CERCLA,"⁶¹ Syntex stated that it could not be held vicariously responsible for the Minker site due to the Act's express imposition of liability only where the generator arranged for disposal at the site at which the release occurred, and for which response costs are sought.⁶² Since Syntex arranged for disposal at Bubbling Springs rather than at Minker, in Syntex's view, Missouri did not state a claim against Syntex under CERCLA § 107(a)(3).⁶³

Unconvinced by the defendant's arguments, the IPC [15 ELR 10166] court held that Missouri could seek to recover response costs from Syntex for cleanup of the Minker site.⁶⁴ The court found Syntex's argument to be "without merit," because "CERCLA imposes liability upon those who arranged for the disposal of hazardous substances which were released."⁶⁵ The court's determination that Missouri presented a cognizable CERCLA claim rested on its extension of the definition of "release"⁶⁶ to include transportation of the dioxin-contaminated Bubbling Spring's soil to the Minker site, which became the "depository" of this first release.⁶⁷ Thus, Syntex's liability for response costs incurred at the Minker site is tied to its primary source of liability for the Bubbling Springs release.

The court noted that the need to remove the waste from Bubbling Springs could have been foreseen thus ruling out a § 107(b) defense.⁶⁸ The court did not discuss whether the failure of the second site was an intervening cause, suggesting that once Syntex's wastes were hauled out of Bubbling Springs, Syntex would be liable however they reached the environment should there later be a release.

By liberally interpreting "release," the court dodged the argument of whether arrangements for disposal must be at the same facility where release occurred in order to trigger liability under § 107(a)(3). The fact that the court chose to characterize the removal of waste from Bubbling Springs as a release does however suggest that without this characterization, the court would not have held Syntex liable for response costs incurred at the Minker site. Thus, the IPC court seems to have read § 107(a) as requiring disposal at the facility where the release occurred.

In both Wade and IPC the courts concluded that generator defendants were subject to liability for arranging for disposal of hazardous substances pursuant to § 107(a)(3), despite the fact that neither defendant selected the site at which release occurred. In Wade, the transporter chose a bad site; in IPC, the operator of the site selected by the generator chose the leaky site. Both courts broadly interpreted § 107(a) in order to achieve results compatible with the Act's goal of facilitating prompt cleanup of unsafe hazardous waste disposal sites. Similarities between the two decisions end there. The two cases differed factually in one significant aspect; in Wade, the waste remained at the original site, whereas in IPC it was removed from Bubbling Springs to the Minker site, where the release of dioxin resulted in the incurrence of response costs.⁶⁹ The courts also apparently relied on different interpretations of § 107(a)(3) to arrive at the same results. Wade flatly rejects the argument that the statute only extends liability to generators who chose the site that had to be cleaned up; IPC implies that the argument is valid, but not applicable where wastes are removed from one unsafe site and taken to another. The arguments put forward by defendants in both Wade and IPC concern intervening causes, persons who contributed to the eventual release of defendants' unwanted hazardous substances by putting them in disposal sites that proved unsafe. These two cases include the most likely such cases, where a transporter or disposal site operator moved the material to a site not chosen by the generator. How would the two courts' interpretations of § 107(a)(3) apply to the other's facts? If the Wade court were confronted with the IPC facts, there is no doubt that it would have rejected defendant's § 107(a)(3) argument since Syntex would have failed the three-pronged causation test: there had been a release from the Minker site and the state had undertaken a response action, Syntex' substances had been delivered to the site, and substances of the type remained. Indeed, there was no dispute that it was the release of the dioxin-contaminated wastes originally disposed of by Syntex that was the problem at Minker.

Putting the shoe on the other foot does not produce the same result, however. Confronted with the Wade facts, the IPC court might have come out differently. Its analysis of "release" would not have resolved the issue, at any rate.Since the Wade defendant did not select any site, there could have been no "release" from such a site, no matter how broadly the term is defined. The court would have had to find another rationale or absolve the generator.

