3

CLAIM SUMMARY / DETERMINATION 

Claim Number: E14431-0001

Claimant: Environmental Remediation Consultants, Inc.

Type of Claimant: OSRO

Type of Claim: Removal Costs

Claim Manager: 

Amount Requested: $305,466.53

Action Taken: Denied

I. FACTS:

A. The Incident

At approximately 1515 hours on February 14, 2014, a representative from APAC-Atlantic, 

Inc. d/b/a Harrison Construction Company (APAC) contacted the National Response Center

(NRC) to report a discharge of No. 2 fuel oil from a 20,000-gallon above ground storage tank 

(AST) located in Candler, North Carolina.1 Approximately 5,000 gallons of diesel spilled onto 

the ground and some reached Hominy Creek.2 Hominy Creek is a tributary to the French Broad 

River, a navigable water of the U.S. The U.S. Environmental Protection Agency Region IV was 

the Federal On-Scene Coordinator (FOSC).3

The record indicates that, at the time of the incident, APAC identified itself as the 

responsible party (RP) on the day of the spill, February 14, 2014.4 APAC owned and operated 

the AST5and is the responsible party (RP) as defined by the Oil Pollution Act of 1990.6

According to its website, APAC operates the Enka Asphalt Plant at the site in Candler, North 

Carolina.7 

APAC contracted with ERC to conduct removal actions. According to the documents 

submitted to the NPFC the Contract, executed on February 14, 2015, included ERC’s Time and 

Materials Rate Schedule and a Reimbursement Terms and Conditions for Time and Materials 

Contract. Pursuant to the Contract ERC began invoicing APAC on April 23, 2014. The initial 

invoice sought $140,530.31 for services provided.

8

 ERC continued invoicing the RP regularly 

through September 1, 2018, adding compound interest to each progressive invoice, finally 

totaling $305,446.53 with $164,936.22 being accrued interest.

9 ERC presented the final total of 

its uncompensated removal costs to the RP on September 1, 2018.

 

1 EPA POLREP #1

2 EPA POLREP #1

3 EPA POLREP #1

4 EPA POLREP #1 and NRC report.

5 NC UST Form 62, 24-Hour Notification of Discharge Form p.2; and February 25, 2014 NCDENR Notice of 

Violation Letter to Harrison APAC-Atlantic, Inc.

6 33 U.S.C. § 2701(32). 

7 https://harrisoncc.com/locations/

8

Invoice #20140215

9 September 1, 2018, ERC letter with Invoice #20180901
4

B. Claim to the Fund

When APAC failed to pay the ERC invoices,10 ERC presented its uncompensated removal 

cost claim for $305,466.53 to the Fund. The National Pollution Funds Center (NPFC)

administers the Fund.

11 The ninety-day presentment period for the final invoice was satisfied on 

December 1, 2018. 

According to NPFC procedures, the NPFC sent a letter to APAC, notifying it that the Fund 

received a claim from ERC. In a response letter dated February 16, 2019, , 

Environmental Compliance for Harrison,12 acknowledged that it had contracted with ERC to 

conduct removal actions, but ERC failed to provide supporting documentation for the invoices. 

NPFC initially reviewed the claim and via email and letter dated October 23, 2018, NPFC 

communicated to ERC that arbitration provisions in its Contract may affect its Claim to the Fund 

because the provisions of the Oil Pollution Act of 1990, 33 U.S.C. § 2701 et seq. (OPA) require 

that “all” of a claimant’s rights be subrogated to the U.S. Government. In a reponse letter dated 

November 16, 2018, ERC argued that OPA’s requirements that the U.S. Government acquire “all 

rights of the claimant” means all rights that the claimant has, but not all rights that a claimant 

could possibly have or rights he doesn’t have.13 Further, ERC argues that it did not waive its 

right to sue in its contract, simply agreeing that it has a right to arbitration. Thus, ERC argues 

that the NPFC is subrogated to ERC’s rights under the contract, including arbitration. 

