Opinion
Civil Action No. 5:04-CV-047-C.
August 27, 2004
ORDER
On this date the Court considered the Motion for Summary Judgment filed by Third-Party Defendant, Skinner Tank Company, on July 8, 2004. Third-Party Plaintiff, Poole Chemical Company, Inc., filed its Response on July 28, 2004. Skinner filed a Reply on August 11, 2004. Skinner seeks a take-nothing judgment as a matter of law based on Texas Civil Practice and Remedies Code § 16.012, the statute of repose for products liability actions.
I. PROCEDURAL HISTORY
On March 3, 2004, Plaintiff, the Burlington Northern Santa Fe Railway Company ("BNSF"), brought suit against Defendant/Third-Party Plaintiff, Poole Chemical Company, Inc. ("Poole"), in this Court. BNSF alleged several state and federal causes of action, contending that Poole was liable for damages to, and the cost of removing hazardous chemicals from, BNSF property. Poole filed its Original Answer on April 12, 2004. Poole then filed its Third-Party Complaint against Skinner Tank Company ("Skinner") on April 19, 2004. Poole asserted claims against Skinner, Aon Risk Services Inc. of Central California ("Aon"), and Plains Insurance Agency of Amarillo, Inc. ("Plains"). Poole filed its First Amended Third-Party Complaint against the three Third-Party Defendants on May 7, 2004. Aon filed its Answer on May 27, 2004. On May 26, 2004, Skinner filed a Motion to Dismiss Poole's claims of fraud and negligence per se because of pleading insufficiencies. Poole's Response, filed on June 17, 2004, agreed to withdraw those two claims against Skinner. On June 17, 2004, the Court entered an Order dismissing Poole's fraud and negligence per se claims against Skinner. However, the Court denied Skinner's request to dismiss the entire complaint, finding that although Skinner had prayed for dismissal of the entire First Amended Complaint, it had provided no argument or authority therefor. On June 21, 2004, Poole filed a Motion for Voluntary Dismissal of the claims against Aon and Plains. Poole's certificate of conference stated that BNSF and Skinner did not oppose the motion for voluntary dismissal. On June 22, 2004, the Court issued an order requiring Aon to file a Response to Poole's Motion for Voluntary Dismissal on or before July 12, 2004, or face dismissal without prejudice. Plains had not yet appeared or answered in the suit. On June 29, 2004, Skinner filed its Original Answer and Affirmative Defenses. Aon never responded to Poole's Motion for Voluntary Dismissal. On July 14, 2004, the Court granted Poole's Motion for Voluntary Dismissal and dismissed Aon and Plains from the suit, without prejudice. Skinner filed its Motion for Summary Judgment on July 8, 2004, along with supporting brief and appendix. BNSF moved on July 15, 2004, for leave to amend its Complaint and add Skinner as a defendant. The Court granted BNSF's request and BNSF's First Amended Original Complaint was filed on July 16, 2004. Poole filed its Response to Skinner's Motion for Summary Judgment on July 28, 2004. Skinner filed a Reply on August 11, 2004.
II. BACKGROUND
On September 13, 1988, Skinner submitted a Proposal and Acceptance to Mr. Jim Poole, of Poole, whereby Skinner agreed to erect two tanks on Poole's property. Skinner was to furnish all necessary labor, transportation, supplies, and materials to erect the two tanks. Skinner completed the installation of those tanks on October 28, 1988. Skinner warranted the tanks against defects for one year. One of the tanks ruptured on January 29, 2003, releasing 200,000 to 300,000 gallons of liquid ammonium polyphosphate on to an adjacent right-of-way. The right-of-way was owned by BNSF. BNSF sued Poole under several state and federal causes of action, contending that Poole was liable for damages to, and costs of removing the chemicals from, its property. Poole denied liability and claimed a third-party's acts or omissions were the sole cause of the release of the chemicals and the alleged damages. Poole sued Skinner on April 19, 2004, alleging several products liability causes of action. Poole asserted that Skinner designed, manufactured, fabricated, constructed, assembled, maintained, and tested the above-ground chemical storage tank that ruptured. Poole claimed that the tank was in a defective condition, which rendered it unreasonably dangerous. Poole also claimed that the allegedly defective condition was a producing and proximate cause of the injuries and damages suffered by Poole and BNSF. Poole's causes of action include negligence, strict liability, misrepresentation, and breach of warranties. The fraud and negligence per se causes of action were withdrawn/dismissed. Poole also claims that Skinner is liable to Poole for contribution and/or indemnification.
