May Cercla Apply Retroactively?
| Jurisdiction | United States,Federal |
| Citation | Vol. 25 No. 10 Pg. 103 |
| Pages | 103 |
| Publication year | 1996 |
1996, October, Pg. 103. May CERCLA Apply Retroactively?
Courts have long held that the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA")(fn1) applies retroactively to conduct that occurred prior to the Act's 1980 effective date.(fn2) The 1994 U.S. Supreme Court case of Landgraf v. USI Film Products(fn3) has called into question this aspect of CERCLA liability by imposing a strict presumption of prospectivity on substantive legislation creating new liability. This presumption of prospectivity can be rebutted only by the "clear intent" of Congress that a new statute's liability shall be applied retroactively.
In United States v. Olin Corp.,(fn4) a federal district court in Alabama recently applied Landgraf to CERCLA and concluded that the Act may not be applied retroactively to pre-enactment conduct. The federal district court in Nevada almost simultaneously held the opposite in State ex rel. Department of Transportation v. United States ("NDOT").(fn5) This article briefly analyzes these conflicting decisions and evaluates the impact of Landgraf, Olin Corp. and NDOT on CERCLA law and practice.
Much of the controversy surrounding CERCLA's unprecedented liability scheme has been fueled by application of its liability provision, § 107(a), to the conduct of "potentially responsible parties" ("PRPs") that occurred prior to its 1980 effective date. The statute's presumed retroactive effect stems from several sources.
First, while CERCLA does not explicitly state whether any of its various forms of liability, such as for the "costs of removal or remedial action"(fn6) or for "any other necessary"(fn7) response costs, are to be retroactive, it does explicitly provide that liability for natural resources damages(fn8) is to be prospective. Because CERCLA affirmatively limits retroactive liability of this one particular category of damages, a number of courts have surmised that Congress intended the Act's other forms of liability not be so limited.(fn9)
Second, it has been argued, and some courts have held, that the language of CERCLA's liability provision, which refers to liability-triggering conduct in the past tense, is consistent with retroactive liability. CERCLA § 107 refers to "any person who at the time of disposal of any hazardous substance owned or operated" a facility, or "who... arranged with a transporter for transport for disposal," or "who accepted any hazardous substances for transport...."(fn10) [Emphasis added.]
Additionally, many courts have observed that CERCLA seems to have been a response to the perceived deficiencies and inadequacies of then-existing environmental protection statutes, particularly the Resource Conservation and Recovery Act ("RCRA").(fn11) In the years just prior to CERCLA's passage, the RCRA statute was thought to be prospective, addressing only future, post-enactment handling of hazardous wastes. Thus, it has been argued that the underlying purpose for CERCLA was to fill a regulatory gap that could be addressed only through retroactive liability.(fn12)
These arguments, among others, were adopted by those federal courts that addressed the issue of CERCLA's retroactivity prior to Landgraf.(fn13) Those pre-Landgraf cases are typified by a handful of the earliest decisions that attempted to address specifically the longstanding common law presumption against retroactivity, such as United States v. Northeastern Pharmaceutical and Chemical Co. ("NEPACCO"), United States v. Shell Oil and State ex rel. Brown v. Georgeoff.(fn14) The courts in those cases tended to base their reasoning on CERCLA's general purpose, statutory scheme, and structure,(fn15) since the language of the Act contains no express provision for its retroactive application.
The majority opinion in Landgraf sets forth an analysis that requires a reviewing court to engage in a multi-step inquiry when deciding whether to honor the presumption of prospectivity or permit a statute to apply retroactively. The first step of the inquiry is whether a new statute is capable of having...
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