Extending the IPC rationale to the Wade facts appears to offer more shelter to generator defendants than do the affirmative defenses set out in the statute.⁷⁰ Section 107(b) limits the extent to which these causes can serve as affirmative defenses.⁷¹ Defendant must have exercised due care, may not have had a contractual relationship with the third party, and must not have been able to forsee that the release might occur. The defense apparently was rejected by the court in IPC because of the forseeability of the release, and was not addressed in the court's decision in Wade. Hypothetical explanations of why the defense might not be available in Wade might be that defendant's complete reliance on the transporter was a breach of due care, or that the release was caused "solely" by the transporter (by selecting a site it knew to be leaking) and thus defendant's contractual relationship with the transporter negates the defense.

[15 ELR 10167]

Conclusion

The linkage between "arranged for disposal" and "at the facility" "at which the release occurred" is perhaps the last line of attack on the broad generator liability imposed by the courts under CERCLA § 107(a). Wade dealt that strategy a serious blow, albeit with a passing shot. IPC preserves at least the semblance of an argument that generators that did not choose the disposal sites that later proved unsafe should be exculpated. Such an extension of the reasoning in IPC seems irrational in light of the limited causation requirement found by the Wade court and others, because it rewards generators that avoided confronting the question of where their hazardous wastes would be disposed. Another potentially troubling question about the IPC decision is whether it would apply to a second generation CERCLA site. What if the person who removed the hazardous substances from the repository selected by the generator was, not a site owner, but EPA, carrying out a CERCLA removal action? The generator, if liable for the first set of removal costs, arguably would be liable again under IPC. In any event, speculation about possible extension of the IPC rationale, while interesting, may miss the essential point about that case. The court, like virtually every other that has heard CERCLA cases, found a way to make the generator potentially liable. It is that result, and not the questionable rationale, that has an immediate effect. And given the strong message in the legislative history of CERCLA that Congress wanted to make generators broadly liable,⁷² it is hard to argue that the results in Wade and IPC are not what Congress intended.

1. 42 U.S.C. §§ 9601-9657, ELR STAT. 41941.

2. See H.R. REP. NO. 1016, 96th Cong., 2d Sess. 1, reprinted in 2 ELI, SUPERFUND: A LEGISLATIVE HISTORY 429 (1982) (stating that the primary purpose of CERCLA is to encourage the elimination of unsafe hazardous waste sites).

3. 42 U.S.C. § 9601(22), ELR STAT. 41943 (defining "release" as "any spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping, or disposing into the environment"). Both releases and threatened releases trigger cleanup and liability provisions of the Act.

4. CERCLA § 107(a)(3), 42 U.S.C. § 9607(a)(3), ELR STAT. 41947.

5. 15 ELR 20161 (E.D.Mo. Jan. 8, 1985).

6. Id.

7. See Comment, CERCLA Litigation Update: The Emerging Law of Generator Liability, 14 ELR 10224, 10226 (1984) ("The language of this section, . . . could mean that a generator is covered as long as it intended the hazardous substances to be taken to any disposal site.")

8. Id. at 10225.

9. See infra notes 14-18 and accompanying text (discussing the deletion of joint and several liability from the Act).

10. CERCLA § 107(a), 42 U.S.C. § 9607(a), ELR STAT. 41947.

11. CERCLA § 107(b), ELR STAT. 41947.

12. Id. See also S. REP. No. 848, 96th Cong., 2d Sess. 31 (referring to the narrow range of circumstances under which a generator's due care can function as a viable defense, the Report stipulates that "consistent with the concept of strict liability, persons cannot escape liability by 'contracting away' their responsiblility or by alleging that the incident was caused by the act or omission of a third party"), reprinted in 1 ELI, SUPERFUND: A LEGISLATIVE HISTORY 187 (1982).

