Opinion
Civil No. 99-959-MO.
September 21, 2004
Before the court are seven motions: First, a motion for partial summary judgment (#149) filed by plaintiff, Department of Environmental Quality ("DEQ"); second and third, a motion for judgment on the pleadings (#139) and related motion for judgment on pleadings based on her third-party complaint (#151) filed by defendant Sherma Wenner; fourth, a motion for partial summary judgment (#145) filed by defendants Spar Investment Co. and Jerome Parker; fifth, a motion for partial summary judgment (#147) filed by defendants Main Street Cleaners Inc., George Fossati and Joseph C. Fossati; sixth, a motion for partial summary judgment (#152) filed by defendant Alexander Aginsky; and seventh, a motion for partial summary judgment (#157) filed by third-party defendant Edwin Fain.
BACKGROUND
Oregon Revised Statutes, Chapter 465 governs hazardous waste and hazardous materials. Section 465.500, et seq., was created by the Oregon legislature in 1995 and established a separate liability scheme for the dry cleaning industry.
On May 24, 1999, plaintiff State of Oregon, Department of Environmental Quality ("DEQ") filed a complaint alleging: strict liability for cleanup costs under ORS § 465.255, strict liability under CERCLA, 42 U.S.C. § 9601, et seq., breach of consent agreement, and breach of agreement in state court against defendants Spar Investment Co., Jerome Parker, Alexander Aginsky, Ilene Aginsky, George L. Fossati and Joseph C. Fossati ("defendants").
DEQ's complaint alleged that since 1963 defendants were either owners or operators of a dry cleaning business located at 10863 S.E. Main Street, Milwaukie, Oregon (hereinafter "the site"). Beginning in July 1992, DEQ investigated and removed hazardous substances from the site, including perchloroethylene ("PCE"), a hazardous substance used by dry cleaners. DEQ allegedly incurred costs of at least $739,188.57 from remedial actions at the site.
DEQ further alleges that on April 11, 1994, defendant Spar entered into a consent agreement whereby Spar agreed to assist DEQ in determining the extent of the releases of hazardous substances at the site. DEQ alleges that Spar breached the consent agreement by failing to reimburse DEQ in the amount of $6,128.36. Likewise, DEQ alleges that it entered into an agreement with the Aginsky defendants, which they breached by failing to reimburse DEQ in the amount of $7,434.43.
In early 2001, the parties moved for summary judgment on the issue of whether ORS § 465.503 exempts defendants from liability for alleged violations of CERCLA.
On March 16, 2001, Magistrate Judge Hubel issued Amended Findings and Recommendation on the parties cross-motions for summary judgment. Magistrate Judge Hubel found that while the owners and operators had a long history of improperly disposing of PCE, analysis of legislative history compelled him to conclude that "only dry cleaning owners and operators who do not comply with the environmental laws after June 30, 1995 lose the exemption from liability allowed for in ORS 465.503(1)." As a consequence, Judge Hubel found that defendants were entitled to prevail on summary judgment while DEQ's motion for summary judgment was denied.
The Ninth Circuit Court of Appeals, however, disagreed. In a memorandum disposition decided on May 23, 2003, the appellate court determined that ORS § 465.503(3)(b) must be interpreted utilizing the plain language of the statute and not by determining the legislature's intent through legislative history. Under the plain language of ORS § 465.503(3)(b), the Ninth Circuit determined that dry cleaners do not receive immunity if "the release resulted from a violation of federal or state laws in effect at the time of the release, including but not limited to waste minimization requirements imposed under ORS 465.505." Thus, the court of appeals found that "this statutory provision was intended to subject owners and operators to liability for past releases that resulted from contemporaneous state or federal law violations." DEQ v. Spar Investment Co., 2003 WL 21222052, *3 (9th Cir. May 23, 2003). Because the Ninth Circuit agreed with the district court that defendants had made illegal discharges of PEC, and found that the plain language of the statute prohibited illegal discharges of PEC, regardless of when the discharge occurred, the appellate court reversed and remanded.
