Joint and Several Liability under CERCLA

Background

Section 107(a) of the Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA") allows any person expending money to cleanup environmental damage to recover those costs from four categories of entities: (1) current owners, (2) past owners, (3) arrangers and (4) transporters. Whether CERCLA liability was intended to be joint and several, or several only, has been the source of considerable debate. The House bill drafted to create CERCLA allowed a court to impose joint and several liability. The Senate bill, required the imposition of joint and several liability. Ultimately the joint and several liability language was deleted from the final legislation in order to secure passage. As a result, CERCLA simply specifies that the four categories of persons "shall be liable" for response costs. The scope of that liability was not spelled out and left to the courts to decide.

The Chem-Dyne Decision

The first case to address the scope of CERCLA liability was U.S. v. Chem-Dyne Corp., decided three years after CERCLA was enacted. The Chem-Dyne court concluded Congress deleted joint and several liability to avoid inequitable results, and did not intend to prevent its imposition in all instances. It further determined Section 107 called for a uniform rule of decision on the scope of liability and relied on the Restatement (Second) of Torts to establish the scope of liability. The rule that emerged from Chem-Dyne was that liability under CERCLA Section 107 is joint and several unless a defendant can prove that the environmental injury is divisible and a reasonable basis exists for apportioning the harm. The burden of establishing divisibility and that a reasonable basis for apportionment rests with the defendant. Congress amended CERCLA in 1986 by passing the Superfund Amendments and Reauthorization Act ("SARA"). SARA added two provisions designed to mitigate the harshness of joint and several liability: (1) the right of contribution and (2) de minimis settlements. SARA has been viewed as a congressional endorsement of the pre-SARA law. Since then it has been consistently held that liability under Section 107(a) of CERCLA is joint and several, unless a defendant can prove that the environmental injury is divisible and there is a reasonable basis for apportioning the harm.

Divisibility

Once the scope of liability was decided, the Chem-Dyne court addressed the standard for divisibility. It concluded that in multi-party disposal sites, volumetric contributions alone do not provide a basis for divisibility, and the defendant must provide other evidence to support apportionment. Courts following Chem-Dyne’s lead found that where wastes of varying degrees of toxicity and migratory potential have commingled it is not possible to establish divisibility. Chem-Dyne established a high standard for defendants involved at multi-party waste sites to establish divisibility and thereby defeat joint and several liability.

The BNSF Case

Given the standard established in Chem-Dyne, there were very few instances in which defendants involved at multi-party waste sites established divisibility. That changed with the Burlington Northern and Santa Fe Railway Co. v. United States (BNSF) decision in 2009. There the U.S. Supreme Court agreed with the trial court’s decision that because BNSF only owned a portion of the contaminated property, its liability could be reasonably apportioned. The Supreme Court ruled that evidence supporting apportionment need not be precise—and that there only need to be "facts contained in the record reasonably support[ing] the apportionment of liability." Most agree BNSF establishes a lower standard for divisibility. However, there are too few decided cases to draw firm conclusions regarding the quantum of proof necessary to establish a divisibility defense.

The Future

The application of joint and several liability to claims brought under § 107(a) for the present appears settled. However, the Supreme Court has not directly addressed the issue. In 2007, Justice Thomas in U.S. v. Atlantic Research Corp. stated "[w]e assume without deciding that § 107(a) provides for joint and several liability.” The Supreme Court and many other judicial bodies have repeatedly stated that if Congress has deleted a proposal for a particular rule or remedy, and did so as a part of a legislative compromise, that deletion should be recognized and given effect by the courts. So far this rule of statutory construction has been disregarded. Time will tell if the application of joint and several liability in § 107(a) cost recovery actions will be directly addressed by the Supreme Court.

Authored by:

Ron Ricketts

Ronald N. Ricketts
Environmental Law
Shareholder
Tulsa
918.595.4842
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