Barnett v. BP Prods. N. Am.,
Inc., 2006 NCBC 9
|
STATE OF |
IN THE GENERAL COURT OF JUSTICE SUPERIOR COURT DIVISION 01 CVS 1271 |
|
|
BOBBIE ADAMS, TINA ADAMS, individually and as
Guardian Ad Litem of CODY ADAMS and LINDSEY ADAMS,
MARJORIE G. ADAMS, ROY THOMAS ADAMS, ROBBIE ADAMS, ANEDA ADAMS, individually
and as Guardian Ad Litem of DANIEL ADAMS and DREW ADAMS,
ELIZABETH BEALL, individually and as Guardian Ad Litem
of AMBER N. ENGLEBY, NATHAN TOMMY GOLDEN, MARTHA A.BELL, individually and as
Guardian Ad Litem of CHRIS BELL, SUNNY HERRING, ELTON GUY BELL, JR., DAVID
PRESTON BELL, DAVID CARY BROOKS, STEPHANIE DANIELS, individually and as
Guardian Ad Litem of CHARLES DANIELS, DARRIN
DANIELS, AMBER DANIELS, DALLAS FRAZIER, and KRISTEN FRAZIER, MARVIN FRAZIER,
NAN MORTON FIELDS, DAVID FIELDS, SAMANTHA FIELDS, TROY FIELDS, VICTORIA S. GAMBLE, ROSEANNE COLÓN, SHEILA COLÓN, MARGUERITE GUTHRIE GILLIKIN,
ANNA KIM MORTON HADLEY, individually and as Guardian Ad Litem
of NICHOLAS SCOTT HADLEY, COREY ALLEN HADLEY, FRANKLIN LEE JENKINS,
ALBERT C. LEWIS, JR., MARGARET J.
LEWIS, CHRISTEL ANN LEWIS GEIER, JACKOLINE S. LEWIS, FRONIE LEWIS, JOE LEWIS,
individually and as Guardian Ad Litem of CHELSEA
LEWIS, SHARON GARNER, individually and as Guardian Ad Litem
of JOHN SALTER and BRANDON SALTER,
NATASHA SALTER, JUDY McNAMARA, CHARLES
MIZELLE, individually and as Guardian Ad Litem of
CARLA DANETTE MIZELLE, DONNA MIZELLE,
ANTHONY R. MORTON, individually and as Guardian Ad Litem
of JACOB T. MORTON, SOMMER L. MORTON, DANNY MARK MORTON, individually and as
Guardian Ad Litem of VICTORIA LYNN MORTON, DANIELLE
MARIE MORTON, GURTHEY MORTON, MILON C. MORTON, SR., SHEILA MORTON, MILON C.
MORTON, JR., THURMAN G. MORTON, JR., individually and as Guardian Ad Litem of MATTHEW MORTON, JONI M. MORTON, JULIE SYKES,
individually and as Guardian Ad Litem of MIKAYLA
SYKES, VERNON MORTON, NANCY MORTON, VIRGINIA B. MORTON, ROBERT J. NOLAN, DEBORAH A. NOLAN,
ROBERT L. NOLAN, DANIEL NOLAN, DOUGLAS NORRIS, LOU ANN NORRIS, ANDREA NORRIS,
RICHARD NORRIS, individually and as Guardian Ad Litem
of BRANDON NORRIS and LYDIA NORRIS, NANCY NORRIS, STEPHANIE NORRIS, EMMA P.
O’NEAL, GREGORY RIGGS, individually and as Guardian Ad Litem
of ASHLEY B. RIGGS and SONYA WILLIAMSON, individually and as Guardian Ad Litem of APRIL MOLOSKY, KYLE D. SAWYERS, LOIS SAWYERS,
DONALD W. SHOPTAUGH, CHERYL SHOPTAUGH, individually and as Guardian Ad Litem of FAITH D. SHOPTAUGH, CASEY A. SHOPTAUGH, ANDREW
E. SHOPTAUGH, LOLA G. SMITH, FRANCINE WINBERRY, PAUL R. SMITH, individually
and as Guardian Ad Litem of PAUL R. SMITH,
JR., CONNIE T. SMITH, individually and
as Guardian Ad Litem of CAMERON
S. THOMPSON, SHERRI SMITH, JAMES ANDREW SMITH, JUDI FARLOW, JERRY E.
TAYLOR, SR., LAVERNE S. TAYLOR, JERRY TAYLOR, JR., RICHARD TAYLOR, and JENNIFER VanDEVOORD, Plaintiffs, v. A. J. BALLARD, JR. TIRE & OIL COMPANY,
INCORPORATED, JOYCE D. BALLARD, individually, as trustee for ALBERT
CHRISTOPHER BALLARD, and as executrix of the estate of Albert J. Ballard, Jr., ALBERT
CHRISTOPHER BALLARD, GARY ALLEN BALLARD, and FISHER STORES, INC., Defendants. |
|
|
|
STATE
OF |
IN THE GENERAL COURT OF JUSTICE SUPERIOR COURT DIVISION 03 CVS 912 |
|
|
BOBBIE ADAMS, TINA ADAMS, individually and as
Guardian Ad Litem of CODY ADAMS and LINDSEY ADAMS, MARJORIE
G. ADAMS, ROY THOMAS ADAMS, ROBBIE ADAMS, ANEDA ADAMS, individually and
as Guardian Ad Litem of DANIEL ADAMS and DREW
ADAMS, ELIZABETH BEALL, individually and as Guardian Ad Litem
of AMBER N. ENGLEBY, NATHAN TOMMY GOLDEN, MARTHA A. BELL, individually and as
Guardian Ad Litem of CHRIS BELL, SUNNY HERRING, ELTON GUY BELL, JR., DAVID
PRESTON BELL, DAVID CARY BROOKS, CLARENCE DANIELS, CLAUDIA DANIELS,
CHRISTOPHER SCOTT DANIELS, CHRISTIE CANNON, CHARLES DANIELS, STEPHANIE
DANIELS, individually and as Guardian Ad Litem of
CHARLES A. DANIELS, DARRIN DANIELS, AMBER DANIELS, DALLAS FRAZIER, and
KRISTEN FRAZIER, MARVIN FRAZIER, FREDERICK SHAWN DEFEO, JENNIFER MARIE DEFEO,
individually and as Guardian Ad Litem of DAVID
SHANE DEFEO, NAN MORTON FIELDS, DAVID FIELDS, SAMANTHA FIELDS, TROY FIELDS,
VICTORIA S. GAMBLE, SHEILA COLON, ROSEANNE COLON, MARGUERITE GUTHRIE
GILLIKIN, WALLACE A. GUTHRIE, SR.,
MARILYN W. GUTHRIE, WALLACE A. GUTHRIE, JR., ELAINA B. GUTHRIE, ANNA KIM MORTON
HADLEY, individually and as Guardian Ad Litem of
NICHOLAS SCOTT HADLEY, COREY ALLEN HADLEY, BRETT HARSTINE, individually and
as Guardian Ad Litem of TYLER HARSTINE AND TALON
HARSTINE, JENNIFER HARSTINE, FRANKLIN LEE JENKINS, individually and as
Guardian Ad Litem of FRANKLIN R. JENKINS and SAMANTHA
WEST, ALBERT C. LEWIS, JR., MARGARET J. LEWIS, CHRISTEL ANN LEWIS GEIER,
CHARLES P. JACOBI, JR., DORIS H. JACOBI, JACKOLINE S. LEWIS, individually and
As Executrix of the Estate of FRONIE
LEWIS, JOE LEWIS, individually and as Guardian Ad Litem
of CHELSEA LEWIS, SHARON GARNER, individually and as Guardian Ad Litem of BRANDON SALTER, JOHN SALTER, JR., NATASHA
SALTER, JUDY McNAMARA, JAMES SCOTT McNAMARA as Guardian Ad Litem
of JAMES SCOTT McNAMARA, JR., TABITHA LYNN McNAMARA, and CODY RAY McNAMARA,
CHARLES MIZELLE, individually and as Guardian Ad Litem
of CARLA DANETTE MIZELLE, DONNA MIZELLE, ANTHONY R. MORTON, individually and
as Guardian Ad Litem of JACOB T. MORTON, SOMMER L.
MORTON, DANNY MARK MORTON, individually and as Guardian Ad Litem of VICTORIA
LYNN MORTON, DANIELLE MARIE MORTON, GURTHEY MORTON, MILON C. MORTON,
SR., SHEILA MORTON, MILON C. MORTON, JR., THURMAN G. MORTON, JR.,
individually and as Guardian Ad Litem of MATTHEW
MORTON, JONI M. MORTON, JULIE SYKES, individually and as Guardian Ad Litem of MIKAYLA SYKES, VERNON MORTON, NANCY
MORTON,VIRGINIA B. MORTON, ANTHONY
MURRAY, WANDA MURRAY, ROBERT A. MURRAY, RONDA E. NIXON, JAMES NIXON, JONATHAN
NIXON, ROBERT J. NOLAN, DEBORAH A. NOLAN, ROBERT L. NOLAN,DANIEL NOLAN,
DOUGLAS NORRIS, LOU ANN NORRIS, ANDREA NORRIS, RICHARD NORRIS, individually
and as Guardian Ad Litem of LYDIA NORRIS, NANCY
NORRIS, BRANDON NORRIS, STEPHANIE SKRABACZ, EMMA P. O’NEAL, GREGORY IGGS,
individually and as Guardian Ad Litem of ASHLEY B.
RIGGS, SONYA WILLIAMSON, individually and as Guardian Ad Litem
of APRIL MOLOSKY, KYLE D. SAWYERS, LOIS SAWYERS, DONALD W. SHOPTAUGH, CHERYL SHOPTAUGH, individually
and as Guardian Ad Litem of FAITH D. SHOPTAUGH,
CASEY A. SHOPTAUGH, ANDREW E. SHOPTAUGH, LOLA G. SMITH, FRANCINE WINBERRY,
PAUL R. SMITH, individually and as Guardian Ad Litem
of PAUL R. SMITH, JR., CONNIE T.
SMITH, individually and as Guardian Ad Litem of
CAMERON S. THOMPSON, SHERRI SMITH,
JAMES ANDREW SMITH, JUDI FARLOW, JOHN R. STEWART, JR., VELMA A. STEWART,
RODNEY CHARLES STEWART, individually and as Guardian Ad Litem
of JORDAN WAYNE STEWART, JENNIFER C. STEWART, JERRY E. TAYLOR, SR., LAVERNE S. TAYLOR, JERRY
TAYLOR, JR., ELIZABETH TAYLOR, individually and as Guardian Ad Litem of FELICIA TAYLOR and SHAINA TAYLOR, RICHARD
TAYLOR, and JENNIFER VANDEVOORD, individually and as Guardian Ad Litem of ALEXIS TAYLOR, KEVIN L. UNDERWOOD, VELMAE.
UNDERWOOD, individually and as Guardian Ad Litem of
KRISTIN N. UNDERWOOD, KEVIN L. UNDERWOOD, JR. and TABITHA L. NIXON, Plaintiffs, v. BP PRODUCTS NORTH AMERICA,
INC.; BP OIL COMPANY; SHELL OIL
COMPANY; EXXON MOBIL CORPORATION; ATLANTIC RICHFIELD COMPANY; SUN OIL
COMPANY; CHEVRON OIL COMPANY; CHEVRON U.S.A, INC.; PHILLIPS PETROLEUM
COMPANY; COLONIAL OIL INDUSTRIES, INC.; COLONIAL TERMINALS, INC; TOSCO
CORPORATION; WACCAMAW TRANSPORT, INC., and BALLARD TRANSPORT, INC., Defendants. |
|
|
|
STATE
OF |
IN THE GENERAL COURT OF JUSTICE SUPERIOR COURT DIVISION 03 CVS 1124 |
|
|
LINDA BARNETT, individually and as Guardian Ad Litem of MEGAN WILLIS, SAMANTHA BARNETT and CHRISTOPHER
BARNETT, and DEANNA L. ECHTMAN, Plaintiffs, v. BP PRODUCTS NORTH AMERICA,
INC.; BP OIL COMPANY; SHELL OIL COMPANY; EXXON
MOBIL CORPORATION;
ATLANTIC RICHFIELD COMPANY;
SUN OIL COMPANY;
CHEVRON OIL COMPANY; CHEVRON U. S. A,
INC.; PHILLIPS PETROLEUM COMPANY; COLONIAL
OIL INDUSTRIES, INC.; COLONIAL TERMINALS, INC; TOSCO
CORPORATION; WACCAMAW TRANSPORT,INC.; and BALLARD TRANSPORT, INC., Defendants. |
|
|
ORDER AND OPINION
{1}
These
cases are before the Court on numerous motions argued over an extensive period
of time. It has taken the Court some time
to get the record in the position it should be for the determination of the
issues by this Court and the appellate courts.
