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June 29, 1999


The opinion of the court was delivered by: McMAHON, District Judge.


Plaintiffs, thirty-two homeowners and residents of the Town of Carmel in Putnam County, New York, bring this action seeking relief under the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, 42 U.S.C. § 9601 et seq. (1995) ("CERCLA"), the Resource Conservation and Recovery Act of 1976, 42 U.S.C. § 6901 et seq. (1995) ("RCRA"), and the common law against various municipalities, corporations and individuals whose activities over the last forty-five years have touched on or concerned the land on which their homes stand. After expedited discovery and dismissal or discontinuance of the action against six individual defendants,*fn2 all ten remaining defendants and all three third-party defendants have moved for summary judgment or dismissal of various claims, counterclaims, cross claims, and third-party claims asserted against them. The motions are disposed of as follows:

I. Disposition of the Various Motions for Summary Judgment

A. Plaintiffs' Claims

  1. First Cause of Action: Plaintiffs' RCRA action
    for hazardous or solid waste clean-up is dismissed
    with prejudice as against the following defendants:
    Town of Carmel, Putnam County, Lynlil Land
    Development Corp., Howard Stockfield, Thomas
    Boniello, Michael Barile, Joseph Mantovi, and
    Mahopac Septic Sanitation, Inc.
  2. Second Cause of Action: Plaintiffs' CERCLA
    action for hazardous substance clean-up is
    dismissed with prejudice as against the following
    defendants: Town of Carmel, Putnam County, Lynlil
    Land Development Corp., Howard Stockfield, Thomas
    Boniello, Michael Barile, Joseph Mantovi, and
    Mahopac Septic Sanitation, Inc.
  3. Third, Fourth, Fifth, and Sixth Causes of
    Action: The Court declines to exercise pendent
    jurisdiction over Plaintiffs' state common law
    claims of trespass, public nuisance, private
    nuisance, and negligence against the above-named
    defendants, and they are dismissed without
    prejudice to refiling them in the New York State
    Supreme Court and without prejudice to the
    assertion of any and all defenses that have been or
    may be asserted.
  4. Ninth*fn3 and Tenth Causes of Action:
    Plaintiff Koji Higashionna's common law claims for
    fraudulent conveyance and breach of contract are
    dismissed without prejudice as against defendants
    Lynlil Land Development Corp., Howard Stockfield,
    Thomas Boniello, and Michael Barile.

B. Defendants' Cross Claims

The various cross claims for indemnity, contribution, and/or response costs under CERCLA and/or RCRA asserted by the following defendants:

1. Town of Carmel ("Carmel" or the "Town")

2. Putnam County ("Putnam" or the "County")

3. Lynlil Land Development Corp. ("Lynlil")

4. Howard Stockfield ("Stockfield")

5. Thomas Boniello ("Boniello")

6. Michael Barile ("Barile")*fn4

7. Joseph Mantovi ("Mantovi")

C. Defendants' Counterclaims

Lynlil, MSSI, and Mantovi assert counterclaims against the Plaintiffs for indemnification and contribution under CERCLA. These counterclaims are dismissed with prejudice. The remaining counterclaims have not been addressed in any of the parties' briefings and are unaffected by the Court's various rulings. They consist of the following counterclaims against Plaintiffs: (1) frivolous prosecution of a RCRA claim, asserted by Lynlil, Stockfield, MSSI, Mantovi, and Putnam County; (2) frivolous prosecution of a CERCLA claim, asserted by Putnam County; and (3) cost recovery under CERCLA for Lynlil's expenses in investigating possible contamination at the DeLuca Farm and from constructing an alternate public water supply.

D. Third-Party Action

The third-party contribution claims asserted by Lynlil and the Lynlil Defendants against Olga DeLuca, Elizabeth DeLuca, and Thomasina Christianson (the "Third-Party Defendants"), under CERCLA, 42 U.S.C. § 9607 & 9613(F)(1), are dismissed with prejudice.

E. Third-Party Defendants' Cross Claims

The Third-Party Defendants brought cross claims for contribution and indemnity against Carmel, Putnam, Lynlil, the Lynlil Defendants, Mantovi, MSSI, Anthony DeLuca, and Theresa Miller. To the extent they seek contribution under CERCLA, these cross claims are moot and are dismissed with prejudice. To the extent they seek common law indemnity and/or contribution, these claims are dismissed, but may be reasserted in the State Supreme Court.