DISCUSSION
I. DEQ's Motion for Summary JudgmentPlaintiff DEQ's motion for summary judgment asks the court to make four legal determinations: First, pursuant to ORS § 465.255, it seeks to impose liability for the costs of environmental remediation upon the defendant owners and operators of the dry cleaning business at the site; second, an order formally establishing that each of the owners is strictly liable for the costs of remediation; third, that defendants' strict liability is joint and several; and fourth, that defendants' liability extends to the entire cost of remediation.
Oregon Revised Statute § 465.255 (1999) provides, in relevant part —
(1) The following persons shall be strictly liable for those remedial action costs incurred by the state or any other person that are attributable to or associated with a facility and for damages for injury to or destruction of any natural resources caused by a release:
(a) Any owner or operator at or during the time of the acts or omissions that resulted in the release.
(b) Any owner or operator who became the owner or operator after the time of the acts or omissions that resulted in the release, and who knew or reasonably should have known of the release when the person first became the owner or operator.
DEQ argues that the Ninth Circuit's decision compels this court to find in its favor on issues one and two. Issues three and four, DEQ asserts, are new issues that logically follow from a decision in its favor on issues one and two. The court analyzes DEQ's motion for summary judgment by addressing each defendant, in connection with that defendant's motion for summary judgment seeking to be found exempt from liability. Defendants' cross-claims against each other are discussed separately in other sections.
A. DEQ's First Motion — Defendants Exemptions from Liability are Unavailable pursuant to ORS § 465.503.
The question of whether defendants are exempt from liability pursuant to ORS § 465.503(1) was before Judge Hubel, who found defendants were exempt from liability, and before the Ninth Circuit, which found that they were not. "Here, the clear import of § 465.503(3)(b) is that dry cleaning owners and operators are liable for the release of dry cleaning solvent that stemmed from conduct that violated state or federal law at the time of the release." DEQ v. Spar Investment Co., 2003 WL 21222052, *2 (9th Cir. May 23, 2003). The Ninth Circuit found that "the owners' and operators long history of improperly disposing of perchloroethylene ("PCE") directly into the ground," was factually established. Id. Additionally, the appellate court rejected the owners' alternative argument that they did not lose immunity because of the illegal conduct of the operators. "[T]he clear import of § 465.503(3) is that dry cleaning owners and operators are both ineligible for immunity if the release of dry cleaning solvent resulted from unlawful conduct." Id. at *3.
Under the law of the case doctrine, "the decision of an appellate court on a legal issue must be followed in all subsequent proceedings in the same case." United States v. Cote, 51 F.3d 178, 181 (9th Cir. 1995) (citations and internal quotations omitted). The doctrine acts as a bar only when the issue "was actually considered and decided by the first court."Id. Although the law of the case doctrine applies to a court's explicit decisions and those made by necessary implication, it "clearly does not extend to issues an appellate court did not address." Id. Thus, lower courts are free to decide "anything not foreclosed by the mandate." United States v. Kellington, 217 F.3d 1084, 1092 (9th Cir. 2000). Here, the Ninth Circuit reversed and remanded, finding that the exceptions to liability did not apply to these defendants. Defendants, however, continue to argue that they are exempt from liability by claiming that the exceptions to liability apply to them. None of defendants' arguments seeking to apply the exceptions to liability are availing.
These defendants include George Fossati, Joseph Fossati and Main Street Cleaners (the "Fossati defendants"); defendants Spar Investment and Jerome Parker and defendant Alexander Aginsky. The court will address whether or not these defendants are liable under the law of the case doctrine by addressing each of their legal theories in turn.
Although Ilene Aginsky is listed as a defendant on the pleadings, she was dismissed from this action with prejudice on March 15, 2000.
