The opinion of the court was delivered by: CHARLES P. SIFTON
Allied Princess Bay Co. #2 ("Allied") brings suit against defendant Atochem North America, Inc. ("Atochem") on multiple statutory and common law grounds, alleging that defendant is responsible for at least part of the cost of an environmental remediation at a site sold to plaintiff by defendant in 1972 (the "site"). Defendant seeks summary judgment on all of plaintiff's causes of action, and plaintiff cross-moves for partial summary judgment in its favor declaring that defendant is liable for plaintiff's remediation costs. For the reasons discussed below, partial summary judgment is granted in favor of plaintiff; defendant's motion for summary judgment is denied.
By Memorandum and Order dated March 10, 1992 (the "March Order"), the Court granted summary judgment in defendant's favor on all of plaintiff's claims for relief to the extent the relief requested involved payment by plaintiff of sums expended pursuant to a New York State Department of Environmental Conservation (the "DEC") order to clean up the site -- costs which plaintiff had agreed to assume by contract. In addition, the March Order granted summary judgment in defendant's favor on plaintiff's private nuisance, trespass, and negligent misrepresentation claims. Familiarity with the March Order is assumed.
Based on the March Order, defendant now reasons that it is entitled to summary judgment on all of its claims because the site can be cleaned up only pursuant to orders from the DEC. Plaintiff, on the other hand, contends that it is entitled to a declaratory judgment that defendant is liable for the costs of remediation at the site under the Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA"), 42 U.S.C. §§ 9601 et seq.
The following facts are not disputed unless otherwise indicated. Plaintiff filed its complaint on October 24, 1991, setting forth numerous claims for relief. One claim was withdrawn by the plaintiff, and as already mentioned, this Court granted summary judgment in defendant's favor on three other claims. The remaining claims are as follows: (1) a claim based on New York Navigation Law § 181(5), (2) a claim for indemnity under the Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA"), 42 U.S.C. §§ 9601 et seq., (3) a claim for contribution under CERCLA, 42 U.S.C. § 9613(f), (4) a claim of strict liability for conducting an ultrahazardous activity, (5) a negligence claim for causing unreasonable risks to human health and the environment, (6) a claim alleging willful and wanton misconduct in causing these risks, (7) indemnification, (8) contribution, (9) unjust enrichment, and (10) public nuisance.
This action arises out of the sale to plaintiff in 1972 of a twenty-two acre site in Staten Island by defendant's predecessor in interest, Pennwalt Corporation.
The sales contract, signed September 14, 1972, included the following assumption provision:
Buyer agrees to take title to the premises under and subject to (i) any notices of violations of law or municipal ordinances,
orders or requirements issued on or after the date [of the Contract] by any state or municipal department having jurisdiction over or affecting the Premises.
Over the years, the site has been used for various purposes. From approximately 1881 to 1971, part of the site was used by the S.S. White Co., formerly S.S. White Dental Manufacturing, and its successor the Pennwalt Corporation to manufacture dental equipment. A factory complex where the dental manufacturing occurred was situated in the southern portion of the site. The companies operated a coal burning foundry [i.e., a machine used to melt and cast metal, glass, or plastic], and the site contained storage areas for ash, dust, and coal associated with the foundry.
These operations resulted in the disposal of PAH's (polynuclear aromatic hydrocarbons) on the site. PAH's are classified as a hazardous substance under the relevant regulations and CERCLA. See 42 U.S.C. § 9601(14), 9602(a); 40 C.F.R. § 302.1, 302.4 (table). Coal combustion produces PAH's, which are absorbed on the surfaces of coal ash and this ash was disposed of on the site. Also, moisture causes leaching from raw coal; thus, precipitation or other moisture "leaches" small particles of coal dust containing PAH's from the coal and carries the coal dust to the ground. The soil filters the dust containing the PAH's from the water and the contaminated dust remains in the soil. Further, defendant's predecessors employed injection molding machines to make parts of moldable resin for dental use and used an area in the northeast portion of the site to dump waste plastic parts, some of which contained concentrations of PCB's (polychlorinated Biphenyls) of a type classified as a hazardous substance under the relevant EPA regulations and CERCLA. See 42 U.S.C. §§ 9601(14), 9602(a); 40 C.F.R. §§ 302.1, 302.4 (table).