During the course of this litigation a public policy debate over the use
of methyl tertiary-butyl ether (“MTBE”), an additive used to increase oxygen
content in gasoline, has taken place that has delayed the court’s consideration
of the issues until the legislative bodies on the federal and state level had
taken some position on the legislation before them. The issues in these cases are difficult from
a legal perspective, complex from a proof perspective, important from an
environmental standpoint, and riddled with public policy concerns. Not insignificantly, they are important to
the plaintiffs whose well water has been impacted. The outcome of these cases could impact the
retail price of gasoline in this state.
It will also affect the sources of recovery for well owners whose water
supplies are contaminated by leaking underground fuel storage tanks.
{2}
These
cases present three key issues with many subparts. They are:
1) May refiners
be held liable for underground storage tank leaks or spills at sites they do
not own?
2) What causes
of action and statutes of limitation and repose apply to leaks or spills that
contaminate drinking water under adjacent property?
3) What state regulations
determine when drinking water is contaminated?
{3}
Not
all of the defendants are in the same position.
Complaints were filed against different defendants at different times.
The cases originally involved two different sites owned by different defendants
and supplied by different refiners. Not
all of the plaintiffs have similar claims or damages. They have been impacted in different
ways. There are issues that affect some
parties and do not affect others. For
those reasons, the Court will attempt to identify the undisputed facts and
answer the questions that it believes will be of importance to the parties, the
public, and the appellate courts.
Ward and Davis, LLP by Catherine Piwowarski and
Harris, Creech, Ward & Blackerby,
PA by
Tennille,
Judge.
{4}
For
purposes of addressing the issues in some logical fashion, the Court will
describe the parties and the procedural posture of the pending motions and then
follow the outline below.
FACTUAL
AND STRUCTURAL FRAMEWORK
I.
What
is MTBE and why is it used in the refining of some gasoline?
II.
Clean
air v. clean water—what are the public policy concerns?
III.
How
does
IV.
How
does
V.
What
is the factual history of well contamination in the Broad Creek Community?
VI.
What
is the factual history of the Ballard Site?
VII.
What
are the additional relevant facts?
VIII.
What
does the record demonstrate as to the involvement of the individual Ballard
Defendants?
LEGAL
QUESTIONS
I.
Are
refiners that sell gasoline containing MTBE free from liability when that
gasoline is released from USTs as a result of the
negligence of others?
A. May the
proximate causation barrier be overcome by finding “forseeability”
of negligent conduct by owner/operators of USTs?
B. May the
proximate causation barrier be overcome by holding refiners strictly liable for
adding MTBE to gasoline?
C. May the
proximate causation barrier be overcome by applying the products liability
statute? Is summary judgment appropriate
on the issue of whether selling gasoline containing MTBE constitutes negligent
conduct?
II.
What
statutes of limitations and repose apply in this case?
A. Do the
statutes of repose apply to sales of gasoline containing MTBE?
B. What
statutes of limitation apply when gasoline leaks from an UST: (a) as to the refiner
selling the gas, and (b) as to the tank owner/operator responsible for the
leak?
C. If the
statutes of limitation and repose apply, have Plaintiffs raised an issue of
fact with respect to the question of whether a leak occurred at the Ballard
Site within a period not barred by the statute of limitations or the statute of
repose?
III.
Which
state regulated drinking water standards determine the basis for liability in
contamination cases, and what triggers any applicable statute of limitations in
those cases?
IV.
Do
Plaintiffs have a claim that survives summary judgment as to any one of the
Ballard Defendants?
V.
Are
Defendants entitled to summary judgment as a matter of law with respect to the res ipsa,
fraud, nuisance, trespass, willful and wanton negligence, and OPHSCA claims?
SUMMARY OF
DECISIONS
{5}
The
Court has concluded that:
1)
Refiners
who do not own or control retail or wholesale locations are not responsible for
injuries resulting from actions of the owners of the USTs
located at those sites. The intervening
negligence of tank owner/operators insulates refiners from liability.
2)
Even
if refiners are not insulated from liability, the issue of whether or not
refiners are negligent in using MTBE as an oxygenate in gasoline would be an
issue upon which neither side would be entitled to summary judgment.
3)
The
interrelationship between the level of contamination providing the basis for
liability and the triggering of the running of the statute of limitations is
critical. If the contamination level
giving rise to liability were poorly defined, for example by taste or odor, and
the statute of limitations were to start to run when the poorly defined
contamination level is reached, well owners might not get the water tested and
might not be aware of a problem until after the statute of limitations has
run. If the level is more precisely
defined, for example by the maximum allowable concentration levels as defined
by state regulations, and confirmed by testing, the statute of limitations
should not begin to run until the higher levels are confirmed.
4)
The
maximum concentration levels for specific chemicals have been set in health
standards and thus should be reliable in protecting users of the well water.[1] As a corollary, when a well owner ceases to
use her well as a result of perceived contamination of any kind from a
particular source, the statute of limitations should begin to run at that
point.
5)
If
Refiner Defendants were not insulated from liability, the ten-year and six-year
statutes of repose would apply to product liability claims arising out of the
sales of gasoline by the Refiner Defendants and begin to run when the refiners
transfer title to the product to the retailer or wholesaler and bar any claims
arising out of sales outside the repose period.
6)
The
ten-year and six-year statutes of repose apply to product liability claims
against the Ballard Defendants and began to run whenever there was a leak which
resulted in contamination of Plaintiffs’ wells and bar any claims for product
liability arising from leaks or spills outside the repose period.
7)
The
three-year statute of limitations applies to the simple negligence claims
against the Ballard Defendants and begins to run when an injury occurs as
defined below.
8)
The
three-year statute of limitations applies to the trespass and nuisance claims
against the Ballard Defendants and begins to run when an injury occurs as
defined below.
9)
The
state regulations for ground water govern whether a well owner has a claim for
contamination. A cause of action based
upon contamination of well water by a specific chemical does not accrue until
the well owner becomes aware that the concentration levels for that specific
chemical have exceeded state standards.
Accordingly the plaintiffs whose wells have been affected by
contamination from MTBE or benzene above the state levels have a cause of
action which has accrued and which is maintainable if suit was filed within the
applicable statutes of limitation. Those
plaintiffs who were affected by wells which have not evidenced contamination
from MTBE or benzene above state levels do not have a cause of action which has
yet accrued and those claims are subject to dismissal for that reason. Those claims could be asserted later if the
contamination levels exceed permissible levels.
10)
Refiner
liability, if any, would be limited to those wells which, when tested, showed
MTBE present at levels higher than 200 parts per billion (“ppb”), the maximum
allowable concentration as defined by state regulations. The Ballard Defendants’ liability may extend
to wells with other contamination (i.e. benzene) in excess of state
regulations. The specific guidelines for
maximum allowable concentration levels for chemicals specified in the state
regulations are chosen for their certainty and reliability. They provide a bright line test for
contamination based on science. At best,
only three wells used by Plaintiffs have MTBE contamination in excess of levels
permitted by state regulations.
11)
There
is insufficient evidence in this record to establish that the Refiner
Defendants sold product containing MTBE to the Ballard Site within the three-,
six-, or ten-year periods of limitation and repose, which gasoline leaked or
was spilled in a manner causing injury to Plaintiffs’ wells.
12)
There
is sufficient evidence in this record to raise an issue of fact with respect to
whether there were leaks or spills on the Ballard Site which continue to cause
contamination of some wells in the Broad Creek Community, for which some, but
not all, of the Ballard Defendants may be liable. The wells that may have been impacted are
confined to the Central District as defined herein.
13)
All
defendants are entitled to summary judgment on the res ipsa and fraud claims.
14)
With
respect to the 1987 leak at the Ballard Site, the notice provided to Plaintiffs
by DENR was in compliance with state regulations and was sufficient notice of
the existence of a problem to start the statute of limitations running with
respect to claims arising out of that incident.
Accordingly, the statute of limitations has run on claims arising out of
that leak except for claims associated with the failure of the responsible
parties to remediate or for continuing trespass and nuisance.
PARTIES
{6}
Plaintiffs
are citizens and residents, or former citizens and residents, of the Broad
Creek Community, located in
{7}
Defendant
A.J. Ballard, Jr. Tire & Oil Company, Incorporated (“Ballard Tire & Oil
Co.”), is a
{8}
Defendant
A.J. Ballard, Jr. was a citizen and resident of
{9}
Defendant
Joyce D. Ballard is a citizen and resident of
{10}
Defendant
Albert Christopher Ballard is a citizen and resident of
{11}
Defendant
Gary Allen Ballard is a citizen and resident of
{12}
Defendants
A.J. Ballard, Jr., Joyce D. Ballard, Albert Christopher Ballard, and Gary Allen
Ballard will be collectively referred to herein as the “Individual Ballard
Defendants” unless individual treatment is warranted. Defendants Ballard Tire & Oil Co. and the
Individual Ballard Defendants will be collectively referred to herein as the
“Ballard Defendants” unless individual treatment is warranted. At
times relevant to the allegations in the Complaint, various of the
Ballard Defendants were the owners, occupiers, and/or operators of real
property located on Highway 24, Post Office Box 1465, City of Newport, Carteret
County, North Carolina, upon which is located a gas station or facility known
as “First Stop Food Store No. 2,” which sells fuel and other petroleum products. This will sometimes be referred to as the
“Ballard Site”.
{13}
Defendant
BP Products North America, Inc. is a
{14}
Defendant
Atlantic Richfield Company (“ARCO”), at the time the Complaint was filed, was a
{15}
BP
Products North America, Inc., BP Oil Company, and ARCO will hereinafter be
collectively referred to as “Refiner Defendants.” These defendants sold product to the Ballard
Site up until 2002. The other oil
company defendants, who sold to the Fisher Site and the owners of the Fisher
Site, have resolved their disputes with Plaintiffs. Those defendants are no longer parties to
this lawsuit.
{16}
Defendant
Fisher Stores, Inc. (“Fisher Stores”) is a
{17}
Defendant
Shell Oil Company is a
{18}
Defendant
Exxon Mobil Corporation is a
{19}
Defendant
Chevron Oil Company is a
{20}
Defendant
Phillips Petroleum Company is a
{21}
Defendant
Tosco Corporation is a
{22}
Defendant
Sun Oil Company is a
{23}
No
claims remain against the other defendants.
FACTS
I. MTBE: What it is and why it is used in some
gasoline
{24}
Methyl
tertiary-butyl ether (“MTBE”) is a chemical compound produced from the chemical
reaction of methanol and isobutylene.
MTBE is commonly and almost exclusively used as an additive to motor
gasoline and is part of a group of chemicals called “oxygenates,” which
increase oxygen content when added to gasoline. Greater oxygen levels allow gasoline to burn
more completely. More efficient
combustion reduces harmful tailpipe emissions from motor vehicles.
{25}
Gasoline
refiners began using MTBE to replace lead in gasoline in the late 1970s, with
the adoption of the U.S Environmental Protection Agency (“EPA”)’s tetraethyl
lead phase-down program. Prior to the
program’s adoption, approximately 250,000 tons of tetraethyl lead were added
annually to gasoline to increase octane ratings and, consequently, engine
efficiency. Agency for Toxic Substances
and Disease Registry,
{26}
The
U.S. Congress amended the Clean Air Act (“CAA”) in 1990 and in doing so banned
the use of gasoline containing lead or lead additives as fuel in motor
vehicles.
II. Clean
Air v. Clean Water
{27}
The
use of MTBE as an oxygenate in reformulated gasoline has provoked a national
debate. As a result, the EPA appointed
the Blue Ribbon Panel on Oxygenates in Gasoline (the “Blue Ribbon Panel”) in
1998 to investigate the air quality benefits and water quality concerns
associated with oxygenates in gasoline.
The Report of the Blue Ribbon Panel provides a concise summary of the
policy issues posed by the inclusion of MTBE in gasoline products:
The Clean Air Act requires that RFG contain 2% oxygen,
by weight. Over 85% of RFG contains the
oxygenate methyl tertiary butyl ether (MTBE) and approximately 8% contains
ethanol - a domestic fuel-blending stock made from grain and potentially from
recycled biomass waste. There is
disagreement about the precise role of oxygenates in attaining the RFG air
quality benefits although there is evidence from the existing program that
increased use of oxygenates results in reduced carbon monoxide emissions, and
it appears that additives contribute to reductions in aromatics in fuels and
related air benefits. It is possible to
formulate gasoline without oxygenates that can attain similar air toxics
reductions, but less certain that, given current federal RFG requirements, all
fuel blends created without oxygenates could maintain the benefits provided
today by oxygenated RFG.
