Ball v. Versar, Inc.
| Citation | 454 F.Supp.2d 783 |
| Decision Date | 05 September 2006 |
| Docket Number | No. 1:01 CV 0531 DFH TAB.,1:01 CV 0531 DFH TAB. |
| Parties | Roy O. BALL and Norman W. Bernstein, As Trustees On Behalf Of Environmental Conservation and Chemical Corporation Site Trust Fund, Plaintiffs, v. VERSAR, INC., Defendant, Counterclaimant, and Third Party Plaintiff, v. Environmental Resources Management, Inc. and Radian International, LLC, Third Party Defendants. Environ International Corporation, Intervenor. |
| Court | U.S. District Court — Southern District of Indiana |
Alan H. Goldstein, Curtis W. Mccauley, Ice Miller LLP, Indianapolis, IN, Frederick D. Emhardt, George M. Plews, Plews Shadley Racher & Braun, Indianapolis, IN, for plaintiffs.
David A. Gradwohl, Fox Rothschild LLP, Lansdale, PA, Philip L. Hinerman, Fox Rothschild LLP, Philadelphia, PA, Sharon Oras Morgan, Fox Rothschild LLP, Wilmington, DE, David M. Haskett, Dean R. Brackenridge, Locke Reynolds LLP, Indianapolis, IN, for defendants.
Cory Stephen Brundage, Indianapolis, IN, Robert Ballard Clemens, Sarah Steele Riordan, Bose McKinney & Evans, LLP, Indianapolis, IN, for Environmental Resources Management, third-party defendant.
Thomas A. Barnard, Sommer Barnard Attorneys, PC, Indianapolis, IN, for Radian Intern., LLC, third-party defendant.
ENTRY ON CROSS-MOTIONS FOR PARTIAL SUMMARY JUDGMENT
This case presents a contract dispute relating to the remediation of an EPA-designated Superfund hazardous waste site in Boone County, Indiana. Plaintiffs Roy O. Ball and Norman W. Bernstein ("the Trustees") are trustees for the fund formed by hazardous waste generators to clean up the site under an agreement with federal and state government authorities. The Trustees filed this action against defendant Versar, Inc. for breach of its contract to perform remediation services at the site.
The parties have filed essentially cross-motions for partial summary judgment. The primary issues are whether Versar fulfilled its performance obligations under the contract and, if not, whether it was excused from doing so based on an "Additional Work" provision or a contract amendment. As explained in detail below, each motion is granted in part and denied in part. Under the express language of the contract, Versar bore almost all of the risk of uncertainties relating to hydrological and subsurface conditions at the site. The undisputed evidence shows that Versar was obligated under the contract to achieve the clean-up standards mandated by the consent decree and that it failed to do so. Versar's failure to perform was not excused by the exclusion of "Additional Work" from the scope of its responsibilities. However, Versar has presented evidence that raises a genuine issue as to whether its failure to achieve required clean-up standards was caused (and thus excused) by soil contamination below the contractual "zone of influence" of its remedial system. The parties agreed in their second amendment to the contract that that situation would excuse Versar's failure to achieve the agreed clean-up standards. Versar has not raised a genuine issue that it is entitled to rescission or reformation of its contract based on a theory of either mutual mistake or unilateral mistake combined with inequitable conduct by the Trustees. Because its written contract is enforceable, Versar's unjust enrichment and implied contract claims fail as a matter of law. Versar is entitled to summary judgment in its favor, however, on the Trustees' claim for breach of the contract's forum selection clause.
The purpose of summary judgment is to "pierce the pleadings and to assess the proof in order to see whether there is a genuine need for trial." Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). Summary judgment is appropriate when there are no genuine issues of material fact, leaving the moving party entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c). The moving party must show there is no genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). The fact that both sides have filed cross-motions does not alter this standard; the court must consider each motion independently and will deny both motions if there is a genuine issue of material fact. E.g., Heublein, Inc. v. United States, 996 F.2d 1455, 1461 (2d Cir.1993); Harms v. Laboratory Corp. of America, 155 F.Supp.2d 891, 905-06 (N.D.Ill.2001).
A factual issue is material only if resolving the factual issue might change the suit's outcome under the governing law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). A factual issue is genuine if there is sufficient evidence for a reasonable jury to return a verdict in favor of the nonmoving party on the evidence presented. Id. "Where there are no genuine issues of material fact, contract interpretation is particularly well-suited for summary judgment." Allstate Ins. Co. v. Tozer, 392 F.3d 950, 952 (7th Cir.2004) ().
