Opinion ID: 2552631
Heading Depth: 3
Heading Rank: 2

Heading: Alaska Statute 46.03.822(a) Provides Private Plaintiffs with a Cause of Action for Strict Joint and Several Liability.

Text: FDIC alleges that the defendants are subject to joint and several strict liability under AS 46.03.822(a), which provides that the owner and the operator of a ... facility, from which there is a release ... of a hazardous substance are among those strictly liable, jointly and severally, for damages, for the costs of response, containment, removal, or remedial action incurred by the state, a municipality, or a village .... The passive language of this provision does not specify whether a private party may sue for damages. But the legislative history of this provision and our case law dealing with the creation of statutory causes of action establish that it provides a private cause of action for the owner of private property damaged by a release.
The original version of AS 46.03.822, enacted in 1972, created a cause of action imposing strict liability on polluters who damaged private property: To the extent not otherwise preempted by federal law, a person owning or having control over a hazardous substance which enters in or upon the waters, surface or subsurface lands of the state is strictly liable, without regard to fault, for the damages to persons or property, public or private, caused by the entry .... [3] The act defined damages to include injury to or loss of persons or property, real or personal, loss of income, loss of the means of producing income, or the loss of an economic benefit. [4] A separate provision, AS 46.03.870, specified that causes of action under AS 46.03 inure solely to and are for the benefit of the state [e]xcept as provided under AS 46.03.822-46.03.828, implying that those sections provide for private causes of action. [5] In 1989 the legislature amended section.822 to strengthen the State's ability to obtain cleanup of hazardous substance spill sites. [6] The amendments explicitly allowed the state and municipalities to recover damages, including cleanup and remediation costs, under the strict liability language of subsection .822(a): Notwithstanding any other provision or rule of law and subject only to the defenses set out in (b) of this section[,] ... the following persons are strictly liable, jointly and severally, for damages to persons or property, whether public or private, including damage to the natural resources of the state or a municipality, and for the costs of response, containment, removal, or remedial action incurred by the state or a municipality, resulting from an unpermitted release of a hazardous substance .... .... (2) the owner and the operator of a vessel or facility from which there is a release ... of a hazardous substance[.] [7] Legislative history indicates that this amendment was modeled after the Federal Comprehensive Environmental Response Compensation and Liability Act (CERCLA), [8] which Congress enacted in 1980. [9] In 1991 the legislature passed a number of amendments to AS 46.03.822. First, it amended subsection .822(a) to add villages to the governmental entities that could recover cleanup and remediation costs. [10] In so doing, the legislature retained the public or private damages language quoted above. [11] Later in the same session, the legislature moved the damages language from subsection.822(a) to a new subsection, .822(k), but did not change its content. [12] In each of the foregoing amendments, the legislature also retained AS 46.03.824, a provision defining damages to include injuries to persons or property, real or personal, and loss of income. [13] The legislature likewise retained the original version of AS 46.03.870, which, as mentioned above, specifically provides that causes of action under section .822 are not limited to the state. Moreover, every version of section .822 has subjected polluters of either private or public property to joint and several strict liability. In sum, this history strongly suggests that the legislature originally contemplated a private cause of action against parties who release hazardous substances and that it never repealed that cause of action. It would be incongruous for the legislature to create strict liability for damage to private land without providing a way for private parties to get compensation for that damage.