At the same time, the use of MTBE in the program has
resulted in growing detections of MTBE in drinking water, with between 5% and
10% of drinking water supplies in high oxygenate use areas showing at least
detectable amounts of MTBE. The great
majority of these detections to date have been well below levels of public
health concern, with approximately one percent rising to levels above 20
ppb. Detections at lower levels have,
however, raised consumer taste and odor concerns that have caused water suppliers
to stop using some water supplies and to incur costs of treatment and
remediation. The contaminated wells
include private wells that are less well protected than public drinking water
supplies and not monitored for chemical contamination. There is also evidence of contamination of
surface waters, particularly during summer boating seasons.
The major source of groundwater contamination appears
to be releases from underground gasoline storage systems (UST). These systems have been upgraded over the last
decade, likely resulting in reduced risk of leaks. However, approximately 20% of the storage
systems have not yet been upgraded, and there continue to be reports of
releases from some upgraded systems, due to inadequate design, installation,
maintenance, and/or operation. In
addition, many fuel storage systems (e.g. farms, small above-ground tanks) are
not currently regulated by U.S. EPA.
Beyond groundwater contamination from UST sources, the other major
sources of water contamination appear to be small and large gasoline spills to
ground and surface waters, and recreational water craft - particularly those
with older motors - releasing unburned fuel to surface waters.
Blue
Ribbon Panel, Achieving Clean Air and Clean Water: The Report of the Blue
Ribbon Panel on Oxygenates in Gasoline, at 1-2 (Sept. 15, 1999) (footnote
omitted), available at
http://www.epa.gov/otaq/consumer/fuels/oxypanel/r99021.pdf. The Blue Ribbon Panel summarized its findings
as follows:
Based on its review of the issues, the Panel made the
following overall findings:
· The distribution, use, and combustion of gasoline poses risks to our environment and public health.
· RFG provides considerable air quality improvements and benefits for millions of US citizens.
· The use of MTBE has raised the issue of the effects of both MTBE alone and MTBE in gasoline. This panel was not constituted to perform an independent comprehensive health assessment and has chosen to rely on recent reports by a number of state, national, and international health agencies. What seems clear, however, is that MTBE, due to its persistence and mobility in water, is more likely to contaminate ground and surface water than the other components of gasoline.
· MTBE has been found in a number of water supplies nationwide, primarily causing consumer odor and taste concerns that have led water suppliers to reduce use of those supplies. Incidents of MTBE in drinking water supplies at levels well above EPA and state guidelines and standards have occurred, but are rare. The Panel believes that the occurrence of MTBE in drinking water supplies can and should be substantially reduced.
·
MTBE is currently an integral component of the
{28}
The
debate has not subsided or been resolved. During the last session of Congress,
the entire energy package of legislation was held up by a debate over the
inclusion of a provision which would have eliminated oil company liability for
use of MTBE in reformulated gasoline. See 151 Cong. Rec. H5772 (daily ed. July
13, 2005) (debate on the motion offered by Congresswoman Capps to instruct the
House managers not to agree to a provision limiting MTBE liability for refiners
at the conference meeting on the Energy Policy Act of 2005). That provision was
ultimately eliminated from the legislation.
See Energy Policy Act of 2005,
Pub. L. No. 109-58 (2005). Had it
passed, the claims in this case against the defendant oil companies would have
been barred.
{29}
The Secretary of
Environment and Natural Resources and the Commissioner of Agriculture shall
jointly study the feasibility and advantages of a coordinated regional approach
for the phaseout of methyl tertiary butyl ether
(MTBE) as an additive to motor fuel in the southeast region of the
(1) Other southeastern
states, including
(2) Refiners,
suppliers, distributors, transporters, and retailers of motor fuel and liquid
fuel pipeline operators.
(3) Consumer, environmental,
and other public interest groups.
(4) The United States
Environmental Protection Agency and other relevant governmental agencies.
2005 N.C. Sess. Laws 93.
{30}
In
summary, the public policy issues surrounding the use of MTBE are unresolved.
The competing concerns of clear air, clean water, and affordable fuel are
extraordinarily difficult to reconcile; the data surrounding the benefits and
detriments of oxygenates is not clear; and the impact of changes in gasoline
composition on fuel supply and costs remains uncertain. With gasoline prices
skyrocketing above three dollars a gallon, affordable fuel is not an
insignificant concern. The North
Carolina General Assembly has elected to ban MTBE, but it has done so under a
regime that permits its continued use for several years into the future and
recognizes the distribution problems created by the ban. The General Assembly has not enacted
legislation creating liability for the use of MTBE as an oxygenate, nor has it
amended the laws and regulations governing USTs to
impose liability on refiners for leaks from USTs of
gasoline containing MTBE. While the
State has adopted the future ban on MTBE in gasoline, it has not altered the
regulations governing drinking water. See infra ¶¶ 38-41. It is against this public policy background
that the legal issues in this case arise.
III.
How NC addresses the
problem created by leaking underground storage tanks
{31}
As
the implementing agency for the Federal Underground Storage Tank Program, as
authorized by 42 U.S.C. § 6991 et seq.,
the Underground Storage Tank section of the Waste Management division of the
North Carolina Department of Environmental and Natural Resources (“DENR”)
regulates most underground storage tanks in the state. DENR is authorized to implement federal
regulations on behalf of the EPA under the Federal UST program, as promulgated
under Part 280, Title 40, of the Code of Federal Regulations.
{32}
In
the event of a spill causing a release of at least 25 gallons of petroleum into
the environment surrounding a tank or causing a sheen on nearby water, state
regulations for reporting and cleanup are triggered. Within 24 hours, the owner/operator of the
UST system is required to contain and clean up any spill or overfill and report
the incident to DENR. 15A NCAC 2N. 0604;
15A NCAC 2N. 0702.
{33}
Following
the initial response, the owner/operator is required to conduct initial
abatement measures, which include taking corrective measures aimed at
preventing further releases as well as containing the migration and remedying
the hazards of released substances. 15A
NCAC 2N .0703 (Jan. 2002). It must also
take further measurements to confirm the presence of a release to the
environment and investigate the possible presence of free product.[5]
{34}
Whenever
free product is detected, the UST owner/operators must—“to the maximum extent
practicable”—remove all free product and submit a free product removal report
to DENR within 45 days of confirming the release. 15A NCAC 2N .0703-.0705. If there is evidence that groundwater wells
have been affected or if free product is found to be in need of recovery, state
and federal regulations require further investigation into the full extent of
the effects of the spill on nearby groundwater.
15A NCAC 2N .0706. A separate
report detailing the results of that investigation must then be filed.
{35}
Ultimately,
DENR may require the owner/operator to compile a “corrective action plan,”
which may be approved only after DENR has determined that it will “adequately
protect human health, safety, and the environment.” 15A NCAC 2N .0707 (adopting 40 CFR § 280.66
by reference). The owner/operator is
responsible for implementing the plan as modified by DENR.
{36}
In
the event of a leak requiring a corrective action plan, the regulations require
DENR to provide notice to the public “by means designed to reach those members
of the public directly affected by the release and the planned corrective
action” and may hold a public meeting to consider comments from the public on
the proposed action before the plan is put in place. 15A NCAC 2N .0708 (adopting 40 CFR § 280.67
by reference).
{37}
The
groundwater quality rules also prescribe specific action to be taken by
owner/operators of petroleum USTs in the event of a
discharge or release. Under those rules,
owner/operators are required to undertake corrective action as discussed
above. 15A NCAC 02L .0115. They must also conduct a risk-based
assessment, classifying the risk of any known discharge or release as high,
intermediate, or low. The
classifications take into account the effect that the release has had on nearby
surface water, groundwater, and water supply wells. Remediation under a corrective action plan is
required if the release is classified as an intermediate or high risk.[6]
{38}
The
General Assembly, under N.C.G.S. § 143-214.1, authorized the Environmental
Management Commission (“Commission”) to develop and adopt specific water quality
standards applicable to groundwaters of the
state. 15 NCAC 02L .0101 (2006). The standards adopted by the Commission in
Subchapter 2L are applicable “to all activities or actions, intentional or
accidental, which contribute to the degradation of groundwater quality” except
in specific circumstances not relevant in this case.
{39}
{40}
The
Commission promulgated groundwater quality standards in Title 15A, Subchapter
2L, Rule .0202 of the N.C. Administrative Code.
The specified standards are “the maximum allowable concentrations
resulting from any discharge of contaminants to the land or waters of the
state, which may be tolerated without creating a threat to human health or
which would otherwise render the groundwater unsuitable for its intended best
usage.” 15A NCAC 02L .0202(a) (emphasis
added). The rule lists specific
concentrations at which a contaminant creates a threat to human health or
causes groundwater to be unsuitable for its intended best usage as classified
under Rule .0201.[7] It is significant that an owner/operator
responsible for a corrective action plan must have as a goal the restoration of
water quality to this level. See supra ¶35.
{41}
For
(1) Systematic threshold concentration . . .;
(2) Concentration which corresponds to an incremental
lifetime cancer risk of 1x10-6;
(3) Taste threshold limit value;
(4) Odor threshold limit value;
(5) Maximum
contaminant level [as specific under
Rule .0202(g)-(h)]; or
(6) National secondary drinking water standard.
15A NCAC .02L
.0202(d). The rules do not define “taste
threshold limit value” or “odor threshold limit value.” The well-defined maximum contaminant level
for MTBE is 0.2 milligrams per liter—or 200 parts per billion (“ppb”). 15A NCAC 02L .0202(g). The well-defined maximum contaminant level
for benzene is .001 milligrams per liter—or 1 ppb.
V. Well contamination in Broad Creek
{42}
The
Court has compiled Appendix A using information provided by Plaintiffs. The Appendix, together with exhibits 6A, 6B,
7A, and 7B to Mr. Cornette’s
report, is the best way to get a picture of where and what kind of
contamination exists in the Broad Creek Community. Hazardous chemicals other than benzene and
MTBE were found in some of the wells.
Since the levels of benzene were so high, the Court has elected not to
deal with the other contamination. The
benzene levels alone render the water unusable under state regulations.
{43}
As
Appendix A makes clear, the wells contaminated with MTBE above the level of 200
ppb are also contaminated with levels of benzene significantly in excess of
permitted levels. The permitted levels
of benzene are significantly lower than those for MTBE. Where the MTBE levels drop off on Appendix A,
the benzene levels show an almost identical drop. It is also clear that in all wells the levels
of benzene present exceed permitted contamination levels by a far greater
amount than the MTBE levels exceed permitted amounts. This raises several questions. First, if benzene in fact travels slower than
MTBE, is the benzene contamination older?
Second, could it be that the use of MTBE did not contribute to the
contamination here anymore than non-MTBE, benzene-containing products?
{44}
Plaintiffs’
expert, Anthony Brown divided the Broad Creek community into three separate areas—the
Eastern, Central, and Western Districts.
Brown conceded in his deposition that the evidence available does not
support the conclusion that it is more likely than not that leaks from the
Ballard Site contributed to contamination in the eastern and western
regions. (Brown Dep., at 304-06,
323.) No evidence has been put forward
to refute that conclusion. Therefore,
the Court confines its inquiry to the Central District and the wells situated
therein.
{45}
When
viewing Appendix A it is clear that, with the exception of WSW-33, which is in
the Western District, the next group of wells, with MTBE contamination levels
of 83-65 ppb and consisting of WSW-2, 3, 4, 5, 8, and 16, are geographically
concentrated in the same areas as the more highly contaminated wells in the
Central District. When the truly de minimus
level wells of 22, 25, 27, 28, 29, and 34 are viewed together, there is a
boundary to the MTBE contamination which runs along
{46}
Appendix
A demonstrates the difficulty of selecting a threshold for contamination that
is not based upon verifiable violations of the maximum allowable concentration
levels for specified chemicals.
Plaintiffs’ wells contain vastly different levels of MTBE contamination—from
1.2 to 562 ppb. It would be virtually
impossible to decide a contamination level, either within this case or between
this case and other cases, without using the maximum contamination levels. There would be no consistency and no
guidelines to enforce liability unless the maximum contamination levels are
used as opposed to taste and odor.
{47}
Appendix
A also demonstrates the difficulty of assessing liability against refiners for
using MTBE when, as in this case, the levels of contamination from benzene are
equal to or greater than the MTBE contamination. Imposing strict liability for using MTBE
would impose liability for all clean up on the refiners who would not be held
liable under the statutory scheme for other contaminants such as benzene. This is not a case in which MTBE has raced
ahead of other contaminants.
