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August 12, 2004.


The opinion of the court was delivered by: ROBERT SWEET, Senior District Judge


There are currently four pending motions in this case: 1) a motion for partial summary judgment by plaintiff Kara Holding Corp. ("Kara") against defendants and third-party plaintiffs Getty Petroleum Marketing, Inc. ("Getty Petroleum"), Getty Properties Corp. ("Getty Properties"), Getty Realty Corp. ("Getty Realty"), Leemilt's Petroleum Inc. ("Leemilt's") and The Tyree Organization, Ltd. ("Tyree") (collectively "G & T"); 2) a cross-motion for summary judgment by G & T against Kara; 3) a motion for summary judgment by third-party defendant Island Transportation Corp. ("Island") against G & T; and 4) a motion for sanctions by Kara against G & T and second third-party defendants Tyree Brothers Environmental Services Inc. ("Tyree Bros."), Larry E. Tyree Co., Inc. ("Larry Tyree"), Tyree Maintenance Co., Inc. ("Tyree Maintenance") and Tyree Engineering, P.C. ("Tyree Engineering"). For the reasons set forth below, G & T's motion for summary judgment is granted in part and denied in part. Kara's motion for partial summary judgment is denied. Island's motion for summary judgment is denied, except that G & T's Navigation Law claim is dismissed. Kara's motion for sanctions is granted in part and denied in part.

Parties Kara owns a two-story office building, with a cellar, at 1209 Colgate Avenue in the Bronx (the "Colgate Building") which has been leased to the New York City Human Resources Administration (the "City") and is used as a Job Center. The Colgate Building is adjacent to Getty Station #329 located at 1441 Westchester Avenue (the "Station").

  Getty Realty is a real estate company headquartered in Jericho, New York that, among other things, leases properties to others primarily for use as gasoline stations. Leemilt's is a subsidiary of Getty Realty and holds title to the Station. Leemilt's has leased the Station to Getty Properties, also a subsidiary of Getty Realty, which, in turn, has leased it to Getty Petroleum. Getty Petroleum sublets the Station to Esteven Service Station, which is responsible for its day to day operations.

  Tyree is an independent contractor with special environmental assessment, monitoring and remediation expertise which had been hired by Getty Properties to undertake repair, maintenance and remediation activities at the Station and at other Getty stations in the New York City area. Tyree has represented that its "[w]ork [on behalf of Getty] shall be performed and completed in compliance with all applicable statutes, regulations rules, rulings, ordinances, and/or directives of any and/or all federal, state, county, municipal and/or local government departments and/or agencies" and that "a high degree of care . . . will be exercised by Tyree in the performance of any Work. . . ." Unit Cost Agreement between Getty Petroleum Corp. and Tyree, dated October 5, 1994 at Articles 7(f) and 11. Getty Properties is the successor to Getty Petroleum Corp.

  Tyree Bros., Larry Tyree, Tyree Maintenance are corporations with a principal place of business in Farmingdale, New York. Tyree Engineering is a corporation with a principal place of business in Wachtung, New Jersey. Each of the second third-party defendants are alleged to have performed services on behalf of the Getty defendants in connection with remediation and monitoring at the Station.

  Prior Proceedings

  The complaint in this action was filed on January 14, 1999. On September 22, 1999, G & T's motion to dismiss the complaint and for summary judgment was denied, except that Kara's complaint was dismissed to the extent that it requested relief under the Resource Conservation and Recovery Act of 1976 and the Solid Waste Amendments of 1984 (collectively, "RCRA"), 42 U.S.C. § 6901, et. seq., "civil penalties for past events and `declaratory judgment' for `all remedial costs incurred' as a consequence of wastes discharged by the Getty station . . ." Kara Holding Corp. v. Getty Petroleum Marketing, Inc., 67 F. Supp.2d 302, 309 (S.D.N.Y. 1999) ("Kara I"). On October 21, 1999, G & T filed a third-party complaint against Island and Xerxes Corporation ("Xerxes"), alleging that Island's driver negligently overfilled an underground storage tank at the Station and that Xerxes was negligent in the design, manufacture and sale of the tanks. On September 25, 2000, Xerxes filed a second third-party complaint against Tyree Bros., Larry Tyree, Tyree Maintenance and Tyree Engineering, alleging that the failure of the second third-party defendants to properly secure the alarm sensor on one of the USTs at the Station rendered it susceptible to overflow, thus contributing to the contamination.