13. See H.R. 29, H.R. 85, H.R. 1048, H.R. 1049, H.R. 3441, H.R. 3797, H.R. 3798, H.R. 4548, H.R. 4566, H.R. 4571, H.R. 5074, H.R. 5290, H.R. 5291, H.R. 6931, H.R. 7020; S. 684, S. 953, S. 1046, S. 1325, S. 1341, S. 1480, 96th Cong., 2d Sess. (1980), reprinted in ELI, SUPERFUND: A LEGISLATIVE HISTORY (1982).

14. S. 1480, § 4(a), 96th Cong., 2d Sess. (1980), 126 CONG. REC. S14714 (daily ed. Nov. 19, 1980), reprinted in 2 ELI, SUPERFUND: A LEGISLATIVE HISTORY 187 (982).

15. S. REP. No. 848, 96th Cong., 2d Sess. 31 (1980), reprinted in 1 ELI, SUPERFUND: A LEGISLATIVE HISTORY 187 (1982).

16. The Stafford-Randolph Compromise Bill, like CERCLA, attempted to place costs on the sector which is most responsible for the pollution, and which benefits most from chemical production. See, e.g., 126 CONG. REC. S14972 (daily ed. Nov. 24, 1980) (statement of Sen. Tsongas explaining the Compromise Bill). Reprinted in 1 ELI, SUPERFUND: A LEGISLATIVE HISTORY 169 (1982).

17. See CERCLA § 107(a), 42 U.S.C. § 9607(a), ELR STAT. 41947. The term "strict liability" itself does not appear in the Act, but legislative history strongly indicates that liability is imposed under CERCLA without regard to fault. This is substantiated by the express language of § 107, which provides only for limited defenses to liability. See also e.g., 126 CONG. REC. H11787 (daily ed. Dec. 3, 1980) (statement of Rep. Florio in reference to the final Compromise Bill), reprinted in 1 ELI, SUPERFUND: A LEGISLATIVE HISTORY 164 (1982):

With respect to strict liability, this bill contains no significant change from that in our earlier bill. Liability remains "subject only to the defenses" provided in the bill. That, is a defendant can escape liability only if he establishes that the release or threatened release is caused solely by an act of God, an act of war, or an act or omission of a third party, with third parties being narrowly defined. Thus, the absence of negligence is not a defense to liability.

18. The other bills reported out of Committee were more limited in scope. H.R. 7020 did not allow for private recovery of damages, and provided only for government recovery for costs incurred by cleanup of hazardous waste sites. See H.R. 7020, 96th Cong., 2d Sess. (1980), 126 CONG. REC. S14714 (daily ed. Nov. 19, 1980), reprinted in 3 ELI, SUPERFUND: A LEGISLATIVE HISTORY 89 (1982). H.R. 85 extended mainly to hazardous waste and oil spills in waters under the jurisdiction of the Federal Water Pollution Control Act. See H.R. 85, 96th Cong., 2d Sess. (1980), 126 CONG. REC. H. 9185-9209 (daily ed. Sept. 19, 1980), reprinted in 3 ELI, SUPERFUND: A LEGISLATIVE HISTORY 185-234 (1982); see also Federal Water Pollution Control Act, 33 U.S.C. §§ 1251-1376, ELR STAT. 42133.

19. See United States v. Wade 577 F. Supp. 1326, 1331, 14 ELR 20096, 20097 (E.D.Pa. 1983) ("Any attempt to divine the legislative intent behind many of its provisions will inevitably involve a resort to the Act's legislative history. Unfortunately, the legislative history is unusually riddled by self-serving and contradictory statements.").

20. S. 1341, 96th Cong., 2d Sess. (1980), reprinted in 3 ELI, SUPERFUND: A LEGISLATIVE HISTORY 47 (1982).

21. Id.

22. H.R. 7020, 96th Cong., 2d Sess. (1980), 126 CONG. REC. S14714 (daily ed. Nov. 19, 1980), reprinted in 3 ELI, SUPERFUND: A LEGISLATIVE HISTORY 89 (1982).

23. S 1480, 96th Cong., 2d Sess. (1980), 126 CONG. REC. S14714 (daily ed. Nov. 19, 1980), reprinted in 2 ELI, SUPERFUND: A LEGISLATIVE HISTORY 561 (1982).