II. DETERMINATION PROCESS:

The NPFC utilizes an informal process when adjudicating claims against the Oil Spill 

Liability Trust Fund (OSLTF).

14

 As a result, 5 U.S.C. § 555 (e) requires the NPFC to provide a 

brief statement explaining its determinations. This determination is issued to satisfy that 

requirement for the Claimant’s claim against the OSLTF.

When adjudicating claims against the OSLTF, the NPFC acts as the finder of fact. In this 

role, the NPFC considers all relevant evidence, including evidence provided by claimants and 

evidence obtained independently by the NPFC, and weighs its probative value when determining 

the facts of the claim.15 The NPFC may rely upon, is not bound by the findings of fact, opinions, 

or conclusions reached by other entities. If there is conflicting evidence in the record, the NPFC 

makes a determination as to what evidence is more credible or deserves greater weight, and finds 

facts and makes its determination based on the preponderance of the credible evidence.

III. DISCUSSION:

OPA provides that a responsible party is liable for all removal costs and damages resulting 

from either an oil discharge or a substantial threat of oil discharge into a navigable water of the 

 

10 33 CFR 136.103(c). 

11 ERC optional OSLTF claim form dated September 20, 2018 and received by the NPFC on October 4, 2018.

12 See letter. Harrison is a Division of APAC-Atlantic.

13 ERC’s November 16, 2018 letter, p. 1

14 33 CFR Part 136.

15 See, e.g., Boquet Oyster House, Inc. v. United States, 74 ERC 2004, 2011 WL 5187292, (E.D. La. 2011), “[T]he 

Fifth Circuit specifically recognized that an agency has discretion to credit one expert's report over another when 

experts express conflicting views.” citing Medina County v. Surface Transp. Bd., 602 F.3d 687, 699 (5th Cir. 2010).
5

United States.16 A responsible party’s liability is strict, joint, and several.17 In this case APAC 

admits that it is the responsible party for the discharge of oil from its facility and was liable for 

the removal costs incurred. It contracted with ERC to conduct the removal actions. 

OPA provides that the Fund is available to pay uncompensated removal costs consistent with 

the National Contingency Plan (NCP) and uncompensated damages. 33 U.S.C. § 2712(a)(4). 

Thus, a party that incurred removal costs that were not paid by an RP may present a claim to the 

Fund if it meets the requirements of the OPA. In this case ERC presented a claim to the Fund for 

its uncompensated removal costs, $140,530.31. Because the RP did not pay the invoice ERC 

included its interest charges in its claim for reimbursement, totaling $305,466.53. 

A specific requirement pertinent to this claim is that the Government must acquire by 

subrogation all rights of the claimant in order that it can recover from the responsible party. OPA 

provides that: 

Payment of any claim or obligation by the Fund under this Act shall be subject to 

the United States Government acquiring by subrogation all rights of the claimant 

or State to recover from the responsible party.18 Any person, including the Fund, 

who pays compensation pursuant to this Act to any claimant for removal costs or 

damages shall be subrogated to all rights, claims, and causes of action that the 

claimant has under any other law.19

Thus, if claimant has not reserved all its rights, the NPFC cannot adjudicate and pay the claim 

because payment of the claim is subject to the United States Government acquiring by subrogation 

all rights of the claimant to recover from the responsible party. Kenan Transp.Co. v. U.S. Coast 

Guard, 2006 WL 1455658 *4 (N.D. Ga.) (What the statute requires to be preserved is broad. 

Section 2712(f) requires a claimant to insure that the Government acquires all rights of the claimant 

to recover from the responsible party. Reimbursement is allowed only if claims are preserved so 

they may be asserted by the Government as subrogee of the claims.) Further, if the Fund pays 

compensation under OPA to any claimant it shall be subrogated to all rights, claims and causes of 

actions that the claimant has under any other law. Rich Franklin Corp. v. U.S. Department of 

Homeland Security, 2008 WL 337978 (D.Or.) (The plain language of Section 2712(f) uses the 

words “all rights” when describing what subrogation rights will be acquired by the government 

when a claimant is compensated by the Fund.) 20

Stated another way, if the Fund pays compensation under OPA to any claimant it shall be 

subrogated to all rights, claims, and causes of actions the claimant has under any other law.21 In 

 

16 33 U.S.C. § 2702(a). 