1. The Fossati Defendants
The Fossati defendants (George L. Fosatti, Joseph C. Fossati, and Main Street Cleaners, Inc.) were operators of a dry cleaning business at the site from 1963 through August 1, 1985. The Fossati defendants move for summary judgment on all of DEQ's claims and, alternatively, seek partial summary judgment on the theory that they are not liable for any remedial action costs or damages on account of releases that took place between 1963 and 1980.
The first argument the Fossati defendants make is a largely semantic one that ORS 465.503(3)(b) requires that a release result from a violation of the laws and that DEQ has not identified such a release. The key language is a "release resulted from a violation of federal and state laws." The Fossati defendants argue that DEQ has merely alleged releases that are a violation of the law, but not a violation of the law resulting in a release.
ORS § 465.503(3)(b) states that immunity does "not apply to a . . . dry cleaning operator if . . . [t]he release resulted from a violation of federal and state laws. . . ."
Thankfully, the Ninth Circuit has stated what ORS § 465.503(3)(b) means. "Here, the clear import of § 465.503(3)(b) is that dry cleaning owners and operators are liable for the release of dry cleaning solvent that stemmed from conduct that violated state or federal law at the time of the release." DEQ v. Spar Investment Co., 2003 WL 21222052, *2 (9th Cir. May 23, 2003). Put simply, this court should not entertain an alternative interpretation of what § 465.503(3)(b) means once the Ninth Circuit has interpreted the statute. None of the reasons for deviating from law of the case — "(1) the decision is clearly erroneous and its enforcement would work a manifest injustice, (2) intervening controlling authority makes reconsideration appropriate, or (3) substantially different evidence was adduced at a subsequent trial," Jeffries v. Wood, 114 F.3d 1484, 1489 (9th Cir.), overruled on other grounds by Lindh v. Murphy, 521 U.S. 320 (1997) (footnote and internal quotation marks omitted) — applies here. Consequently, the Fossati defendants' semantic argument that there is no allegation of a release resulting from a violation of law fails as the Ninth Circuit has found that § 465.503(3)(b) controls any release violating any state or federal law.
DEQ also maintains that the semantic argument fails by arguing that the Oregon Legislature's 2001 amendments resolved any doubt regarding the meaning of § 465.503. These amendments added the bold language while deleting the language in italics as follows:
(3) Notwithstanding the date on which the release occurred, the provisions of subsections (1) and (2) [concerning immunity] of this section do not apply to a dry cleaning owner or dry cleaning operator if:
(a) . . .
(b) The release resulted from an action or omission that was a violation by the dry cleaning owner or dry cleaning operator of federal or state laws in effect at the time of the release, including but not limited to waste minimization requirements imposed under ORS 465.505.
DEQ states that by adding the language "Notwithstanding the date on which the release occurred," the legislature amended the statute to show that they it intended to apply retroactively. These particular amendments can also be viewed as adding clarity to the legislature's intent. See 1000 Friends of Oregon v. Wasco County Court, 704 P.2d 207, 219 (1985) (noting that "an amendment to an act may be resorted to for the discovery of the legislative intent in the enactment amended").
Given that the Ninth Circuit has already interpreted § 465.505, the import of the amendments need not be resolved by this court. Nevertheless, it appears that § 465.505 applies retroactively given the addition of the phrase "notwithstanding that date on which the release occurred."
The Fossati defendants additionally argue that they are entitled to partial summary judgment for any releases that took place between 1963 and 1980. This theory is based on two arguments: that releases prior to 1980 were not illegal and that DEQ has not alleged that releases took place prior to 1980. The Fossati defendants operated their dry cleaning business at the site until August 1, 1985. (Affidavit of Joseph Fossati, ¶ 1). The Spar defendants, who owned the site since June 28, 1979, also make this same argument.
