Kodiak Island Borough v. Exxon Corp.

No. S-7581 (Alaska November 22, 1999)

ELR Digest

The court reverses a trial court decision granting an oil company's summary judgment motion to dismiss cities' claims for the value of municipal services that were diverted to cleanup efforts following the Exxon Valdez oil spill. Assuming that the free public services doctrine applies as a matter of common law, the court first holds that Alaska's hazardous substances statute abrogates the doctrine to the extent that it affects municipal recovery for spill-related damages. The breadth of the statute's language and the statute's specific provision for the recovery of costs incurred by the state, a municipality, or a village strongly suggest a legislative intent to permit compensation for governmental services including those services rendered noncompensable at common law by the free public services doctrine. The court next holds that the cities' diverted services claims are compensable under Alaska's hazardous substances statute. Neither the text nor the history of the statute supports restricting the cities' diverted services claims. While the specific costs listed in the statute provide useful examples of harms that the legislature clearly considered compensable, they cannot properly be construed to define the outer limits of the cities' right to assert their diverted services claims. The trial court, therefore, erred in ruling that the cities were only entitled to recover costs specifically identified in the statute as recoverable by municipalities.

The court also holds that the cities have not waived their right to argue their diverted services claims even though the cities settled their claims for unreimbursed labor with the defendant oil company. The cities expressly reserved the right to appeal the dismissal of their diverted services claims in the settlement agreement, and these claims are not limited to unreimbursed labor. The court additionally holds that the hazardous substances statute confers standing on the cities to assert diverted services claims. Last, the court holds that federal maritime law does not preempt the cities' diverted services claims. The hazardous substances statute does not prejudice a characteristic feature of general maritime law, and the statute does not unduly interfere with the harmony and uniformity of the admiralty system.

The full text of this opinion is available from ELR (21 pp., ELR Order No. L-124).

Counsel for Appellants
Matthew D. Jamin
Jamin, Ebell, Bolger & Gentry
323 Carolyn St., Kodiak AK 99615
(907) 486-6024

Counsel for Appellees
Douglas J. Serdahely
Bogle & Gates
1031 W. 4th Ave., Anchorage AK 99501
(907) 276-4557

[30 ELR 20184]

[OPINION OMITTED BY PUBLISHER IN ORIGINAL SOURCE]