II. Statement of Facts

On these dispositive motions, I construe all facts in favor of the Plaintiffs, who are the non-movants. See United States v. Diebold, Inc., 369 U.S. 654, 655, 82 S.Ct. 993, 8 L.Ed.2d 176 (1962); Donahue v. Windsor Locks Bd. of Fire Commn'rs, 834 F.2d 54, 57 (2d Cir. 1987). What follows, then, is a recitation of the case taken largely from the Plaintiffs' papers opposing the various motions that seek dismissal of their claims, supplemented as needed by uncontested facts from other presentations that are relevant to the issues before me.

A. Septic Waste Dumping at the DeLuca Farm

The property that is the subject of this litigation consists of around 246 acres of land located within the Hamlet of Mahopac, Town of Carmel, County of Putnam, in the State of New York. (Aff. of Joel Sachs in Opposition to Defendants' Motion for Summary Judgment ("Sachs aff."), ¶ 3) Agor Lane, a public road in the Town of Carmel, bisects the property. Id. Philip and Mary DeLuca came to own this property, hereinafter referred to as the "DeLuca Farm," in 1944, and following Philip's death in 1966, Mary conveyed various portions to her children and grandchildren, including defendants Anthony DeLuca and Theresa DeLuca Miller (the "DeLuca Defendants"). (Id., ¶¶ 4, 6, 8) In 1986 and 1990, the DeLuca family members subsequently conveyed portions of the property to two corporate entities controlled by the Lynlil Defendants. (Id., ¶ 9)

Between 1955 and 1970, trenches were excavated within the leased area and were used for disposal of septic wastes by septic waste haulers. This area, consisting of some 10 acres of land located west of Agor Lane and south of the DeLuca farmhouse, is known as the "Site." (Id., ¶ 21) A number of septic waste haulers used the Site for disposal of septic wastes on a daily basis from 1955 to 1970. (Id., ¶ 22) During this same time period, the Town charged septic waste haulers an annual dump fee of $25 per tanker truck to dispose of septic wastes at the Town's septic dump located at the Site. (Id., ¶ 25) Septic waste haulers had access to the Site by means of a dirt road extending from Agor Lane. Town employees occasionally maintained, improved, and snow plowed the dirt road during this period. (Id., ¶ 27) Additionally, the road had a locking gate to which septic haulers who had paid their $25 annual fee would receive a key from the DeLuca family. (Id., ¶ 28)

The final Town lease for use of the Site expired on June 15, 1970. However, the DeLucas permitted individual septic waste haulers to continue dumping for a number of years. (Id., ¶ 41) Defendant Mantovi and Mahopac Sanitation (an unincorporated predecessor to corporate defendant MSSI) entered one such agreement with the DeLuca family for use of the Deluca Farm Site for dumping sewage through December 31, 1971. (Id., ¶ 49) As part of the arrangement, Mantovi agreed to procure a permit from the Putnam County Board of Health and to maintain the sewage pits in accordance with Board of Health requirements. (Id., ¶¶ 49-50)

Mahopac Sanitation, an unincorporated entity controlled by a father and son, Joseph C. Mantovi (who is not a party to this action) and defendant Joseph A. Mantovi, collected septic waste in Carmel between 1955 and 1974. (Id., ¶ 29) Mahopac Sanitation applied for and received a license from the Town allowing it to dispose of septic waste at the Site, on an annual basis between 1955 and 1970. (Id., ¶ 30) Joseph C. Mantovi and defendant Mantovi testified that Mahopac Sanitation, Mantovi Septic Systems, Inc., and a number of other septic waste haulers operating in Carmel disposed of large quantities of septic waste at the Site during this time period. (Id., ¶ 31) Moreover, defendant Mantovi on some occasions personally pumped out the contents of septic tanks located in Carmel and disposed of the collected septic wastes at the Site. (Id., ¶ 32) Mantovi testified that he never used any chemicals to clean septic tanks or his equipment. (Dep. of Joseph A. Mantovi at 28-29 ("Mantovi Dep."), excerpt attached to MSSI's and Mantovi's Memorandum of Law Supporting Motion for Summary Judgment) Defendant Mantovi bought Mahopac Sanitation from his father, in 1973, and subsequently transferred all books, records, and accounts to a successor corporation, defendant MSSI. (Sachs aff., ¶ 33)