However, a party liable for any portion of cleanup costs is jointly and severally liable for the full amount of those costs, regardless of whether the party was responsible for all of the environmental damage. See City of Portland v. Boeing Co., 179 F.Supp.2d 1190, 1200 (D. Or. 2001) ("Under [federal CERCLA law], each responsible party is jointly and severally liable for any necessary costs of response incurred by an innocent party."). Under 42 U.S.C. § 9607(a) and ORS § 465.244(1), the Fossatis' liability for any release that were in violation of the law at the time (here, at least from 1980 to 1985), results in full joint and several liability. Thus, releases made prior to 1980 may or may not have been illegal, but regardless, joint and several liability makes the Fossatis fully liable for any and all clean-up costs because of the releases that took place between 1980 and 1985.
DEQ makes an additional argument in support of summary judgment. DEQ argues that because the Fossati defendants had insurance, they cannot seek immunity under ORS § 465.503(1) (2003). Defendant responds by producing letters from the insurer denying coverage. Because there are disputed facts regarding whether coverage exists, this argument of DEQ fails.
As to the Fossati defendants, the Ninth Circuit's decision is the law of the case and DEQ is entitled to summary judgment on DEQ motion for liability under ORS § 465.503. None of the arguments that the Fossati defendants raise in their own motion for summary judgment, alleging either complete immunity or partial immunity for releases prior to 1980, has merit and, therefore, the Fossati defendants' motion for summary judgment is denied.
DEQ counters the immunity from liability for releases between 1963 and 1980 argument by raising that Oregon law prohibited commercial discharges of toxic substances as early as 1967. The court does not consider this argument given that the Fossati and Spar defendants are jointly and severally liable for all releases given the illegal releases that took place between 1980 and 1985.
2. Spar Investments Jerome Parker
Spar Investments is an Oregon corporation and the current owner of the site. Parker is an officer, director, and principal shareholder of Spar. Spar has owned the property at the site since June 28, 1979. Between April 16, 1963 and June 1, 1976, the property was owned by Parfain Investment Co. Parfain was a partnership consisting of Edwin Fain, his wife Nancy Fain, Jerome Parker and his ex-wife, now known as Sherma Wenner. Between June 1, 1976, and June 28, 1979, the property was owned by Parker and Wenner. A five-year lease between Parker as lessor and Main Street Cleaners as lessee began on November 1, 1977, and continued to October 31, 1982. This lease was subsequently extended through October 31, 1987.
On August 1, 1985, Main Street Cleaners, Inc., assigned its interest in the lease to Arkady and Sharlota Aginsky. The lease was later extended to October 31, 1992. On May 10, 1992, Arkady and Sharlota Aginsky assigned their interest in the lease to defendant Alexander Aginsky. The lease was then extended to October 31, 1997.
Arkady and Sharlota Aginsky are not parties to this action.
Spar and Parker first argue that they are immune from liability for releases that took place prior to August 1979. This argument fails for the same reason the Fossati's identical argument fails — joint and several liability makes Spar and Parker liable for all releases because illegal releases took place after August 23, 1979, when release of PEC onto the ground became illegal under state law. Along the same lines, Spar claims immunity for releases after August 1985 under RCRA's domestic sewage exception, 42 U.S.C. § 6903(27), and this argument likewise fails because of the nature of joint and several liability for the illegal releases.
PEC disposal onto the ground became illegal under federal law on or about November 19, 1980.
Next, defendant Parker claims he should be dismissed as a defendant because he ceased being an owner of the property on June 28, 1979, when he sold his interest in the site to Spar. DEQ does not claim that Parker was an "operator" but an "owner." If Parker was not an owner at the time the releases were illegal, he is not subject to liability under § 465.255.
DEQ, however, claims that dumping of PEC became illegal in 1967. Specifically, ORS Chapter 449.015 (1967) stated that:
No person shall:
(a) Cause pollution of any waters of the state or place or cause any wastes to be placed in a location where such wastes are likely to escape or be carried into the waters of the state by any means.
