Kodiak Island Borough v. Exxon Corp.
| Decision Date | 22 November 1999 |
| Docket Number | No. S-7581.,S-7581. |
| Citation | 991 P.2d 757 |
| Parties | KODIAK ISLAND BOROUGH, City of Seward, City of Cordova, City of Old Harbor, City of Ouzinkie, City of Port Lions, and City of Larsen Bay, Appellants, v. EXXON CORPORATION and Exxon Shipping Corporation, Appellees. |
| Court | Alaska Supreme Court |
Matthew D. Jamin, Jamin Ebell Bolger & Gentry, Kodiak, Lloyd B. Miller, Sonosky Chambers Sachse Miller & Munson, Anchorage, and N. Robert Stoll, Stoll Stoll Berne Lokting & Shlachter, P.C., Portland, Oregon, for Appellants.
Douglas J. Serdahely, Bogle & Gates, P.L.L.C., Anchorage, John F. Clough III, Clough & Associates, P.C., Juneau, and Charles P. Diamond, O'Melveny & Myers, Los Angeles, California, for Appellees.
Before BRYNER, Justice, RABINOWITZ, Senior Justice, pro tem,1 HUNT, GREENE, and ZERVOS, Justices, pro tem.2
This case arises from the EXXON VALDEZ oil spill of March 1989. In response to the discharge of nearly eleven million gallons of crude oil into Prince William Sound, several municipalities were forced to divert employee time and municipal services to a massive cleanup operation. They later filed suit against Exxon to recover the value of these diverted services under an Alaska statute imposing strict liability for the discharge of hazardous substances. The trial court granted summary judgment to Exxon, concluding that the statute did not permit recovery of damages for the municipalities' diverted-services claims. Because we conclude that Alaska law does permit recovery for these diverted services, we reverse.
On March 24, 1989, the tanker EXXON VALDEZ ran aground near Bligh Reef, spilling nearly eleven million gallons of crude oil into Prince William Sound. In response, Kodiak Island Borough and the cities of Seward, Cordova, Old Harbor, Ouzinkie, Port Lions, and Larsen Bay (collectively, the Cities) were forced to participate in a massive cleanup operation. Municipal officials and employees devoted significant time to tracking oil flow; monitoring shoreline; acquiring oil containment equipment; meeting with Exxon, governmental representatives, and experts about the oil spill and cleanup; and booming off and cleaning key spawning areas on city-owned tidelands. Because the Cities' employees were engaged in these activities, they were unable to provide ordinary services to their residents.
The Cities sued Exxon Corporation, which owned the spilled oil, and its maritime subsidiary, Exxon Shipping Corporation, which owned the EXXON VALDEZ (collectively, Exxon). Relying on AS 46.03.822(a), which imposes strict liability for harm caused by the release of hazardous substances, the Cities claimed damages for the costs of municipal services diverted as a result of the spill. These diverted-services claims included the value of ordinary municipal services that the spill prevented the Cities from providing their residents and the costs of extraordinary services necessitated by the spill.3
The superior court established as a matter of law that the oil spill violated the statutory prohibition against release of hazardous substances, that no defenses specified in the hazardous substances statute applied to Exxon, and that Exxon was therefore strictly liable under the statute for "all compensable damages" that the Cities "proved at trial to have been proximately caused by the spill."4
Exxon then moved for summary judgment, contending that the Cities' diverted-services claims were not compensable under the hazardous substances statute. The superior court agreed and granted summary judgment in Exxon's favor.
The Cities appeal.
We review a grant of summary judgment de novo,5 determining whether the record shows a genuine issue of material fact and whether the moving party is entitled to judgment on the law applicable to the established facts.6 For purposes of determining what facts are established, we must draw all reasonable inferences in favor of the non-moving party.7 But in answering questions of law, we apply our independent judgment and adopt "the rule of law that is most persuasive in light of precedent, reason, and policy."8 We may affirm a grant of summary judgment on any legal ground that supports the trial court's ruling.9
Alaska Statute 46.03.822(a) provides that certain persons may be held strictly liable for various damages caused by an unpermitted release of a hazardous substance.10 Alaska Statutes 46.03.822(a), AS 46.03.822(k),11 and AS 46.03.82412 together define the scope of recoverable damages.
The Cities argue that the superior court erred in concluding that their diverted-services claims are not "damages" within the meaning of these statutes. Exxon responds that the "free public services doctrine" bars the Cities' diverted-services claims and that the superior court therefore correctly interpreted the statutes. Exxon also argues that the Cities waived their rights to these damages and that they lack standing to assert their claims. Last, Exxon argues that federal maritime law preempts the Cities' claims. We consider each argument below.
Exxon argues that the free public services doctrine bars the Cities' claims for costs they incurred in responding to the oil spill. This common-law doctrine provides that the public must bear the costs of providing emergency public services, thus relieving individual tortfeasors of liability.13 Although we have had no occasion to consider the doctrine, we assume for purposes of this appeal that it applies unless abrogated by statute.
Subsection (k) of the same statute adds: "In this section, `damages' has the meaning given in AS 46.03.824 and includes damage to persons or to public or private property, [and] damage to the natural resources of the state or a municipality...."16 And AS 46.03.824 broadly defines damages to include any "injury to or loss of persons or property, real or personal, loss of income, loss of the means of producing income, or the loss of an economic benefit."
The breadth of this language and the statute's specific provision for recovery of costs incurred by "the state, a municipality, or a village,"17 strongly suggest a legislative intent to permit compensation for governmental services including those services rendered non-compensable at common law by the free public services doctrine. Moreover, AS 46.03.822(a) expressly states that the imposition of strict liability for release of hazardous substances applies "[n]otwithstanding any other provision or rule of law." This language evinces the legislature's intent to abrogate all otherwise applicable common-law doctrines, including the doctrine of free public services, except insofar as they are expressed in the statute itself.
Again assuming that the free public services doctrine is part of Alaska's common law, we reject Exxon's contention that the doctrine restricts the Cities' compensable damages in the factual context of this case. To define the scope of recoverable damages, we must examine Alaska's hazardous substances statutes.
We next consider whether the superior court correctly interpreted and applied the damages provisions of Alaska's hazardous substances statutes. When we engage in statutory construction, we must, whenever possible, "interpret[ ] each part or section of a statute with every other part or section, so as to create a harmonious whole."18 We must also presume "that the legislature intended every word, sentence, or provision of a statute to have some purpose, force, and effect, and that no words or provisions are superfluous."19 Furthermore, we generally presume that an amendment to an unambiguous statute indicates a "substantive change in the law."20 But if the original version of the statute is ambiguous, we may regard a subsequent change as a legislative interpretation or clarification.21
Alaska's hazardous substances provisions, including AS 46.03.822, were added to the state Environmental Conservation Act in 1972.22 Except for a minor, irrelevant modification, the original version of AS 46.03.822 remained in effect when the EXXON VALDEZ spill occurred; it provided, in relevant part:
To the extent not otherwise preempted by federal law, a person owning or having control over a hazardous substance which enters in or upon the waters, surface or subsurface lands of the state is strictly liable, without regard to fault, for the damages to persons or property, public or private, caused by the entry.23
Though this provision did not specifically define "damages," a...
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