N.Y. NAV Law § 181 — New York Code / Act NAV / Article 12 / Part 3 / Section 181
Liability
Status: in_force

§ 181. Liability. 1. Any person who has discharged petroleum shall be\nstrictly liable, without regard to fault, for all cleanup and removal\ncosts and all direct and indirect damages, no matter by whom sustained,\nas defined in this section. In addition to cleanup and removal costs and\ndamages, any such person who is notified of such release and who did not\nundertake relocation of persons residing in the area of the discharge in\naccordance with paragraph (c) of subdivision seven of section one\nhundred seventy-six of this article, shall be liable to the fund for an\namount equal to two times the actual and necessary expense incurred by\nthe fund for such relocation pursuant to section one hundred\nseventy-seven-a of this article.\n  2. The fund shall be strictly liable, without regard to fault, for all\ncleanup and removal costs and all direct and indirect damages, no matter\nby whom sustained, including, but not limited to:\n  (a) The cost of restoring, repairing, or replacing any real or\npersonal property damaged or destroyed by a discharge, any income lost\nfrom the time such property is damaged to the time such property is\nrestored, repaired or replaced, any reduction in value of such property\ncaused by such discharge by comparison with its value prior thereto;\n  (b) The cost of restoration and replacement, where possible, of any\nnatural resource damaged or destroyed by a discharge;\n  (c) Loss of income or impairment of earning capacity due to damage to\nreal or personal property, including natural resources destroyed or\ndamaged by a discharge; provided that such loss or impairment exceeds\nten percent of the amount which claimant derives, based upon income or\nbusiness records, exclusive of other sources of income, from activities\nrelated to the particular real or personal property or natural resources\ndamaged or destroyed by such discharge during the week, month or year\nfor which the claim is filed;\n  (d) Loss of tax revenue by the state or local governments for a period\nof one year due to damage to real or personal property proximately\nresulting from a discharge;\n  (e) Interest on loans obtained or other obligations incurred by a\nclaimant for the purpose of ameliorating the adverse effects of a\ndischarge pending the payment of a claim in full as provided by this\narticle.\n  3. (a) The owner or operator of a major facility or vessel which has\ndischarged petroleum shall be strictly liable, without regard to fault,\nsubject to the defenses enumerated in subdivision four of this section,\nfor all cleanup and removal costs and all direct and indirect damages\npaid by the fund. However, the cleanup and removal costs and direct and\nindirect damages which may be recovered by the fund with respect to each\nincident shall not exceed:\n  (i) for a tank vessel, the greater of:\n  (1) one thousand two hundred dollars per gross ton; or\n  (2) (A) in the case of a vessel greater than three thousand gross\ntons, ten million dollars; or\n  (B) in the case of a vessel or three thousand gross tons or less, two\nmillion dollars;\n  (ii) for any other vessel subject to the liability limits set forth in\nthe Federal Oil Pollution Act of 1990 (33 U.S.C. 2701 et seq.), six\nhundred dollars per gross ton or five hundred thousand dollars,\nwhichever is greater;\n  (iii) for any other vessel not subject to the liability limits set\nforth in the Federal Oil Pollution Act of 1990 (33 U.S.C. 2701 et seq.),\nthree hundred dollars per gross ton for each vessel;\n  (iv) for a major facility that is defined as an "onshore facility" and\ncovered by the liability limits established under the Federal Oil\nPollution Act of 1990 (33 U.S.C. 2701 et seq.), three hundred fifty\nmillion dollars. This liability limit shall not be considered to\nincrease the liability above the federal limit of three hundred fifty\nmillion dollars per incident.\n  (v) for a major facility not covered in subparagraph (iv) of this\nparagraph, fifty million dollars.\n  (b) The liability limits established in subparagraphs (i) and (ii) of\nparagraph (a) of this subdivision shall not be considered to increase\nliability above the federal limits for tank vessels or vessels as\ndefined in the Federal Oil Pollution Act of 1990 (33 U.S.C. 2701 et\nseq.).\n  (c) (i) The department shall establish, by regulation, a limit of\nliability under this subdivision of less than three hundred fifty\nmillion dollars but not less than eight million dollars, for major\nfacilities defined as "onshore facilities" under the Federal Oil\nPollution Act of 1990 (33 U.S.C. 2701 et seq.), taking into account\nfacility size, storage capacity, throughput, proximity to\nenvironmentally sensitive areas, type of petroleum handled, and other\nfactors relevant to risks posed by the class or category of facility.