* * *
(5) "Wastes" means sewage, industrial wastes, and all other liquid, gaseous, solid, radioactive, or other substances which will or may cause pollution or tend to cause pollution of any waters of the state.
* * *
(3) "Industrial waste" means any liquid, gaseous, radioactive or solid waste substance or combination thereof resulting from any process of industry, manufacturing, trade or business, or from the development or recovery of any natural resource.
This argument, that dumping PEC was illegal as far back as 1967, appears to be a new argument by DEQ. It is not alleged in the complaint, nor did DEQ allege a violation of this statute at any time prior to the opposition to Parker's Motion for Summary Judgment. Further, Parker states that DEQ made a judicial admission on October 18, 2000, as to the extent of the violations committed by defendants and § 449.015 (1967) was not among them. Perhaps more important, there is no allegation that the dumping of PEC caused "pollution of any waters," a requirement of § 449.015.
Magistrate Judge Hubel, however, did consider in his F R that dumpting PEC onto the ground may have been illegal since 1971 under ORS § 466.100, but then rejected that statute's applicability.
See Parker's Reply in Support of MSJ, p. 4.
The most persuasive argument, however, for eliminating a discussion of § 449.015 (1967), is that the Ninth Circuit found that releases prior to before 1980 were not illegal.
Here, the clear import of § 465.503(3)(b) is that dry cleaning owners and operators are liable for the release of dry cleaning solvent that stemmed from conduct that violated state or federal law at the time of the release.
* * *
Indeed, releases by the dry cleaning industry of spent PCE directly into the ground before the solvent was classified as a hazardous waste would not fall under § 465.503(3)(b). Neither would any PCE that leaked into the ground as a by product of pouring waste water down the drain.DEQ v. Spar Investment Co., 2003 WL 21222052, *2 (9th Cir. May 23, 2003). In other words, it was not until PEC was classified as a hazardous substance that the liability scheme of § 465.255, CERCLA and RCRA had force for improper disposals. Because DEQ's complaint seeks liability for violations of § 465.255, CERCLA and RCRA (and not § 449.015), Parker is not liable for releases under § 449.015.
In conclusion, Parker is entitled to summary judgment on his theory that he ceased being an owner of the site prior to the time that disposal of PEC on the ground became illegal under state and federal law. DEQ, on the other hand, is entitled to summary judgment against Spar Investment Company, the owner of the site from the time dumping PEC directly onto the ground became illegal.
3. Defendant Alexander Aginsky
Defendant Alexander Aginsky disputes releasing PEC between 1985 and 1992 when he was the operator at the site. The Ninth Circuit, however, found that "the owners' and operators' [had a] long history of improperly disposing percholoroethylene ('PEC') directly into the ground." DEQ v. Spar Investment Co., 2003 WL 21222052, *2 (9th Cir. May 23, 2003). The Fossati defendants admit that discharges occurred on a regular basis during their operation of the Main Street Cleaners business. (J. Fossati Deop., pp. 71, 74). Joseph Fossati testified that when Aginsky took over as operator in 1985, he retained the Fossatis for 30 days to show Aginsky how to operate all of the dry cleaning equipment. Aginsky testified that he operated the system as he inherited it until 1993. (Aginsky Depo., pp. 158, 182).
A DEQ employee observed Aginsky dumping PEC on the ground. Additionally, Aginsky signed a Final Order before the Environmental Quality Commission ("EQC") in which he waived any objections to a Notice from the EQC that charged him with dumping PEC onto the ground. (DEQ's Consolidated Response to Concise Statement of Facts, section I, fact 12). These facts were addressed and decided by Magistrate Judge Hubel before the facts were adopted by the Ninth Circuit Court of Appeals.
Aginsky does not present any argument that he should not be liable under the law of the case doctrine. Consequently, under the law of the case doctrine, DEQ prevails in its motion for summary judgment against defendant Aginsky while Aginsky's motion for summary judgment is denied.