In Alaska Marine Pilots v. Hendsch, we identified six factors as relevant to determine whether a statute implies a private cause of action in tort: the nature of the legislative provision, the adequacy of existing remedies, the extent to which a tort action will interfere with existing remedies, the importance of the purpose of the provision, how drastically the new tort will change the law, and the burden the [cause of action] will place on the court system. [14] Here, these factors support a private cause of action. (1) Nature of subsection .822(a): Subsection.822(a) is easily amenable to individual enforcement. The prohibited conduct and the potential defendants are clearly identified by subsection .822(a), which attaches strict liability for the release of hazardous substances, and by subsection .822(k), which identifies damage to persons or to public or private property as a kind of damage covered by subsection .822(a). [15] An injured property owner who, like FDIC, identifies parties responsible for contaminating the property need only show that the parties owned or operated the facility causing the contamination. [16] (2) Adequacy of existing remedies: When the legislature created a strict liability regime for hazardous substance contamination, it expressed its judgment that negligence remedies were not adequately controlling the hazardous substance contamination problem. Nevertheless, Peninsula and Laidlaw insist that the subsection .822(j) right of contribution is an adequate remedy. We disagree. Under subsection .822(j), a damaged party can seek contribution only during or after an action against the party under subsection.822(a). Since private parties who voluntarily undertake cleanup efforts cannot compel the state to commence an action against them, they would be forced to wait for government action and, if no action were brought, would lose funds spent cleaning up another's contamination. That is not an adequate remedy. A more convincing reading of subsections .822(a) and (j) gives private parties the means to recover private damages, while allowing defendants a way to spread the costs of that recovery among the responsible parties. (3) Interference with existing remedies, and (4) importance of purpose of the provision: A private cause of action under subsection.822(a) would not interfere with existing remedies, such as contribution claims; and it would enhance the important purposes of Alaska's contamination responsibility regime. As discussed above, allowing private parties to initiate cleanup while they bring an action against others who may be responsible  without waiting for government action  promotes the goal of quick response to discovered contamination. At the same time, actions for contribution allow the parties to sort out ultimate responsibility for the contamination afterwards. (5) Scope of change in the law: Allowing a private cause of action under subsection.822(a) is not a departure from the way the law already operates in Alaska. In Chenega Corp. v. Exxon Corp., for example, the parties litigated a complex private strict liability claim under subsection .822(a) stemming from the EXXON VALDEZ disaster. [17] No party questioned that subsection .822(a) allowed the action, and Exxon ultimately conceded strict liability, contesting only causation and damages. [18] (6) Burden on the courts of creating a private action: While allowing private parties to bring causes of action may increase the number of claims under subsection.822(a), it will be consistent with what the legislature intended. We do not see that as an undue burden on the courts. Because subsection .822(a) meets all of the criteria for an implied cause of action under our Hendsch analysis, and since the legislative history of the provision supports the conclusion that the legislature meant to permit private actions, we hold that subsection.822(a) creates a private cause of action for joint and several strict liability. In the following section, we briefly consider the scope of this private action.
In arguing that the only remedy available to FDIC is a subsection .822(j) action for contribution, the defendants place great weight on FDIC's status as a potentially responsible party. They contend that potentially responsible parties should not be allowed joint and several recovery, but should be limited to contribution from other potentially responsible parties. Any entity that may be required to take financial responsibility for cleaning up a contaminated site is a potentially responsible party. Alaska Statute 46.03.822(a)(3) imposes strict liability on the owners of a facility that releases hazardous material. Insofar as FDIC stands in the shoes of the owner of the contaminated property at the time of the release  allegedly Sun Savings  FDIC is a potentially responsible party and, as such, is theoretically subject to the same liability as those who caused the contamination. [19] The defendants maintain that allowing one potentially responsible party to claim direct damages under subsection .822(a) from other potentially responsible parties would give the claimant an unfair advantage over the defending parties, because the claimant's joint and several recovery under subsection .822(a) might include compensation for damages caused by absentee or judgment-proof polluters; the claimant would then receive full compensation despite being a potentially responsible  and possibly culpable  party, whereas the defending parties might be left with a worthless claim for contribution under subsection .822(j). The defendants reason that, in these situations, cleanup costs should be borne by all potentially responsible parties equally. This argument seems to assume that courts cannot distinguish among potentially responsible parties to avoid inequitable results. But federal case law shows that courts can. In Rumpke of Indiana, Inc. v. Cummins Engine Co., the Seventh Circuit Court of Appeals found that when a potentially responsible party sues for direct damages under the federal counterparts to subsections.822(a) and (j), the federal statutes allow the claim, but leave room for equitable distinctions upon conclusion of the litigation. [20] Thus, the court approved a direct action for joint and several liability by Rumpke  a potentially responsible party that denied actual responsibility for the contamination: [W]e see nothing in the language of § 107(a) [the subsection .822(a) analog] that would make it unavailable to a party suing to recover for direct injury to its own land, under circumstances where it is not trying to apportion costs ( i.e., where it is seeking to recover on a direct liability theory, rather than trying to divide up its own liability for someone else's injuries among other potentially responsible parties). [21] But the court went on to observe: If the facts show, contrary to Rumpke's protestations, that it was partially responsible for the mess ..., it can proceed only under § 113(f)(1) [the subsection .822(j) analog] in a suit for contribution. [22] We agree with Rumpke that the possibility of inequitable results need not bar a potentially responsible party who denies responsibility from pursuing a direct cause of action for joint and several strict liability against other potentially responsible parties. Insofar as a plaintiff is an innocent potentially responsible party, that is, one who ultimately would not be liable for contribution, that plaintiff should recover jointly and severally. On the other hand, if a plaintiff ends up being among those responsible for the damage, the court may recast the direct claim as a claim for contribution upon conclusion of the litigation.