Taygeta Corporation v. Varian Associates, Inc.
| Decision Date | 05 November 2001 |
| Citation | 763 NE 2d 1053,436 Mass. 217 |
| Parties | TAYGETA CORPORATION v. VARIAN ASSOCIATES, INC. |
| Court | United States State Supreme Judicial Court of Massachusetts Supreme Court |
Present: GREANEY, IRELAND, SPINA, COWIN, SOSMAN, & CORDY, JJ.
Eric W. Wodlinger (H. Hamilton Hackney, III, with him) for the plaintiff.
Seth D. Jaffe for the defendant.
The following submitted briefs for amici curiae:
Cynthia L. Amara, R. Robert Popeo, Jeffrey R. Porter, & Andrew N. Nathanson for Associated Industries of Massachusetts & another.
Thomas F. Reilly, Attorney General, & James R. Milkey, Assistant Attorney General, for the Commonwealth.
Jan Richard Schlichtmann for Wenham Lake Watershed Association.
Taygeta Corporation (Taygeta), the owner of real property at 31 Tozer Road in Beverly (site), filed a complaint against Varian Associates, Inc. (Varian), the former owner of real property in Beverly located to the northeast of the site (Varian property), to recover damages for groundwater contamination at the site caused by Varian. A Superior Court judge denied Taygeta's motion for summary judgment, granted Varian's motion for summary judgment, and dismissed Taygeta's action as barred by the statute of limitations. We granted Taygeta's application for direct appellate review. The issues now before us are whether the judge (1) misconstrued the discovery rule and therefore erred in concluding that Taygeta's property damage and negligence claims were barred by the statute of limitations; (2) erred in ignoring disputed issues of fact as to when Taygeta reasonably should have known that it had been injured by Varian and in failing to submit such factual issues to a jury; and (3) erred in concluding that Taygeta could not recover on a nuisance claim where groundwater contamination at the site constituted an ongoing harm. We vacate the grant of summary judgment in Varian's favor and remand the case to the Superior Court for further proceedings consistent with this opinion.1 1. Background. Varian purchased the Varian property in 1959 from Bomac Laboratories, Inc. (Bomac). Both entities were in the business of manufacturing electronic equipment, processes that involved the use of industrial chemicals. From approximately 1950 until 1973, employees of Bomac and Varian discharged thousands of gallons of untreated waste chemicals, including volatile organic compounds (VOCs), onto the ground of the Varian property and into a stream running through the property. In 1970, the predecessor in interest to Taygeta purchased the site from Varian and subsequently constructed on it the Bass River Tennis Club.2
In 1985, Varian removed an underground storage tank from its property and found traces of waste acetone in the surrounding soil. The Department of Environmental Quality Engineering (department)3 determined that a release of hazardous material had occurred, and that it was governed by the Massachusetts Oil and Hazardous Material Release Prevention Act, G. L. c. 21E. After being directed to investigate and assess the source, nature, and extent of the contamination, Varian installed monitoring wells and discovered the presence of VOCs in its groundwater. Varian retained Clean Harbors Environmental Services, Inc. (Clean Harbors), to assist with further assessment and possible remediation activities.
In January, 1987, the department placed the Varian property on its list of confirmed disposal sites and locations to be investigated. Between 1987 and 1989, Clean Harbors prepared and filed with the department several reports concerning the nature and extent of contamination on the Varian property, including the presence of VOCs in the groundwater and the southwest direction of the flow. Clean Harbors recommended the construction of a treatment system to remove and destroy the VOCs dissolved in the groundwater. The treatment system became operational in May, 1992. Beginning around that same time, Taygeta contacted representatives of GZA GeoEnvironmental, Inc. (GZA), about "environmental conditions" at the site and about the potential cost of a contamination assessment. On January 19, 1993, Taygeta met with GZA to discuss preparation of a bid to conduct such an assessment in conjunction with Taygeta's possible plans to refinance the property. By letter dated April 28, 1993, Taygeta retained GZA to perform some preliminary assessment work at the site. On May 18, 1993, GZA drilled monitoring wells and collected soil and groundwater samples. On June 10, 1993, GZA transmitted the lab analysis of those samples to Taygeta. GZA's data indicated the presence of elevated concentrations of VOCs in the groundwater below the site and the flow of such groundwater in a southerly direction.