  At Kara's request, discovery orders were signed by the Court on June 26, 2001 and November 6, 2001.

  On March 28, 2002, Kara's motion to strike G & T's answer as a discovery sanction was denied, as was the motion by third-party defendants Island and Xerxes to dismiss the defendants' third-party complaint. See Kara Holding Corp. v. Getty Petroleum Marketing, Inc., 99 Civ. 0275, 2002 WL 475125 (S.D.N.Y. Mar. 28, 2002) ("Kara II"). However, the defendants were ordered to comply with earlier discovery orders, and the Court noted that "Any future failure to comply may result in the type of harsh sanctions that plaintiff sought prematurely in this motion." Id. at *1.

  On July 24, 2002, Kara's motion to strike G & T's answer as a discovery sanction was again denied, as was the motion by third-party defendants Island and Xerxes Corporation ("Xerxes") to dismiss the defendants' third-party complaint. See Kara Holding Corp. v. Getty Petroleum Marketing, Inc., 99 Civ. 0275, 2002 WL 1684365 (S.D.N.Y. July 24, 2002) ("Kara III"). Further, Kara's motion to disqualify then-counsel for the defendants, Robert G. Del Gadio ("Del Gadio") was postponed until after a hearing. Other counsel were subsequently substituted for Del Gadio.

  Further discovery orders were signed by the Court on November 7, 2002, December 19, 2002, January 2, 2003 and January 21, 2003.

  On September 22, 2003, both Kara and G & T moved for partial summary judgment, and Kara moved for sanctions against the defendant. One day later, Island moved for summary judgment, dismissing the third-party complaint against it. After submission of briefs, argument was heard on all four motions on January 21, 2004, at which time they were was deemed fully submitted.


  As they pertain to the various summary judgment motions, the following facts are taken from the parties' Rule 56.1 statements, the responses to those statements, and the briefs. Factual disputes are noted. As required, the facts are construed in the light most favorable to the non-movant, as applicable. They do not constitute findings of fact by the Court.

  The instant action arises out of a petroleum spill that occurred on April 2, 1997 at the Station, located in Bronx, New York. Kara, the owner of the Colgate Building, which is situated adjacent to the gas station, contends that a gasoline spill or spills at the station have resulted in hazardous conditions at the Colgate Building, as well as contamination of nearby soil and groundwater contamination, as well as of the Bronx River, which is less than 400 feet away. G & T contend that the petroleum contamination was the result of an overfill of an underground storage tank ("UST") at the Station in the early morning hours of April 2, 1997 by Terrance Mullane ("Mullane"), a gasoline truck driver employed by Island Island conversely proposes that the delivery of 5,100 gallons of premium gasoline to the Station two days prior to Island's delivery is the cause of the petroleum contamination.

  The Colgate Building and the Station

  The Colgate Building is a two story building, approximately 100 feet by 81 feet, with a full cellar. The cellar is not in active commercial use but is used by maintenance and other personnel for the rendering of supporting services to the building. Kara contends that the Colgate Building is approximately 150 feet from shore, while defendants have submitted an aerial photograph and United States Geological Survey map showing that the building is approximately 300 feet from the river.

  The Colgate Building is currently rented to the New York City Human Resources Administration (the "City") for use as a Job Center. The City leased the Colgate Building from Kara for a period of 15 years beginning in April 1993. Further, the City "has not penalized the owner of [the Colgate Building] for any downtime and has made no indications of breaking the lease agreement." Expert Report of Eric A. Sterling, IFA, ASA, GAA ("Sterling Report"), at 2. The annual rent on the Colgate Building is $176,076.50.

  Kara alleges, and G & T deny, that Leemilt's is the fee owner of the 1441 Westchester Avenue, and that Leemilt's leased the real property to Getty Petroleum. There is also a factual dispute over who controls the Station. Kara maintains that Leemilt's retains control over the property, and that Getty Petroleum retained a right over improvements it made, and that Getty controlled the use of the property. G & T argue that Getty sublets the Station to Esteven Service Station, which is responsible for its day to day operations. According to Kara, Esteven is only the manager of the station. Environmental Oversight

  The New York State Department of Environmental Conservation ("NYSDEC") is the state agency responsible for the cleanup and removal of petroleum discharges pursuant to Article 12 of the Navigation Law and Article 17 of the Environmental Conservation Law.

