Opinion ID: 4278131
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Text: af K' OO psmE oxso; sire I ^ m ? 4 2m SUSANL CARLSON SUPREME COURT CLERK IN THE SUPREME COURT OF THE STATE OF WASHINGTON POPE RESOURCES, LP, a Delaware limited partnership; OPG PROPERTIES, LLC, a Washington limited liability company. NO. 94084-3 Respondents, EN BANC THE WASHmGTON STATE DEPARTMENT OF NATURAL Filed NAY 2 4 2018 RESOURCES, a Washington State agency. Petitioner. STEPHENS, J.—In concluding that the Department of Natural Resources (DNR) is a potentially liable party under Washington's Model Toxics Control Act (MTCA), ch. 70.105 RCW, the Court of Appeals below rejected the prior interpretation of that statute in Unigard Insurance Co. v. Leven, 97 Wn. App. 417, 983 P.2d 1155 (1999) and Taliesen Corp. v. Razore Land Co., 135 Wn. App. 106, 144 P.3d 1185 (2006). See Pope Res., LP v. Dep't ofNat. Res., 197 Wn. App. 409, Pope Resources, LP, et al. Dep't ofNat. Res., 94084-3 422,389 P.3d 699(2016)(Because the language ofthe provision in MTCA differs from the language in CERCLA [Comprehensive Environmental Response, Compensation, and Liability Act of 1980, 42 U.S.C. §§ 9601-9675], Taliesen's and Unigard's holdings relying on an interpretation of CERCLA liability are not persuasive.). We granted review to resolve this split in the Court of Appeals and to provide guidance for interpreting MTCA. We reverse the Court of Appeals and hold that DNR is not an owner or operator ofthe Port Gamble Bay facility within the meaning of MTCA. As did the courts in Unigard and Taliesen, we recognize MTCA's affinity with CERCLA, under which the control retained by DNR is insufficient to support its liability for environmental contamination ofthe Port Gamble Bay facility. BACKGROLfND Between 1853 and 1995, the Port Gamble Bay facility in Kitsap County operated as a sawmill and forest products manufacturing facility by Pope & Talbot and its corporate predecessors. In 1890, some 37 years after Puget Mill Co., predecessor to Pope & Talbot, began operating the sawmill, the legislature authorized the disposal of certain occupied state-owned aquatic lands, including the tidal lands within Port Gamble Bay. Clerk's Papers(CP) at 249-55. In 1893 and 1913,Puget Mill Co. purchased tidelands around the mill facility and on the east and Pope Resources, LP, et al. Dep't ofNat. Res., 94084-3 west sides of Port Gamble Bay from the State of Washington. CP at 266. DNR issued the first lease for Pope & Talbot's use of the Port Gamble Bay submerged lands in 1974. CP at 103. In 1985,Pope & Talbot's Board of Directors and shareholders approved a 'Plan of Distribution' ... to transfer 71,363 acres of its timberlands, timber, land development, and resort businesses in the State of Washington . . . to Pope Resources, a newly formed Delaware limited partnership. Pope & Talbot, Inc. v. Comm'r, 162 F.3d 1236, 1237 (9th Cir. 1999). The Partnership paid no consideration for the Washington Properties, id., although Pope Resources and Olympic Property Group(Pope/OPG)claim they assumed a $22.5 million mortgage in consideration. Appellants' Opening Br. at 5. However, the Ninth Circuit Court ofAppeals affirmed the tax court's valuation ofthe transferred properties at between $46.7 and $59.7 million. Pope & Talbot, Inc., 162 F.3d at 1238, 1242. Pope Resources in tum leased the mill area to Pope & Talbot. CP at 77. Pope & Talbot ceased mill operations in 1995. CP at 231. The record indicates that Pope/OPG now seek to develop their Port Gamble holdings for a large, high-density community with a marina. CP at 153-55. Contamination of the Port Gamble site stems in part from the operation of sawmill buildings to saw logs for lumber, operation of chip barge loading facilities Pope Resources, LP, et al. Dep't ofNat. Res., 94084-3 and a log-transfer facility, particulate sawmill emissions from wood and wood waste burning, in-water log rafting and storage, and creosote treated pilings placed throughout the bay to facilitate storage and transport of logs and wood products. Logs were generally stored, rafted, and sorted in-water throughout the Bay. CP at 78. It is uncontested that DNR did not control the fmances ofthe facility at Port Gamble, manage the employees of the faeility, manage the daily business operations of the faeility, or have authority to operate or maintain environmental eontrols at the faeility. DNR did not eontrol Pope and Talbot's deeisions regarding eomplianee with environmental laws or regulations, or Pope and Talbot's decisions regarding the presenee of pollutants. DNR did not authorize the release of any hazardous substances on this site. CP at 269.1 After entering into a consent decree with the Washington Department of Ecology in 2013 to provide for remedial action at a portion(s) of the facility . . . where there has been a release or threatened release of hazardous substances, CP at 73,Pope/OPG filed a complaint in 2014 seeking a declaration that DNR is liable for natural resources damages and remedial costs, and for contribution of costs. CP at 'See also CP at 120 (During the Term of this Lease, Lessee shall have exclusive control and possession ofthe Property(subject to easements or other land uses that may be granted under Subsection 5.5, and any interference by third parties as identified in Subsection 10.2), and State shall have no liabilities, obligations, control, or responsibilities whatsoever with respect thereto, or with respect to any plans or specifications submitted to State pursuant to this Lease, or improvements or repairs made to the Property or any activity conducted thereon. State's approval or disapproval of any such plans and specifications or improvements shall not render State liable therefore.). Pope Resources, LP, etal. Dep'tofNat. Res., 94084-3 3-10. The Kitsap County Superior Court granted summary judgment in favor of DNRin2016. CP at 368-70. The Court of Appeals reversed, holding that DNR is an owner or operator with potential liability under MTCA. Pope Res., 197 Wn. App. at 412. DNR appealed, and we granted review. Pope Res., LP v. Dep't ofNat. Res., 188 Wn.2d 1002, 393 P.3d 357(2017).