City of Seattle v. Dept. of Transp.

• Decision Date: 03 December 1999
• Docket Number: No. 24042-4-II.,24042-4-II.
• Citation: 989 P.2d 1164,98 Wash.App. 165
• Court: Washington Court of Appeals
• Parties: The CITY OF SEATTLE (SEATTLE CITY LIGHT) a municipal corporation; City of Tacoma (Department of Public Utilities Light Division) a municipal corporation; Lewis County P.U.D.; Chelan County P.U.D., No. 1, a municipal corporation; Peninsula Light Co., a mutual corporation; Grays Harbor P.U.D.; and City of Centralia (Centralia City Light) a municipal corporation, Respondents, v. The WASHINGTON STATE DEPARTMENT OF TRANSPORTATION, Appellant.

989 P.2d 1164

98 Wash.App. 165

The CITY OF SEATTLE (SEATTLE CITY LIGHT) a municipal corporation; City of Tacoma (Department of Public Utilities Light Division) a municipal corporation; Lewis County P.U.D.; Chelan County P.U.D., No. 1, a municipal corporation; Peninsula Light Co., a mutual corporation; Grays Harbor P.U.D.; and City of Centralia (Centralia City Light) a municipal corporation, Respondents, v. The WASHINGTON STATE DEPARTMENT OF TRANSPORTATION, Appellant.

No. 24042-4-II.

Court of Appeals of Washington, Division 2.

December 3, 1999.

Deborah L. Cade, Attorney General's Office, Olympia, for Appellant.

George Stephen Karavitis, Assistant City Attorney, Tacoma, Peter Edward Hapke, Joel Cartwright Merkel, William Henry Beaver, Karr Tuttle Campbell, Seattle, Shannon M. Murphy, Dudenbostel Law Offices, Centralia, Erik K. Wahlquist, Davis Arneil Law Firm, Wenatchee, Dennis R. Colwell, Ingram Zelasko & Goodwin, Aberdeen, for Respondents.

BRIDGEWATER, C.J.

Seven public utilities sued the Washington State Department of Transportation (WSDOT) under the Washington Model Toxics Control Act (MTCA) for contribution to recover remedial action costs associated with cleaning up a Superfund site. WSDOT appeals the trial court's decision that it was liable and had to pay the Utilities 1.8 percent of the total site cleanup costs, some attorney fees, expenses and other costs. We affirm the trial court's holding that WSDOT is technically liable under the MTCA, but reverse the court's holding that WSDOT pay remedial action costs to the Utilities. Because the asphalt that WSDOT contributed to the site did not pose a threat or potential threat to human health or the environment, we hold that the trial court erred in requiring WSDOT to pay for costs associated with the cleanup of PCBs that another party later poured on the asphalt. Consequently, we reverse the award for remedial action costs, attorney fees and costs and order summary judgment in favor of WSDOT.

A group of public utilities from Seattle, Tacoma, and five other areas (collectively "the Utilities"), sent their used transformers to Leonard Strandley's transformer disposal business in Purdy, Washington. In the summer of 1984, the U.S. Environmental Protection Agency (EPA) shut down Strandley's operation after finding that PCB (polychlorinated biphenyl) and dioxin contamination from the site threatened a nearby lagoon. Accepting their own clear liability, the Utilities formed a voluntary group to clean up the site. EPA supervised the cleanup.

Part of the site cleanup included disposing of a large railroad tank car that Strandley used in his operation. The tank was 28 feet long and 7 feet in diameter, weighed about 11,000 pounds and held about 9,000 gallons. Strandley used the tank to store PCB-contaminated transformer oil that he drained from the Utilities' transformers. He would then sell the oil to recyclers. During the cleanup, the Utilities discovered a semi-hardened, asphalt layer on the bottom of the tank that had become contaminated with PCBs. The Utilities tested the asphalt but did not find the presence of any other toxic chemicals apart from PCBs. No evidence suggests that the PCBs and asphalt combined and commingled synergistically to form a new and different hazardous substance.

The Utilities discovered that WSDOT originally owned the tank car, using it to store an asphalt emulsion known as "tack oil," a substance that serves as a kind of asphalt glue to bond new asphalt pavement to old. In 1975, WSDOT requested authority to sell the storage tank as scrap metal, stating that the tank was "rusted and in such condition no longer serviceable to the Department." Gordon Manning purchased the tank for $236 and a few years later sold it to Strandley, Manning's brother-in-law. When WSDOT sold the tank car to Manning, the tank contained the hardened layer of asphalt emulsion.

No evidence suggests that the tank ever leaked or that WSDOT ever added PCBs to it. Asphalt, by itself, is a petroleum-based product. The parties agree that hardened asphalt does not pose a threat to human health or the environment.

The Utilities sued WSDOT for contribution under the MTCA, claiming that WSDOT had disposed of a hazardous substance and should be held responsible for some of the cleanup costs.