\n  (ii) The department shall establish, by regulation, a limit of\nliability under this subdivision of fifty million dollars or less for\nmajor facilities other than vessels that are not defined as "onshore\nfacilities" under the Federal Oil Pollution Act of 1990 (33 U.S.C. 2701\net seq.), taking into account facility size, storage capacity,\nthroughput, proximity to environmentally sensitive areas, type of\npetroleum handled, and other factors relevant to risks posed by the\nclass or category of facility.\n  (d) The provisions of paragraph (a) of this subdivision shall not\napply and the owner or operator shall be liable for the full amount of\ncleanup and removal costs and damages if it can be shown that the\ndischarge was the result of (i) gross negligence or willful misconduct,\nwithin the knowledge and privity of the owner, operator or person in\ncharge, or (ii) a gross or willful violation of applicable safety,\nconstruction or operating standards or regulations. In addition, the\nprovisions of paragraph (a) of this subdivision shall not apply if the\nowner or operator fails or refuses:\n  (1) to report the discharge as required by section one hundred\nseventy-five of this article and the owner or operator knows or had\nreason to know of the discharge; or\n  (2) to provide all reasonable cooperation and assistance requested by\nthe federal on-scene coordinator or the commissioner or his designee in\nconnection with cleanup and removal activities.\n  (e) (i) The owner or operator of a vessel shall establish and maintain\nwith the department evidence of financial responsibility sufficient to\nmeet the amount of liability established pursuant to paragraph (a) of\nthis subdivision. The owner or operator of any vessel which demonstrates\nfinancial responsibility pursuant to the requirements of the Federal Oil\nPollution Act of 1990 (33 U.S.C. 2701 et seq.), shall be deemed to have\ndemonstrated financial responsibility in accordance with this paragraph.\n  (ii) The commissioner in consultation with the superintendent of\nfinancial services may promulgate regulations requiring the owner or\noperator of a major facility other than a vessel to establish and\nmaintain evidence of financial responsibility in an amount not to exceed\ntwenty-five dollars, per incident, for each barrel of total petroleum\nstorage capacity at the facility, subject to a maximum of one million\ndollars per incident per facility in an aggregate not to exceed two\nmillion dollars per facility per year; provided, however, that if the\nowner or operator establishes to the satisfaction of the commissioner\nthat a lesser amount will be sufficient to protect the environment and\npublic health, safety and welfare, the commissioner shall accept\nevidence of financial responsibility in such lesser amount. In\ndetermining the sufficiency of the amount of financial responsibility\nrequired under this section, the commissioner and the superintendent of\nfinancial services shall take into consideration facility size, storage\ncapacity, throughput, proximity to environmentally sensitive areas, type\nof petroleum handled, and other factors relevant to the risks posed by\nthe class or category of facility, as well as the availability and\naffordability of pollution liability insurance. Any regulations\npromulgated pursuant to this subparagraph shall not take effect until\nforty-eight months after the effective date of this section.\n  (iii) Financial responsibility under this paragraph may be established\nby any one or a combination of the following methods acceptable to the\ncommissioner in consultation with the superintendent of financial\nservices: evidence of insurance, surety bonds, guarantee, letter of\ncredit, qualification as a self-insurer, or other evidence of financial\nresponsibility, including certifications which qualify under the Federal\nOil Pollution Act of 1990 (33 U.S.C. 2701 et seq.).\n  (iv) The liability of a third-party insurer providing proof of\nfinancial responsibility on behalf of a person required to establish and\nmaintain evidence of financial responsibility under this section is\nlimited to the type of risk assumed and the amount of coverage specified\nin the proof of financial responsibility furnished to and approved by\nthe department. For the purposes of this section, the term "third-party\ninsurer" means a third-party insurer, surety, guarantor, person\nfurnishing a letter of credit, or other group or person providing proof\nof financial responsibility on behalf of another person; it does not\ninclude the person required to establish and maintain evidence of such\nfinancial responsibility.