IV A Thumbnail Sketch of the Comprehensive Environmental Response, Compensation, and Liability Act (cercla)

• Library: Illinois Environmental Law for Non-Environmental Lawyers (2017 Ed.)

IV. A Thumbnail Sketch of the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) Bertram C. Frey Deputy Regional Counsel United States Environmental Protection Agency, Region 5 Chicago, Illinois The ISBA acknowledges the contribution of co-author Nicole Wood, then a USEPA Region 5 Intern and now Nicole Wood-Chi, Associate Regional Counsel for Region 5, on the prior version of this article. The author also acknowledges the contribution of Alejandro Rettig y Martinez, USEPA Region 5 Summer Legal Extern, currently a student at the University of Chicago Law School, to a number of footnotes of this article. The views expressed in this article are the views of the authors and are not necessarily those of the USEPA.

A. Introduction

In December 1980, the specter of poisonous, cancer-causing chemicals improperly stored decades earlier, leaking from the ground into the homes of Love Canal, New York, galvanized Congress¹ to enact the Comprehensive Environmental Response, Compensation, and Liability Act.² Commonly referred to as CERCLA, the statute contains unique and powerful authorities to address the problem of hazardous contamination. In particular, CERCLA 1) provides federal authority to respond to releases or threatened releases of hazardous substances that may endanger public health or the environment and 2) finances cleanup actions through a revolving trust fund and a comprehensive and unique liability scheme.³ This Thumbnail provides the non-environmental law attorney with an overview of CERCLA⁴ and a synopsis of the CERCLA enforcement process. Because of its complexity and unique liability scheme, on specific legal questions involving CERCLA, we recommend that the non-environmental lawyer seek the advice of competent environmental counsel.

B. Applicability

In order for CERCLA to apply, the following three elements must coexist: 1) a release or threat of release 2) of a hazardous substance 3) from a facility or a vessel.⁵ CERCLA defines each of the key terms of these three jurisdictional elements of the statute—"release," "hazardous substance" and "facility."⁶Each of these definitions leaves room for interpretation, and thus the courts bear responsibility for determining the scope of CERCLA's applicability.

The statute defines the term "release" as "any spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping or disposing into the environment . . ." excluding emissions from exhaust engines, releases of nuclear material from a nuclear incident (as defined in the Atomic Energy Act) or a designated nuclear processing site, the normal application of fertilizer, "any release which results in exposure to a person solely within a workplace," and federally permitted releases.⁷ In keeping with the statute's expansive definition, courts have consistently construed the term "release" broadly and have understood "release" to encompass uncontrolled movement⁸such as: the continued leaching of hazardous materials into soil and ground water from earlier spills,⁹ leakage resulting from the decomposition of waste drums or storage tanks, migration of hazardous substances due to rainfall and flooding, and the dispersion of hazardous substances as a result of washing the personal effects of industrial workers who unwittingly carry minute particles of hazardous substances home.¹⁰ Based on the theory of res ipsa loquitor, courts have also extended the term "release" to situations involving unknown sources of elevated levels of hazardous substance or contamination.¹¹

In regard to the second jurisdictional element, any substance designated by the USEPA as hazardous under the Clean Air Act (CAA), the Clean Water Act (CWA), the Resource Conservation and Recovery Act (RCRA) and the Solid Waste Disposal Act (SWDA), or the Toxic Substances Control Act (TSCA) constitutes a hazardous substance under CERCLA. Additionally, USEPA can designate any element, compound, mixture, solution, or substance as a CERCLA "hazardous substance."¹² All of the substances identified as hazardous under these various statutory provisions are set forth in a consolidated list in the Code of Federal Regulations.¹³ As of this writing, USEPA considers more than 800 substances to be "hazardous substances" under CERCLA. Further, a material need only contain a substance listed as a CERCLA hazardous substance to trigger its applicability.¹⁴ Thus, mixtures that could appear to be benign may be regulated under CERCLA.¹⁵ Finally, CERCLA explicitly exempts from the definition of "hazardous substance": "petroleum, including crude oil or any fraction thereof which is not otherwise listed or designated as a hazardous substance . . ." and "natural gas, natural gas liquids, liquefied natural gas, and synthetic gas used for fuel."¹⁶ As a consequence, other regulatory schemes determine liability for releases of petroleum; for example, the Resource Conservation and Recovery Act (RCRA) regulates leaking petroleum from underground storage tanks¹⁷and the Oil Pollution Act regulates oil spills on surface waters.¹⁸