B. Motion for Summary Judgment: Is Defendants' Strict Liability Established as a Matter of State Law?
As set forth above, ORS § 465.255 is Oregon's law for allocating responsibility for remediation costs. The Ninth Circuit noted that it starts at "a baseline of strict liability." Id. at *1.
(1) The following persons shall be strictly liable for those remedial action costs incurred by the state or any other person that are attributable to or associated with a facility and for damages for injury to or destruction of any natural resources caused by a release:
(a) Any owner or operator at or during the time of the acts or omissions that resulted in the release.
(b) Any owner or operator who became the owner or operator after the time of the acts or omissions that resulted in the release, and who knew or reasonably should have known of the release when the person first became the owner or operator.
For liability to be established, a defendant must met three statutory definitions for "facility," "owner or operator," and "release."
Facility is defined at ORS § 465.200(12), which provides —
"Facility" means any building, structure, installation, equipment, pipe or pipeline including any pipe into a sewer or publicly owned treatment works, well, pit, pond, lagoon, impoundment, ditch, landfill, storage container, above ground tank, underground storage tank, motor vehicle, rolling stock, aircraft, or any site or area where a hazardous substance has been deposited, stored, disposed of, or placed, or otherwise came to be located and where a release has occurred or where there is a threat of a release, but does not include any consumer product in consumer use or any vessel.
Judge Hubel found, and there is no dispute, that Main Street Cleaners is a facility as defined by the statute. It was a "building" or "site or area" where a hazardous substance "came to be located and where a release occurred." Judge Hubel found that both the Fossatis and Mr. Aginsky used PCE. He found that PCE is a hazardous substance and was released at the business. Consequently, the site of the dry cleaning business owned or operated by defendants was a facility.
There is also no dispute that each of the defendants was either an "owner" or an "operator." Judge Hubel established that each was an owner or operator and the Ninth Circuit ratified this determination. Id.
"Release" is defined at ORS 465.200(21) as — any spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping, or disposing into the environment including the abandonment of discarding of barrels, containers and other closed receptacles containing any hazardous substance or threat thereof.
The parties do dispute, however, whether their owner or operator status took place during a period for which improper PCE disposal results in liability under the relevant statutes.
Judge Hubel found that PCE was "discharged . . . into the ground" which the Ninth Circuit adopted. (F R, at 20, Opinion at 2).
Finally, to establish liability, defendants must have either been owners or operators "at or during the time of the acts or omissions that resulted in the release," as required by ORS § 465.255(1)(a); or they must have become "the owner or operator after the time of the acts or omissions that resulted in the release, and who knew or reasonably should have known of the release when the person first became the owner or operator," as required by ORS § 465.255(1)(b).
Here, Judge Hubel found that when DEQ inspected the site in 1992, the releases were occurring. Aginsky operated the site at that time, thus bringing him into subsection (1)(a). Likewise, the Fossatis fall into that subsection because the Fossatis "admit that discharges occurred on a regular basis during their operation of the Main Street Cleaners business," and specifically, Judge Hubel found that "they discharged the dryer waste water into the ground." (F R, at 20).
Spar Investment was the owner of the property after June 28, 1979. Parker owned the property with his wife prior to Spar. Consequently, Spar should be liable for releases occurring after 1979 (when disposing of PEC became illegal) while Parker and his wife, Wenner, should not be.
The Fossatis, Mr. Aginsky and Spar Investments are liable as a matter of law under ORS § 465.255(1)(a) because each of the three elements is met.
In addition, Judge Hubel was reversed and remanded by the Ninth Circuit on his conclusion that defendants were exempt from liability under CERCLA, 42 U.S.C. § 9607. Essentially, once Judge Hubel found that defendants fit into a category exempting them from liability under state law, he concluded that the state should not be allowed to do under federal law what it was unable to do under state law. Because the Ninth Circuit reversed Judge Hubel, the question of CERCLA liability is again before the court.