B. Putnam County Department of Health Inspects the Site

Johanson inspected the Site on behalf of PCDOH three more times in 1968: on May 27, on June 14, and once more on July 17. (Id., ¶¶ 38-40). Johanson reported that, during his June 14 inspection, he found that two disposal trenches had reached their full capacity and were close to overflowing into the adjoining field. (Id., ¶ 39) At that time, Johanson directed Patsy DeLuca to discontinue use of the two filled trenches. (Id.) During his July 17 inspection, Johanson observed that another trench approached full capacity. He also noted that the main gate was no longer locked to prevent uncontrolled dumping. (Id., ¶ 40) The record does not reflect any other Site inspections by Putnam County until May 12, 1975. (Id., ¶ 55)

C. The Lynlil Defendants Develop the DeLuca Farm Site

In the mid-1980's, defendants Barile and Boniello, two residential home builders in Carmel, sought assistance from a local attorney, defendant Stockfield, in forming a New York real estate development corporation that came to be known as Lynlil Land Development Corp. ("Lynlil"). (Id., ¶¶ 56-58, 62) Barile and Boniello were at all times the officers, directors, and shareholders of Lynlil. (Id., ¶ 63) Lynlil was formed for the purpose of acquiring and developing a portion of the DeLuca Farm for single-family residences. (Id., ¶ 64) Stockfield also formed three other New York corporations related to development of residential housing at the DeLuca Farm: Lynlil Builders, Inc., for the purpose of constructing single-family homes; Agor East, Ltd. ("Agor"), for the purpose of acquiring and developing another portion of the DeLuca Farm; and Agor East Construction Corp. ("Agor Construction"), for the purpose of constructing single-family homes on that portion of the DeLuca Farm. (Id., 1165, 67-68) Barile and Boniello were the officers, directors, and shareholders of Lynlil Builders, Inc. at all times; Stockfield, Barile, and Boniello were the officers, directors and shareholders of Agor and Agor Construction at all times. (Id., ¶¶ 66-68)

In December 1986, a parcel of at least 100 acres of the DeLuca Farm was conveyed by various DeLuca family members to defendant Lynlil*fn5 in exchange for $583,000. (Id., ¶ 76) The contract of sale was contingent upon Lynlil's obtaining subdivision approval from Carmel and Putnam to build not less than 49 one-family building lots on the parcel. (Id., 73) Agor subsequently acquired from the DeLuca defendants an additional 25 acre parcel of the DeLuca Farm property to the north of Agor Lane (the "Agor subdivision"), in January 1990. (Id., ¶ 101) On April 20, 1987, the Town granted conditional final subdivision approval to Lynlil for 44 residential building lots on the larger parcel, to be known as the "Farmview Estates" subdivision. (Id., ¶ 91) The septic waste dump site previously leased to the Town is located on lots 42 and 43 of the subdivision purchased by Lynlil in 1986. (Third-Party Cplt., ¶ 25)

D. Plaintiffs Purchase Property at the DeLuca Farm.

Beginning in September 1989, some of the thirty-two plaintiffs in this action entered into contracts with Lynlil and its affiliated builders to purchase single-family residential houses on the Farmview Estates subdivision of the old DeLuca Farm. (Sachs aff., ¶¶ 144-154) Each of the homes of these plaintiffs is connected to a community water supply known as "Water District 12" or the "Farmview Water Supply." (Decl. of Daniel Riesel in support of Lynlil's Motion for Summary Judgment ("Riesel decl."), ¶ 40) These plaintiffs allege that, at no time prior to the closings of title to any of the subject premises did the Lynlil Defendants provide any notice of well water or ground water contamination at the old DeLuca Farm. (Sachs aff., ¶¶ 155, 157) These plaintiffs allege further that the first notice they received of the former septic waste dump's presence at the Site was from a fact sheet distributed in January 1995 by the NYSDEC. (Id., ¶ 164)

The remaining plaintiffs consist of two groups of individuals who own property outside of the subdivisions developed by the Lynlil Defendants and whose properties are served by individual private residential wells, rather than Water District 12 (hereinafter, the "Private Well Plaintiffs"). Among the Private Well Plaintiffs, one group's wells have presented no chemicals or contaminants in excess of state or federal standards. (Riesel decl., ¶ 54) This group contends that hazardous substances allegedly contained at the Site will ultimately pollute their private wells. The second group of Private Well Plaintiffs has been advised by the PCDOH, the New York State Department of Health ("NYSDOH"), and the NYSDEC that their private wells are contaminated and that they should not drink, cook, or bathe with the water. (Aff. of James Delaney in Opposition to Defendants' Motion for Summary Judgment, ¶ 5(d)) These plaintiffs contend that the pollutants found in their private wells originated at the Site and result from the dumping activities at the DeLuca Farm. Both groups of Private Well Plaintiffs seek to hold the various defendants liable for actual and threatened contamination of their well water, as well as reduced property values resulting from the stigma allegedly caused by proximity to the Site.

