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Purchaser of a Hazardous Waste Treatment, Storage or Disposal Facility Was Not Required to Provide Financial Assurance for the Ongoing Performance of Corrective Action Imposed Upon the Prior Owner

The Third Department, reversing the Department of Environmental Conservation Commissioners ruling below on an issue of first impression, determined the subsequent owner of property formerly used as a permitted hazardous waste treatment, storage or disposal (TSD) facility was not required to provide financial assurance for the ongoing performance of corrective action imposed upon the prior owner.  The decision includes an exhaustive analysis of all the relevant statutes and regulations:

In essence, respondents seek to impose strict liability to provide financial assurance, in perpetuity, on all subsequent owners of property on which a former TSD facility was operated. Had this been the Legislature’s intent, rather than relegate us to a strained analysis of multiple regulations in order to reach that conclusion, it would have done so expressly. Indeed, the Legislature did exactly that in the context of New York’s “Superfund Law,” which requires the owner of an inactive hazardous waste disposal site, and/or any person responsible for the disposal of hazardous wastes at such site, to take remedial action … . Other examples of New York statutes imposing “strict liability” on property owners are the Oil Spill Act (see Navigation Law § 181 [1]) and the Scaffold Law (see Labor Law § 240 [1]). Thus, there can be no doubt that, if the Legislature had intended to impose liability on landowners for providing financial assurance under New York’s version of RCRA —[Resource Conservation and Recovery Act] without regard to whether they had ever operated a TSD facility on the property in question — clear language to that effect could easily have found its place in the statute and regulations. While such a result would not be inconsistent with the laudatory environmental purposes of this regulatory scheme, absent such language, we discern no legal basis for the Commissioner to create such a requirement. To the extent that the Commissioner interpreted the regulations otherwise, such interpretation was arbitrary and capricious and affected by an error of law and we, therefore, annul his determination, as well as the penalties imposed on petitioners.  Matter of Thompson Corners LLC v New York State Dept of Envtl Conservation, 2014 NY Slip Op 03556, 3rd Dept 5-15-14

 

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