Polaroid Corp. v. Rollins Environmental Services (NJ), Inc.
| Citation | 416 Mass. 684,624 N.E.2d 959 |
| Parties | POLAROID CORPORATION et al. 1 v. ROLLINS ENVIRONMENTAL SERVICES (NJ), INC. 2 |
| Decision Date | 29 December 1993 |
| Court | United States State Supreme Judicial Court of Massachusetts |
Pamela S. Gilman, Boston (Jennifer Ellis Burke, with her) for defendant.
James E. McGuire, Boston, (Catherine E. Reuben, with him) for plaintiffs.
Before LIACOS, C.J., and WILKINS, ABRAMS, LYNCH and GREANEY, JJ.
The defendant appeals from a Superior Court judgment granting the plaintiffs' motion for declaratory relief and ruling that the defendant is obligated to indemnify the plaintiffs for costs associated with a hazardous waste cleanup performed pursuant to the Comprehensive Environmental Response Compensation and Liability Act (CERCLA), 42 U.S.C. §§ 9601 et seq. (1988 & Supp. III 1991). The defendant, Rollins Environmental Services (NJ), Inc. (Rollins), operates a waste disposal facility in Bridgeport, New Jersey, where it disposes of hazardous waste materials through incineration and other chemical and biological processes for customers throughout the country. Polaroid Corporation (Polaroid) and Hooker Chemical Corporation (Hooker), the predecessor company of the plaintiff Occidental Chemical Corporation (Occidental), were customers of Rollins during the 1970's, whereby Rollins disposed of their hazardous wastes.
The plaintiffs' action sought a determination that Rollins was contractually obliged to indemnify them against liability for hazardous waste spills at a temporary storage facility, Bridgeport Rental and Oil Service, Inc. (Bridgeport). Although the complaint sets forth several counts, only the declaratory judgment count is presently before this court. The parties filed cross motions for summary judgment and agreed that there was no dispute as to the material facts.
In her well-reasoned opinion, the trial judge concluded that Polaroid and Occidental have valid, binding, and enforceable indemnification contracts with Rollins under which Rollins is to indemnify and to save the plaintiffs harmless from all liability and loss for releases or a substantial threat of release of hazardous substances at the Bridgeport site. She also ruled that § 107(e)(1) of CERCLA, 42 U.S.C. § 9607(e)(1), does not prohibit enforcement of contractual indemnity provisions between private parties with respect to CERCLA cleanup costs. We transferred this case from the Appeals Court on our own motion and we now affirm.
The judge set forth the following undisputed facts from the pleadings, depositions, affidavits, and exhibits. In early 1976, Polaroid and Rollins entered into an agreement whereby Rollins agreed to perform waste disposal services for Polaroid. Polaroid gave Rollins a copy of Polaroid's "Supplemental General Conditions for Chemical Waste Disposal Services" (supplemental general conditions) and informed Rollins that agreement to the supplemental conditions was an essential condition to any contract between the parties. Rollins made a number of handwritten and initialed changes and then both Rollins and Polaroid signed the supplemental general conditions which provide in pertinent part:
From May, 1976, until at least 1980, Rollins provided chemical waste disposal services to Polaroid and transported materials from Polaroid's Massachusetts plants to Rollins' New Jersey plant for treatment. Routinely, Polaroid sent Rollins a completed waste data sheet, a written description, and a sample of the waste to enable Rollins to determine whether its facility could properly treat the waste. Rollins would analyze the waste and return a written proposal with the treatment price and shipping cost to Polaroid. Polaroid would then execute a purchase order and Rollins would pick up the waste. All of Polaroid's purchase orders referenced the supplemental general conditions in a list of "documents which constitute this contract." Copies exist only of the fronts of Polaroid's purchase orders, which include the supplemental general conditions. However, the backs of purchase order forms of that general time period, which contain other terms and conditions, are available. 3
The Occidental Purchase Orders.
Hooker, the predecessor to Occidental, entered into a similar business arrangement with Rollins in late 1970 or early 1971. Hooker operated a chemical manufacturing plant in Hicksville, New York, and contracted with Rollins for waste removal and treatment. Routinely, Hooker submitted purchase orders which contained the following indemnity clause typed on their fronts:
The purchase orders also stated:
Although Occidental has produced copies of the fronts of the purchase orders with the preceding language, they have not produced the reverse side of the documents. From 1971 through 1976, thirteen of the fourteen purchase orders issued by Hooker contained the preceding indemnity clause and instructions. Rollins never returned the acknowledgement copies of an order containing the indemnity language. This indemnity language was used on Hooker's purchase orders without objection from Rollins until January 6, 1977, when Rollins refused a Hooker purchase order because it objected to the typed indemnity clause. At Rollins' behest, the parties thereafter adopted an indemnification clause which provided indemnification only for Rollins' negligent acts.
During the course of doing business with both Polaroid and Hooker, Rollins sometimes stored the plaintiffs' waste materials in the Bridgeport "tank farm" until Rollins' facility was able to process the waste. Several hazardous waste spills occurred at Bridgeport during the 1970's. In August of 1988, the United States Environmental Protection Agency (EPA) notified Polaroid and Occidental that, as waste generators, they were potentially responsible parties under CERCLA and would be held jointly and severally liable for investigation and remediation costs incurred by the government. The EPA asserted that Polaroid was potentially responsible as the generator of waste shipped to Bridgeport on October 17, 1973, and seven additional shipments made between August 11, 1976, and April 2, 1977. 4 Occidental is listed as the generator of waste shipped on June 27, 1974, and August 2, 1974.
The New Jersey Department of Environmental Protection has requested potentially responsible parties voluntarily to contribute $9,224,189 to the remediation efforts at the Bridgeport site. Polaroid has paid a small portion but Occidental has paid nothing. Both Polaroid and Occidental requested Rollins to defend and to indemnify them with regard to the Bridgeport site spills but Rollins has refused.
1. Rollins first claims that the indemnity provision in Hooker's purchase order should not have been considered a term of the agreement between Rollins and Occidental. Rollins asserts that, because a portion of the complete contract--the back page of the purchase order--is missing, the remaining terms including the indemnity clause cannot be construed fairly. Rollins cites no case law on point for this proposition but rather extrapolates from general rules of contract construction. Rollins agrees with the judge's choice of law analysis and determination that New Jersey law applies to the relationship between Rollins and Occidental.
While it is true that a general rule of contract construction is that contracts should be construed as a whole, when the court is satisfied that an original document is not available, the party seeking to prove the content may offer secondary evidence to determine the content of a contract. See Lubarr v. Royal Woodwork, Inc., 70 N.J.Super. 1, 8, 174 A.2d 627 (App.Div.1961). See also Old Colony Trust Co. v. Shaw, 348 Mass. 212, 219, 202 N.E.2d 785 (1964); Capitol Bank & Trust Co. v. Richman, 19 Mass.App.Ct. 515, 520-521, 475 N.E.2d 1236 (1985). Occidental has met its burden of proof by producing copies of the indemnity clause it is seeking to enforce. The indemnity clause makes no reference to other provisions of the contract. In the absence of evidence that the reverse side of the contract modified the indemnity clause, the clause applies. Indeed, as the judge pointed out, since the indemnity clause is a typewritten provision, it would supersede any inconsistent printed...
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