Opinion ID: 706842
Heading Depth: 3
Heading Rank: 3

Heading: The Liability of A.C. Realty As a Joint Venturer With ADS

Text: 72 Transporter liability under Sec. 107(a)(4) is imposed on a covered person, which CERCLA defines as including a joint venture. 42 U.S.C.A. Sec. 9601(21) (1995). Each member of a joint venture is considered the agent of the others, so that the act of any member within the scope of the enterprise is charged vicariously against the rest. Pritchett v. Kimberling Cove, Inc., 568 F.2d 570, 579-80 (8th Cir.1977), cert. denied, 436 U.S. 922, 98 S.Ct. 2274, 56 L.Ed.2d 765 (1978). As noted above, the district court held that, as a matter of law, ADS, A.C. Realty, ESWECO, and A.C. Enterprises operated as a joint venture with regard to the waste disposal at the Tabernacle Site. 30 73 The sine qua non of a joint venture is a contract, express or implied; that is, an actual agreement between the parties. Hellenic Lines, Ltd. v. Commodities Bagging & Shipping, Process Supply Co., 611 F.Supp. 665, 679 (D.N.J.1985). The agreement to create a joint venture may be implied based upon the conduct of the parties. Wanaque Borough Sewerage Authority v. Township of West Milford, 281 N.J.Super. 22, 32, 656 A.2d 448, 453 (1995). Other requisite elements of a joint venture are: 74 (1) The contribution by each party of money, property, effort, knowledge or some other asset to a common undertaking; 75 (2) The existence of a joint property interest in the subject matter of the venture; 76 (3) The right of mutual control or management of the venture; and(4) An agreement to share the profits or losses of the venture. 77 Inter-City Tire And Auto Center, Inc. v. Uniroyal, Inc., 701 F.Supp. 1120, 1126 (D.N.J.1988), aff'd mem. sub nom. Uniroyal, Inc. v. Erbesh, 888 F.2d 1382 (3rd Cir.1989) (table). The existence of a genuine dispute as to any of these elements precludes summary judgment. Id. 78 We need go no further than the first element, the existence of an agreement to form a joint venture, to conclude that a genuine issue of material fact precludes summary judgment on A.C. Realty's liability. Although the principle on which the district court relied in addressing this element, that the acts or conduct of the parties may imply the existence of an agreement, is correct standing alone, the existence of the requisite agreement is not the only inference that could be drawn from the facts of record. 79 In his affidavit, White disclaims any intention to form a joint venture. Undisputed facts tend to corroborate White's disclaimer. For example, separate financial statements were prepared for ADS, A.C. Realty, ESWECO, and A.C. Enterprises. Each entity maintained a separate bank account. Moreover, each enterprise was created at a different point in time, and the function of each entity appears to have evolved over time. Entities were formed not to share profits, but to maximize earnings for White and Carite. For example, the district court noted that ESWECO became a maintenance company so that White and Carite could take advantage of lower workers' compensation rates. It is not unusual for owners of closely held corporations to establish separate entities that are intended to provide some insulation from tort liability or avoid high employment costs. From the facts of this case, a jury could rationally conclude that White's disclaimer of an intent to form a joint venture is credible. 80 We have previously held that a court should be reluctant to grant a motion for summary judgment when resolution of the dispositive issue requires a determination of state of mind, for in such cases much depends upon the credibility of witnesses testifying as to their own states of mind, and assessing credibility is a delicate matter best left to the fact finder. Metzger v. Osbeck, 841 F.2d 518, 521 (3rd Cir.1988). Where, as here, the facts permit competing inferences concerning the existence of an agreement to form a joint venture, the issue must be submitted to the fact finder. 31 Contrary to the assertion of the United States, the evidence it has proffered is not so overwhelming that a fact finder would necessarily have to infer the existence of the requisite agreement. 32 Accordingly, the United States was not entitled to summary judgment against A.C. Realty.