24. STAFF OF SENATE COMM. ON ENV'T AND PUBLIC WORKS WORKING PAPER No. 1, 96th Cong., 2d Sess. (1980); reprinted in 3 ELI, SUPERFUND: A LEGISLATIVE HISTORY 16 (1982).

25. Id.

26. See STAFF OF SENATE COMM. ON ENV'T AND PUBLIC WORKS, WORKING PAPER No. 2, 96th Cong., 2d Sess. (1980), reprinted in 2 ELI, SUPERFUND: A LEGISLATIVE HISTORY 607 (1982).

27. Id.

28. CERCLA's powerful liability scheme focuses on generators of hazardous substances to insure that parties responsible for environmental harm will be held strictly responsible for resulting costs and damages. See S. REP. No. 848, 96th Cong., 2d Sess. 15, stating:

In correcting the historic neglect of hazardous substances disposal, it is essential that this incentive for greater care focus on the initial generators of hazardous wastes since they are in the best position to control the risks. Generators create the hazardous wastes and know how to avoid them, and they determine whether and how to dispose of these wastes — on their own site or at locations controlled by others. Without a strict liability standard for generation of hazardous wastes, generators will have a strong incentive to transfer control of their wastes to others as quickly as possible — a practice whose social and environmental consequences are documented almost daily in news reports.

Reprinted in 2 ELI, SUPERFUND: A LEGISLATIVE HISTORY 484 (1982).

29. 582 F. Supp. 342, 14 ELR 20432 (S.D. Ill. Mar. 30, 1984).

30. 592 F. Supp. 291, 14 ELR 20719 (N.D.N.Y. June 26, 1984).

31. 14 ELR 20483 (S.D. Mo. June 29, 1983).

32. See A & F Materials, 582 F. Supp. 842, 845, 14 ELR 20432, 20433 (S.D. Ill. Mar. 30, 1984).

33. Id.

34. Id. The court further noted, "Indeed, CERCLA was enacted to insure that considerations far weightier tan price dictate who is given the task of disposing of hazardous wastes." Id. See also Memorandum in Opposition to Motion for Summary Judgment of McDonnell Douglas Corporation at 15, United States v. A & F Materials, 582 F. Supp 842, 14 ELR 20432 (S.D. Ill. Mar. 30, 1984). The memorandum notes:

A waste generator's liability under CERCLA should not turn on its ability to characterize its disposal arrangements as sales. To craft such an exception in the broad liability section could possibly open a major loophole in the hazardous control scheme.

Id.

35. See A & F Materials at 845, 14 ELR 20432-20433 (S.D. Ill. Mar. 30, 1984).

36. See General Electric at 297, 14 ELR at 20721 (N.D.N.Y. June 26, 1984).

37. Id. at 296, n.9, 14 ELR at 20720.

38. Id. at 297, 14 ELR at 20721.

39. See Westinghouse, 14 ELR at 20484.

40. Id. at 20485. See also A & F Materials at 845, 14 ELR 20433 (distinguishing Wesinghouse with the observation that in that case, the defendant neither generated waste, nor arranged for disposal).

41. CERCLA is not limited to waste materials, but covers all "hazardous substances," including PCBs. See CERCLA § 101(14), 42 U.S.C. § 9601(14), ELR STAT. 41943.

42. 577 F. Supp. 1326, 14 ELR 20096 (E.D. Pa. 1983).

43. Id. at 1331, 14 ELR at 20097.

44. Id.

45. Id. at 1333, n.3, 14 ELR at 20098.

46. Id.

47. See Comment, CERCLA Litigation Update: The Emerging Law of Generator Liability, 14 ELR 10224, 10229 (1984).

48. Wade at 1333, 14 ELR 20098. See also United States v. South Carolina Recycling and Disposal, Inc., 14 ELR 20272, 20274 (D.S.C. Feb. 23, 1984) (rejecting the generator defendant's causation argument in favor of the Wade court's three-pronged test). The court held that generator defendants were subject to liability for arranging for disposal under § 107(a)(3), since the generators' wastes arrived at the site, hazardous substances like the generators' wastes were present at the site as the time of release, and there was a release that resulted in the incurrence of response costs.