From 1977 until 1982, the Environmental Conservation and Chemical Corporation ("Enviro-Chem") operated a facility in rural Boone County for processing and reclaiming solvents, oils, and other wastes from industrial clients. The accumulation and discharge of contaminated storm water, poor management of drum inventory, and several spills at the site ultimately led the United States Environmental Protection Agency ("EPA") and the State to investigate. In 1982, a court ordered Enviro-Chem to close and environmentally secure its site.
EPA listed the Enviro-Chem site as a Superfund hazardous waste site to be addressed by federal and state authorities and potentially responsible parties ("PRPs"). Throughout 1983 and 1984, EPA and a group of over 250 hazardous waste generator PRPs performed immediate removal and groundwater collection activities pursuant to a 1983 Consent Decree. In 1987, the EPA selected a longer-term remedy in a Record of Decision ("ROD"). The 1987 ROD called for the installation of a permanent cap over the site and a system to intercept and treat contaminated groundwater.
A steering committee for the Trustees later proposed an alternative remedial action plan involving soil vapor extraction rather than groundwater collection and treatment. See Def. Ex. 9. A soil vapor extraction ("SVE") system operates by using vacuum pumps to extract air from a network of wells and/or trenches located throughout a vapor extraction area. The volatile contaminants essentially evaporate from the soil and the extracted vapors are then treated before being released into the atmosphere. Free liquid in the air is collected in a separate container and pumped to an on-site storage tank for treatment and later release. In 1991, EPA revised its ROD to use the SVE remedy in the northern area of the Enviro-Chem site. See Def. Ex. 8 ("Revised ROD").1
Following EPA's approval of a site remedy, Judge Noland of this court entered a negotiated Consent Decree between EPA and the PRPs. See Def. Ex. 6. The Consent Decree required the PRPs to establish a trust, to raise and administer funds, and to manage implementation of the remedial action at the Enviro-Chem site. Both the Revised ROD and the 1991 Consent Decree called for a contingent remedy in the event that the SVE system failed to clean up conditions at the site within five years.
Plaintiffs Roy O. Ball and Norman W. Bernstein are trustees for the fund created by the 1991 Consent Decree. The Trustees sought bids for remediation services and eventually accepted the bid of defendant Versar, Inc. On August 28, 1997, the Trustees entered into a fixed-price contract with Versar ("the Contract") for, among other things, the design, construction, operation, and maintenance of an SVE system. See Def. Ex. 1. The Trustees previously had retained Radian international, LLC ("Radian"), through its predecessor company AWD Environmental Services ("AWD"), and Environmental Resources Management, Inc. ("ERM") to participate in the testing and investigation of environmental conditions at the Enviro-Chem site and the design of the remediation system.
Versar prepared two presentations for EPA concerning the design of the SVE system. See Pl. Exs. 14 & 15. In mid-November 1997, EPA approved the design and authorized Versar to proceed. Pl. Exs. 16 & 17. The SVE system became operational on November 24, 1998.
Versar and the Trustees eventually became involved in a dispute under the Contract. In an effort to resolve their dispute, they entered into an Amendment to Contract/Settlement Agreement and Release ("Amendment No. 1"), which became effective May 4, 1999. See Def. Ex. 2.
After the parties entered into Amendment No. 1, additional disputes arose. On June 2, 1999, George Anastos, Versar's Senior Vice President and Project Manager, contacted the Trustees requesting additional compensation for consulting work at the site. See Pl.Ex. 18. Trustee Bernstein responded that Versar was obligated to achieve the clean-up standards without an adjustment in contract price and that recent monitoring well data did not appear consistent with reaching that goal within the two-year time period provided by the contract. See Pl.Ex. 19. Versar's General Counsel, James Dobbs, responded in turn: "It is Versar's position that groundwater remediation, whether till water or saturated aquifer, is not within Versar's scope-of-work." See Pl.Ex. 20. Counsel for the Trustees wrote Dobbs, referring him to the mandatory claims procedure under the Contract. See Pl.Ex. 21. Trustee Ball wrote Anastos requesting that Versar develop a plan to augment its SVE system to deal with monitoring wells T-2 and T-6. See Pl.Ex. 22. On November 30, 1999, the parties...
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