Posted on September 14, 2009 by Earl Phillips
There are three avenues of recovery under CERCLA – a contribution action and two types of cost recovery actions. These cost recovery actions are based on either the plaintiff’s “removal” of the hazardous substances or “remediation” efforts at the site. Each of these avenues has an independent statute of limitations provision. Thus, whether the statute of limitations period has been triggered will depend on how an action is characterized, i.e. whether the action constitutes a contribution action, a cost recovery removal action, or a cost recovery remedial action. While there are various state-specific causes of action related to environmental contamination in Connecticut, this article is confined to the statute of limitations for CERCLA cost recovery and contribution claims.
The statute of limitations analysis related to contribution claims is thankfully quite straight forward. Under CERCLA Section 113, these claims must be brought within three years of a civil action under Section 106 or 107, a CERCLA administrative order, or a judicially approved settlement with respect to costs or damages. 42 U.S.C. § 9613(g)(3). While questions may arise as to what may constitute a CERCLA “administrative order” or whether a “judicially approved settlement” must reference Section 106 or 107, we leave those discussions for another article.
Cost Recovery Claim
The analysis of what constitutes a viable cost recovery claim, whether it is removal or remedial, and when the statute of limitations is first triggered is more intricate. First, it is important to note that certain actions performed on a site may not trigger the statute of limitations period. “[T]here are some cases in which work on a site is neither a remedial nor a removal action, but rather constitutes ‘preliminary’ or ‘interim’ measures that do not trigger the statute of limitations . . ..” Yankee Gas Servs. Co. v. UGI Utils., Inc., 2009 U.S. Dist. LEXIS 44282, *117 (D. Conn. May 22, 2009). While caselaw on what constitutes a preliminary remedy, as opposed to a permanent remedy, is limited, at least one court has determined that “evaluation, sampling, surveying and measuring” do not constitute the initiation of physical on-site construction because “these activities [do] not constitute ‘construction.’” Schaefer v. Town of Victor, 457 F.3d 188, 204 (2d Cir. 2006)(quoting United States v. Findett Corp., 220 F.3d 842, 848 (8th Cir. 2000)).
Beyond this, the characterization of a cost recovery action as either removal or remedial is crucial to determining whether an action to recover response costs is time-barred because there are different statute of limitations periods for a removal action and a remedial action. The statute of limitations for recovery of costs related to removal actions is three years after the completion of the removal action, whereas the limitations period for recovery of costs related to remedial actions is six years after the initiation of physical on-site construction of the remediation. Although there is a lack of clarity as to what constitutes a removal verses a remedial action, removal actions have generally been construed as “time-sensitive responses to public health threats . . ..” Remedial actions, in contrast, are often described as “permanent remedies to threats for which an urgent response is not warranted.”
Assuming for this discussion that the efforts undertaken at a site are beyond preliminary, there is inconsistency as to whether the statute of limitations for remedial actions would only run after a final Remedial Action Plan (RAP) has been approved for the site. One court in the Ninth Circuit, for example, concluded that initiation of physical on-site construction of the remedial action “can only occur after the final remedial action plan is adopted, and that . . . the statute of limitations, therefore, could not have begun to run until the final remedial action was approved . . ..” Cal. v. Neville Chem. Co., 358 F.3d 661, 671 (9th Cir. 2004). The Second Circuit, however, has rejected such a bright line rule and determined that the statute of limitations can be triggered without a final RAP, if the action is “consistent with a permanent remedy.” Schaefer v. Town of Victor, 457 F.3d 188, 205 (2d Cir. 2006).
Compounding the important distinction between removal and remedial actions is variability within the courts in determining the initial trigger for the statute of limitations period. Some courts apply a statute of limitations to an entire site after remediation commences on one portion of the site, while others look to multiple statute of limitations at a single property. See Colorado v. Sunoco, 337 F.3d 1233 (10th Cir. 2003) contra U.S. v. Manzo, 2006 U.S. Dist. LEXIS 70860 (D.N.J. Sept. 29, 2006). While the Second Circuit has not spoken on this issue, a recent District of Connecticut case has adopted the opinion that “there can be only one removal and one remedial action per facility, regardless of the number of phases in which the clean-up occurs.” Yankee Gas Servs. Co. v. UGI Utils., Inc., 2009 U.S. Dist. LEXIS 44282 (D. Conn. May 22, 2009)(emphasis added). Should a court adopt a one site, one action approach, the statute of limitations would be triggered by the first removal or remedial action at the site. Id.; see also Colorado v. Sunoco Thus, it is important to evaluate what actions have occurred at your facility and whether those actions would be considered “removal” or “remedial” to ensure the statute of limitations for a cost recovery action does not run., 337 F.3d 1233 (10th Cir. 2003).
At Robinson & Cole, we have environmental attorneys who have broad experience representing clients in CERCLA actions and the prosecution or defense of other environmental claims. We stand ready to apply this experience and insight to your specific needs. If you would like to discuss statute of limitations concerns, or broader environmental issues, please contact any of the attorneys in our Environmental and Utilities Practice Group.
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 United States v. W.R. Grace & Co., 429 F.3d 1224, 1228 (9th Cir. 2005); see also OBG Tech. Servs. v. Northrop Grumman Space & Mission Sys. Corp., 503 F. Supp. 2d 490, 524 (D. Conn. 2007)(“[w]hether . . .actions are properly characterized as remedial or removal actions is a question of law for the Court to decide”); Geraghty & Miller, Inc. v. Conoco Inc., 234 F.3d 917, 926 (5th Cir. 2000)(“the CERCLA definitions [of removal and remedial action] are expansive enough that certain activities may well be covered by both…[and] the cases on this issue tend to be highly fact-specific . . ..”)
 United States v. W.R. Grace & Co., 429 F.3d 1224, 1228 (9th Cir. 2005); see also W.R. Grace & Co. v. Zotos Int’l, Inc., 559 F.3d 85, 92 (2d Cir. 2009). Under 42 U.S.C. § 9601(24) a remedial action “includes, but is not limited to, such actions at the location of the release as storage, confinement, perimeter protection using dikes, trenches, or ditches, clay cover, neutralization, cleanup of released hazardous substances and associated contaminated materials, recycling or reuse, diversion, destruction, segregation of reactive wastes, dredging or excavations, repair or replacement of leaking containers, collection of leachate and runoff, on-site treatment or incineration, provision of alternative water supplies, and any monitoring reasonably required to assure that such actions protect the public health and welfare and the environment.”
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