After plaintiff Allied bought the site in 1972 from defendant's predecessor Pennwalt Corporation, the site was not used until 1975. In 1975, Allied converted the manufacturing complex into a shopping mall that was active from 1975 until 1983. Some of the businesses in this shopping mall conducted metal fabricating operations, cabinet manufacturing, and printing operations. During this period of time, leaking paint, solvent, and oil cans were observed on the site.
It Between 1983 and 1986, the site was not used for any purpose and open to members of the public. A number of the transformers located at the site were vandalized by scavengers, who removed the copper from the transformers and dumped the transformer fluid on the ground.
Also during this period, a fire occurred in a building at the site. The combustion of synthetic and treated construction materials is a potential source of PAH contamination.
In July 1986, plaintiff Allied demolished the buildings and other structures on the site and leveled and covered the rubble with landfill from off site. Because the site was filled with 8 to 10 feet of fill and hazardous substances were detected at depth levels of 0 to 2 feet, there is reason to believe that the fill itself was contaminated.
Starting in the mid-1980's, Allied planned to develop the site for residential use. As part of this planned development and at the behest of the New York City Department of Environmental Protection ("DEP"), Allied hired an environmental consulting firm to conduct an investigation to determine whether there were hazardous substances on the site. This preliminary investigation, which consisted of twelve subsurface and surface soil samples taken from six locations and six groundwater samples, revealed the presence of heavy metals and other contaminants.
After the discovery of the contamination, plaintiff consented to an order of the DEP in July 1988 (the "Order on it Consent"), authorized by Article 27 of the New York Environmental Conservation Law. The Order on Consent disclaims any liability on the part of Allied for the contamination or responsibility for any cleanup. Pursuant to the order, Allied conducted more extensive investigation and sampling of the soil and groundwater of the site and prepared a final report describing the findings of the investigation and including a remediation plan for the cleanup of any contamination revealed by the study which would pose a significant risk to human health and the environment. The investigation was conducted in September of 1988 and the final report was issued in March 1989.
The report revealed that the site contained high concentrations of a variety of hazardous substances in both the soil and groundwater, including PAH's and PCB's. Multiple types of PCB's exist and are identified by "aroclors," which reflect the amount of chlorine in different PCB compounds. The type of PCB's found in the soil of the site surrounding the area where S.S. White Co. had dumped plastic waste are the same aroclor of the PCB's found in the plastic waste itself, namely aroclor 1254.
Certain areas of the site are contaminated by PAH's. The areas with the highest levels of PAH's are found on or near the location where the former coal-burning foundry stood; the levels of PAH's decrease with distance from the area where the foundry used to be located.
Because of the level of contamination, DEC listed the site in the Registry of Inactive Hazardous Waste Disposal Sites and classified the site in category "2," a category for sites that pose a significant threat to public health or the environment and at which remediation is required.
The showing needed on summary judgment reflects the burden of proof in the underlying action. The court must consider "the actual quantum and quality of proof" demanded by the underlying cause of action and which party must present such proof. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 254, 91 L. Ed. 2d 202, 106 S. Ct. 2505 (1986).
Therefore, where the ultimate burden of proof is on the nonmoving party, the moving party meets his initial burden for summary judgment by "'showing' -- that is, pointing out to the district court -- that there is an absence of evidence to support the nonmoving party's case." Celotex Corp. v. Catrett, 477 U.S. 317, 325, 91 L. Ed. 2d 265, 106 S. Ct. 2548 (1986). To survive the motion, the nonmoving party must then "make a showing sufficient to establish the existence of [the challenged] element essential to [that party's] case." Id. at 322.
If the moving party demonstrates an absence of evidence supporting the nonmoving party's case, the party opposing the motion must come forward with specific facts showing that there is a genuine issue for trial. Matsushita, 475 U.S. at 587. To sustain this burden, the nonmoving party may not rest upon the pleadings, but rather must come forward with specific facts to support its claims and show that there is a genuine issue for trial. Id.
1. Defendant's Motion. The defendant predicates its motion for summary judgment on an argument that, since the site can only be remediated pursuant to order of the DEC, any remediation falls within the assumption provision. The argument must be rejected.
First, the applicable New York statute does not necessarily require that the plaintiff as owner remediate the site, although the law does require that some action be taken by the DEC and authorizes the DEC to require the responsible party to bear the cost of the remediation. ...