Although the various groups of plaintiffs are distinguishable in terms of their respective contact with alleged contaminants, they all allege the same source of contamination and seek to impose liability upon the same defendants (except as discussed otherwise above). Thus, the same legal analysis governs all of the plaintiffs' claims and they will be addressed collectively in this opinion.

E. Lynlil Discovers the Septic Waste on its Subdivision

Lynlil commenced development of the Farmview Estates subdivision in 1987. (Sachs aff., ¶ 93) In assessing the appropriate placement of septic systems on the new lots, Lynlil retained an engineering consultant firm that dug several test pits throughout the property, including two on lot 43, in 1988. (Id., ¶ 93) On August 3, 1989, Gary Tretsch, Lynlil's engineer, learned from the PCDOH that lots 42 and 43 appeared to be "a former location scavenger dump site" which once existed on the DeLuca Farm Site. (Id., ¶ 94) Accordingly, PCDOH required that the well on lot 42 be tested for pollutants and semivolatile compounds prior to issuance of a construction or building permit for the property. (Id.)

On November 9, 1989, Lynlil collected a groundwater sample from a residential water supply well on lot 42 that demonstrated levels of trichloroethene ("TCE") and vinyl chloride above the NYSDOH maximum contaminant levels for drinking water purposes (the "MCLs"). (Id., ¶ 95) Lynlil provided these results to Putnam in January 1990. (Id.) Subsequent sampling at the Site by Lynlil and Putnam in January 1990 revealed widespread groundwater contamination in other proposed drinking water wells at the DeLuca Farm. Shortly thereafter, Barile learned from the PCDOH that water sampled from the lot 42 well showed levels of vinyl chloride and TCE in excess of the State MCLs. (Id., ¶ 96) At that time, the PCDOH issued a "stop work order," suspending Lynlil's construction permits for the DeLuca Farm Site pending resolution of the water quality issue. (Id.)

At the PCDOH's direction, Lynlil hired a groundwater hydrogeologist and site assessment consultant to explore the possibility of installing a central public water supply. (Id., ¶¶ 98-99; Third-Party Cplt., ¶ 31) Between January and March 1990, Lynlil and the PCDOH collectively sampled approximately 16 residential wells. (Third-Party Cplt., ¶ 30)

On February 7, 1990, the Lynlil Defendants met with John Karell, of the PCDOH, to discuss Lynlil's proposal to install a central public water supply system on the Agor subdivision. (Sachs aff., ¶ 101; Third-Party Cplt., ¶ 32) Karell advised Lynlil's engineer on June 25, 1990 that the PCDOH was approving the public water system to be known as "Water District 12" or the "Farmview Water Supply." (Sachs aff., ¶ 119) Upon completion of the water supply system, Lynlil transferred its ownership and operation of Water District 12 to the Town in 1992. (Third-Party Cplt., ¶ 33)

Lynlil stopped paying taxes on lots 42 and 43 in January 1991, when it learned that houses could not be built on those lots. (Sachs aff., ¶ 180 & exh. 115; aff. of William J. Carlin, attached to Putnam County's Notice of Motion for Summary Judgment, ¶ 6) These lots were then sold by Putnam at a tax foreclosure sale in December 1991. (Sachs aff., ¶ 182) The New York Secretary of State subsequently dissolved Lynlil for tax delinquency, pursuant to N.Y. Tax Law § 203-a, by proclamation on or about December 28, 1994. (Sachs aff., ¶ 181; exh. 116 to Sachs aff.)

III. Procedural Background

Plaintiffs filed the complaint in this action on April 19, 1996. Plaintiffs amended the complaint three times, filing the current version, the Third Amended Complaint (hereinafter the "Complaint"), on February 11, 1998. After various stipulations of discontinuance, there are ten remaining defendants: Town of Carmel, Putnam County, Lynlil Land Development Corp., Howard Stockfield, Thomas Boniello, Michael Barile, Joseph Mantovi, Mahopac Septic Sanitation, Inc., Anthony DeLuca, and Theresa Miller.