As to the third jurisdictional element, CERCLA defines "facility" as:

any building, structure, installation, equipment, pipe or pipeline, . . . well, pit, pond, lagoon, impoundment, ditch, landfill, storage container, motor vehicle, rolling stock, or aircraft, or . . . any site or area where a hazardous substance has been deposited, stored, disposed of, or placed, or otherwise come to be located; but does not include any consumer product in consumer use or any vessel (emphasis added).¹⁹

The courts agree that the term "facility" is purposely expansive and that in order to satisfy this jurisdictional element, a plaintiff need only show that a hazardous substance has been placed or has otherwise come to be located at a site.²⁰

C. CERCLA Liability²¹

A great deal of CERCLA litigation focuses on issues of liability. As with other sections of the statute, CERCLA's liability provision is complex and sometimes ambiguous. Simply stated, liability extends to four types of "potentially responsible parties" (PRPs), who can be generically categorized as follows: 1) current owners and operators of the site, 2) past owners and operators of the site at the time of disposal, 3) generators or other persons who arranged for the disposal or treatment of a hazardous substance at the site, and 4) transporters of the hazardous materials to the site if they, and not the generator, chose the disposal site.²² In keeping with Congress' intention that parties associated with a contaminated site be responsible for "remedying the harmful conditions they created,"²³ courts consistently interpret CERCLA's liability to be far reaching.²⁴Accordingly, a PRP's liability generally extends to: (1) the "costs of removal or remedial action" or "costs of response" taken by the United States or a state that are not inconsistent with the NCP;²⁵ (2) the costs of removal or remedial actions taken by other parties that are consistent with the NCP;²⁶ (3) damages affecting natural resources; (4) penalties and punitive damages for noncompliance with administrative orders; and (5) the costs of health assessments.²⁷

The statute imposes strict liability. Thus, CERCLA plaintiffs need not prove fault by a PRP. A plaintiff may bring a suit against a PRP even when a release of hazardous substances occurred prior to CERCLA's enactment and the releases were lawful at the time. Although the statute is silent, courts have consistently held that based on the statute's legislative history and common law principles, liability is joint and several if two or more persons have contributed to a single indivisible harm.²⁸ Joint liability means that liability for a single harm extends to more than one defendant. Several liability means the plaintiff may choose to sue only one of the defendants and recover the entire amount claimed. Situations involving owners, operators, generators and transporters, such as co-disposal landfills, provide a classic example of joint and several liability under CERCLA. In co-disposal landfill cases, any one PRP could be liable for the clean-up costs of the entire landfill for its part in disposal of just one barrel of hazardous substances at the landfill.

D. Statutory Defenses, Exemptions, and Protections from CERCLA Liability

CERCLA provides several statutory defenses to as well as exemptions and protections from its liability. CERCLA originally provided three statutory defenses: an "act of God" defense, an "act of war" defense, and a "third party" defense.²⁹ Specifically, a person will not be liable: if he/she can demonstrate by a preponderance of the evidence that the release was caused solely by an act of God or war or if he/she can show that the release was caused by an act of a third party other than an agent or employee or one whose act or omission occurs in connection with a contractual relationship.³⁰ Under the Superfund Amendments and Reauthorization Act (SARA), Congress enacted a fourth statutory defense by defining the term "contractual relationship" to include a safe harbor for "innocent landowners."³¹

In addition to the statutory defenses to liability, CERCLA provides statutory exemptions to and protections from liability for certain parties.³² CERCLA provides exemptions to liability for cost recovery and natural resource damages³³ such as the "de micromis exemption,"³⁴ the "municipal solid waste exemption,"³⁵ and the "federally permitted release" exemption.³⁶ The statute also exempts from cost recovery and natural damages liability certain broad classes of people: bona fide prospective purchasers (BFPP),³⁷certain contiguous property owners,³⁸ fiduciaries,³⁹ secured creditors,⁴⁰ and a governmental unit that involuntarily acquires title to property by virtue of its function as a sovereign.⁴¹ Bona fide prospective purchasers are persons who acquired the property at issue after January 11, 2002, and who have established that all...