To establish a claim for contribution under CERCLA, DEQ has to prove: (1) defendant was an owner or operator; (2) of a facility; (3) from which there was a release; and (4) which caused the incurred response costs. California v. Campbell, 319 F.3d 1161, 1165 (9th Cir. 2003). The definitions for these elements are nearly identical to the definitions for ORS § 465.255. As the court has found that plaintiff has proven that defendants were owners or operators of a facility from which there was a release causing the incurred response costs, a claim for CERCLA contribution has been made.
Where the state is a plaintiff, the defendant has the burden to show that the state's action does not demonstrate compliance with the National Contingency Plan. California v. Neville Chemical Co., 358 F.3d 661, 673 (9th Cir. 2004). Defendants have failed to make any showing that DEQ has failed to comply with the National Contingency Plan. Consequently, defendants also violated CERCLA and are, therefore, strictly liable for clean up costs under both state and federal law.
C. Liability Under State and Federal Law is Joint and Several.
Under CERLA and Oregon law, each responsible party is jointly and severally liable for any necessary response costs when an action is brought by a government entity. See City of Portland v. Boeing Co., 179 F.Supp.2d 1190, 1200 (D. Or. 2001);California v. Montrose Chem. Corp., 104 F.3d 1507, 1518 n. 9 (9th Cir. 1997). DEQ is granted summary judgment on this motion.
D. Defendants' Liability Extends to the Entire Cost of Remediation.
The nature of joint and several liability means that defendants cannot seek a reduction in their share of the cleanup costs because they were not an owner or operator during the complete range of time that releases took place or because releases were not considered hazardous during a period of time.
Under CERCLA, a responsible party is liable for "all costs of removal or remedial action incurred by the United States Government or a State. . . ." 42 U.S.C. § 9607(a). The language of ORS § 465.255(1) has the same effect. "The following persons shall be strictly liable for those remedial action costs incurred by the state or any other person that are attributable to or associated with a facility. . . . (a) Any owner or operator at or during the time of the acts or omissions that resulted in the release." The court has previously found that the Fossati defendants, Aginski and Spar were owners or operators during the time of releases. Under Oregon law, strict liability is shared among those defendants for the costs associated with a facility once any liability is found.
In conclusion, summary judgment should be GRANTED on all four of DEQ's motions, except as to defendant Parker who did not own the site at the time the dumping of PEC became illegal.
II. Spar Investments' Cross Claims Against Other Defendants
Spar seeks: (1) Contribution from the Fossati defendants and Main Street Cleaners; (2) Damages for Breach of the lease agreement by the Fossati defendants and Main Street Cleaners; (3) Indemnity from the Fossati defendants and Main Street Cleaners; (4) Damages from Aginsky; (5) Contribution from Aginsky; (6) Contribution from Sherma Wenner; and (7) Contribution from Edwin Fain.
In addition, to the extent there is any liability for actions that took place prior to 1976, then Parker seeks a determination that he is not liable for such releases because the property was owned by Parfain, a partnership of himself, his ex-wife Wenner, and Edwin and Nancy Fain. Parker also maintains that the Fains and his ex-wife Wenner are liable for contribution.
For the reasons discussed below, each of Spar's motions for summary judgment is denied because of the existence of issues of material fact. As to Parker's motions for summary judgment because the court finds there is no liability for PERC dumping prior to 1979, Parker is not personally liable as a partner and, consequently, his claims against his former partners fail.
The lease, signed on November 1, 1977, and extended through October 31, 1997, includes the following provisions that Spar contends are noteworthy:
(2b) The lessee will not make any unlawful, improper or offensive use of said premises; he will not suffer any strip or waste thereof; he will not permit any objectionable noise or odor to escape or to be emitted from said premises, or to do anything or permit anything to be done upon or about said premises in any way tending to create a nuisance;
* * *
(2d) Lessee shall comply at lessee's own expense with all laws and regulations of any municipal, county, state, federal or other public authority respecting the use of said leased premises.