{48}
It
should be noted that MTBE can enter the water supply from various sources. In this case, for instance, there is evidence
of release(s) from the nearby Pender Park Fuel Market and of the existence of
incineration pits in the Broad Creek Community at which gasoline was used. (Brown Exp. Report, at 51-52; Cornette Rebuttal Exp. Report, at 7-8.) Also, Plaintiffs’ expert testified that lower
volume releases in the Broad Creek Community occurred from the use of gasoline
as an accelerant in fires, lawnmower spills, and auto accidents. (Dep. of Anthony Brown, at 255-56.)[8]
VI. Factual
history of the Ballard Site
{49}
Plaintiffs
argue in their briefs that the evidence overwhelmingly supports the conclusion
that gasoline released from the USTs at the Ballard
Site caused their properties and drinking wells to become contaminated. (Plaintiffs’ Brief in Support of Motion for
Partial Summary Judgment, at 2 (“Plaintiffs’ Brief in Support”).) They cite to the following evidence. In April 1984 an Underground Storage Tank
system, owned and operated by Ballard Tire & Oil Co, was installed at the
Ballard Site. (Plaintiffs’ Brief in
Support, at 3.) Three years later, in
August of 1987, contamination in the form of petroleum hydrocarbons was
discovered at the sight during routine tests by
{50}
On
December 3, 1987, DENR issued a Notice of Non-compliance, informing Mr. Ballard
that he was in violation of
{51}
A
separate incident occurred in November 1990, when Chris Ballard, while working
as an employee, observed a stain, which had resulted from an overflow during a
delivery of gasoline to the Ballard Site.
(Aff. of Albert Christopher Ballard (June 25,
2005).) The driver responsible was
terminated immediately after the incident.
{52}
Groundwater
Management Assocs. (“GMA”), an environmental consultant hired by the Ballards to respond to the Notice of Non-compliance, determined
that the 1987 release was caused by the leaking flange gasket that had been
reported to DENR. (Aff.
of Rick Shiver, Ex. A (Report of Groundwater Management Associates to DENR,
Hydrological Site Characterization at First Stop Food Store, at 12 (June 14,
1988)).) GMA proposed that DENR require
no further corrective action other than continued monitoring.
{53}
On
June 3, 1992, DENR assessed civil penalties against Ballard Tire & Oil Co.
in the amount of $149,634.05 for the continuous violation of
{54}
In
2000, some plaintiffs noticed taste and odor problems in their well water. Many had tests performed to identify the
problem. Those well test results are
shown on Appendix A. While most of the
wells were contaminated with some hydrocarbon from some source, only three
wells showed MTBE above state permitted levels.
In October 2002, GMA compiled a report that concluded that the most
likely source of contamination in the Broad Creek area was from the
Ballard Site. GMA’s
report stated that “[c]ollectively, these data indicate
to GMA that the [Ballard Site] is the most likely source of most or all of the
groundwater contamination being investigated in the Broad Creek
community.” (Aff.
of Steven K. Campbell, Ex. 3 (May 25, 2005) (GMA, An Assessment of Hydrogeology
& Groundwater Quality, at 27 (Oct. 21, 2002) (prepared for DENR as part of GMA’s assessment of contamination in the Broad Creek
Community and its efforts to identify of the possible sources of that
contamination)).)[9]
{55}
The
UST system was eventually removed from the Ballard Site in April 2004. According to a closure report dated August 5,
2004, 505.98 tons of petroleum-contaminated soil was removed from the site
during a total of three excavation events.
Report of Applied Resource Management, P.C., Under Ground Storage Tank
Closure Report for the First Stop #2, at 4-5 (Aug. 5, 2004).
{56}
Another
unrelated confirmed leak occurred at the Fisher Site in 1997. Claims as to the Fisher Site are no longer at
issue in this case. See supra ¶ 15. Therefore,
the 1997 spill is not at issue here and does not provide grounds for the
liability of the remaining defendants, whose liability here, if any, can only
stem from spills or releases at the Ballard Site.
VII. Additional
Facts
{57}
It
should be noted that, as originally filed, these cases involved allegations of
leaks at both locations, the Ballard Site and the Fisher Site. Claims arising out of the separately owned
Fisher Stores site have been resolved.
The only claims at issue here are the claims of contamination from the Ballard
Site. The fact remains that some
plaintiffs alleged their wells were contaminated from the Fisher Site.
{58}
For
purposes of the pending motions, the Court has accepted certain facts as
undisputed or given Plaintiffs the benefit of facts alleged as required on a
motion to dismiss or for summary judgment.
See infra ¶¶ 60-62. The following appear to be the key facts
which the Court believes are undisputed or which the parties are entitled to
have accepted as true at this stage:
1)
Gasoline
contains many contaminants, including benzene, toluene, and others. The presence of those contaminants at certain
levels constitutes a hazard to health.
2)
MTBE
is added to some gasoline as an oxygenate.
At levels at or above 200 ppb it constitutes a hazard to health. MTBE is more soluble in water than other
contaminants contained in gasoline and therefore may migrate farther and faster
than other contaminants.
3)
MTBE
has a distinct and undesirable odor and taste.
Its presence in water is easily detectable.
4)
MTBE
is not used as an oxygenate in regular leaded gasoline.
5)
In
1987 a leak occurred in an underground storage tank at the Ballard Site. The regular leaded gasoline which leaked from
the tank on that occasion did not contain MTBE and thus could not be the source
of MTBE contamination in the Broad Creek Community. It could be the source of other
contamination.
6)
Another
spill, which was discovered in November 1990 by Christopher Ballard, resulted
from overflow during a delivery of gasoline to the Ballard Site. Only 5.6 gallons of gasoline was spilled.
7)
Of
all the wells tested in the Broad Creek Community only three water supply wells
contain levels of MTBE in excess of the levels permitted by state
regulation. Those are water supply wells
6, 8, and 11. Those three wells also
contained other contaminants found in gasoline, such as benzene, that rendered
the water contaminated. Other wells in
the community contained some MTBE but at levels permitted under state
regulations. Some wells showed
negligible MTBE contamination but showed other contaminants from gasoline in
excess of levels permitted under state regulations.
8)
Water
Supply Wells 6, 8, and 11 were used by the following families, as delineated by
the Affidavits filed by Plaintiffs on April 20, 2006, and May 5, 2006: Morton (Virginia), Lewis, Beall,
Defeo, and Sylvia Lewis, on behalf of Plaintiff Emma
P. O’Neal. [10] The Lewis family connected to the public
water supply in 1992—eight years before tests indicated contamination levels in
excess of state standards. (Aff. of Margaret Lewis.)
The Beall family connected to the public water
supply on October 2, 2000, a year before tests indicated contamination levels
in excess of state standards. (Aff. of Elizabeth Beall.) The Defeo family
moved away from the Broad Creek Community several years before contamination
was discovered. (Aff.
of Jennifer Defeo.)
The Morton family connected to the public water supply on November 3,
2000, a year before tests discovered contamination levels in excess of state
standards. (Aff.
of Virginia Morton.)
VIII. Individual Ballard Defendants
{59}
In
addition to claims brought against the Refiner Defendants and Ballard Tire
& Oil Co., claims remain against the Individual Ballard Defendants. A.J. Ballard, Jr. and Joyce Ballard purchased
the Ballard Site in April 1983. In
September 1984, they conveyed ownership of the property and, it appears, have
had no ownership interest in the property as individuals since that conveyance. (Ballard Defs.’
Procedural
posture and pending motions
{60}
The
Refiner Defendants have filed a motion to dismiss pursuant to Rule 12(b)(6) and
have also filed a motion for summary judgment.
The Ballard Defendants have filed a motion to dismiss and a motion for
summary judgment. Plaintiffs have filed
a motion for summary judgment against all defendants.
{61}
In
deciding the motions to dismiss the Court has followed the guidelines set forth
by our appellate courts. When ruling on
a motion to dismiss under Rule 12(b)(6), the court must determine “whether, as
a matter of law, the allegations of the complaint . . . are sufficient to state
a claim upon which relief may be granted.”
Harris v. NCNB, 85 N.C. App.
669, 670, 355 S.E.2d 838, 840 (1987). In
doing so, the court must treat the allegations in the complaint as true. See
Hyde v. Abbott Lab., Inc., 123 N.C.
App. 572, 575, 473 S.E.2d 680, 682 (1996).
The court must construe the complaint liberally and must not dismiss the
complaint unless it appears to a certainty that the plaintiff is entitled to no
relief under any set of facts which could be proved in support of the
claim.
{62}
In
deciding the motions for summary judgment the court has followed the guidelines
set forth by our appellate courts. A
Rule 56 motion for summary judgment should be granted if “the pleadings,
depositions, answers to interrogatories, and admissions on file, together with
the affidavits, if any, show that there is no genuine issue as to any material
fact and that any party is entitled to judgment as a matter of law.” N.C. R. Civ. P.
56(c). A “genuine issue” is one that
“can be proven by substantial evidence” and a “material fact” is one that
“would constitute or irrevocably establish any material element of a claim or a
defense.” Lowe v. Bradford, 305 N.C. 366, 369, 289 S.E.2d 363, 366
(1982). The moving party may prevail if
it meets its burden “(1) of proving an essential element of the opposing
party’s claim is non-existent, or (2) of showing through discovery that the
opposing party cannot produce evidence to support an essential element of his
or her claim.”
{63}
The
cases are in the unusual posture of having both motions to dismiss and summary
judgment motions pending for several reasons.
First, it appeared at one point that Congress would pass legislation
restricting suits against refiners for using MTBE. That legislation stalled and then was
abandoned. Second, while this court has
concluded that there are some bases for granting the Rule 12(b)(6) motions,
there are novel questions of law which could result in some change in the law
in the appellate courts. Accordingly,
through its case management orders, the Court directed the parties to proceed
with a phased discovery which would focus first on which plaintiffs had been
impacted, how they had been impacted, and the source of any contamination. Discovery with respect to the medical records
of plaintiffs and their individual monetary claims was left for a later date on
the premise that such discovery would be expensive and time consuming,
resulting in waste if there were insurmountable legal barriers to
liability. In retrospect, that phased
discovery has been efficient and has put these cases in a posture where the
appellate courts can review them and, if there are issues to be tried, give the
parties and the Court guidance on the applicable law to be used at trial.
{64}
Also
pending are several procedural motions directed to the state of the record and
the admissibility of certain evidence.
The Court will address those issues as they become pertinent to the
substantive issues discussed below.
ANALYSIS
I.
INTERVENING NEGLIGENCE
& Refiner Liability
A.
{65}
The
first and perhaps least complex question raised by the pending motions is
whether or not refiners, who do not own or control a UST, may nonetheless be
held liable for negligence if the UST owner causes a spill or leak resulting in
contamination of underground water supplies.
The Court believes the answer is no.
{66}
It
is an unavoidable fact that there would be no injury, no contamination of
water, without the intervening negligence of a tank owner/operator (in this
case the alleged negligence of the Ballard Defendants). No court of this state and no legislation
enacted by the General Assembly has placed liability on refiners for leaks or
spills at sites not controlled or owned by the refiners. To the contrary, this state has enacted a
very specific statutory scheme to deal with leaks from USTs. See
supra ¶¶ 31-37. That scheme recognizes that the proximate
cause of injury in the leaking UST situation is the negligence, if any, of the
owner/operator of the tank. Put differently, proximate causation is attributed
to the person or entity responsible for the discharge of the contaminant into
the ground.
{67}
Gasoline
contains contaminants which are hazardous to health if ingested. MTBE is but one of those contaminants. It is singled out in this litigation, as it
has been in other cases, because it migrates farther and faster than other
chemicals in gasoline, thus permitting it to reach underground water supplies
with greater frequency than other chemicals.
Other chemicals migrate and pollute underground water, but they are
slower to move and not as soluble in water.
If there is to be some litmus test which separates one harmful chemical
component from another that standard
should be determined by the appellate courts which to date have not created any
such distinction. Nor can this court
ascertain what the standard would be that would lead to refiner liability in
some cases involving leaks and not in others.
What is clear in this case is that Plaintiffs’ wells all contained
benzene at levels substantially higher than state regulations permit. This is not a case where MTBE has outrun
other contaminants and contaminated wells not affected by other components of
gasoline.
{68}
Even
if this were a case where MTBE outran other contaminants, a multitude of
questions would still have to be resolved in order to establish a standard for
liability. Is there a migration rate
that would trigger liability? If so,
should not that be a part of the liability and clean-up scheme enacted by the
legislature? Where is the cutoff? What would the law dictate be done where, as
in this case, there are other contaminants present in the water supply? How would the cost of cleanup be assessed as
between the negligent owner/operator and the refiner? Would the refiner be liable for the entire
clean up including other contaminants, an outcome not heretofore existent? Would the judicially created liability supercede the General Assembly’s statutory solution? What if the cause of the spread of
contamination is the failure to remediate?