Taygeta filed its complaint on September 30, 1996. Count I of the complaint asserted a claim of property damage pursuant to G. L. c. 21E, § 5.4 Count II of the complaint asserted a claim of negligence in that Varian had released the hazardous material, had allowed it to migrate to the site, and had failed to act expeditiously to remediate known contamination. Count III of the complaint asserted a claim of nuisance. Taygeta alleged that the value of the site had been diminished as a result of the migration of hazardous material from the Varian property to the site and demanded a jury trial. Pursuant to a tolling agreement between the parties, the complaint was considered, for statute of limitations purposes, to have been filed by May 24, 1996. The applicable statutory limitations period was three years, both under G. L. c. 260, § 2A (), and G. L. c. 21E, § 11A (4) (). Thus, Taygeta's claims would be time barred if its causes of action accrued prior to May 24, 1993, unless the statute of limitations was tolled by some other statutory or common-law provision.
Pursuant to Mass. R. Civ. P. 16, 365 Mass. 762 (1974), a Superior Court judge bifurcated the case with the damages component to be tried first, followed by the liability component. Varian filed a motion for summary judgment based on its contention that Taygeta's claims were time barred. The motion was denied. The damages component of the case was then tried to a jury who returned a verdict for Taygeta and awarded it damages of $2,300,000. The judge allowed Varian's motion for a new trial subject to a remittitur of the damages to $1,300,000, to which Taygeta agreed.
Varian filed a renewed motion for summary judgment which was also denied. The judge concluded that there existed an issue of fact as to the timing of actionable contamination that was sufficient to warrant submission of the statute of limitations question to a jury. Subsequently, by order pursuant to Mass. R. Civ. P. 56 (d), 365 Mass. 824 (1974), the judge specified, as uncontroverted facts, that Taygeta was aware, or reasonably should have been aware, that it had suffered actionable harm at the hands of Varian as of March 3, 1993,5 and that no actions by Varian had misled Taygeta into believing that it had not been harmed as of that date. The judge specified that a controversy did exist as to the actual date on which Taygeta suffered actionable harm to the site.
Taygeta and Varian then filed cross motions for summary judgment. The judge first concluded that, because Taygeta had effectively, if not expressly, conceded that actionable contamination of the site occurred no later than March 3, 1993, Taygeta's claim pursuant to G. L. c. 21E was barred by the statute of limitations. With respect to Taygeta's nuisance claim, the judge concluded that Varian had done nothing to perpetuate the contamination and that the ongoing migration of VOCs to the site was not an abatable condition. Rather, the ongoing contamination was a product of previously terminated tortious conduct and, thus, was not a continuing nuisance.6 Accordingly, the Superior Court judge granted Varian's motion for summary judgment and dismissed Taygeta's complaint.7
2. Property damage claim pursuant to G. L. c. 21E. Taygeta first contends that its cause of action did not accrue until it had knowledge of its actual harm and the likely cause. Taygeta argues that, because subsurface groundwater contamination is not an observable condition, it had no evidence of such contamination at the site until June 10, 1993, the date when Taygeta received groundwater sampling results from GZA. Taygeta asserts that this would be the date on which its cause of action accrued and the statute of limitations began to run. Because Taygeta's complaint was deemed filed by May 24, 1996 (pursuant to the tolling agreement), its lawsuit was therefore not barred by the statute of limitations. Taygeta contends that the Superior Court judge erroneously imposed on it a duty to investigate possible injury on the basis of mere suspicion of potential harm, not knowledge of actual harm. Moreover, it asserts that mere knowledge that the Varian property was contaminated should not have obligated Taygeta to undertake a costly drilling and sampling program at the site, particularly where Varian already had a statutory obligation to assess and remediate contamination migrating from its own property.
The property damage claim brought by Taygeta, as well as the statute of limitations applicable thereto, is governed by the comprehensive statutory scheme of G. L. c. 21E. General Laws c. 21E sets forth the legal obligations of owners, operators, and other responsible persons for investigating and addressing contamination at a "site."8 See G. L. c. 21E, §§ 5, 7, 8, 9. The primary purpose of G. L. c. 21E is "to improve the Commonwealth's capability to respond to environmental contamination and to recover response costs from persons responsible for the contamination." Guaranty-First Trust Co. v. Textron, Inc., 416 Mass. 332, 335 (1993). See St. 1983, c. 7, emergency preamble. A second significant purpose of G. L. c. 21E is to enable private persons "to obtain...
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