III. STANDARD
Summary judgment is appropriate only if "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any," when viewed in the light most favorable to the non-moving party, "show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247, 91 L.Ed.2d 202, 106 S.Ct. 2505 (1986) (internal quotations omitted). A dispute about a material fact is "genuine" if the evidence is such that a reasonable jury could return a verdict for the non-moving party. Id. at 248. In making its determination, the court must draw all justifiable inferences in favor of the non-moving party. Id. at 255. Once the moving party has initially shown "that there is an absence of evidence to support the nonmoving party's case," Celotex Corp. v. Catrett, 477 U.S. 317, 325, 91 L.Ed.2d 265, 106 S.Ct. 2548 (1986), the non-movant must come forward, after adequate time for discovery, with significant probative evidence showing a triable issue of fact. FED.R.CIV.P. 56(e); State Farm Life Ins. Co. v. Gutterman, 896 F.2d 116, 118 (5th Cir. 1990). Conclusory allegations and denials, speculation, improbable inferences, unsubstantiated assertions, and legalistic argumentation are not adequate substitutes for specific facts showing that there is a genuine issue for trial. Douglass v. United Servs. Auto. Ass'n, 79 F.3d 1415, 1428 (5th Cir. 1996) (en banc); SEC v. Recile, 10 F.3d 1093, 1097 (5th Cir. 1993). To defeat a properly supported motion for summary judgment, the non-movant must present more than a mere scintilla of evidence. See Anderson, 477 U.S. at 251. Rather, the non-movant must present sufficient evidence upon which a jury could reasonably find in the non-movant's favor. Id.
In reviewing the summary judgment evidence, "Rule 56 does not impose upon this Court a duty to sift through the record in search of evidence to support a party's opposition to summary judgment." Ragas v. Tenn. Gas Pipeline Co., 136 F.3d 455, 458 (5th Cir. 1998). Rather, the Court need rely only on those portions of the submitted documents to which the nonmoving party directs the Court's attention. Id.; see also Forsyth v. Barr, 19 F.3d 1527, 1536-37 (5th Cir. 1994) (finding that two volumes of summary judgment evidence were insufficient to preclude summary judgment when plaintiffs failed to identify specific portions which supported their claims).
Rule 56(e), Federal Rules of Civil Procedure, requires the party against whom the motion is made to "set forth specific facts showing that there is a genuine issue for trial." Absent such a showing, a properly supported motion for summary judgment should be granted. See Eversley v. MBank Dallas, 843 F.2d 172, 173-74 (5th Cir. 1988); Resolution Trust Corp. v. Starkey, 41 F.3d 1018, 1022-23 (5th Cir. 1995). Once a properly supported motion for summary judgment is presented, the nonmoving party must rebut with "significant probative" evidence. Ferguson v. National Broadcasting Co., Inc., 584 F.2d 111, 114 (5th Cir. 1978). "[T]he nonmoving litigant is required to bring forward significant probative evidence demonstrating the existence of a triable issue of fact." In Re Municipal Bond Reporting Antitrust Lit., 672 F.2d 436, 440 (5th Cir. 1982). A party defending against a proper motion for summary judgment may not rely on mere denial of material facts or on unsworn allegations in the pleading or arguments and assertions in briefs or legal memoranda; rather, the party's response, by affidavit or otherwise, must set forth specific facts showing that there is a genuine issue for trial. See Union Planters Nat'l Leasing v. Woods, 687 F.2d 117, 119 (5th Cir. 1982).
IV. DISCUSSION
Skinner argues that section 16.012 of the Texas Civil Practice and Remedies Code ("section 16.012") prohibits any products liability suit filed after July 1, 2003, to be commenced more than fifteen years after the date the product was sold. Section 16.012 is designed to protect manufacturers and sellers from stale claims based on a product. Zaragosa v. Chemetron Investments, Inc., 122 S.W.3d 341, 345 (Tex.App.-Fort Worth 2003, no pet.). Section 16.012(a)(2) defines products liability actions as
any action against a manufacturer or seller for recovery of damages or other relief for harm allegedly caused by a defective product, whether the action is based in strict tort liability, strict products liability, negligence, misrepresentation, breach of express or implied warranty, or any other theory or combination of theories, and whether the relief sought is recovery of damages or any other legal or equitable relief, including a suit for:
(A) injury or damage to or loss of real or personal property;
(B) personal injury;
(C) wrongful death;
(D) economic loss; or
(E) declaratory, injunctive, or other equitable relief.