17 See, H.R. Rep. No. 101-653, at 102 (1990), reprinted in 1990 U.S.C.C.A.N. 779, 780.

18 33 U.S.C. § 2712(f).

19 33 U.S.C. § 2715(a).

20 Kenan Transp. Co. v. U.S. Coast Guard, 2006 WL 1455658 at *4 (N.D. Ga 2006). That Congress required 

a claimant to preserve all rights... is clear in the legislative history. The Senate bill had proposed that the Fund 

“acquire by subrogation the rights of claimants to which the Fund paid removal costs or damages and 

to recover those removal costs or damages from the responsible party.” The House bill proposed that reimbursement 

be conditioned on the Government “acquiring by subrogation all rights of the claimant or State to recover from 

the responsible party.” H.R. Court. Rep. No. 101-653, at 115-16 (1990), reprinted in 1990 U.S.C.C.A.N. 779, 795. 

The conference rejected the Senate limitation to clean-up costs and damages and adopted, instead, the “all rights” 

version. Id. at *8 n.7.

21 33 U.S.C. § 2715(a).
6

this case the issue is whether the claimant has retained all its rights in light of the arbitration 

clause in the contract. 

Claimant’s contract

ERC provided a copy of its Form 2013-1 Time and Materials Rate Schedule, which was 

signed on February 15, 2014, by , Environmental Health and Safety Manager at 

APAC. Included with the rate schedule is a Reimbursement Terms and Conditions for Time and 

Materials Contracts document. Provision 9 includes the following paragraphs:

“All claims, disputes, and other matters in question arising out of, or relating to, this 

Contract or any subcontract made or purchase order issued pursuant to the Contract, or 

the breach thereof, shall be decided by arbitration in accordance with the Construction 

Industry Arbitration Rules of the American Arbitration Association that are in effect as 

of the time demand for arbitration is made.” 

“Notice of demand for arbitration shall be filed in writing with the American 

Arbitration Association and upon all proposed parties to such proceeding, and shall be 

filed within a reasonable time after the claim, dispute, or other matter in question has 

arisen, but in no event shall be made after the date when institution of legal or 

equitable proceedings base on such claim, dispute or other matter will be barred by the 

applicable statute of limitations. Any arbitration proceeding will be conducted in 

Sevierville, Seviert County, Tennessee. The arbitration hearings will begin within 180 

days of the date the demand for arbitration is served and continue on successive 

business days until completed. The prevailing party shall be entitled to recover not 

only attorney fees, but also the costs of the arbitration proceedings, including the fee 

paid to the American Arbitration Association and the arbitrators, witness, fees, and the 

cost of preparing demonstrative exhibits.”

Claimant argues that it has not waived its right to sue under the contract, including a right to 

arbitration. Thus, Claimant argues that if the Fund pays the claim the U.S. government acquires 

the rights to arbitrate. 

The terms of the Contract are clear that arbitration will decide the differences between the 

parties. The provisions state that the differences of the parties shall be decided by arbitration. 

The prevailing party shall be entitled to recover not only attorney fees, but also the cost of the 

arbitration proceedings, including fees paid to the arbitrator, witness fees and the costs of 

demonstrative exhibits.22 Thus, it is clear that ERC cannot sue APAC in court, including a suit 

for liability under OPA, because the issues will be decided by arbitration. If ERC has no rights it 

can take to court, it appears that it has no rights to sue in court that it can subrogate to the United 

States. At best it is unclear that ERC has any subrogable rights under the terms of the Contract 

under OPA; therefore, it has not established that it has met the requirements of 33 U.S.C. § 

2712(f). 

 

22 ERC, Reimbursement Terms and Conditions for Time and Materials Contracts, Paragraph 9, Terms of Payment