State v. Chrysler Outboard Corp., No. 96-1158

• Court: United States State Supreme Court of Wisconsin
• Citation: 219 Wis.2d 130,580 N.W.2d 203
• Decision Date: 19 June 1998
• Parties: , 46 ERC 1811 STATE of Wisconsin, Plaintiff-Appellant, v. CHRYSLER OUTBOARD CORPORATION, a/k/a Beaver Dam Products Corporation, a/k/a Chrysler Marine Corporation, a foreign corporation, Defendant-Respondent.
• Docket Number: No. 96-1158

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580 N.W.2d 203 219 Wis.2d 130, 46 ERC 1811 STATE of Wisconsin, Plaintiff-Appellant,
v.
CHRYSLER OUTBOARD CORPORATION, a/k/a Beaver Dam Products
Corporation, a/k/a Chrysler Marine Corporation, a
foreign corporation, Defendant-Respondent. No. 96-1158. Supreme Court of Wisconsin. Argued Dec. 3, 1997.
Decided June 19, 1998.

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[219 Wis.2d 136] For the plaintiff-appellant the cause was argued by Shari Eggleson, and Cynthia R. Hirsch, Assistant Attorney Generals, with whom on the briefs was James E. Doyle, Attorney General.

For the defendant-respondent there was a brief by Steven C. Kohl and Howard & Howard Attorneys, P.C., Bloomfield Hills, MI and William F. Reilly and Hippenmeyer, Reilly & Moodie, S.C., Waukesha and oral argument by Steven C. Kohl.

¶1 JON P. WILCOX, Justice.

This case is before the court on certification from the court of appeals following an order of the Circuit Court for Waukesha County, Patrick L. Snyder, Judge, which dismissed the appellant State of Wisconsin's (State) environmental enforcement action pursuant to Wis. Admin. Code §§ RD 51.05-.06 (1969) (Solid Waste Law) for failure to commence the action within the applicable statute of limitations. The circuit court also held that the State could not impose liability upon the respondent Chrysler Outboard Corporation (Chrysler) ¹ pursuant [219 Wis.2d 137] to Wis. Stat. § 144.76(3) (1977) (Spills Law) because Chrysler caused the hazardous substance spill at issue prior to the effective date of the Spills Law. The State appealed.

¶2 On certification, we consider two issues: (1) whether the State's Solid Waste Law violation enforcement action is subject to a statute of limitations bar or to the application of the "discovery rule"; and (2) whether Wis. Stat. § 144.76(3) (1977) is applicable to post-1978 discharges resulting in part from pre-1978 acts when the implicated party does not own or possess the affected property but generated the wastes and failed to remediate their subsequent spillage. We hold that the discovery rule is not applicable to the State's environmental enforcement action under the Solid Waste Law, ² and that the Spills Law is applicable in actions by the State to compel remediation of, and to impose penalties for, hazardous substance spills which, although initially caused in part by actions preceding the statute's May 21, 1978, effective date, continue to discharge after that date. Therefore, we affirm the order of

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the circuit court dismissing the State's action pursuant to the Solid Waste Law as time-barred, and reverse the circuit court's order which dismissed the State's action under the Spills Law.

¶3 The facts relevant to our decision are not in dispute. Chrysler, a foreign corporation registered to do business in the state of Wisconsin, owned and operated a plant in Hartford, Wisconsin, from 1965 to 1984 [219 Wis.2d 138] where it manufactured outboard marine engines. The manufacturing process generated waste paints, oils, and solvents, some of which contained hazardous substances as defined by Wis. Stat. § 144.30(10) (1977).

¶4 For approximately the first six months of 1970, Chrysler contracted with a construction and demolition business known as Keller Transit to remove the waste, contained in 55-gallon drums, from the Hartford plant for disposal. Keller Transit hauled the waste to a site located in the Village of Hartland, then owned by Mr. Lee Hasslinger, president of Keller Transit, and now owned by a real estate partnership named Bark River Properties (Bark River site). Keller Transit dumped the drums together with other rubbish in a low spot at the Bark River site, and covered the area with fill. The drums remained buried there until they were discovered in late 1992.

¶5 On August 25, 1992, the State became aware of the drums for the first time. In the ensuing investigation, the State determined that at least some of the drums originated at Chrysler's Hartford plant. Testing at the Bark River site has shown that the hazardous wastes have discharged into the ground, producing a plume of groundwater contamination at least one-half mile long. The plume contains levels of chlorinated solvents as much as ten times the safe drinking water standard.