Tex. Civ. Prac. Rem. Code § 16.012 (Vernon 2004).
The prior version of section 16.012, which was in effect at the time the tank ruptured, contained the same 15-year period. Thus, the new version did not alter the repose period in effect prior to the current version's effective date. Tex. Civ. Prac. Rem. Code § 16.012 (1993). It is not clear that the storage tank at issue would not have qualified as "manufacturing equipment" under the prior version.
Skinner alleges that it completed the installation of the storage tanks on October 28, 1988. One of the tanks ruptured on January 29, 2003. However, Poole did not file its complaint against Skinner until April 16, 2004 — almost six months after the 15-year period under section 16.012 had expired and nearly fifteen months after the tank had ruptured. Skinner further asserts that all of Poole's claims are of the type that the Legislature intended to be prohibited because all of Poole's remaining claims are either specifically listed under section 16.012 or covered under the broad language which encompasses "any theory or combination of theories, and any relief sought. . . ." Thus, Skinner argues, Poole's claims against it are barred by section 16.012.
In its Response, Poole argues that (1) section 16.012 cannot be applied retroactively to Poole's claims against Skinner because (a) the terms of the statute do not evidence a clear intent that it be applied retroactively and (b) any retroactive application would violate the Texas Constitution; (2) the indemnity/contribution claims are not within section 16.012's purview and said claims do not accrue until Poole becomes liable to BNSF for damages; and (3) section 16.012's 15-year period is preempted by or superseded by federal law because Poole's claims against Skinner follow BNSF's claims against Poole, the Third-Party Plaintiff, under the Comprehensive Environmental Response Compensation and Liability Act ("CERCLA"), 42 U.S.C. § 9601- 9675. Retroactivity and Open Courts Doctrine
At no point did either party present arguments regarding whether section 16.012 was the proper statute of repose for the circumstances of this case. Specifically, Poole did not object (other than as to whether the Act covered indemnification/contribution for products liability claims) to the classification of its claims as "products liability: manufacturing equipment" claims — the subject matter to which section 16.012 applies. Thus, the Court concludes that Poole's claims are of the type to which section 16.012 applies.
The Court notes that section 16.009 might also be construed as applying to the case at hand See Tex. Civ. Prac. Rem. Code § 16.009 (Vernon 2002) (10-year statute of repose for persons furnishing construction or repair of improvements). However, because section 16.009 was not advanced by Skinner as an affirmative defense in its Original Answer to Poole's claims, this Court need not consider it.
Poole argues that statutes are to be applied prospectively unless the terms of the statute clearly show the legislative intent that it is to be retroactive in application and that any doubt is to be resolved against retroactive application. See Ex parte Abell, 613 S.W.2d 255, 258 (Tex. 1981). Poole asserts that section 16.012 does not evince a clear legislative intention for retroactive application. However, if "by fair implication from the language used that it was the intent of the Legislature to make [an act] applicable to both past and future transactions, then the act may be properly applied retroactively." Id.
"In ascertaining legislative intent, the entire act must be examined, not just isolated provisions in the act." Id. Here, section 16.012 is designed to operate as a statute of repose. The statute's plain language clearly shows that the Legislature intended for section 16.012 to cut off a right of action after a 15-year period. See § 16.012(b) ("Except as provided by Subsections (c), (d), and (d-1), a claimant must commence a products liability action against a manufacturer or seller of a product before the end of 15 years after the date of the sale of the product by the defendant."). Because the plain language of section 16.012 "sets a period of time within which an action may be brought," the statute is a statute of repose. See Johnson v. City of Ft. Worth, 774 S.W.2d 653, 654 n. 1 (Tex. 1989); Holubec v. Brandenberger, 111 S.W.3d 32, 37 (Tex. 2003) (listing, along with other similar statutes, section 16.012 as a statute of repose, which fixes an outer limit beyond which no action can be maintained).
Section 16.012(b) provides three exceptions to the 15-year cut-off-none of which is at issue in this case. Subsection (c) allows a greater time if so warranted under a warranty by the seller or manufacturer. Subsection (d) prevents application of the statute to personal injury claims that did not manifest themselves before the end of the 15-year period. Subsection (d-1) merely states that a limitations period for personal injury claims described in subsection (d) is not reduced for claims that accrue before the end of the 15-year period (in effect allowing such claims the benefit of the applicable statute of limitations period before being barred)).
