Opinion ID: 201206
Heading Depth: 2
Heading Rank: 2

Heading: Awarding of contribution entitlement

Text: 81 The district court determined that R & H's share of liability for its hazardous waste at the Picillo site was 3.23%. R & H paid the United States $4,636,725 in groundwater cleanup costs and received $382,807 in settlements. Thus, R & H's total net payment for the groundwater cleanup to the United States was $4,253,918. 82 The district court concluded that the total estimated cost of the groundwater cleanup would be $49,600,000. By multiplying the total estimated cost of the cleanup ($49,600,000) by R & H's share of responsibility (3.23%), the district court concluded that R & H's share of payment for the groundwater remediation should have been $1,602,080. Since R & H had already paid $4,253,918, the district court concluded that the Capuanos were liable for the $2,651,838 that R & H paid over its fair share ($4,253,918—$1,602,080). 83 The Capuanos contend that the district court should not have entered a monetary judgment since the cost of the groundwater cleanup is unknown and, therefore, it is impossible to calculate whether R & H paid an amount in excess of its pro rata share. It is firmly established in this circuit that a party may seek declaratory relief in a contribution action. Davis, 261 F.3d at 47. By allowing such relief, parties will know their share of costs before they are incurred. Id. (citing Boeing Co., 207 F.3d at 1191). Indeed, the more liability can be limited and quantified, the more practical it is for a party to budget and borrow to finance it. Boeing Co., 207 F.3d at 1191. Taking this logic one step further, the district court in this case entertained estimates of the costs of the groundwater remedy and entered a judgment based on the submitted evidence, In so doing, the district court did not abuse its discretion. 84 R & H presented the district court with three alternatives for calculating estimated response costs. First, R & H proposed that the common liability was $5,969,202.52, based upon the response costs the United States incurred until this litigation in the district court. As the district court correctly noted, this amount is only a small fraction of the costs expected to be incurred in the future. Second, R & H submitted the total costs for the groundwater remedy as estimated by the EPA's Record of Decision, which was $22,300,000. Last, R & H submitted the estimate provided by the Ashland Group, a group of PRPs that has sued R & H for contribution in the United States District Court for the District of New Jersey. This estimate was $49,600,000. 85 In some cases, it may be impossible to estimate the total cost of a remediation. In other cases, the available estimates may be too outdated to make an informed calculation. In this case, however, the district court was presented with a recent estimate provided by a group of companies performing the groundwater remedy. The Capuanos did not challenge the accuracy of this estimate. 86 The district court acted consistent with CERCLA's goals by entering a monetary judgment before the remediation was completed. Entering a monetary judgment fosters an incentive for timely settlements and provides finality for those parties that choose to settle. See United Techs. Corp., 33 F.3d at 103 (stating that CERCLA was designed to encourage settlements and provide PRPs a measure of finality in return for their willingness to settle). 87 By settling with the United States, a PRP pays a portion of the response costs. By seeking contribution from other PRPs ' a settling PRP seeks to recoup the portion it paid in excess of its pro rata share. If a PRP is unable to receive a monetary judgment until the remediation process is complete, then a PRP may be reluctant to settle knowing it will be unable to recoup any money it paid in excess of its pro rata share until the remediation is completed. In contrast, by not settling, a PRP could be held liable for a percentage of the cleanup in a contribution action but forestall payment of that percentage until the cleanup is completed. Thus, a non-settler could avoid payment to the PRP that did settle for many years, if not decades. Such an approach favors a non-settling PRP over a settling PRP, the antithesis of what CERCLA was enacted to achieve. 88 Entering a monetary judgment is a double-edged sword for both parties. For example, in this case, if the response costs are more than estimated, R & H will receive a windfall at the expense of the Capuanos. In contrast, if the response costs are less than estimated, the Capuanos will receive a windfall at the expense of R & H. In a CERCLA action, the district court is afforded broad discretion in apportioning liability because it is very difficult to determine accurately the liability of each party. As a result, one party may be forced to pay more than its equitable share. See, e.g., Davis, 261 F.3d at 48-49; United Techs. Corp., 33 F.3d at 102-03; United States v. Charles George Trucking, Inc., 34 F.3d 1081, 1086 (1st Cir.1994). The fact that the monetary judgment is entered based on an estimate, therefore, does not on its own make that judgment unjust. The district court entertained many possibilities regarding the estimate of total response costs and both sides had opportunities to suggest whether the estimated response cost was too low or too high. After reviewing the possible estimated costs, the district court concluded that $49,600,000 was the best estimate of total response costs and entered a judgment using that estimate. We believe it was not error to do so.