Unocal Corp. v. U.S.
| Decision Date | 07 August 2000 |
| Docket Number | 99-55381,CROSS-APPELLEES,CROSS-APPELLANTS,PLAINTIFFS-APPELLEES,DEFENDANTS-APPELLANTS,Nos. 99-55342,s. 99-55342 |
| Citation | 222 F.3d 528 |
| Parties | (9th Cir. 2000) UNOCAL CORPORATION; UNION OIL COMPANY OF CALIFORNIA; AND ERST, INC.,, v. THE UNITED STATES OF AMERICA, DEFENDANT, AND THE SOUTHERN CALIFORNIA REGIONAL RAIL AUTHORITY DBA METROLINK; AND KRUZE & KRUSE CONSTRUCTION & ENGINGEERING, INC., |
| Court | U.S. Court of Appeals — Ninth Circuit |
Gregory M. Bergman, Alan H. Mittelman, Robert M. Mason III, and Michele M. Goldsmith, Bergman & Wedner, Inc., Los Angeles, California, for the defendants/appellants/cross-appellees.
William H. Collier, Jr., Dawn M. Schock, Joseph A. Walsh II, and John M. Whelan, Keesal, Young & Logan, Long Beach, California, for the plaintiffs/appellees/cross-appellants.
Appeal from the United States District Court for the Central District of California Ronald S.W. Lew, District Judge, Presiding D.C. No. CV-97-0024 RSWL (RCx)
Before: Stephen Reinhardt and Marsha S. Berzon, Circuit Judges, and Charles R. Breyer, District Judge.1
This case concerns the cause and aftermath of a 1995 crude oil pipeline spill in Norwalk, California. The spill, which discharged over 45,000 gallons of crude oil, occurred on February 20, 1995 during the construction of the Norwalk-Santa Fe Metrolink railway station. At least 50 gallons of oil escaped through a nearby storm drain and contaminated a local creek and river. The total cost of cleanup was over $4 million.
In the wake of the spill, Union Oil Co. of California ("Unocal"), the owner of the ruptured pipeline, filed suit against Southern California Regional Rail Authority, dba Metrolink ("Metrolink"), for reimbursement of the cleanup costs. After a two-week trial, a jury returned a verdict in favor of Unocal based on negligence, breach of contract and quasicontract theories, and pursuant to the Oil Pollution Act of 1990 ("OPA"), 33 U.S.C. S 2701, et seq. Metrolink now appeals, contesting the validity of both the jury's verdict and the district court's special verdict form. Unocal has filed a cross-appeal protesting the district court's award of prejudgment interest, its refusal to award attorney's fees, and its refusal to issue a declaratory judgment.
Unocal has operated the Stewart pipeline since 1957. Metrolink is a joint powers authority established pursuant to California Government Code section 6509. In August 1994, Metrolink contracted with Kruze & Kruze ("K&K") to construct a new Metrolink railway station in Norwalk. As the general contractor on the project, K&K subcontracted with defendant ECCO to provide a Caterpillar 973 loader and an operator to perform heavy equipment operations on the site.
The proposed Metrolink site in Norwalk was located directly above a section of the Stewart pipeline. The site also contained a Los Angeles County Flood Control District storm drain box culvert which ran underground above the pipeline near the western edge of the construction site.
In approximately December 1994, Emery Brown, K&K's superintendent in charge of the Norwalk project, contacted Underground Service Alert ("Dig Alert") for assistance. Dig Alert operates a program which coordinates efforts to prevent damage to underground pipelines during excavation and construction. Dig Alert notified Unocal, and Unocal responded by sending two employees, Richard Alvarez and Ned Voigt, to the construction site to mark the course of the Stewart pipeline with yellow paint. Following maps and overlays, Alvarez and Voigt marked the course of the pipeline.
Voigt also "potholed" in the area of the storm drain. Potholing requires a digger to excavate a site slowly by hand to uncover underground conditions. Voigt's potholing revealed that, in the area surrounding the storm drain, the Stewart pipeline was located approximately seven or eight feet below the ground.
Nothing in the record indicates that anyone working on the project had potholed in the area where the pipeline rupture eventually occurred prior to the accident on February 20, 1995. Accordingly, no one at the site knew that the pipeline was actually less than a foot under the ground in that area.