The trial court bifurcated the action, first deciding on cross-motions for summary judgment that WSDOT was liable under the MTCA. In the cost allocation phase of the proceedings, also tried by affidavit, the Utilities claimed that the quantity and consistency of the asphalt doubled the cost of cleaning up the PCBs in the tank and, consequently, requested half the total cost of the tank cleanup. The Utilities also requested some costs related to cleaning up the "toxic hot spot" on the ground around the tank where Strandley had spilled transformer oil. The total cost of remedial action at the Strandley-Manning site was about $10 million. The trial court granted judgment in the amount requested by the Utilities: $180,037.29 of the cleanup costs, $24,143.91 in attorney fees and expenses relating to the remedial action, and another $64,845.04 in attorney fees and costs as the prevailing party. Thus, the total award against WSDOT was $269,026.24.

I. Review Standards

The parties cross-moved for summary judgment on the issue of liability. This court reviews summary judgment under the familiar standards, namely, a de novo application of CR 56(c). Wilson v. Steinbach, 98 Wash.2d 434, 437, 656 P.2d 1030 (1982). We do not reach the issue of the standard used in reviewing the actual allocation of remedial action costs because we hold the court should have granted summary judgment in favor of WSDOT under CR 56.

II. MTCA Contribution Action

In 1989, Washington voters approved the MTCA, which has the ambitious goal of cleaning up contaminated land and preserving the environment for future generations. Some parts of the MTCA track its federal counterpart CERCLA¹ and, consequently, federal cases interpreting similar language in CERCLA are persuasive, albeit not controlling, authority.² But unlike CERCLA, Washington's MTCA explicitly creates a scheme of strict liability and joint and several liability for those caught in its sweep.³

The Utilities, responsible for cleanup costs at the Strandley-Manning site, brought a private contribution against WSDOT to recover some of those costs. Like the trial court, we must address two questions. First, is WSDOT liable under RCW 70.105D.040? If the answer is yes, then what portion of the cleanup costs should be allocated to WSDOT? The first question is determined by applying the statutory criteria (enumerated in RCW 70.105D.040) to the facts. We hold that there is liability under the Act. But in order to impose remedial costs for cleanup on a defendant, a plaintiff must prove that the hazardous substance poses a threat or potential threat to human health or the environment. RCW 70.105D.020(21).⁴ Then, "[r]ecovery shall be based on such equitable factors as the court determines are appropriate." RCW 70.105D.080.

A. Liability

WSDOT is liable for remedial action costs if it is an "arranger" who disposed of a "hazardous substance" under the Act. Liability is defined, as relevant here, as follows:

(1) Except as provided in subsection (3) of this section [defenses], the following persons are liable with respect to a facility:

(a) The owner or operator of the facility;

(b) Any person who owned or operated the facility at the time of disposal or release of the hazardous substances;

(c) Any person who owned or possessed a hazardous substance and who by contract, agreement, or otherwise arranged for disposal or treatment of the hazardous substance at the facility, or arranged with a transporter for transport for disposal or treatment of the hazardous substances at the facility, or otherwise generated hazardous wastes disposed of or treated at the facility;

RCW 70.105D.040.

We segregate the contested elements of liability from the uncontested. The parties agree on several elements: WSDOT is a "person" as defined by MTCA; WSDOT owned the tank car and the asphalt emulsion in the tank car before they were sold to Manning in 1975; and the site was a "facility" under the Act. WSDOT contests only two elements of liability: that the asphalt emulsion in the tank car was a "hazardous substance"; and that WSDOT arranged for its disposal.

1. Hazardous Substance

"Hazardous substance" as defined by the Act expressly includes: "(d) Petroleum or petroleum products." RCW 70.105D.020(7). The Act's "petroleum product" definition contains one exception:

The term hazardous substance does not include any of the following when contained in an underground storage tank from which there is not a release: Crude oil or any fraction thereof or petroleum, if the tank is in compliance with all applicable federal, state, and local law.

RCW 70.105D.020(7)(e). This exception does not apply to the facts here, and there are no other exceptions from the terms "petroleum or petroleum products."⁵

WSDOT concedes that the asphalt residue in the tank car is a petroleum product. But WSDOT argues that it has no liability because asphalt is ubiquitous and benign, and the City is unable to prove that the asphalt residue, itself, created a threat or a potential threat to public health or the environment. While the degree of the hazard may be relevant to the question of cost allocation (see below), it is irrelevant to liability.

Petroleum products are specifically enumerated "hazardous substances" under the Act. Like CERCLA, no minimum level of "hazardous substance" is required to trigger MTCA liability. See A & W Smelter & Refiners, Inc. v. Clinton, 146 F.3d 1107, 1110-11 (9th Cir.1998) (rejecting de minimis defense); United States v. Alcan Aluminum Corp., 990 F.2d 711, 720 (2d Cir.1993); United States v. Alcan Aluminum Corp., 964 F.2d 252, 260-63 (3d Cir.1992). Consequently, the trial court...