This week the United States Supreme Court decided the case of Cooper Industries, Inc. v. Aviall Services, Inc. In a decision that reversed nearly 20years of judicial precedent the Court held that Section113(f) of CERCLA (commonly referred to as Superfund) did not allow a responsible party performing a “voluntary” cleanup to sue another responsible party for contribution. The Court decided that unless the remediating party had itself been subject to a “civil action” by the United States it could not sue another responsible party for a share of the cleanup costs. In other words, unless the government is taking action against you to force remediation you may not file a claim against another party.

This decision will likely have a significant impact on how and whether voluntary cleanups are carried out. Often, parties are willing to undertake voluntary remediation, whether at their own property or at another site because they have the potential of recovering contribution from another responsible party. It now appears that such recovery will not be possible using CERCLA, especially if the party has some responsibility for the contamination. The prevailing view among the federal Courts of Appeal is that a responsible party may not use Section 107 of CERCLA to recover contribution. Thus a responsible party proceeding voluntarily may be at great risk of having to shoulder the entire cost of remediation.

It is also unclear what impact the decision will have on Brownfield projects. Many Brownfield projects are undertaken without any real anticipation of recovering costs from another party. However, the purchaser of the Brownfield property may become a responsible party under CERCLA by reason of ownership and lose the ability to use either section 107 or 113 to seek contribution if such should become necessary. The Court’s decision does make it clear that under Section113(f)(3) a party that has entered into an administrative or judicial settlement with the United States or the state may seek contribution. Therefore, it is likely that remediation that has previously been “voluntary” will more likely be performed under a consent order or consent decree in the future.

The Supreme Court’s decision is an interpretation of the federal Superfund law and does not directly affect actions brought under the Pennsylvania Hazardous Sites Cleanup Act (“HSCA”). However, Section705 of HSCA is nearly identical to the language in Section113 of CERCLA. Therefore, the Supreme Court’s interpretation of Section113 may influence courts construing Section705 of HSCA.

It appears that the rights and liabilities of parties involved in remediation have been changed significantly by the Supreme Court’s decision. Parties contemplating voluntary remediation and/or Brownfield’s projects should proceed cautiously and reevaluate their legal options in light of this important decision. (Contributed by Terry R. Bossert, Stevens & Lee, 717-561-5274)

NewsClip: Supreme Court Says Pollution Cleanups Limited

12/17/2004