  G & T argue that the Environmental Protection Agency ("EPA") has designated NYSDEC as the implementing agency for the RCRA Underground Storage Tank ("UST") program, pursuant to the "Revised Memorandum of Agreement between the New York State Department of Environmental Conservation and the Environmental Protection Agency" (the "Revised MOA"). The Revised MOA states that "[w]ith regard to Federal enforcement, it is EPA's expectation that it will not take such action where the State has taken timely and appropriate enforcement action." Kara argues that, notwithstanding the Revised MOA, that New York State is not an approved State for enforcement of UST provisions.

  In 1988, EPA promulgated regulations that required underground storage tanks to be upgraded or replaced within ten years to meet certain safety and performance standards. See 40 C.F.R. § 280.21 (2003). In 1995, as part of tank removal and replacement at the Station, Tyree removed twelve 550 gallon USTs and one 4,000 gallon UST at the Station and replaced them with three new 4,000 gallon fiberglass USTs. G & T assert, and Kara denies, that the replacement program was in compliance with federal regulations.

  One UST was dedicated to the storage of "regular" unleaded gasoline, and the other two to "premium" unleaded gasoline. Each of the three USTs has its own "fill line" used to deliver gasoline to the tank. Island contends that each UST at the Station was equipped with an Attached Collar Riser ("ACR") that sits atop the tank and is designed to contain any leak from the tank system and its piping. G & T dispute this, contending that the ACR was not designed to contain any leak from the tank or its piping, and that Island's own expert has admitted this.

  On July 10, 1995, during the removal of the tanks, petroleum-contaminated soil was identified and Tyree reported the contaminated soil to NYSDEC, which issued the Station Spill No. 95-04305. According to Kara, Getty and Tyree failed to timely report the spill as required by New York state law. Thereafter, Tyree removed approximately 980 tons of petroleum-contaminated soil from the area where the previous USTs had been situated. In January 1996, Tyree submitted a Closure Report to the NYSDEC documenting the UST upgrade and soil remediation activities. The NYSDEC has not provided comment on the Closure Report. Events Surrounding the Spill

  On September 23, 1996, the overfill alarm probes inside of the premium USTs at the Station were removed by a Tyree employee. The probes are designed both to gauge the level of fluid inside the UST and to sound an external alarm when the fluid level nears the tank's capacity. G & T does not dispute this, but notes that alternate overfill alarm protection was in place, including leak detection probes in the tanks, between the tank walls and in the containment sumps.

  From September 23, 1996 to April 2, 1997, there were a total of 63 deliveries of premium gasoline to the Station. On March 30, 1997, a fuel carrier other than Island delivered 5,100 gallons of premium gasoline to the Station. The March 30 delivery represents 67% of the total capacity available in both USTs used to store premium gasoline at the Station.

  Island asserts, and G & T deny, that the entire leak detection/overfill alarm system was deactivated on April 2, 1997.

  On the morning of April 2, 1997, Island driver Mullane made a delivery of gasoline to the Station. The Island delivery truck had been loaded with 2,299 gallons of premium gasoline at the Mount Vernon fuel terminal. According to Island, the "driver card" given to Mullane at the Mount Vernon terminal contained a highlighted notation that the two premium USTs at the Station were "not connected." G & T dispute this characterization, contending that while the first page of the driver card indicated that they were not connected, another page of the card stated that the two premium grade USTs were connected by a "siphon bar."

  At the time of the April 2, 1997 delivery, a two-inch siphon bar contained with a three-inch secondary containment pipe ran between the two premium USTs at the Station. The siphon bar responds to variance in pressure created by differing fluid levels between the two USTs by transferring gasoline from the tank containing more fluid to the other, resulting in a leveling of the gasoline levels in the two tanks. The siphon bar was functioning at the time of the delivery.

  Mullane had never previously delivered to the Station. Island asserts that a station employee, Tito Gomez ("Gomez"), was present for the delivery of the fuel and signed the delivery receipts prepared by Mullane. G & T state that they lack knowledge sufficient to determine whether Gomez actually signed the receipts or was present for the delivery.