\n  4. (a) The only defenses that may be raised by a person responsible\nfor a discharge of petroleum are: an act or omission caused solely by\n(i) war, sabotage, or governmental negligence or (ii) an act or omission\nof a third party other than an employee or agent of the person\nresponsible, or a third party whose act or omission occurs in connection\nwith a contractual relationship with the person responsible, if the\nperson responsible establishes by a preponderance of the evidence that\nthe person responsible (a) exercised due care with respect to the\npetroleum concerned, taking into consideration the characteristics of\npetroleum and in light of all relevant facts and circumstances; and (b)\ntook precautions against the acts or omissions of any such third party\nand the consequences of those acts or omissions. These defenses shall\nnot apply to a person responsible who refuses or fails to (a) report the\ndischarge, or (b) provide all reasonable cooperation and assistance in\ncleanup and removal activities undertaken on behalf of the fund by the\ndepartment. In any case where a person responsible for a discharge\nestablishes by a preponderance of the evidence that a discharge and the\nresulting cleanup and removal costs were caused solely by an act or\nomission of one or more third parties as described above, the third\nparty or parties shall be treated as the person or persons responsible\nfor the purposes of determining liability under this article.\n  (b) Nothing set forth in this subdivision shall be construed to hold a\nlender liable to the state as a person responsible for the discharge of\npetroleum at a site in the event: (i) such lender, without participating\nin the management of such site, holds indicia of ownership primarily to\nprotect the lender's security interest in the site, or (ii) such lender\ndid not participate in the management of such site prior to a\nforeclosure, and such lender:\n  (1) forecloses on such site; and\n  (2) after foreclosure, sells, re-leases (in the case of a lease\nfinance transaction), or liquidates such site, maintains business\nactivities, winds up operations, or takes any other measure to preserve,\nprotect or prepare such site for sale or disposition; provided however,\nthat such lender shall take actions to sell, re-lease (in the case of a\nlease finance transaction), or otherwise divest itself of such site at\nthe earliest practicable, commercially reasonable time, on commercially\nreasonable terms, taking into account market conditions and legal and\nregulatory requirements.\n  (c) This exemption shall not apply to any lender that has (i) caused\nor contributed to the discharge of petroleum from or at the site, (ii)\npurchased, sold, refined, transported, or discharged petroleum from or\nat such site, or (iii) caused the purchase, sale, refinement,\ntransportation, or discharge of petroleum from or at such site.\n  The terms "participating in management," "foreclosure," "lender" and\n"security interest" shall have the same meaning as those terms are\ndefined in paragraph (c) of subdivision one of section 27-1323 of the\nenvironmental conservation law.\n  5. Any claim by any injured person for the costs of cleanup and\nremoval and direct and indirect damages based on the strict liability\nimposed by this section may be brought directly against the person who\nhas discharged the petroleum, provided, however, that damages recover-\nable by any injured person in such a direct claim based on the strict\nliability imposed by this section shall be limited to the damages\nauthorized by this section.\n  6. Notwithstanding any other provision of this section, a volunteer\nfirefighter, volunteer fire company, volunteer fire district, volunteer\nfire protection district, or volunteer fire department shall not be\nstrictly liable for discharged petroleum when such discharge results\nfrom such volunteer firefighter, volunteer fire company, volunteer fire\ndistrict, volunteer fire protection district, or volunteer fire\ndepartment performing his, her, or their firefighting duties and there\nis not a showing of willful or gross negligence. This subdivision shall\nnot be construed to provide an exemption from liability for a discharge\nof petroleum on or from real or personal property owned, leased, or\noperated by any such volunteer fire company, volunteer fire district,\nvolunteer fire protection district, or volunteer fire department.\n