In this instance, the Legislature clearly intended section 16.012 to be a statute of repose rather than a garden-variety statute of limitations. When dealing with a statute of repose, it is generally implied that they are to have retroactive application:
Although generally statutes of limitations are statutes that set periods of time within which actions must be brought after they "accrue," and therefore are not retroactive, statutes of repose differ from other statutes of limitations in the sense that the term "statute of repose" refers to a distinct type of statute that cuts off a right of action before it accrues. As such, [statutes of repose] are distinguishable from the usual statutes of limitations, which operate merely to bar enforcement of a right; these statutes take away the right altogether after the specified period. These [types of] statutes represent a response by the legislature to the inadequacy of traditional statutes of limitations and are specifically designed to protect [defendants] from protracted and extended vulnerability to lawsuits. [Statutes of repose] were intended to be applied retroactively.Texas Gas Exploration Corp. v. Flour Corp., 828 S.W.2d 28, 32 (Tex.App.-Texarkana 1991, writ granted, order withdrawn, writ denied) (internal citations omitted).
Applying the same logic to section 16.012, and because by fair implication from the language used it can be ascertained that the Legislature intended section 16.012 to be a statute of repose, this Court finds that the clear legislative intent was to apply section 16.012 retroactively. Statutes of repose demonstrate legislative recognition of the protracted and extensive vulnerability to lawsuits of defendants under certain circumstances. Sowders v. M.W. Kellogg Co., 663 S.W.2d 644, 647 (Tex.App.-Houston [1st Dist.] 1983, writ ref'd n.r.e.). The cardinal rule of statutory construction is to ascertain the intent of the legislature and to give effect to that intent. Knight v. Int'l Harvester Credit Corp., 627 S.W.2d 382, 384 (Tex. 1982). A reviewing court, however, is not confined to the literal meaning of the words used but must consider that which is implied as well as that which is expressed. McCulloch v. Fox Jacobs, Inc., 696 S.W.2d 918, 921 (Tex.App.-Dallas 1985, writ ref'd n.r.e.).
Poole cites to Dayton Independent School District v. U.S. Mineral Products Company, 789 F. Supp. 819 (E.D. Tex. 1992), which relied heavily on Doran v. Compton, 645 F.2d 440, 447 (5th Cir. 1981), for the proposition that if the statute became effective before a plaintiff filed an action but after accrual of the action, then the statute would be unconstitutional. See Pl. Br. at 5. However, Dayton dealt specifically with the retroactive application of similar repose statutes to personal injury claims based on asbestos exposure. Dayton simply proclaims that (1) asbestos injury claims are not covered retroactively because it would be impossible to know of a claim until the injury manifested itself and (2) no clear intent existed that the legislature intended retroactivity for that particular statute of repose. As to asbestos exposure claims, the current version of section 16.012 specifically states that personal injury claims are exempt if they were not discoverable until after the repose period had expired. See § 16.012(d). Thus, Dayton and the current version of section 16.012 do not differ on that point. If the district court in Dayton meant to carve out an exception for asbestos injury claims, the current section 16.012 incorporates such an exception.
As to retroactivity, Poole also quotes the district court in Dayton as stating that "[t]he legislature certainly had knowledge of its own rule of construction that statutes would be presumed to operate prospectively unless expressly made retroactive . . . [and] . . . the Court [cannot] find any indication that the legislature intended the Statutes of Repose to apply retroactively." See Pl. Br. at 5. The district court in Dayton apparently either chose to ignore or was unaware of the Texarkana Court of Appeals decision in Texas Gas Exploration Corporation, which specifically found that sections 16.008 and 16.009 were indeed intended to be retroactive. See Dayton, 789 F. Supp. at 821 ("No Texas court has yet addressed the specific question of whether the legislature intended Sections 16.008 and 16.009 to be applied retroactively."). The district court in Dayton also stated that the "[d]efendant does not cite, nor can the Court find, any indication that the legislature intended the Statutes of Repose to apply retroactively." Such is not the case here. Here, not only has the Court found Texas case law stating that statutes of repose are intended to have retroactive application, Texas Gas Exploration Corporation, 828 S.W.2d at 32, but the Third-Party Defendant has also cited in its Reply section 23.02(c) of Acts 2003, 78th Legislature, chapter 204, which provides:
"Section 16.008 protects registered or licensed engineers who design, plan, or inspect the construction of improvements to real property or equipment attached to real property if suit is brought more than ten years after the substantial completion of the improvement or the beginning of operation of the equipment. Tex. Civ. Prac. Rem. Code Ann. § 16.008. Section 16.009 protects a person who constructs or repairs improvements to real property when the suit is brought more than ten years after the substantial completion of the improvement. Tex. Civ. Prac. Rem. Code Ann. § 16.009." Cofer v. Ferro Corp., 2003 WL 21804821, *3 (Tex.App.-Tyler 2003).
