Electric Power Board of Chattanooga v. Monsanto Co.

No. CIV-1-85-634 (E.D. Tenn. December 5, 1986)

The court holds that the Tennessee statute of repose is preempted by § 309 of the Comprehensive Environmental Response, Compensation, and Liability Act, added by the 1986 Superfund amendments, with regard to actions for damages involving exposure to hazardous substances. The court holds that the statute of repose is a statute of limitations, intended to be preempted by § 309. The court holds that the section is not unconstitutional and does not deprive a defendant of a vested right. The court modifies its prior order, 17 ELR 20526, holding that the statute of repose barred the action by plaintiff electric utilities boards against the manufacturer of electrical equipment containing polychlorinated biphenyls on various tort theories, and reinstates plaintiff's claim for property damage caused by exposure to a hazardous substance.

[Plaintiff's memorandum in support of its motion to modify the order is digested at ELR PEND. LIT. 65946.]

Counsel are listed at 17 ELR 20526.

[17 ELR 20526]

Hull, J.:

Order

This is a products liability action in which plaintiffs Electric Power Board of Chattanooga and Huntsville Electric Utilities Board are seeking to recover for damages allegedly suffered because of the existence of polychlorinated biphenyls [PCBs] in certain electrical equipment they have used. No personal injury is alleged. The main thrust of the complaint is that, in compliance with regulations promulgated by the United States Environmental Protection Agency, the plaintiffs must specially test, inspect, service, remove, replace, and dispose of the PCBs and PCB equipment. They seek to recover their expenses related to compliance on various theories of liability including restitution, continuing nuisance, negligence, fraud and misrepresentation, strict liability, implied warranty, and express warranty.

By agreement of the parties, the Court ruled first on the threshold issue of whether Tenn. Code Ann. § 29-28-103 (the "statute of repose") bars this action insofar as it relates to any of the defendants' equipment purchased by the plaintiffs more than ten years before this suit was filed. By order of October 27, 1986, this Court found that it does.

This action is now before the Court on the plaintiffs' motion to modify this order [Doc. 215]. In support of their motion, the plaintiffs raise a new theory not argued before, that the October 1986 amendments to the Comprehensive Environmental Response, Compensation and Liability Act of 1980 [CERCLA], 42 U.S.C. § 9601 et seq., the "Superfund Amendments and Reauthorization Act of 1986," preempt state law statutes of limitations and repose with regard to actions for damages involving exposure to hazardous substances, including PCBs.

The Court has examined this new legislation and the underlying report of the Superfund Section 301(e) Study Group. While the Court agrees with the defendants that, on its face the legislation is limited to commencement dates rather than statutes of repose, the obvious purpose of the legislation is to ensure that no claim for personal injury or property damage caused by exposure to hazardous substances is already time-barred at the time it is discovered. In addition, while the ten-year cap on products liability actions is commonly termed a "statute of repose," the provision is found in a code section entitled "limitations of actions." The Court is of the opinion that if this particular ten-year limitation were to bar the plaintiffs' claim in this lawsuit, as it appears to, then this result would be contrary to the intent of the new, preemptive federal legislation.

In addition, the Court finds that there is nothing unconstitutional about this new legislation and it does not deprive the defendants [17 ELR 20527] of a vested right. See Clay v. Johns-Manville Sales Corp., 722 F.2d 1289 (6th Cir. 1983), cert. denied 467 U.S. 1253 (1984).

Accordingly, plaintiffs' motion to modify this Court's order of October 27, 1986, is hereby GRANTED. Insofar as this action may be fairly characterized as one for property damage caused by exposure to a hazardous substance released into the environment from a facility, it is not affected by Tenn. Code Ann. § 29-28-103.

The Court notes that there are several outstanding motions with regard to the plaintiffs' other theories of liability.

Defendant Sangamo Weston, Inc.'s motion for summary judgment of May 19, 1986, on the claims of the Electric Power Board of Chattanooga, should be answered by January 16, 1987.

Defendant Westinghouse Electric Corporation's motion for summary judgment filed May 28, 1986, should be answered by January 30, 1987.

Allis-Chalmers Corporation's very similar motion for summary judgment and to dismiss filed June 24, 1986, should also be answered by January 30, 1987.

Sangamo's motion for summary judgment filed July 21, 1986, with regard to the claims of Huntsville, should be answered by January 30, 1987.

Monsanto Company's motion to dismiss filed August 7, 1986, should be answered by February 13, 1987.

It appears to the Court that these motions are primarily concerned with issues of law. However, insofar as factual information is required, all parties should cooperate with the plaintiff in providing any information necessary to meet these issues.