{69}
The
General Assembly could have exacted part of the cost of cleanup from refiners
by adding to the fuel tax. In fact, it
might even have taxed fuel containing MTBE differently to cover the cost of
cleanup. It elected to place the burden
on the owner/operators who had control over the processes that caused problems,
ie., those responsible for filling and
maintaining the tanks. The logic of the
statutory system is apparent. If
refiners were to be held liable, owner/operators would have little incentive to
properly maintain and fill their tanks.
The cost of any negligence would be passed on to the refiners who had no
control over the operation of hundreds of thousands of service stations and
convenience stores. That cost would
undoubtedly be passed on to consumers.
The system is designed to encourage those who can prevent the leaks and
spills to do so. It places direct
responsibility on owner/operators. They
are in the best position to remediate their property. By its assessment against tank owners, the
regulations attempt to spread the cost of unfunded cleanup among all tank
owners. Some of those costs undoubtedly
get passed on to consumers in the form of higher gas prices. By implementing a future ban on the use of
MTBE, the General Assembly chose a means other than extending liability for
leaks to refiners to address the problem.
It has not changed the existing statutory scheme, which places liability
for leaks on tank owner/operators; nor has DENR changed its water quality
standards.
{70}
The
statutory system is also in accord with the liability decisions of our
appellate courts. That is not surprising
since both systems place liability on those with the most control over the
problem of leaks and spills—tank owners.
There are no
that cause, unbroken by any new or independent cause,
which produces the result in continuous sequence and without which it would not
have occurred, and one from which any man of ordinary prudence would have
foreseen that such a result was probable under all of the facts then
existing. Foreseeability
is thus a requisite of proximate cause, which is, in turn, a requisite for
actionable negligence.
Clodfelter v. Leonard, No. 05-890 (N.C. App. June 20, 2006) (quoting Williams v. Smith, 68 N.C. App. 71, 73,
314 S.E.2d 279, 280, cert. denied, 311 N.C. 769, 321 S.E.2d 158 (1984)).
{71}
Plaintiffs
seek to avoid the fundamental requirement of proximate causation by urging the
court to adopt a theory of causation based upon a remarkably loose definition
of forseeability.
Under this theory, all refiners of gasoline would be liable for ground
and ground water contamination because they have sold a product that
contaminates when leaked or spilled with knowledge that some USTs are improperly maintained by service station operators
and that some operators would be careless and spill the gasoline. It is undeniable that old and leaking USTs pose a problem in this country and that gasoline will
be carelessly spilled at times. However,
Plaintiffs’ theory would open a Pandora’s box of litigation over the negligence
of others based on a mere scintilla of forseeability. Clearly, tank owner/operator negligence is a
foreseeable possibility, but that fact alone doesn’t mean that a refiner of
ordinary prudence could foresee that a given owner/operator’s negligence is probable. A panel of the North Carolina
Court of Appeals recently reiterated the language of the North Carolina Supreme
Court’s 1972 decision in McNair v. Boyette, which
stated:
In searching for the proximate cause of an event, the
question always is: Was there an unbroken connection between the wrongful act
and the injury, a continuous operation?
Do the facts constitute a continuous succession of events, so linked
together as to make a natural whole, or was there some new independent cause
intervening between the wrong and the injury?
B.
{72}
In
essence, Plaintiffs ask the Court to adopt strict liability in tort for a
certain product; in this case not gasoline generally, but only gasoline
containing MTBE. To date, our courts
have adopted strict liability only in blasting cases. See
Woodson v. Rowland, 329 N.C. 330, 350-51, 407 S.E.2d 222, 234 (1991). The reluctance to go further is indicative of
the appellate courts’ deferral to the legislature in this area of public policy
as well as a recognition that legislatures, rather than the courts, are better
suited to balance the competing interests and public policy issues surrounding
such decisions. The cases to which
Plaintiffs cite in support of a finding of liability against refiners are from
{73}
In
summary, Refiner Defendants are entitled to dismissal under Rule 12(b)(6)
because the Amended Complaint establishes that those defendants did not
proximately cause the injury to Plaintiffs and that there was some intervening
negligence which was the proximate cause.
C.
{74}
The
Court next addresses Plaintiffs’ argument that this is really a products
liability case and that the Refiner Defendants are liable for placing a
defective product on the market.
Adopting this theory would require the Court to ignore proximate
causation altogether. The alleged defect
in the product (gasoline) is the inclusion of MTBE as a component. If plaintiffs could overcome the proximate
causation barrier, they would have to prove that the use of MTBE as a component
in gasoline to meet mandated federal standards was negligent. Refiner Defendants contend that the issue is
foreclosed by the Congressional mandate to refiners to use oxygenates to help
reduce air pollution. The Court is not
prepared to enter summary judgment for Refiner Defendants on that basis. Discovery is not complete on that issue, and
the Court does not believe that, short of a Congressional direction requiring
use of MTBE as the sole source of oxygenates, there is an absolute defense to
the negligence claim. There may well
exist issues of best available technology to meet the government mandates, but
this record is not developed sufficiently to decide those issues on summary
judgment. It is clear that MTBE is more
soluble in water and does migrate faster than other contaminants in
gasoline. The appellate courts may
decide that the Congressional mandates were sufficient to relieve the Refiner
Defendants from liability for use of MTBE.
Congress itself refused to do so.
See Energy Policy Act of 2005,
Pub. L. No. 109-58 (2005); see also
151 Cong. Rec. H5772 (daily ed. July 13, 2005) (debate on the motion offered by
Congresswoman Capps to instruct the House managers not to agree to a provision
limiting MTBE liability for refiners at the conference meeting on the Energy
Policy Act of 2005). The detriments of
MTBE, upon which Plaintiffs rely, and the benefits of MTBE and government
regulations, upon which the Refiner Defendants rely, are known and not subject
to dispute. Ultimately, the Court
believes that the appellate courts will defer to the General Assembly or
Congress to make the complex balancing decisions that need to be made as public
policy in this area. Certainly these
cases do not present the clear cut case where MTBE has contaminated wells in
the absence of other contaminants. The
vast majority of the contamination in this case comes from benzene. The Court denies Plaintiffs’ and Defendants’
motions for summary judgment to the extent that they are based upon use of MTBE
as a component of gasoline.
II.
STATUTES
OF LIMITATIONS & REPOSE
{75}
If
the product liability statute were to apply and Plaintiffs survive summary
judgment on the question of whether the Refiner Defendants were negligent in
using MTBE, the Court’s work would not be done.
The Refiner Defendants assert that the applicable statutes of repose and
statutes of limitation serve as a bar to all claims brought against them in
this action. They have moved both to
dismiss the action and for summary judgment.
The Ballard Defendants have also asserted the statutes of limitation and
repose in support of their motions with respect to certain of the causes of
action asserted against them. The Court
notes at the outset that the statue of repose need not be pled as an
affirmative defense. As the N.C. Court
of Appeals has recently reiterated, the statute of repose is a “condition
precedent to a party’s right to maintain a lawsuit.” Whittaker
v. Todd, __ N.C. App. __, 625 S.E.2d 860, 862 (2006) (quoting Tipton & Young Construction Co. v. Blue
Ridge Structure Co., 116 N.C. app. 115, 446 S.E.2d 603 (1994)).
{76}
Plaintiffs
assert that even though this is a products liability case, the various statutes
of repose and limitation that normally apply in products liability cases are
inapplicable because there has been no sale, use, or consumption of the product
causing the injury and thus the statutes have never begun to run. Such a position is contrary to both the facts
of this case and the rationale behind the statutes of repose and limitation.
{77}
It
is undisputed that the Refiner Defendants sold gasoline to the Ballard
Site. Title changed hands, and the
Refiner Defendants had no control over the gasoline once it left their
facilities. It is equally clear that the
gasoline which is the subject of the claims has been consumed. It has leaked or spilled and cannot be put
back in the tank and sold. It was not
sold to Plaintiffs.
{78}
The
Court takes its direction on the application of the statutes of limitation and
repose from the Supreme Court’s decision in Wilson
v. McLeod Oil Company. 327 N.C. 491,
398 S.E.2d 586 (1990). The facts of that
case are complex and will not be set out here.
They are stated as clearly as they can be in Justice Frye’s opinion. This Court has gleaned several rules
governing ground water contamination from the
{79}
The
Court will apply those principles to the claims in these actions based upon the
Courts’ ruling below that a cause of action for contamination does not arise
until the ground water contaminants exceed maximum concentration levels under
state regulations. The statute of
limitations does not begin to run until the landowner is aware that
contaminants are present in excess of those permissible levels.
A.
TEN-YEAR
STATUTE OF REPOSE
{80}
Plaintiffs’ claims arising out
of acts occurring more than ten years prior to the filing of the complaints in
this action are barred by the ten-year statute of repose. Under N.C.G.S. § 1-52(16), a cause of action
for personal injury or property damage will not accrue unless certain
conditions are met. Nonetheless, the
statute prohibits the plaintiff from bringing a cause of action more than ten
years after the last act or omission from which relief is sought. The provision states:
Unless
otherwise provided by statute, for personal injury or physical damage to
claimant’s property, the cause of action, except in causes of actions referred
to in G.S. 1-15(c), shall not accrue until bodily harm to the claimant or
physical damage to his property becomes apparent or ought reasonably to have
become apparent to the claimant, whichever event first occurs. Provided that no cause of action shall accrue
more than 10 years from the last act or omission of the defendant giving rise
to the cause of action.
{81}
Therefore, regardless of the
date of accrual of injury, no cause of action may be allowed if “filed more
than 10 years after the last act or omission of the defendant giving rise to
the cause of action.”
{82}
Plaintiffs’ original product
liability claims are based on a gasoline release from an UST at the Ballard
Site that was discovered on October 30, 1987.
(Compl. ¶ 24.)
After noticing an inventory loss of approximately 1,000 to 1,500 gallons
of gasoline at the Ballard Site, an excavation of the surrounding grounds
revealed a leaking flange gasket on the submersible pump. (Compl. ¶ 24.) It is now clear from the record on summary
judgment that the tank which leaked did not contain gasoline with MTBE as a
component. Therefore, there could be no
liability on the part of the Refiner Defendants as to that leak.
{83}
Even if there were a question
as to the presence of MTBE in the tank which leaked in 1987, Plaintiffs’ claims
against the Refiner Defendants would be barred by the statute of repose. Under N.C.G.S. § 1-52(16), “no cause of
action shall accrue more than 10 years from the last act or omission of the
defendant giving rise to the cause of action.”
In
{84}
Similarly, here the last act or
omission giving rise to a cause of action occurred on or before the date of
release, October 30, 1987. The last act
by Refiner Defendants was the final delivery of gasoline to the Ballard Site
preceding the gasoline release, which must have occurred on or before October
30, 1987. Plaintiffs filed their action
in
{85}
The Ballard Defendants are in a
different position than the Refiner Defendants with respect to the ten-year
statute of repose. The statutory scheme
places the responsibility on the tank owner to remediate. See
supra ¶¶ 31-37. Failure to do so may
result in liability arising from the failure to remediate and not the leak
itself. Here, there is evidence which
might place the failure to remediate within both the ten-year and six-year
statute of repose periods. DENR assessed
penalties against some defendants for failure to remediate as late as 1994, and
the tank that leaked and the contaminated soil were not removed until
2004. See supra ¶¶ 42-49. Issues
of fact exist which prevent summary judgment for either Plaintiffs or Ballard
Tire & Oil on the statutory claims.
{86}
Plaintiffs argue that the
Complaint need not plead compliance with the statutes of repose. (Pl.’s Resp. to
Mot. to Dismiss at 45). However, the
Supreme Court has held that “[a] statute of limitation or repose may be the
basis of a 12(b)(6) dismissal if on its face the complaint reveals the claim is
barred by the statute.” Cage v.
Colonial Bldg. Co., Inc., 337 N.C. 682, 683, 448 S.E.2d 115,116
(1994).
{87}
In response to Defendants’
argument regarding the application of the ten-year statute of repose, Plaintiff
argues only that the ten-year statute of repose should not apply because
Defendants also move for dismissal based upon the six-year statute of repose in
N.C.G.S. § 1-50(6). (Pl.’s Resp. to Mot. to Dismiss at 45, n.20.) Plaintiff cites Cage as precedent
disallowing Defendants’ use of the ten-year statute of repose. However, in Cage, the Supreme Court
reversed the Court of Appeals decision which held that the six-year statute of
repose in N.C.G.S. § 1-50(5) did not apply.
After holding that the six-year statute of repose did not apply, the
Court of Appeals held that the ten-year statute of repose did not bar the
plaintiff’s claims. Thus, although the
Supreme Court found that the six-year statute of repose applied and barred the
plaintiff’s claims, the Supreme Court did not hold that a defendant is
prohibited from seeking dismissal based upon both the ten-year and six-year statutes
of repose. In fact, in Boudreau v.
