Bourbon Mini-Mart v. Gast Fuel and Services

• Decision Date: 14 February 2003
• Docket Number: No. 50S03-0106-CV-287.,50S03-0106-CV-287.
• Citation: 783 N.E.2d 253
• Parties: BOURBON MINI-MART, INC. and Robert E. Wanemacher, Appellants, v. GAST FUEL AND SERVICES, INC., and Jack Boardman, d/b/a Boardman Chevrolet, Appellees.
• Court: Indiana Supreme Court

783 N.E.2d 253

BOURBON MINI-MART, INC. and Robert E. Wanemacher, Appellants, v. GAST FUEL AND SERVICES, INC., and Jack Boardman, d/b/a Boardman Chevrolet, Appellees.

No. 50S03-0106-CV-287.

Supreme Court of Indiana.

February 14, 2003.

Patricia Polis McCrory, Angela L. Hamm, Lisa Tuytschaevers, Harrison & Moberly, LLP, Indianapolis, IN, Attorney for Appellant.

Donald G. Orzeske, Andrew S. Peacock, Goodin, Orzeske & Stevens, P.C., Indianapolis, IN, Attorneys for Appellee. SULLIVAN, Justice.

Bourbon Mini-Mart seeks indemnification for and contribution to its costs of cleaning up petroleum contamination from leaking underground storage tanks from one of its suppliers and an automobile dealership. Because Mini-Mart was found at least partially responsible for the contamination in prior litigation, it is not entitled to indemnification. However, Indiana's underground storage tank legislation authorizes Mini-Mart to seek contribution from its supplier under the facts of this case.

Background

The principal actors in this decade-old environmental drama are: Bourbon Mini-Mart, a gas station and convenience store, and its owner, Robert Wanemacher (collectively, "Mini-Mart"); Gast Fuel and Services, Inc., Mini-Mart's sole supplier of gasoline and other petroleum products ("Supplier"); Boardman Chevrolet, an automobile dealership near Mini-Mart that stores gasoline, oil, and other chemicals removed from motor vehicles in an underground storage tank ("Dealership"); the Workmans and the Duffs, two families whose homes were adjacent to Mini-Mart (the "Homeowners"); and the Indiana Department of Environmental management ("IDEM"). Mini-Mart stored gasoline in underground storage tanks ("USTs"). In 1990, the Homeowners complained to IDEM of fumes in their homes. After an investigation, IDEM found that the land, groundwater, and homes adjacent to Mini-Mart were contaminated with solvents including petroleum. Concluding that the petroleum contamination originated from Mini-Mart, IDEM informed Mini-Mart of the contamination and indicated that IDEM would clean up the site and attempt to recover its costs from Mini-Mart unless Mini-Mart acted on its own.

After Mini-Mart failed to initiate clean up of the contamination, IDEM began to clean up the site. The case that is the subject of this appeal began on June, 28, 1991, when IDEM sued Mini-Mart for reimbursement for its remediation expenses. (We will refer to this case from time to time in this opinion as the "IDEM Litigation" to distinguish it from the "Homeowner Litigation" described below.) In December, 1997, Mini-Mart filed a third party complaint against Supplier, and amended the complaint in January, 1999, to add Dealership. The third party complaint alleged that Supplier and Dealership caused the contamination and sought payment from them for any sums that IDEM recovered from Mini-Mart for IDEM's remediation expenses.

During the time between the commencement of IDEM's case against Mini-Mart and the addition of Supplier and Dealership in Mini-Mart's third party complaints, the Homeowners sued Mini-Mart for nuisance, trespass, and negligence alleging Mini-Mart caused the contamination (the "Homeowner Litigation"). The Homeowner Litigation was a completely separate lawsuit from the IDEM Litigation and Mini-Mart did not attempt any cross-claim against the Supplier or Dealership in that case. The Homeowner Litigation concluded in 1996 when a jury found Mini-Mart liable and awarded the Homeowners $530,000.

The rulings in the IDEM Litigation that are the subject of this appeal were issued in November, 1999, when the trial court granted summary judgment in favor of Supplier and Dealership. In December, 2000, the Court of Appeals affirmed in part and reversed in part. Commissioner, Ind. Dep't of Envtl. Mgt. v. Bourbon Mini-Mart, 741 N.E.2d 361 (Ind.Ct.App.2000). As to Supplier, the Court of Appeals found that summary judgment in its favor was proper with respect to remediation costs incurred prior to July 1, 1991, but not after that date. Id. at 371-372. As to Dealership, the Court of Appeals affirmed the grant of summary judgment in its favor. Id. at 369. Both Mini-Mart and Supplier sought and this Court granted transfer. Commissioner, Ind. Dep't of Envtl. Mgt. v. Bourbon Mini-Mart, 753 N.E.2d 17 (Ind. 2001) (table).