Lynlil and the Lynlil Defendants filed their answer and counterclaim, as well as a cross claim against Carmel on June 6, 1996. Lynlil and the Lynlil Defendants also filed a third-party complaint against Olga DeLuca, Elizabeth DeLuca, and Thomasina Christianson, and various Jane and John Does on August 1, 1996.*fn6 Putnam filed its answer and counterclaim, as well as cross claims against Carmel, Lynlil, and MSSI on June 17, 1996. MSSI filed a cross claim against Carmel, Putnam, Lynlil, and the DeLuca Defendants, as well as a counterclaim against the Plaintiffs and Lynlil, on August 14, 1996. Carmel filed its answer and a cross claim against Putnam, MSSI, and the DeLuca Defendants on September 10, 1996. Carmel also asserted cross claims against the Third-Party Defendants on November 21, 1996, and against Putnam, Lynlil, the Lynlil Defendants, MSSI, and the McCranie and Flanigan plaintiffs on January 7, 1997.

The Third-Party Defendants moved on February 4, 1997 for summary judgment dismissing the third-party complaint. Mantovi and MSSI moved for summary judgment dismissing the complaint on February 7, 1997. Lynlil and the Lynlil Defendants also moved for summary judgment on February 7, 1997, as did Putnam and Carmel. The DeLuca Defendants served a motion for summary judgment upon all of the parties to this action, but never filed their motion papers with this Court.*fn7 All of the motions have been opposed, supplemented, and briefed extensively over the two intervening years.

IV. Legal Analysis

A. Putnam County

  1. Putnam County's Motion to Dismiss Plaintiffs' CERCLA Claim
    for Liability as an Operator and Former Operator of the Site,
    is Granted.
  (a) Whether Putnam County Has or Had Legal Title to the Site
    Need Not Be Resolved.

The various complaints filed by Plaintiffs in this matter have all alleged that Putnam County is liable under CERCLA and RCRA as the legal owner of the contaminated lots on the DeLuca Farm Site.

As discussed above, Lynlil took title to the Farmview Estates subdivision, which contained the Site, in 1986. In January 1991, Lynlil ceased paying real property taxes on the two-lot Site, after learning that it could not build houses on that parcel. The two-lot parcel thereby became eligible for tax foreclosure. Putnam sent notices to owners and published notices in newspapers in the fall of 1991 that all similarly situated properties would be included in a tax lien sale if the delinquent owners did not redeem the liens. (Aff. of William J. Carlin ("Carlin aff."), attached to Putnam's Notice of Motion, ¶ 6) Putnam County Commissioner of Finance, William J. Carlin ("Carlin"), purchased the tax liens on behalf of Putnam on December 20, 1991. (Carlin aff., ¶ 7) In the Fall of 1992, Putnam again sent and published notices advising owners of property with delinquent taxes that the liens sold on December 20, 1991 could be redeemed before December 21, 1992, at which point they would expire. (Id., ¶ 8)

Putnam sent another notice to delinquent property owners in December 1994, advising them that a tax lien had been sold on their property and instructing them to contact the Putnam County Finance Department to redeem the lien. (Id., ¶ 9) Finally, on March 1, 1995, Carlin executed a Tax Deed, which recorded the interest Putnam County had acquired in properties pursuant to the tax delinquency sale held on December 20, 1991. (Id., ¶ 10) This document is, curiously, referred to as the "1994 Tax Deed." (Id., ¶ 5 n. 1) The 1994 Tax Deed included a twelve-page list of 90 parcels of land on which taxes had become delinquent, including the Site, lots 42 and 43 in Lynlil's Farmview Estates subdivision. (Exh. 1 to Carlin aff.)

Since 1991, Putnam County's Finance Department has refused to take title to properties containing potential environmental hazards. (Carlin aff., ¶ 12) To that end, the Finance Department obtains input from the PCDOH concerning potentially contaminated properties. (Id., ¶ 13-15) After reviewing the 1993 Tax Deed (precursor to the 1994 Tax Deed) and concluding that none of the properties listed therein contained environmental hazards, PCDOH Director Karell sent the Finance Department a list of "contaminated properties," including the DeLuca Farm Site, for reference in future tax delinquency sales. (Id., ¶ 15, exh. 4) If the Finance Department had done its job correctly, the Site would have been stricken from the subsequent 1994 Tax Deed property list, which, as discussed above, listed all the properties that were to be included on the Tax Deed to be executed by Putnam on March 1, 1995. Someone erred, ...

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