Baughman, 86 N.C. App. 165, 172, 356 S.E.2d 907, 911 (1987), rev’d on other grounds, 322 N.C. 331, 368
S.E.2d 849 (1988), the Court of Appeals found that both N.C.G.S. § 1-52(16) and
N.C.G.S. § 1-50(6) applied to dismiss the plaintiff’s complaint.
{88}
Therefore, all of Plaintiffs’
original product liability claims against all defendants arising solely out of
the 1987 leak are barred by the ten-year statute of repose set forth in
N.C.G.S. § 1-52(16). The “last act or omission
of the defendant giving rise to the cause of action” occurred when the gasoline
manufacturers delivered the product to the Ballard Site and the Ballard
Defendants committed whatever acts caused the leak, more than 16 years before
the filing of this action. “The public
policy of this State is to protect
B.
SIX-YEAR
STATUTE OF REPOSE
{89}
Additionally,
Refiner Defendants argue that all of Plaintiffs’ claims are barred by the
six-year statute of repose. Under
N.C.G.S. § 1-50(6), “[n]o action for the recovery of damages for personal
injury, death, or damage to property based upon or arising out of any alleged
defect or any failure in relation to a product shall be brought more than six
years after the date of initial purchase for use or consumption.”
{90}
Plaintiffs’
first and second claims allege negligence and a failure to warn under N.C.G.S.
Chapter § 99B—
{91}
Plaintiffs’
remaining claims for gross negligence, unfair and deceptive trade practices,
conspiracy, fraud, and public nuisance all derive from the product liability
claims and are hence subject to the six-year statute of repose of N.C.G.S. §
1-50(6). Under North Carolina law,
claims based upon or arising out of an alleged defect or product failure will
fall under the six-year statute of repose of N.C.G.S. § 1-50(6). See Colony Hill Condo. I Ass’n v. Colony Co., 70 N.C. App. 390, 396, 320 S.E.2d
273, 277 (1984) (finding that “[t]he generality of the language in § 1-50(6)
indicates that the legislature intended to cover the multiplicity of claims
that can arise out of a defective product”); Vogel v. LVD Corp., 132
N.C. App. 797, 802, 514 S.E.2d 113, 116 (1999); Davidson v. Volkswagenwerk, 78 N.C. App. 193, 336 S.E.2d 714
(1985). Further, allegations of fraud do
not extend the period of repose for products liability cases as they do in real
property cases. Jack H. Winslow Farms, Inc. v. Dedmon,
171 N.C. App. 754, 615 S.E.2d 41, pet.
disc. rev. denied, 360 N.C. 64, 621 S.E.2d 625 (2005). Thus, all of Plaintiffs’ claims against
Refiner Defendants are subject to the six-year statute of repose of N.C.G.S. §
1-50(6).
{92}
Plaintiffs
do not dispute that the six-year statute of repose of N.C.G.S. § 1-50(6)
applies to all of Plaintiffs’ claims.
(Pls. Resp. at 46-47.) However, Plaintiffs posit that the statute of
repose has not expired. In fact,
Plaintiffs argue that the statute of repose has not begun to run because there
has been no “initial purchase for use or consumption.” (Pls. Resp. at
47-50.) In support of this argument,
Plaintiffs cite several cases in which a manufacturer sold a product to a
dealer-distributor who later sold said product to a third party. (Pls. Resp. at
47-50.) In earlier cases, the statute of
repose for the manufacturer did not begin to run when the product was sold to
the dealer-distributor. Instead, the
statute of repose began to run when the product was sold to the consumer. See Teeterton v.
Long Mfg. Co., Inc., 314 N.C. 44, 332 S.E.2d 67 (1985) (holding that the
statute of repose began to run when farmer bought tobacco harvester from
dealer-distributor, rather than when dealer-distributor bought from
manufacturer); Chicopee, Inc. v. Sims Metal Works, Inc., 98 N.C. App.
423, 391 S.E.2d 211 (1990) (holding that the statute of repose began to run
when plaintiff textile manufacturer bought from dealer-distributor, rather than
when dealer-distributor bought from manufacturer). Consequently, Plaintiffs contend that the
statute of repose of N.C.G.S. § 1-50(6) can never be triggered in this
case.
{93}
Plaintiffs’
suggested outcome is untenable in light of the policy and rationale behind
N.C.G.S. § 1-50(6). The Supreme Court of
North Carolina noted that “the obvious intent of the legislature . . . was to
limit . . . manufacturers’[] liability after a certain period of years had
elapsed from the date of initial purchase for use or consumption.” Tetterton
v. Long Mfg. Co., 314 N.C. 44, 56, 332 S.E.2d 67, 74 (1985). The Court of Appeals found that N.C.G.S. §
1-50(6) “is intended to be a substantive definition of rights which sets a
fixed limit after the time of the product’s manufacture beyond which the seller
will not be held liable. Davidson v. Volkswagenwerk, 78 N.C. App. 193,195, 336 S.E.2d 714,
716 (1985). The Court of Appeals further
described the six-year statute of repose by reasoning that “the public policy
of this State is to protect North Carolina manufacturers and designers as well
as the North Carolina courts from stale claims based on injuries occurring long
after the purchase of an allegedly defective product and long after a defendant
participated in its manufacture or design.”
Boudreau v. Baughman, 86 N.C. App. 165, 172, 356 S.E.2d 907, 911
(1987), rev’d in part, modified and aff’d in part, 322 N.C. 331, 368 S.E.2d 849
(1988). “It is apparent from the face of
the statute that the
{94}
In
more recent cases, the Court of Appeals has helped further distinguish when the
statute of repose of N.C.G.S. § 1-50(6) begins to run. In Cacha
v. Montaco, Inc., 147 N.C. App. 21, 554 S.E.2d
388 (2001), the plaintiff homebuyers’ claims against a synthetic stucco (EIFS)
manufacturer were barred by the six-year statute of repose. The plaintiff homebuyers argued that the
statute of repose should begin to run at the time of the purchase of the
house. In rejecting the plaintiffs’
argument, the Court of Appeals held that the statute of repose began to run
when the EIFS was purchased by the subcontractor. The Court of Appeals reasoned that the EIFS
was first purchased for use or consumption by the subcontractor who applied the
product. Moreover, the Court of Appeals
reasoned that once the subcontractor “applied the EIFS, it was ‘consumed,’ that
is, utilized in the construction process, which use resulted in its
transformation, and the destruction of its original form. At that point, the EIFS could not be returned
to its original consistency and could not be deployed in the construction of
another house.”
{95}
Plaintiffs
contend that Cacha should be applied to the
present case such that the “initial purchase for use or consumption” would be
“when a consumer at a retail outlet purchases gasoline.” (Pl.’s Resp. Mot.
Dismiss at 49.) Plaintiffs assert that
because there was never a purchase of the gasoline by a consumer at a retail
outlet, the statute of repose has not begun to run. (Pl.’s Resp. Mot.
Dismiss at 50.)
{96}
Plaintiffs’
interpretation of Cacha does not rationally
relate to the present facts. The
released gasoline could never have been purchased at a retail outlet. The reasoning of the Court of Appeals in Cacha supports finding that the six-year statute
bars Plaintiffs’ claims. The
Estoppel.
{97}
Plaintiffs
claim that Defendants should be barred from asserting the statute of repose
under the doctrine of equitable estoppel because of
Defendants’ alleged fraudulent behavior and concealment with respect to the
dangers and hazards of MTBE. (Pl.’s Resp. Mot. Dismiss at 50-51.) In order to bar the assertion of the statute
of repose to dismiss a claim, the complaint must sufficiently allege a claim
for equitable estoppel on its face. Cacha, 147
N.C. App. at 28, 554 S.E.2d at 393. To
sufficiently allege a claim for equitable estoppel, a
plaintiff must claim elements of “conduct amounting to a false representation
or concealment of material facts.” Bryant
v. Adams, 116 N.C. App. 448, 460, 448 S.E.2d 832, 838 (1994). In Bryant, the Court of Appeals found
that the plaintiff’s complaint contained the essential elements of a claim for
equitable estoppel where the defendant’s discovery
abuses delayed the filing of a claim thereby subjecting the claim to dismissal
by the statute of limitations or repose.
Latent Diseases Exception
{98}
Plaintiffs
further argue that their claims are shielded from the six-year statute of
repose by the latent diseases exception.
See Wilder v. Amatex Corp., 314 N.C.
550, 336 S.E.2d 66 (1985). In Wilder,
the Court held that the applicable statute of repose did not bar the
plaintiff’s wrongful death claim for asbestosis, even though more than 10 years
had passed from plaintiff’s last exposure to the defendant manufacturer’s
asbestos products.
Minority Exception
{99}
Plaintiffs
argue that those plaintiffs who were minors at the alleged time of injury
should have their claims tolled for statute of repose purposes until they reach
majority or a guardian ad litem is appointed under N.C.G.S. § 1-17. (Pl.’s Resp. Mot.
Dismiss at 51, n. 24) However, the Court
of Appeals in Bryant clarified the effect of the statute:
Moreover, G.S. § 1-17 does not completely eviscerate
the statute of repose in the case of minors and others under disability. If a product is over six years old at the
time of injury, which would be the time that the claim accrues, then the
statute of repose operates as a total bar on that claim. However, if a claim accrues before the six
year statute of repose has expired, G.S. § 1-17 simply operates to extend the
time period within which a minor or other with disability may bring suit under
Chapter 99B. Therefore, claims accruing
after six years will still be barred.
116 N.C.
App. at 458, 448 S.E.2d at 837. Thus,
the six-year statute of repose bars the claims of all minor plaintiffs unless
they are claiming that they were injured within six years of the release
alleged to have caused their injury. Any
claims arising out of the 1987 leak would be barred..
C.
APPLICATION
OF THE STATUTES OF REPOSE
{100} The application of the statutes of
repose raise the most contentious issue in this case: Have Plaintiffs
adequately pled or established factual proof of a leak or spill of MTBE
containing gasoline from the Ballard Site within the six- or ten-year period before
a statutory bar? When these cases were
first filed Plaintiffs alleged that their injuries resulted from tank leaks at
the Ballard Site in 1987 and the Fisher Site in 1997. It is well established that a large leak
occurred at the Ballard Site in 1987. It
is now clear that the leak did not involve gasoline containing MTBE. Accordingly, there can be no claim against
the Refiner Defendants arising out of the 1987 leak at the Ballard Site. It is incumbent upon Plaintiffs to establish
that there was a sale by Refiner Defendants of MTBE gasoline which leaked from
the Ballard Site less than six years prior to the filing of the complaint
against them in 2003. Thus, 1997 becomes
the critical year.
{101} The Refiner Defendants sold gasoline
products containing MTBE to the Ballard Site up until sometime in 2002. MTBE is
present in some wells in the Broad Creek Community. The missing element of
clear allegation and proof is the occurrence of a leak or release from the
Ballard Site that caused the contamination in the wells during the applicable
period.
{102} Plaintiffs’ problems in that regard
arise from the failure of their designated expert to render a valid opinion
that such a leak occurred in 1997 or later. The designated expert, Mr. Brown,
originally expressed such an opinion. However, on cross examination during his
deposition he disavowed that opinion stating that he could no longer give that
opinion based upon the results of certain studies that had been brought to his
attention after his original opinion was formed.[12] Nor is there an allegation in the Amended
Complaint of a specific incident post-1996 giving rise to a leak or spill.[13] Similarly, there is no factual evidence in
the record of a specific leak or spill at the Ballard Site after 1996. There is no evidence of when, where, or how a
leak or spill occurred after 1996.
{103} Having lost their expert, Plaintiffs
fall back upon three different approaches to establish the required leak within
the safe harbor. First, they seek to use
expert opinions from other reports which were not designated as expert opinions
as required by the Case Management Order.
Those expert opinions include reports by DENR and consulting company
Groundwater Management Associates (GMA), along with affidavits filed by Rick
Shiver and Steven Campbell. Defendants
have objected to the Court’s consideration of those expert opinions and
affidavits. Their objections are well
founded and their motion to strike the other expert reports is granted to the
extent those reports contain opinions which were not disclosed as required by
the Case Management Order. Defendants had no opportunity to challenge or test
those reports. As proven by the
deposition of Mr. Brown, such opportunities are critical to the process. This ruling is in line with a recent Court of
Appeals opinion which affirmed Judge Spainhour’s
decision to exclude evidence which was produced in a manner that was in
violation of the court’s rules and orders governing discovery in that
case. In re Pedestrian Walkway Failure, __ N.C. App. __, 618 S.E.2d 796
(2005). There, the Court of Appeals
noted:
. . . the record is replete with information which
reveals the importance of the deadlines in each of the pedestrian walkway cases
and with admonitions by Judge Spainhour that the
parties should strictly and completely comply with rules and orders governing
discovery. On the facts of this case, we are unpersuaded
that Judge Spainhour was compelled to find that there
was good cause to permit Dr. Bederka to testify, and
we discern no abuse of discretion in the decision to exclude Dr. Bederka's testimony.