Discussion

Briefly stated, this appeal requires that we decide whether Mini-Mart is entitled to proceed to trial against either or both of Supplier and Dealership based on Mini-Mart's claims that they caused in whole or in part the petroleum contamination described in Background, supra. The trial court held that Mini-Mart's claims against both Supplier and Dealership were barred by application of the doctrine of collateral estoppel and by the statute of limitations for damage to real property. It also held that Mini-Mart's claim against Dealership was additionally barred by application of the doctrine of laches.

As mentioned in Background, supra, the Court of Appeals affirmed in part and reversed in part.

First, it affirmed the trial court's ruling that Mini-Mart's claim against Dealership was barred by application of the doctrine of collateral estoppel.¹ Bourbon Mini-Mart, 741 N.E.2d at 369. On this issue, we summarily affirm the opinion of the Court of Appeals pursuant to Indiana Appellate Rule 58(A).² Second, it reversed the trial court's ruling that Mini-Mart's claims against Supplier were subject to the statute of limitations for damage to real property, Ind. Code § 34-11-2-7. Bourbon Mini-Mart, 741 N.E.2d at 371-72. On this issue, we also summarily affirm the opinion of the Court of Appeals pursuant to Indiana Appellate Rule 58(A).

Third, it affirmed the trial court's ruling that Mini-Mart's claim against Supplier with respect to remediation costs incurred prior to July 1, 1991, was barred by the statute of limitations, but held that Mini-Mart's claims against Supplier with respect to remediation costs incurred after that date could proceed. Bourbon Mini-Mart, 741 N.E.2d at 369-71. We conclude, however, that Mini-Mart may proceed against Supplier with respect to remediation costs incurred both prior to July 1, 1991, and after.

I

We mentioned in Background, supra, that Mini-Mart had been found in the Homeowner Litigation to be liable for the petroleum contamination at issue here. "Collateral estoppel or issue preclusion bars subsequent litigation of an issue necessarily adjudicated in a former suit if the same issue is presented in the subsequent suit." See Shell Oil Company v. Meyer, 705 N.E.2d 962, 968 (Ind.1998). In the litigation between the Homeowners and Mini-Mart, the jury found Mini-Mart liable for negligence, nuisance, and trespass.³ While Mini-Mart argues to the contrary, we agree with the trial court⁴ and the Court of Appeals⁵ that the jury's determination established that Mini-Mart was not without fault with respect to the petroleum contamination and that collateral estoppel bars re-litigation of that issue in this case.

As noted briefly in footnote 2, supra, Mini-Mart sought recovery from Supplier on two separate theories—indemnification and statutory contribution. The indemnification claim seeks payment from Supplier on the basis that the petroleum contamination was the sole fault of Supplier and others, i.e., Mini-Mart itself was without fault. See Third-Party Pl.'s Am. Third-Party Compl. ¶ 9, R. at 690-91. Indeed, Indiana law provides that in an action for indemnification, the party seeking indemnification will only prevail if it is without fault. Indianapolis Power & Light Co. v. Brad Snodgrass, Inc., 578 N.E.2d 669, 671 (Ind.1991). For Mini-Mart to avoid summary judgment on its indemnification claim, there would need to be a genuine issue of material fact that it was not liable for any of the petroleum contamination. We agree with the trial court and Court of Appeals that Mini-Mart cannot make such a showing because its liability for at least some contamination was established in the Homeowner Litigation. Subsequent re-litigation of the issue is barred by collateral estoppel.

However, collateral estoppel does not dispose of Mini-Mart's statutory contribution claim against Supplier. Under applicable environmental statutes to be discussed in detail infra, a party held liable for environmental contamination can seek contribution from others partially liable for the same contamination in certain circumstances. We agree with the Court of Appeals and Mini-Mart that the verdict in the Homeowner Litigation, while establishing for purposes of collateral estoppel that Mini-Mart was not without fault with respect to the petroleum contamination, did not establish that Mini-Mart was solely responsible therefor.

While collateral estoppel does not bar Mini-Mart from seeking contribution from Supplier, it remains to be seen whether applicable law permits it to do so. It is to that question we now turn.⁶

II

A

Indiana's UST laws are modeled after the federal Comprehensive Environmental Response Compensation and Liability Act ("CERCLA"), 42 U.S.C. § 9601 to § 9675. Federal CERCLA law is directed at the cleanup of certain hazardous substances but excludes petroleum. To deal with the cleanup of petroleum, Indiana's Legislature enacted UST laws to provide for the regulation of underground storage tanks and the prevention and remediation of pollution from the tanks. As our Court has previously noted, the provisions of Indiana's UST laws are similar to corresponding provisions of federal CERCLA law, see Shell Oil Co. v. Meyer, 705 N.E.2d 962, 967 (Ind.1998), and they follow the same remedial principles. See Western Ohio Pizza, Inc. v. Clark Oil & Refining Corp., 704 N.E.2d 1086, 1090 (Ind.Ct.App. 1999), transfer denied, 714 N.E.2d 176 (table); The Pantry, Inc. v. Stop-N-Go Foods, Inc., 777 F.Supp. 713, 720 (S.D.Ind. 1991).

CERCLA authorizes the federal government to clean up hazardous substances and then seek reimbursement from responsible ...