49. The court elaborated on this reasoning, noting that "given two possible constructions of a statute, one which renders it useless should be rejected."

50. See supra note 28 and accompanying text for a discussion of the deletion of the "caused or contributed to" phrase; H.R. REP. NO. 1016, 96th Cong., 2d Sess. (1980), reprinted in 2 ELI, SUPERFUND: A LEGISLATIVE HISTORY 429 (1982) (observing, "had the original language been returned, the mere act of generation or transportation of hazardous waste, or the mere existence of a generator's or transporter's waste at a site would not be sufficient alone to result in liability").

51. 15 ELR at 20161.

52. It is also possible to interpret IPC as leaving untouched the question of whether § 107(a)(3) requires that arrangments for disposal be at the same site at which there is a release, after initially determining that transfer of dioxin from Bubbling Springs to the IPC site constituted a release. The court's rather contorted effort to create a connection between the defendant and the site of release at Bubbling Springs, however, indicate that the other view seems to be the more reasonable approach.

53. Memorandum in Support of Motion to Dismiss at Syntex Agribusiness, Inc. (Memorandum of Syntex) at 3, Missouri v. Independent Petrochemical Corporation, 15 ELR 20161 (E.D. Mo. Jan. 8, 1985).

54. IPC, 15 ELR at 20161.

55. Complaint of Missouri at 13, Missouri v. Independent Petrochemical Corporation, 15 ELR 20161 (E.D. Mo. Jan. 8, 1985).

56. Memorandum of Syntex at 8 (declaring that "Any connection which Agribusiness may have had to the wastes now alleged to have come to rest at the IPC site is simply too attenuated, on the face of the complaint to sustain liability under CERCLA § 107(a)(3)").

57. Complaint of Missouri at 18, Missouri v. Independent Petrochemical Corporation, 15 ELR 20161 (E.D. Mo. Jan. 8, 1985).

58. Memorandum of Syntex at 8.

59. Id.

60. Id.

61. Id. at 10.

62. Id. at 9.

63. Id. at 12.

64. IPC at 20161.

65. Id.

66. See supra note 3 (definition of "release").

67. IPC at 20161.

68. See supra notes 11-12 and accompanying text (referring to § 107(b) defenses to liability).

69. See supra notes 39-40 and accompanying text for a discussion of Westinghouse. In Westinghouse, as in IPC, wastes did not remain at the original site. The defendant in Westinghouse was held not liable for arranging for disposal of hazardous wastes. The facts of that case, however, differ from those of IPC in three significant ways.In Westinghouse, the defendant's purely commercial sale of a manufactured product did not constitute arranging for disposal of a hazardous substance; the original site was not considered to be a "facility" within the meaning of the Act; and removal of the waste from the original site to Neal's Landfill and Neal's Camp did not qualify as a release.

70. It is possible to hypothesize a set of facts in which IPC would make a generator liable and Wade would not. Assume the same initial disposal situation as in IPC: Syntex sent its wastes to Bubbling Springs; the operator at that site determined that the site was not secure, and shipped the wastes elsewhere. Instead of Minker, assume the dioxin was sent to be incinerated at a licensed, safe facility. While awaiting the burn in a leak proof tank, the wastes were released as a result of the acts of a malicious vandal who breached that site's extraordinary safety precautions. The IPC court arguably would hold Syntex liable, since the removal from Bubbling Springs was the release. The Wade court arguably would not hold Syntex liable, since the release from the incinerator site probably comes under the third party defense in § 107(a)(4). The hypothetical is so strained, however, as to have little practical relevance.

71. CERCLA § 107(b), 42 U.S.C. § 9607(b), ELR STAT. 41947.

72. See supra note 16 and accompanying text (referring to Congress' goal of placing costs on those most responsible for creating the pollution).