  Prior to delivering any gasoline into the USTs, Mullane measured the level of fuel in each UST by taking dipstick readings, obtained by inserting a dipstick into the UST. According to Island, 35½ inches of gasoline was in one of the premium USTs, and 35 inches was in the other. G & T state that they lack knowledge sufficient to determine whether the readings were accurate.

  In 1997, third-party defendant Xerxes Corporation ("Xerxes"), the manufacturer of the USTs installed at the station, published a conversion chart (the "Xerxes tank chart") for USTs like those at the Station. The chart provides fluid measurement, in gallons, corresponding to dipstick readings, in inches. The chart also indicates that the actual capacity of the 4,000 gallon USTs is 3,758 gallons. Island contends, and G & T dispute, that on April 2, 1997, Mullane did not use a Xerxes tank chart corresponding to the USTs at the Station, but instead used a "generic tank chart" to convert his readings.

  The invoice for the April 2, 1997 delivery of fuel indicates that the post-delivery fuel levels of the premium USTs were 51½ inches and 53½ inches, respectively. Mullane testified that the post-delivery readings were 51½ inches and 53 inches, respectively. Using the Xerxes tank chart and Mullane's dipstick readings, the amount of gasoline in the premium USTs pre-delivery was 1,890 and 1,926 gallons, respectively. Following delivery, the amount of gasoline according to the invoice was 2,998 and 3,116 gallons, respectively, and according to Mullane's testimony was 2,998 and 3,087 gallons, respectively. The total difference in the pre- and post-delivery amounts of gasoline is 2,298 gallons according to the invoice, and 2,269 according to Mullane's testimony. Island asserts that this demonstrates that there was no overfill. G & T dispute this, asserting that there was an overfill of the westernmost premium UST. G & T also state that
given the siphon effect between the two premium tanks, the post-delivery stick readings cannot establish whether the deliveries were made separately to each premium tank or whether excess gasoline from the overfilled tank was siphoned into the other premium tank.
G & T's Response to Island's Rule 56.1 Statement, ¶ 41. G & T also state that, according to Island's driver, the readings can be inaccurate by "a couple of hundred" gallons. Mullane Deposition at 182-83.

  On the afternoon of April 2, 1997, a gasoline odor was reported coming from the Colgate Building. The same afternoon, the Colgate Building tenant notified the Fire Department of the gasoline odor. Shortly thereafter, the Fire Department arrived at the Colgate Building and foamed the cellar with a fire suppressant as a precautionary measure. A member of the Fire Department also took dipstick readings from each of the premium USTs. Each tank showed 49 ½ inches of fuel, which corresponds to 2,875 gallons using the Xerxes tank chart. The Fire Department notified the New York City Department of Environmental Protection ("NYCDEP") of gasoline fumes during the afternoon of April 2, 1997. At approximately 2:20 P.M. that day, NYCDEP called in a spill report to the NYSDEC, which issued the Station Spill No. 97-00109.

  According to Island, the monthly Statistical Inventory Reconciliation ("SIR") prepared for the Station by Warren Rogers Associates, Inc. show no loss of gasoline from the Station for the period February 19, 1997 through April 19, 1997. G & T dispute this, noting that the SIR reports for premium tanks during that time period showed variances of hundreds of gallons, including deficiencies of 170 gallons and excesses of 275 gallons.

  Remediation of the Station and the Colgate Building

  Tyree arrived at the Station at approximately 6:05 P.M. or, according to Kara, the later afternoon or early evening. Shortly after arriving at the Station, Tyree determined that fresh gasoline was floating on top of the water that had entered the cellar of the Colgate Building from an area beneath the staircase in the cellar. According to Tyree employee Edward Waldron ("Waldron"), the gasoline in the cellar had accumulated quite recently because it "looked too clean to be sitting there for three days." Waldron Deposition at 189. On April 2, 1997, as directed by the NYCDEP, Tyree pumped approximately 600 gallons of petroleum-impacted water out of the cellar. In accordance with orders from the NYSDEC, on the same day Tyree installed a temporary Vapor Abatement System ("VAS") to exhaust the gasoline fumes outdoors. According to Kara, the design and method of installation was determined by Tyree.

  According to G & T, on April 3, 1997, Tyree, as directed by NYCDEP, sealed the areas in the cellar where groundwater was entering. While Kara acknowledges that Tyree sealed at least one claimed contamination entry, it asserts that Tyree did not seal all of the areas where contamination was entering.