Articles 4, 5, and 8 of this Act apply to an action filed on or after July 1, 2003. An action filed before July 1, 2003, is governed by the law in effect immediately before the change in law made by Articles 4, 5, and 8, and that law is continued in effect for that purpose.
Acts 2003, 78th Leg., ch. 204, § 23.02(c) (emphasis added).
Skinner contends that the current section 16.012 was intended to apply to all cases filed after July 1, 2003, as opposed to the logic behind Poole's argument, which would require that the Legislature had intended section 16.012 to apply to causes of action that accrued after July 1, 2003. Skinner argues that the Legislature had used the word "accrued" in earlier versions but purposefully chose the word "filed" in this instance. Thus, as Skinner's argument goes, the Legislature was aware of the difference between "filed" and "accrued" and chose the former. Skinner maintains that such a choice of language evinces a clear intent by the Legislature that the current version of section 16.012 be applied retroactively. See Reply at 2.
The Court finds that the language used by the Legislature shows a clear intent that the current version of section 16.012 be applied retroactively. Regardless, any retroactive application to Poole's claims did not remove Poole's right to bring its cause of action — it merely shortened the time frame for which to do so, as will be discussed below.
Poole argues, however, that the circumstances of its claim and the date that the current section 16.012 became effective combine to create a special circumstance in this instance. Poole contends that its causes of action against Skinner accrued and vested five months before section 16.012 became effective. Specifically, Poole asserts that its claim accrued on the date the tank ruptured. Case law on sections 16.008 and 16.009, similar repose statutes, states that a repose period begins to run from when the "improvements are completed or operations commence, rather than when the cause of action accrues." Texas Gas Exploration Corp., 828 S.W.2d at 32 (citing Sowders, 663 S.W.2d at 647); Holubec, 111 S.W.3d 32, 37 (citing Trinity River Auth. v. URS Consultants, 889 S.W.2d 259, 261 (Tex. 1994) ("While either statute [of limitations or repose] sets deadlines for plaintiffs to file claims, the period set under a statute of repose is independent of the claim's accrual or discovery.")). "Thus statutes of repose not only cut off rights of action within the specified time after they accrue, but they also cut off rights of action before they accrue at all." Holubec v. Brandenberger, 111 S.W.3d at 37.
The Court sees no reason why the same logic applied to sections 16.008 and 16.009 should not apply to section 16.012; thus, Poole's date of accrual (January 29, 2003) makes no difference for the function of section 16.012. Because a statute of repose does not hinge on accrual or discovery of an injury but on the completion of sale or manufacture of the product, it cannot be logically argued that the Legislature intended only a prospective effect. Under Poole's logic, the prospective application would mean that the full force of section 16.012 would not be felt until a full fifteen years after its effective date. A prospective-only approach means that only completed sales or manufacture after July 1, 2003, could begin the clock ticking. Thus, the effect of the statute would not be felt until July 1, 2018. "[A] statute of repose is typically an absolute time limit beyond which liability no longer exists and is not tolled for any reason because to do so would upset the economic balance struck by the legislative body." First United Methodist Church of Hyattsville v. U.S. Gypsum Co., 882 F.2d 862, 866 (4th Cir. 1989) (distinguishing between statutes of limitation and repose).
Poole argues, however, that section 16.012 is operating to remove a vested right of action in that Poole had a cause of action that section 16.012 extinguished on October 28, 2003. Poole cites to Baker Hughes, Inc. v. Keco R. D., Inc., 12 S.W.3d 1, 3 (Tex. 1999), in support of its argument that "[i]t is well settled that statutes of limitation cannot be given retroactive effect where `to do so would impair rights which had become vested before the act became effective.'" See Pl. Br. at 6. Poole argues that it had a vested right of action prior to the enactment of the current section 16.012 and that if section 16.012 is given retroactive application, such application would be cutting off Poole's vested right. But see Texas Gas Exploration Corp. v. Flour Corp., 828 S.W.2d 28, 32 (Tex.App. — Texarkana 1991, writ granted, order withdrawn, writ denied) ("neither the Constitution of the United States nor of this state forbids the abolition of common-law rights to attain a permissible legislative objective").