{104} The Court also notes that DENR
originally asserted that the 1987 leak was the source of MTBE contamination,
while it is now conceded that no MTBE-containing gasoline was involved in that
leak. To the extent the reports contain
factual information as opposed to conclusions they will be considered by the
Court. None of the reports relied upon
contain factual accounts of any spill or leak after 1996. At best, they contain the bare expert
conclusion that the contamination in the Broad Creek Community must have come
from the Ballard Site without any specificity as to when and how the
contamination occurred.
{105} Second, Plaintiffs assert that the
Ballard Defendants are guilty of spoliation.[14] The Court notes at the outset that the
spoliation claim is only asserted as to the Ballard Defendants and has no
effect with respect to the Refiner Defendants’ motions. Plaintiffs conceded that point at oral
argument. It is undisputed that sometime
during 2004, after these lawsuits had been filed, some of the Ballard
Defendants caused the tank that was alleged to be the source of the 1987 leak
to be removed and also removed a substantial amount of contaminated soil from
the area around the tank. Plaintiffs
were not notified that the tank would be removed or the contaminated soil
disposed of. The Ballards
did comply with state law by notifying DENR of its proposed remedial
action. Representatives from DENR were
present when the tank was removed and inspected it. The Ballards also
had their own expert present for the removal.
Remediation of the site was one of the remedies sought by Plaintiffs in
their claims against the Ballards. The Ballards
complied with state law and procedures in the removal process and were entitled
to remediate the site. The sole question
is whether they were required to notify Plaintiffs of the remediation.
{106} No specific discovery requests were
pending. No orders were in place
restricting the Ballards from cleaning up the
site. The tank and the contaminated
soil, however, could have provided evidence relevant to what had happened at
the site. In fact, defendants had their
expert there, and he has provided opinions based upon what he saw. While representatives from DENR were present,
it appears that their participation in and recordation of the tank and soil
removal was woefully inadequate.[15] The Court does note that numerous monitoring
wells had been placed on the Ballard Site after 1987 and that Plaintiffs have
had access to those records.
Nonetheless, the Court is troubled by the removal and destruction of the
tank and soil without giving Plaintiffs’ counsel the opportunity to inspect
them before destruction. The Court is
unaware of any similar circumstance in the reported cases, and the government
regulations all address notice to the government. Private plaintiffs should not have to rely on
the government to do the inspection as this case so amply demonstrates. On the other hand, the Court is also troubled
by the fact that although Plaintiffs’ counsel knew within days of the removal
of the tank and soil in 2004, no issue was raised with the Court until the
response to the motion for summary judgment in 2005 when spoliation was asserted
to defeat the summary judgment motion—this after Plaintiffs’ expert had failed
to pinpoint a leak within the statute of repose period. The Court has concluded that, for purposes of
this motion and trial, the Court will give the standard spoliation charge and
will let the jury consider the fact that the tanks and soil were removed
without giving Plaintiffs an opportunity to inspect them. This is but one of the issues in this case
with which the appellate courts may wrestle and come to a different conclusion. It is arguable that by complying with state
law the Ballard Defendants fulfilled any duty to Plaintiffs and thus no
spoliation occurred.
{107} Finally, Plaintiffs rely on
circumstantial evidence to prove that there was a leak from the Ballard Site
within the statutes of limitation and repose which impacted their wells. Since the Court has ruled that the cause of
action does not accrue until the damage is done by contaminating the well above
state regulated levels, the issue of when the leak occurred as to the Ballards is not as significant as it is with respect to the
Refiner Defendants. There need only be
some evidence of a leak from the Ballard Site which could have reached the
Plaintiffs in order to defeat summary judgment on some of the claims against
the Ballard Defendants. There is
sufficient circumstantial evidence in this record to do so. Plaintiffs have
raised questions concerning the Ballards’ maintenance
of the tanks, the large amount of soil contamination, the lack of other
potential sources of contamination, their delay in remediation, and their
action in removing the tank and soil, the sum of which are sufficient to raise
an issue of fact with respect to the source of contamination in Broad
Creek. See
{108} The disparity between proof required
to keep the Refiner Defendants in the case and that which keeps the Ballard
Defendants in the case seems at first appearance to be inconsistent. In a way
it is. The difference arises as a result
of the nature of the claims asserted. If
the only means of getting around the causation problem for Plaintiffs is
invoking the product liability statute, then the statutes of limitation and
repose become significant and impose on Plaintiffs the obligation to fit sale
of the allegedly defective product within the timeframe not barred by the
statutes. The statutes of repose clearly
create a situation in which a cause of action can be barred before the injury
occurs or becomes known. That is what
happens in this instance. If the 1987
leak had contained MTBE that did not show up in wells until 2000, the statute
of repose would still bar the product liability claims against the Refiner
Defendants. Because the different causes
of action asserted against the Ballard Defendants that are not based on
products liability do not carry the bar created by the statute of repose,
Plaintiffs do not have the same proof and pleading requirements to sustain
those causes of action. In summary,
there is evidence that the Ballard Site was the source of some contamination of
some wells in the Broad Creek Community, but there is no specific evidence of a
leak containing MTBE within the statutes of limitation and repose. If a cause of action for negligent design
against the Refiner Defendants does not accrue until contamination above
permitted levels, the statute of repose would be rendered meaningless. Since there are claims against the Ballard
Defendants based on causes of action other than products liability, Plaintiffs
do not have to meet the same requirements for specific evidence of the timing
of a release.
III.
NEGLIGENT
CONTAMINATION:
STANDARD
FOR LIABILITY
{109} Also at issue is which state drinking
water standards determine the standard for liability in negligent contamination
cases. As discussed above, the North
Carolina Administrative Code sets groundwater standards which represent the
“maximum allowable . . . concentrations [of contaminants] which may be
tolerated without causing a threat to human health or which would otherwise
render the groundwater unsuitable for its intended best usage.” 15A NCAC 02L .0202 (2006). The Eastern District of North Carolina,
applying
{110} Additionally, this Court finds it
significant that the statutory scheme requires remediation to achieve the
minimum standards. See supra ¶ 38. By
definition, concentration levels that do not reach the standard set by
{111} The maximum allowable concentration
of MTBE in
{112} Plaintiffs argue that the applicable
threshold for contamination is the taste and odor threshold and that it is
irrelevant that the threshold for a specific chemical listed in the regulations
is not met. The Court has a number of
problems with that approach. First, with
respect to the particular chemicals at issue here, the state regulations have
made a specific determination of the level of concentration that would render
the water unhealthy for use. In the case
of benzene, that is an especially low threshold, and one that is exceeded by
most of the wells in Broad Creek. The
statute would make little sense if the taste and odor threshold were to
override the specific maximum allowable concentration levels. If that were the case with specific
chemicals, the state would set the level that created contamination at the
taste and odor level where that level was less than the specific level designated.
{113} In the case of MTBE, for example,
that level would be set at 1.2 ppb according to Plaintiffs’ theory, because it
is at that level that taste and odor are affected. There are many chemicals that are not
specified in the regulations that could affect taste and odor. The state has elected to set specific limits
for certain chemicals, and the taste and odor threshold is a catch-all to cover
any chemicals that are not specified.
Under the canon lex specialis derogat
legi generali, when interpreting statutes or
regulations it is a general rule that where there are specific and general
terms, the specific overrules the general.
Piedmont Publ’g
Co. v. City of Winston-Salem, 334 N.C. 595, 598, 434 S.E.2d 176, 177-178
(1993). Applying the principle here requires
using the specific levels for MTBE and benzene.
{114} Second, the specific maximum
allowable concentration levels for MTBE and benzene form a bright line,
objective, and easily determinable test.
Taste and odor are fuzzy and subjective tests, not readily reducible to
a clear determination. Third, if taste
and odor had been an acceptable test, the Supreme Court would have adopted it
in Wilson v. McCleod
Oil. Justice Frye clearly opted for
the specific maximum allowable concentration levels in applying the statute of
limitations, holding that even in the face of taste and odor problems, the
statute did not begin to run until the testing showed a violation of state
regulations.
{115} State authorities responsible for
protecting the state’s water sources are in a better position than courts to
set and reset standards based on new scientific information and changing
standards of health. They have the expertise,
and their guidelines present bright-line objective determinants where specific
chemicals are involved rather than subjective and ambiguous tests such as taste
and odor.
{116} The use of taste and odor as a
threshold might be appropriate in some other situations. The claims here are based on specific
chemicals being contained in the water, and the
{117} It is clear from Appendix A that only
three wells—WCW-6, -8 & -11—exceeded the maximum allowable concentration
levels of MTBE, so only Plaintiffs using those three wells would have a claim
based upon MTBE contamination.
Therefore, only those families would have a claim against the Refiner
Defendants if such claims were not otherwise barred. The families who have used those wells
include: the Morton (
{118} Almost all of Plaintiffs’ wells had
benzene contamination above permitted levels.
Therefore, claims exist for negligent contamination of those wells, but
Refiner Defendants are not liable for those claims. Issues of fact remain to be decided as to
whether any of the Ballard Defendants would be liable for that
contamination. Only those plaintiffs
whose wells are in the Central District may proceed with their claims against
the Ballard Defendants.
{119} As a corollary, when a well owner
ceases to use her well as a result of perceived contamination from a particular
source, the statute of limitations should begin to run at that point. The Beall family
connected to the public water supply on October 2, 2000, a year before tests
indicated contamination levels in excess of state standards. (Aff. of Elizabeth Beall.) The Morton
family connected to the public water supply on November 3, 2000, a year before
tests discovered contamination levels in excess of state standards. (Aff. of Virginia
Morton.) Questions of fact remain as to
whether the Beall and Morton families were damaged by
contamination proximately caused by a release of gasoline from the Ballard
Site. The Lewis family connected to the
public water supply in January, 1992—eight years before tests indicated
contamination levels in excess of state standards. (Aff. of Margaret
Lewis.) The family maintains that it
continued using the well water for purposes other than for drinking until it
learned of the contamination.
IV.
CLAIMS
REMAINING AGAINST
INDIVIDUAL
BALLARD DEFENDANTS
{120} As noted above, A.J. Ballard, Jr. and
Joyce Ballard conveyed ownership of the property at the Ballard Site to Gary
Allen Ballard and Joyce Ballard, in her capacity as Trustee for Albert
Christopher Ballard, in 1984. See supra ¶ 59. There is no evidence Joyce Ballard has had
any dealings with the property in her individual capacity since that time. Therefore, no claims remain against her. Throughout the relevant time-period, the
property has been leased to Ballard Tire & Oil Co. There is not sufficient evidence to indicate
that Defendants Gary Allen Ballard, Albert Christopher Ballard, or Joyce
Ballard in her capacity as Trustee, exercised sufficient control over the
property for claims against them to remain. There is at least some evidence
A.J. Ballard, Jr. continued to exercise some control over the property. Therefore claims remain against A.J. Ballard,
Jr. and Ballard Tire & Oil for those plaintiffs whose wells were
contaminated above the maximum allowable concentration levels as discussed
above. See supra ¶¶ 109-119.
V.
Other Remaining Claims
{121} Finally, the Court must determine
whether Defendants are entitled to summary judgment as a matter of law with
respect to Plaintiffs’ res ipsa, fraud, nuisance and trespass, willful and wanton
negligence, and OPHSCA claims.
Res ipsa loquitor
{122} Plaintiffs have asserted a claim
against the Ballard Defendants under the doctrine of res ipsa loquitor. The doctrine of res ipsa loquitor
“permits negligence to be inferred from the physical cause of an accident,
without the aid of circumstances pointing to the responsible human cause” Harris
v. Tri-Arc Food Systems, Inc., 165 N.C. App. 495, 501, 598 S.E.2d 644, 648
(2004) (quoting Williams v. 100 Block Assoc.,
132 N.C. App. 655, 663, 513 S.E.2d 582, 587 (1999)). A plaintiff invoking res ipsa loquitor
must show: “(1) that there was an
injury, (2) that the occurrence causing the injury is one which ordinarily
doesn’t happen without negligence on someone’s part, (3) that the
instrumentality which caused the injury was under the exclusive control and
management of the defendant.”
{123} Plaintiffs have failed to provide
evidence that would show that the Ballard Defendants are the only possible tortfeasors. Also,
Plaintiffs have presented evidence of the cause of their injury. For both of these reasons, the doctrine of res ipsa loquitor is unavailable to the Plaintiffs in this case.
