NATURAL RESOURCES DAMAGES
Jurisdiction | United States |
(Apr 1997)
NATURAL RESOURCES DAMAGES
New Mexico Office of the Attorney General Environmental Enforcement Division
Santa Fe, New Mexico
I. STATUTORY PROVISIONS
A. Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), 42 U.S.C. §§ 9601 -9675
1. In General. CERCLA was enacted in December 1980 to address the burgeoning problem of uncontrolled hazardous waste sites, such as Love Canal and hundreds of other well-publicized chemical dumps. Pub. L. No. 96-510, 94 Stat. 2795 (Dec. 11, 1980). It was substantially revised by the Superfund Amendments and Reauthorization Act of 1986 (SARA). Pub. L. No. 99-499, 100 Stat. 1613 (Oct. 17, 1986). Among other things, CERCLA establishes liability for damages for injury to, loss of, or destruction of natural resources resulting from a release of a hazardous substance into the environment. § 107(a)(4)(C). CERCLA also contains general provisions governing the scope of the natural resource damage program. § 107(f).
2. Key Definitions.
a. Natural Resources. The term "natural resources" is defined quite broadly as "land, fish, wildlife, biota, air, water, ground water, drinking water supplies, and other such resources belonging to, managed by, held in trust by, appertaining to, or otherwise controlled by the United States,...any State or local government, any foreign government, any Indian tribe...." § 101(16).
b. Hazardous Substance. The term "hazardous substance" is also defined quite broadly by reference to other environmental statutes. CERCLA hazardous substances are: 1) any hazardous substance under section 311 of the Clean Water Act; 2) any substance for which reportable quantities have been set under section 102 of CERCLA; 3) any characteristic or listed hazardous waste under section 3001 of the Resource Conservation and Recovery Act (RCRA), other than wastes that have been exempted by statute from RCRA regulation; 4) any toxic pollutant listed under section
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307(a) of the Clean Water Act, any hazardous air pollutant listed under section 112 of the Clean Air Act; and any imminently hazardous substance for which EPA has taken action under section 7 of the Toxic Substance Control Act. § 101(14).
However, the term does not include petroleum including crude oil or any fraction thereof unless specifically listed or designated under the above regulations, and it does not include natural gas or synthetic gas usable for fuel. § 101(14). This exception is known as the CERCLA "petroleum exclusion" (discussed below).
3. Liability. CERCLA liability provision allows federal or state natural resource trustees to recover "damages for injury to, destruction of, or loss of natural resources" resulting from a release of a hazardous substance. Trustees may also recover the reasonable costs of a damage assessment. § 107(a)(4)(C).
a. Liable parties. Under the liability provision, the same parties that are liable for EPA response costs and injunctive relief are also liable for natural resource damages:
i) Current owners and operators of a facility;
ii) Owners and operators at the time of the disposal;
iii) Transporters that selected the site for disposal;
iv) Generators that "arranged for the treatment or disposal" of a hazardous substance.
§ 107(a).
b. Strict liability. Liability under CERCLA is strict; a party in any of the four categories of liable parties is liable regardless whether its actions were unlawful or negligent. E.g., United States v. Hardage, 982 F.2d 1436, 1443 (10th Cir. 1992), cert. denied sub nom. Advance Chem. Co. v. United States, 510 U.S. 913 (1993); B.F. Goodrich Co. v. Murtha, 958 F.2d 1192, 1198 (2d Cir. 1992); Dedham Water Co. v. Cumberland Farms Dairy, Inc., 889 F.2d 1146, 1150 (1st Cir. 1989); United States v. Monsanto Co., 858 F.2d 160, 167- 173 (4th Cir. 1986), cert.
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denied, 490 U.S. 1106 (1989).
c. Joint and several liability. Liability under CERCLA is also joint and several, unless the defendant can show that its contribution to the harm is divisible. E.g., B.F. Goodrich Co. v. Murtha, 958 F.2d 1192, 1198 (2d Cir. 1992); United States v. R.W. Meyer, Inc., 889 F.2d 1497, 1507- 08 (6th Cir. 1989), cert. denied, 494 U.S. 1057 (1990); O'Neil v. Picillo, 883 F.2d 176, 178- 79 (1st Cir. 1989), cert. denied sub nom. American Cyanamid Co. v. O'Neil, 493 U.S. 1071 (1990); United States v. Monsanto Co., 858 F.2d 160, 171- 73 (4th Cir. 1988), cert. denied 490 U.S. 1106 (1989).