  On April 3, 1997, Tyree began the installation of a temporary soil vapor extraction system ("SVES") to remove hydrocarbon vapors in the soil, including the installation of two groundwater monitoring wells. On April 8, 1997, Tyree commenced operation of the temporary SVES.

  At the direction of NYSDEC, on or about April 8, 1997, Tyree removed the temporary VAS fan and installed a permanent VAS vent with a high velocity blower to vent the gasoline odors outdoors.

  The temporary SVES was replaced with a permanent SVES on or about April 11, 1997. On or about April 15, 1997, a carbon filter was added to the SVES to reduce any gasoline odors emitted by the SVES. On or about July 30, 1997, Tyree moved the exhaust vent away from the Colgate Building's air intake vents to help prevent any petroleum odors emitted by the exhaust vent from entering the Colgate Building.

  Pursuant to the NYSDEC-approved Corrective Action Plan, Tyree performed an environmental site investigation in February 1998 to determine the extent and magnitude of the spill. Kara, however, asserts that neither Getty nor Tyree determined the extent of the magnitude of the spill in that report or in a later document.

  On June 1, 1998, the VAS was upgraded with a more powerful exhaust fan in response to requests from the Colgate Building tenant. Kara states that it does not know whether the more powerful fan is more effective in removing fumes.

  On June 9, 1998, Tyree submitted its Environmental Site Investigation Report to the NYSDEC.

  In or about November 1999, with the approval of the NYSDEC, the dual phase high vacuum extraction system ("DPHVES"), which was installed to replace the SVES, commenced operation. Kara disputes this, stating that the DPHVES was not fully installed in November 1999. Further, Kara states that there is no record that the NYSDEC approved the DPHVES system because the design of the system was not disclosed to the NYSDEC, and such a system was required to have been approved pursuant to a corrective or remedial action plan, and NYSDEC states that such a plan does not exist.

  To further delineate the zone of contamination and to assess the effectiveness of the DPHVES, Tyree conducted additional subsurface soil and groundwater sampling in February through April 2002. According to Kara, G & T have not delineated the contamination plume as required, although Kara acknowledges that soil and groundwater sampling was undertaken.

  According to G & T, Kara has undertaken no remediation work and has incurred no remediation costs in connection with the petroleum contamination discovered at the Colgate Building. Kara disputes this, stating that its remediation work consists of attempting to compel G & T to properly remediate the spill. Kara also states that it has engaged in work regarding its sumps and leakage repairs but that it cannot quantify this work for purposes of specific dollar amounts for remediation. Kara also states that substantial costs have been incurred in this litigation and in developing a proper review of the spill conditions and developing a proper remediation action for protection of the Colgate Building and the surrounding environment including the Bronx River. According to G & T, Tyree has performed monthly system monitoring, quarterly well monitoring, and has submitted quarterly status reports to the NYSDEC concerning the status of the remediation at the Station covering the period from April 1997 to September 2003. Kara states that the reports submitted to the NYSDEC show neither monthly system monitoring nor quarterly well monitoring.

  G & T contend that the air samples collected by Tyree and by Kara's expert, Shapiro Engineering P.C. from the cellar of the Colgate Building indicate contaminant levels below the Permissible Exposure Limits promulgated by the Occupational Safety and Health Administration, 29 C.F.R. § 1915.1000 Table Z (2000), and below background levels for ambient air in basements promulgated by the New York State Department of Health. Kara denies this, stating that the air samples collected by Tyree, particularly on December 20, 2000 showed "excessive levels" which required the evacuation of the Tyree technician. Kara also states that at other times the Colgate Building was evacuated. Kara also states that the air quality levels were not below permissible levels "because employees were hazardously endangered." Kara's Response to Defendants' Rule 56.1 Statement, ¶ 41. Kara also states that because Tyree has failed to provide the analytical data packages for the contamination samples, the Tyree data cannot be verified and should be excluded. G & T state that the sampling data drawn from monitoring wells in and around the Station indicate a substantial decrease in BTEX and MTBE groundwater concentrations during the period October 1997 through July 2003. Kara objects to this data as well, arguing that because no analytical packages were received for this data, it should be excluded.

  G & T state that the groundwater in and around the Station is not a source of drinking water. While Kara does not directly dispute this, it does assert that the groundwater in and around the Station is contaminated at levels above NYSDEC standards, and observes that "people have been known to ...

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