On February 20, 1995, Mike Beltran, an ECCO employee, was operating a large Caterpillar on the Norwalk site. At the time, Beltran was working under the direct supervision of Emery Brown. Beltran spent several hours that day excavating the area surrounding the storm drain and piling the excavated dirt along a nearby surface. At about 2:00 p.m., after partially completing the excavation, Beltran began to smooth out the excavated dirt in order to create a leveled access road for vehicle traffic.
Beltran passed over the access road three times, lifting several inches of dirt from the surface in the process. During Beltran's fourth pass over the access road, one of the teeth from the front bucket of the Caterpillar punctured the Stewart pipeline, causing a cascade of oil to emerge.
As noted above, an underground storm drain was located on the construction site. A storm drain inlet ("the inlet") was situated in the ground approximately 40 feet from the point of the rupture. The grate-covered inlet connected to the storm drain, which, in turn, opened into Coyote Creek, a nearby waterway. Immediately after the rupture, the local fire department and K&K employees placed a piece of plywood over the inlet and piled dirt around and above the wood in order to divert oil from the area of the drain inlet. The goal of this covering was to contain the spilling oil in a pool in order to prevent it from escaping the immediate premises.
As a result of these efforts, the oil formed a pool to the south of the pipeline with dimensions of approximately 200 feet by 20 feet. A second, less fortunate result of these efforts was that the inlet, which was once readily visible, was now completely covered and obscured from view. Because of this initial berming, no one who arrived on the scene for the next several hours was able to see that oil had spilled into the area of the inlet.
Shortly after the rupture, Unocal representatives arrived at the scene, assumed the role of managing oil spill response, established an incident command, and began cleanup efforts. Among the Unocal representatives first on the scene were Hugh Craddock, Unocal's supervisor of Health, Environment and Safety, and Paul Bauer, Unocal's District Maintenance Foreman. Bauer immediately telephoned Unocal's control center to confirm that the pipeline had been shut down, and then, along with Craddock and district foreman Lamar White, closed a nearby block valve in the pipeline to ensure that oil would not continue to flow into the spill area. However, their initial visual inspections of the site raised no concerns about possible infiltration of oil into the storm drain inlet.
Bauer and Craddock met with fire department personnel, who briefed them on the situation. At that time, the Unocal employees were not told, nor did they ask, about the existence of a storm drain inlet. For the next several hours, Unocal's agents on the scene did not know that the pool of oil that had formed from the spill was located above the storm drain, nor that a storm drain inlet was located 40 feet from the site and had been sealed off by K&K personnel. Craddock and his assistants did not speak with Voigt or Alvarez about the site, nor did they consult maps, overlays, or as-built plans which might have informed them of the location of the drain until approximately six hours after their arrival.
At Craddock's instruction, Bill Orr, Unocal's Torrance district operations foreman, placed a telephone call to the state water resources control board and the Los Angeles County Flood Control District ("LACFCD"). Orr placed the calls at approximately 6:30 that evening. Orr told Charlie Sherman, the County Department of Public Works' superintendent of construction, that an oil spill had occurred but that no oil had reached the storm drain and that no waterways had been affected by the spill. Sherman and his team were the only local officials legally authorized to enter the storm drain to check for oil. Because Orr told him that the call was merely a courtesy, Sherman did not visit the site of the spill at all that night.
After consulting several maps that evening, Craddock realized that the oil pool was situated directly above the storm drain. This discovery caused Craddock concern for two reasons. First, he worried that, depending on the exact location of the drain, it might be damaged during the excavation of soil that was planned for the following morning. Second, he recognized that the drain's concrete walls might contain fissures that could cause small leaks. At approximately 9:00 that night, Craddock placed another telephone call to LACFCD, informing Charlie Sherman that there was a storm drain in the area and asking him to visit the site the next morning to monitor the planned excavation.
Following the spill, some portion of the oil from the pipeline traveled through the storm drain into the north channel of nearby Coyote Creek. The oil followed Coyote Creek into the San Gabriel River, and then traveled south along the river. Early in the morning on February 21, 1995, oil was discovered in both Coyote Creek and the San Gabriel River.
Upon learning that oil had reached the waterways, the crew from LACFCD checked the storm drain for the first time since the spill. After entering the drain, the crew discovered that oil had penetrated the drain by way of the inlet that had been covered by K&K immediately following the spill. At approximately 8:00 that morning, Unocal placed booms at the storm drain outflow to prevent further contamination of the water. Later that day, ERST, Inc. ("ERST"), a Unocal subsidiary,...
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