However, several cases have recently declined to impose joint and several liability, holding either that the harm was divisible, or that the defendant was not given the opportunity to show that the harm was divisible. See In re Bell Petroleum Servs., 3 F.3d 889 (5th Cir. 1993) (harm was divisible); United States v. Alcan Aluminum Co., 990 F.2d 711, 721-23 (2d Cir. 1993) (defendant not afforded the opportunity to show that harm was divisible); United States v. Alcan Aluminum Co., 964 F.2d 252, 267-271 (3d Cir. 1992) (same), reh'g and reh'g en banc denied 964 F.2d 271 (3d Cir. 1992), on remand, 892 F. Supp. 648 (M.D. Pa. 1995) (defendant failed to meet its burden of proving divisibility of harm), aff'd, 96 F.3d 1434 (3d Cir. 1996).
d. Retroactive liability. However, liability for damages to natural resources is not entirely retroactive. There is no liability where the release and the damages resulting from the release occurred wholly before the enactment of CERCLA, i.e., December 11, 1980. § 107(f)(1).
* Thus, where a release occurs prior to the date of enactment and the resulting damages continue to occur after that date, and the pre- and post-enactment damages are readily divisible, liability exists for the post-enactment damages, but not for the pre-enactment damages. In re Acushnet River and New Bedford
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Harbor Proceedings re Alleged PCB Pollution, 716 F. Supp. 676 (D. Mass. 1989). If, however, the damages are not divisible, the trustees can recover such non-divisible damages in their entirety. Id. at 686.
4. Defenses to liability.
a. Affirmative defenses. Liability is subject to the statutory affirmative defenses.
i) Act of God;
ii) Act of war;
iii) Act or omission of a third party not in a contractual relationship with the defendant.
§ 107(b).
* Heavy rainfall does not support an act of God defense where such rains were foreseeable. United States v. Stringfellow, 661 F. Supp. 1053, 1061 (C.D. Cal. 1987).
b. Federally permitted release. CERCLA provides that there is no liability where the release of a hazardous substance was permitted under the Clean Water Act, RCRA, the Ocean Dumping Act, the underground injection control program of the Safe Drinking Water Act, the Clean Air Act, or the Atomic Energy Act. §§ 107(j), 101(10).
* The federally permitted release defense does not apply where the release exceeded the limitations established by the permit, or which occurred during a time period during which there was no permit. Idaho v. Bunker Hill Co., 635 F. Supp. 665, 674 (D. Idaho 1986).
* The federally permitted release defense does not apply where the permitting agency knew of the release but did not authorize the release in the permit. United States v. United Nuclear Corp., 814 F. Supp. 1552, 1563- 65 (D.N.M. 1992).
c. Irreversible and irretrievable commitment. CERCLA provides that there is no liability for natural resource damages if there has
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been an "irreversible and irretrievable commitment" of those resources in an Environmental Impact Statement or similar environmental analysis. § 107(f)(1).
* For the defense to apply, the EIS or similar environmental analysis should contain a clear and unambiguous statement, preferably employing the words of the statute and placed in an easily accessible section of the document. Idaho v. Hanna Mining Co., 882 F.2d 392, 396 (9th Cir. 1989).
5. Cap on liability. CERCLA places a cap on awards for damages to natural resources of $50 million for each release or incident involving a release from a facility. § 107(c)(1)(D). This defense does not apply, however, if the release is the result of "willful misconduct" or "willful negligence," or a violation of law. § 107(c)(2).
* The $50 million cap applies to each responsible party individually, not collectively. California v. Montrose Chem. Corp., 104 F.3d 1907 (9th Cir. 1997).
* Several incidents involving a release may occur at one site. Id.
6. Exclusions from Liability.
a. Petroleum exclusion. CERCLA excepts from the definition of "hazardous substance" "petroleum, including crude oil or any fraction thereof which is no specifically listed or designated" as a hazardous substance. It also excepts natural gas and synthetic gas usable for fuel. § 101(14). These exceptions are known as the "petroleum exclusion."
* The U.S. Environmental Protection Agency interprets this exclusion as covering hazardous substances, such as benzene, toluene, and xylene (BTX), that are normally found in petroleum and fractions of crude oil; and hazardous substances such as tetraethyl lead in gasoline, that are added to petroleum products as part of the refining process. EPA does not interpret the
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exclusion as covering hazardous substances that are added to, become commingled with, or are increased in concentration in petroleum during use. Memorandum from Francis S. Blake, EPA General Counsel, to J. Winston Porter, EPA Assistant Administrator for Solid Waste and Emergency Response, regarding the Scope of the CERCLA Petroleum Exclusion Under Sections 101(14) and 104(a)(2) (July 31, 1987), reprinted in, 14 Chem. Waste Lit. Rep. 858 (Oct. 1987). The courts have give deference to EPA's interpretation of the petroleum exclusion. E.g., Wilshire Westwood Assocs. v. Atlantic Richfield Corp., 881 F.2d 801 (9th Cir. 1989),
...* Several courts have held that the
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