* * *
(4a) . . . [T]he lessee hereby agrees to maintain and keep said leased premises, including heating, ventilating and cooling systems, interior wiring, plumbing and drain pipes to sewers or septic tank, in good order and repair during the entire term of this lease at lessee's own cost and expense. . . .
* * *
(11) . . . Lessee agrees to and shall indemnify and hold lessor harmless against any and all claims and demands arising from the negligence of the lessee, his officers, agents, invitees, and/or employees, as well as those arising from lessee's failure to comply with any covenant of this lease on his part to be performed, and shall at his own expenses defend the lessor against any and all suits and actions arising out of such negligence, actual or alleged, and all appeals therefrom and shall satisfy and discharge any judgment which may be award against lessor in any such suit or action.
Spar and Parker seek indemnity or contribution from the lessors for alleged violations of these provisions. Indemnity or contribution for the violation of a lease is a contract action that must be brought within six years under the statute of limitations, ORS § 12.080(1). Whether the breach was concealed may toll the statute of limitations, but the existence of any "concealment" creates a disputed issue of fact.
In interpreting each of the disputed lease provisions there is no disputed issue of fact that releases were unlawful but there are disputed issues of fact regarding whether the statute of limitations was tolled. Spar's motions for summary judgment are, therefore, denied. This court has previously found, however, that liability does not exist for releases prior to 1979 and that, as a consequence, Parker and his partners are not subject to personal liability or partnership liability for releases that occurred prior to 1979.
III. Third-Party Defendant Sherma Wenner's Motion for Judgment on the Pleadings
As noted earlier, the court concluded that Jerome Parker was not liable for clean up costs because he was not an owner of the property during the time the disposal of PEC into the ground was illegal. Likewise, third-party defendant Sherma Winter was the co-owner of the site with her former husband, Jerome Parker, from June 1, 1976, and June 28, 1979. She is not liable under any theory of third-party plaintiffs Spar Investment Co. and Parker and, therefore, her motion for judgment on the pleadings (#139) is granted. Defendant Sherma Wenner also filed a motion for judgment on the pleading pursuant to LR 7.1 (#151) which is identical in substance to her earlier motion. Because the court granted that earlier motion, defendant Sherma Wenner's second motion for judgment on the pleadings is denied as moot.
IV. Third-Party Defendant Edwin Fain's Motion for Summary Judgment
Third-party defendant Edwin Fain filed an opposition to Spar and Parker's Motion for Summary Judgment and also styled that opposition as a motion for summary judgment on his own behalf. Fain ceased to be an owner of the site in 1976. Like Parker and Wenner, Fain is not liable for releases at the time he was an owner because the releases became illegal in 1980. Fain's motion for summary judgment is, therefore, granted.
CONCLUSION
For the foregoing reasons:(1) DEQ's Motion for Partial Summary Judgment (#149) is GRANTED in part and DENIED in part;
(2) Defendant Sherma Wenner's Motion for Judgment on the Pleadings (#139) is GRANTED;
(3) Defendant Spar and Parker's Motion for Summary Judgment (#141) is GRANTED as to defendant Parker being exempt from liability but is otherwise DENIED;
(4) Defendant Fain's Motion for Judgment on the Pleadings (#145) is GRANTED;
(5) Defendants Main Street Cleaners, George L. Fossati and Joseph C. Fossati's Motion for Summary Judgment and/or Partial Summary Judgment (#147) is DENIED;
(6) Defendant Sherma Wenner's Motion for Judgment on Pleadings on her Third-Party Complaint (#151) is DENIED as moot;
(7) Defendant Alexander Aginsky's Motion for Summary Judgment or Partial Summary Judgment (#152) is DENIED.
IT IS SO ORDERED.