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The Term “Release” (Re Hazardous Substances) Did Not Apply to Migration of Hazardous Substance to Neighbor’s Property Underground​

The Third Department determined there were two equally plausible interpretations of the term “sellers” as used in the contract, rendering the contract ambiguous.  Therefore, the motion to dismiss the complaint prior to discovery was properly denied. In addition, the Third Department determined that the term “release” (re: hazardous substances) did not extend to the migration of hazardous substances to neighboring properties under ground:

…[The provision] requires  indemnification  for environmental  claims  related  to, among other things, a “Release” of hazardous substances “at locations other than [500 Beech].” “Release”  is defined  to include  “any  spilling, leaking, pumping,  pouring,  emitting, emptying, discharging, injecting, dumping  or disposing of any Hazardous  Material  into  the  environment.” In its Canadian action, the neighbor alleged that contaminants – which would be classified as “Hazardous Materials” under the agreement – in the ground  at 500 Beech migrated into the soil and  groundwater at 606 Beech. There is no allegation that hazardous substances were spilled, leaked or otherwise disposed of directly onto the property at 606 Beech. Rather, the allegation is that the flow of underground water carried those substances from 500 Beech, where they had been spilled or leaked, to the neighboring property. Although the hazardous substances eventually wound up at 606 Beech, there is no support for an allegation that the “Release” of those substances occurred at a location other than 500 Beech. Vectron International, Inc, v Corning Oak Holding, Inc, 515408, 3rd Dept, 5-2-13

 

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