¶6 The subsequent litigation between the State and Chrysler produced a settlement, by which Chrysler agreed to excavate and properly dispose of the drums and to remediate the environmental damage caused by the discharge of the hazardous waste. In August 1993, in consultation with the Department of Natural Resources (DNR), Chrysler submitted a work plan for investigation and interim response activities. Excavation[219 Wis.2d 139] of the site commenced in December 1993, and the DNR has subsequently issued a closure letter to Chrysler which indicates that the site has been satisfactorily remediated with respect to the removal of the buried drums and remediation of the contaminated soil, but not with respect to the groundwater contamination at the site. ³ Of the 401 drums eventually excavated from the Bark River site, 240 contained hazardous wastes.

¶7 In 1995, the State commenced this action seeking both injunctive relief and civil penalties under both the Solid Waste Law and the Spills Law. ⁴ The Solid Waste Law was promulgated pursuant to Wis. Stat. § 144.43 (1967), which provided in pertinent part:

144.43 Solid Waste Disposal Standards. The department shall, no later than January 1, 1969, prepare and adopt minimum standards for the location, design, construction, sanitation, operation and maintenance of solid waste disposal sites and facilities.... ⁵

The standards developed by the DNR are set forth in the Administrative Code, Wis. Admin. Code §§ RD 51.05-.06 (1969), and provide in relevant part:

219 Wis.2d 140] RD 51.05 Collection and transportation of solid waste. (1) The owner and occupant of any premises, business establishment or industry shall be responsible for the satisfactory collection and transportation of all solid waste accumulated at that premises, business establishment or industry to a solid waste disposal site or facility unless arrangements for such purpose have been made with a collecting and

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transporting service holding a permit from the department.

(2) All persons engaged in the business of collecting and transporting services ... shall obtain an annual permit from the department as indicated in this chapter.

RD 51.06 Disposal of solid waste. No person shall dispose of any solid waste, including salvageable material, at any site or facility not licensed by the department.... ⁶

¶8 The Spills Law, Wis. Stat. § 144.76 (1977), provides in part:

144.76 Hazardous substance spills. (1) DEFINITIONS. As used in this section:

(a) "Discharge" means, but is not limited to, spilling, leaking, pumping, pouring, emitting, emptying or dumping.

(b) "Hazardous substance" has the meaning given under s. 144.30(10).

...

(3) RESPONSIBILITY. Persons having possession of or control over a hazardous substance being discharged,[219 Wis.2d 141] or who cause a hazardous discharge, shall take the actions necessary to restore the environment to the extent practicable and minimize the harmful effects from any discharge to the air, lands or waters of this state. ⁷

¶9 Violations of both the Solid Waste Law, effective May 1, 1969, and the Spills Law, effective May 21, 1978, were subject to penalties as provided by Wis. Stat. § 144.57 (1969) or a subsequent version of the same statute. The penalties provision states:

144.57 Penalties. Any person who violates this chapter, or who fails, neglects or refuses to obey any general or special order of the department, shall forfeit not less than $10 nor more than $5,000, for each violation, failure or refusal. Each day of continued violation is a separate offense.... ⁸

¶10 The State seeks penalties for every day of violation of the Solid Waste Law in 1970, and every day of violation of the Spills Law since May 21, 1978. More specifically, the State seeks to impose penalties under the Solid Waste Law for Chrysler's failure to use licensed haulers to remove its solid waste, and for failure to deposit that waste at a licensed facility. The penalties sought for violations of the Spills Law relate to Chrysler's post-1978 failure to remediate the Bark River site. The injunctive relief sought by the State includes both an order requiring that Chrysler continue and complete remediation of the contamination at the Bark River site, and an order requiring Chrysler [219 Wis.2d 142] to determine where the rest of the hazardous wastes it generated prior to 1976 at its Hartford plant were disposed.

¶11 Both parties moved for summary judgment. The State asserted: (1) that the discovery rule should apply to its Solid Waste Law claim so as to eliminate any statute of limitations concern; and (2) that its attempt to impose liability under the Spills Law was not a retroactive, ex post facto application of the law since it sought to address only Chrysler's post-1978 failure to remediate the Bark River site--not its pre-1978 dumping activities. Chrysler responded and argued in its own motion for summary judgment that the discovery rule, previously employed in tort actions alone, should not be extended to environmental enforcement actions brought by the State years after the environmental violations occurred. In addition, Chrysler argued that any attempt to impose penalties and forfeitures under the Spills Law, which became effective in 1978, violates the ex post facto provisions of the state and federal constitutions since they would be predicated upon Chrysler's actions in 1970.

¶12 Citing the fact that neither the legislature nor this court has extended the discovery rule to an environmental enforcement action of this sort, the circuit court denied the State's motion for summary judgment and granted summary judgment for Chrysler

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on the Solid Waste Law claim. Later, the circuit court denied...