Fraud
{124} Plaintiffs base their fraud claim
against the Refiner Defendants on alleged misstatements and omissions that the
Refiner Defendants made while lobbying the government for approval of MTBE as
an additive to gasoline. These
statements are constitutionally protected “petitioning activity” shielded from
civil liability by the First Amendment right to petition to government and the
so-called Noerr-Pennington immunity doctrine. See
United Mine Workers of Am. v. Pennington, 381 U.S. 657, 671 (1965); Eastern R.R. Pres. Conf. v. Noerr Motor Freight, Inc., 365 U.S. 127, 144 (1961); see also Hamilton v. Accu-Tek,
935 F. Supp. 1307, 1321, 1324-25 (E.D.N.Y. 1996) (applying the Noerr-Pennington doctrine in the negligence
and product liability context), vacated &
remanded on other grounds sub nom. Hamilton
v. Beretta U.S.A., Inc., 264 F.3d 21 (2d Cir. 2001).
{125} Under the doctrine, actions against
businesses or individuals are prohibited where the activity that is being
challenged involves lobbying, “despite the defendant’s anticompetitive or
otherwise injurious purpose or effect.”
Nuisance & Trespass
{126} Plaintiffs have also brought claims
for nuisance and trespass. The nuisance
and trespass claims as to Defendants Ballard Tire & Oil and the estate of
A.J. Ballard Jr. survive summary judgment, but only those plaintiffs whose
wells are in the Central District may proceed with their claims. Nuisance and trespass claims against all
other defendants are dismissed. As
discussed above, in accordance with
Willful & Wanton Negligence
{127} Plaintiffs have also filed a claim
for willful and wanton negligence against the Ballard Defendants. Those claims survive only to the extent they
are based on the Ballard Defendants’ failure to remediate and only as to
Defendant Ballard Tire & Oil and the estate of A.J. Ballard. In all other aspects, Plaintiffs’ willful and
wanton negligence claims are dismissed.
OPHSCA
{128} Plaintiffs claim that the Ballard
Defendants are strictly liable under the Oil Pollution and Hazardous Substances
Control Act, N.C.G.S. § 143-215.93, et
seq. (“OPHSCA”). The OPHSCA holds
strictly liable “any person having control over oil or hazardous substances”
for “damages from oil and hazardous substances that enter the waters of the
State.” N.C.G.S. § 143-215.93. The OPHSCA claims as to Defendants Ballard Tire
& Oil and the estate of A.J. Ballard Jr. survive summary judgment, but only
those plaintiffs whose wells are in the Central District may proceed with their
claims. All other claims under the
OPHSCA are dismissed.
CONCLUSION
{129} In summary, the Court has concluded
that the Refiner Defendants are entitled to dismissal of the claims against
them on the grounds that: (1) refiners are not responsible for the intervening
negligence of tank owners/operators; (2) the statutes of repose and limitation
bar any claims arising out of the 1987 leak at the Ballard Site; (3) the 1987
leak at the Ballard Site did not involve gasoline with MTBE as a component; and
(4) there is no proof as to the Refiner Defendants that there was a leak at the
Ballard Site after 1996 that resulted in MTBE contamination of a plaintiff’s
well from a refiner’s product. In addition, there were only three wells which
showed levels of contamination by MTBE in excess of permitted levels.
Plaintiffs whose wells tested below 200 ppm of MTBE
do not have a claim for contamination against the Refiner Defendants.
{130} With respect to the Ballard
Defendants, the Court has concluded that there are genuine issues of material
fact which preclude summary judgment for Ballard Tire & Oil and the estate
of A.J. Ballard on the First, Third, Fourth, Fifth, Seventh, Eighth and Tenth
Causes of Action in the Second Amended Complaint. The Fourth Cause of Action is limited to
willful and wanton negligence arising out of the alleged failure to remediate,
and any claim for punitive damages would be limited to that claim. The Seventh and Eighth Causes of Action
remain based upon the existence of either sufficient evidence to show a
renewing trespass and nuisance or a leak or spill at the Ballard Site within
three years preceding the filing of the Complaint. The Second, Sixth and Ninth Causes of Action are
dismissed. The remaining claims survive
based on existing material issues of fact to be determined with respect to
whether (1) there was a leak or spill at the Ballard Site after 1996 that
caused contamination of some plaintiffs’ wells and (2) whether or not there was
a failure to remediate the 1987 spill that extended beyond three years prior to
the filing of the Complaint. Plaintiffs
will be required to prove that there was some incident at the Ballard Site other
than the 1987 leak which contaminated their wells or that a failure to
remediate the 1987 leak extending into the limitations period caused the
contamination of their wells.
{131} The Court has concluded that
liability for well water contamination caused by chemicals specifically
addressed in state regulations is dependent upon the existence of levels of
contamination in excess of maximum allowable concentration levels for those
chemicals under the regulations.
{132} The Court has concluded that for all
claims other than renewing trespass and nuisance, which may be ongoing, the
statute of limitations begins to run when there is actual notice, for example
from the published notice by DENR, or an actual test showing contamination at
levels above those permitted by the state.
In any event, where there has been notice, Plaintiffs’ damage claims are
limited to the three years prior to the filing of the complaint.
{133} There is no strict liability under
{134} The critical issue thus becomes
whether there was a leak or spill at the Ballard Site from 1997 forward which
impacted a plaintiff’s well water.
Nowhere in the record is there a definitive unconditional expert opinion
that a leak or spill occurred at the Ballard Site at any time from 1996 forward. Nor is there any direct evidence that a leak
or spill occurred. There is not even a
specific allegation that some incident occurred at some point in time from 1996
forward that caused a problem. There are
no reports to DENR of a leak or spill. The monitoring wells in place did not
indicate additional or new contamination. It is clear that the 1987 spill could
not have caused MTBE contamination.
{135} Plaintiffs rely on the fact that
there is benzene and other contamination in their wells and that there is no
other explanation or source for the contamination other than a problem at the
Ballard Site. They rely on the fact that
contaminated soil was present when the UST was removed from the Ballard Site in
2004. They also rely on evidence that
Ballard Tire & Oil and A. J. Ballard, Jr. were not prompt or diligent in remediating problems at the site. There is evidence of technical violations of
state regulations at the site. Whether
or not there were other potential sources for the contamination is disputed. If
the Court’s ruling on spoliation is upheld on appeal, Plaintiffs will be
entitled to a favorable charge on that basis.
Expert discovery is closed. Plaintiffs’ expert did not provide an
opinion with respect to leaks after 1997 which would get Plaintiffs to a
jury. He retracted his earlier opinion,
which he properly should have done if it was incorrect or unsupportable based
on the facts. Plaintiffs must convince a
jury based upon the factual evidence in the record that it is more likely than
not that a leak occurred at the Ballard Site from 1997 forward that
contaminated some of the wells in the Broad Creek Community and, specifically,
their own wells.
{136} Based upon the foregoing, it is
hereby ORDERED, ADJUDGED, and DECREED, that:
1) Plaintiffs’
claims against the Refiner Defendants are dismissed with prejudice.
2) Plaintiffs’
claims against Joyce Ballard, individually and as Trustee, Albert Christopher
Ballard, and Gary Allen Ballard are dismissed with prejudice.
3) The
Second, Sixth, and Ninth Causes of Action are dismissed with prejudice.
4) The Fourth
and Tenth Causes of Action are dismissed except as to the claims arising out of
failure to remediate.
5) Plaintiffs’
Motion for Summary Judgment is denied.
6) Defendants’
Motion to Exclude Expert Opinions not tendered in a timely manner as required
by the Case Management Order is GRANTED in the Court’s discretion.
7) The claims of
those plaintiffs using wells in the Eastern and Western Districts are
dismissed.
This,
the 30th day of June, 2006.
LINKS:
[1] The reliability of testing presents another
issue. However, as the Supreme Court
pointed out in
[2] Appendix A compiles the information included in Plaintiffs’ affidavits filed on April 20 and May 5, 2006 pursuant to the Court’s Order of March 7, 2006. The division of the wells into three geographical groups (East, Central, and West) is consistent with the divisions crafted by experts for both Plaintiffs and Defendants.
[3] The Refiner Defendants cite to the federal requirements as a complete defense to their use of MTBE.
[4] The legislation states:
No person shall knowingly add MTBE to any motor fuel manufactured, distributed, stored, sold, or offered for sale in this State. No person shall manufacture, distribute, store, sell, or offer for sale motor fuel that contains a concentration of MTBE of more than one-half of one percent (0.5%) by volume in this State. The presence of MTBE in a motor fuel caused solely by incidental commingling of the motor fuel with other motor fuel that contains MTBE during transfer or storage of the motor fuel does not constitute a violation of this section.
2005 N.C. Sess. Laws 93. That aspect of the legislation becomes effective on January 1, 2008.
[5] The regulations define ‘free product’ as “a regulated substance that is present as a non-aqueous phase liquid (e.g., liquid not dissolved in water).” 15A NCAC 2N .0203 (adopting 40 CFR § 280.12 by reference).
[6]
[7] If naturally occurring substances exceed the specified standard, the standard is “the naturally occurring concentration as determined by the Director.” 15A NCAC 02L .0202(b)(3).
If two or more contaminants exist in combination, the Director of the Division of Environmental Management (“Director”) must consider “the effects of chemical interactions” and may specify maximum concentrations at amounts lower than those specifically set by the Rule. 15A NCAC 02L .0202(b)(2). If no concentration level is specified for a given substance by the Rule and if that substance is not naturally occurring, as a general rule that substance is not permitted at all in detectable concentrations in either Class GA or Class GSA groundwaters. 15A NCAC 02L .0202(c).
[8] Other common sources of MTBE contamination include “the discharge of unburned fuels from water craft; gasoline spills from automobile and truck accidents; gasoline spills and drips when refueling automobiles and other machines; plus leaks from pipelines and aboveground storage tanks.” Pollution of Underground Water Sources—Common Law Liability and Private Rights of Action, 94 Am. Jur. Trials 1 § 103.
[9] In the report, GMA noted that its opinions as to the likelihood that the Ballard Site is the source of the Broad Creek contamination needed to be “better qualified and quantified.” Plaintiffs did identify this report as an expert report upon which they would rely—perhaps because of the qualifications.
[10] The Morton family includes Plaintiffs Virginia Morton, Deanna Echtmann, Linda Barnett, Samantah Barnett, Chris Barnett, and Megan Willis. The Lewis family includes Plaintiffs Margaret Lewis, Albert Lewis, and Christel Geier. The Beall family includes Plaintiffs Elizabeth Beall, Natahn Golden, and Amber Engleby. The Defeo family includes Plaintiffs Jennifer Defeo, Frederick Defeo, and David Defeo.
[11] Additionally, the Court of Appeals reasoned that the “ultimate and intended use” of the EIFS was realized upon the application of the material to the house exterior. Therefore, when the EIFS was sold to the subcontractor who applied the material, the statute of repose began to run. The ultimate and intended use of the gasoline was to be sold and used by consumers. Therefore, the statute of repose began to run when the product was sold to the First Stop proprietors who intended to sell the gasoline to consumers.
[12] The Court notes here that a specific schedule for disclosure of expert opinions had been set by the Court in order to avoid surprise and shifting expert opinions. Plaintiffs were required by the Case Management Order to identify their experts and the expert opinions upon which they would rely so that defendants could prepare and disclose to Plaintiffs any rebuttal expert opinions. This phase of discovery was specifically intended to produce all the evidence, expert or otherwise, with respect to when and how Plaintiffs’ well water supplies had been impacted. See Case Management Order (June 10, 2004).
[13] According to
the Complaint and the evidence compiled by Plaintiffs thus far, the only
alleged incidents involving the Ballard Defendants giving rise to a leak or
spill are the August 1987 release, which resulted from a leaking flange that
was quickly repaired, and the release of approximately 5.6 gallons of gasoline
that was discovered by Chris Ballard in November 1990. See
supra at ¶¶ 42-49. (Compl. ¶¶ 127-137.)
No specific incidents subsequent to these have been alleged.
[14] Regardless of the outcome of the Court’s ruling on the Ballard Defendants motion in limine, there are material issues of fact to be determined by a jury with respect to whether a leak at the Ballard Site is the cause of contamination of Plaintiffs’ wells, whether the leak, if any, has caused a continuing trespass, and when a leak, if any, occurred. Neither side is entitled to summary judgment on those issues. See supra ¶¶ 42-58 (setting out the parties’ respective positions and evidence).
[15] The Court notes with some amazement that although DENR had a long running feud with Mr. Ballard and had taken the public position that the Ballard Site was a source of well contamination and that there were monitoring wells on site, the DENR representatives present apparently took no pictures or notes and prepared no report with respect to the tank removal or the soil conditions around the tank.