Baker v. Hughes dealt with statutes of limitation, rather than repose, and to a pending (already filed) suit. Moreover, it is distinguishable in that Baker involved a defendant's use of a vested defense — the prior, shorter limitations period. Regardless, Baker makes little difference because Poole's right of action was not eliminated. Poole still had a period of time to file its action even after the effective date of the current section 16.012 — the time between July 1, 2003 and October 28, 2003. Moreover, Poole also had a full five months before the statute became effective to file its suit, but Poole chose to wait. Baker is also distinguishable from this case because the statute at issue here was effective before Poole filed its suit; whereas, in Baker, the suit had been filed prior to the statutory change.
"The purpose of repose statutes is to give absolute protection to certain parties from the burden of indefinite potential liability." Holubec, 111 S.W.3d 32, 37 (citing Sowders v. M.W. Kellogg Co., 663 S.W.2d 644, 648 (Tex.App.-Houston [1st Dist.] 1983, writ ref'd n.r.e.)). Even though it is well settled that laws may not operate retroactively to deprive or impair vested substantive rights, Ex parte Abell, 613 S.W.2d 255, 260 (Tex. 1981), the Legislature can certainly shorten a limitations period, even with respect to existing causes of action. See City of Tyler v. Likes, 962 S.W.2d 489, 502 (Tex. 1998) ("The Legislature can affect a remedy by providing a shorter limitations period for an accrued cause of action without violating the retroactivity provision of the Constitution if it affords a reasonable time or fair opportunity to preserve a claimant's rights under the former law, or if the amendment does not bar all remedy."); 12A Tex. Jur. 3D Constitutional Law § 309 (2004) (West). No litigant has a vested right in a statute or rule which affects remedy or is procedural in nature. Ex parte Abell, 613 S.W.2d at 260. However, a reasonable time must be afforded within which existing causes of action may be commenced. Id.; 12A Tex. Jur. 3D § 309. Here, Poole still had a reasonable period of time within which to file an action. Whether Poole or its counsel was aware of the change in law is irrelevant to the Court for purposes of the issues at hand The fact is, following the date that the current section 16.012 became effective, Poole still had nearly four full months (before October 28, 2003) to bring a claim stemming from the ruptured tank, which had occurred nearly ten months prior. The Court finds, under these circumstances, that the version of section 16.012 that became effective on July 1, 2003, merely operated to procedurally cut short Poole's time for filing suit. The prior version of section 16.012, in its subsection (d), contained a provision that maintained the statute of limitations period for a claim that accrued before the repose period expired. The new version contained such a provision only for personal injury claims. Because the Legislature was intentionally silent on all other claims, it can be inferred that they chose to have an absolute cut-off at the expiration of the repose period for all claims which were not based upon personal injury.
"The legislature may provide a shorter period of limitation for existing causes of action. It may make a statute of limitation for causes when none existed before, but it cannot, by so abbreviating the time in which suit must be brought, take away the right of action altogether." Wright v. Hardie, 88 Tex. 653, 32 S.W. 885, 886 (1895) (emphasis added). "When a statute, whether it be termed one of "limitation" or of "repose," eliminates a plaintiff's access to the courts for redress of an injury, despite the exercise of all possible diligence, it is susceptible to constitutional challenge. . . ." Nelson v. Krusen, 678 S.W.2d 918, 927 (Tex. 1984) (Robertson, J., concurring) (emphasis added). Here, Poole's access was not eliminated altogether. In fact, if Poole had exercised reasonable diligence, it could have filed its claims during the window between section 16.012's effective date of July 1, 2003 and the end of the 15-year repose period of October 28, 2003. Thus, the Legislature did not take away Poole's claims, vested or not, because Poole could have still filed its suit against Skinner.
Poole made no argument regarding the change in subsection (d). When the Legislature changed subsection (d) to subsection (d-1), it in essence shortened the period of time for filing the suit to ten months as applied to Poole's claims rather than twenty-four months (the provision that maintained the statute of limitations period for a claim that accrued before the repose period expired was changed to apply only to personal injury claims). Poole only argued that the new section 16.012 removed its vested right to file suit — an incorrect argument because Poole still had a period of time to file its suit. Moreover, Poole made no argument that the revision to subsection (d) shortened its period to file suit. Thus, any argument is waived regarding the change which made said provision apply only to personal injury claims.
When looking at similar statutes of repose in the past, Texas courts have upheld their constitutionality when challenged. See Hill v. Forrest Cotton, 555 S.W.2d 145 (Tex.Civ.App.-Eastland 1977, writ ref'd n.r.e.); Sowders v. M.W. Kellogg Co., 663 S.W.2d 644, 648 (Tex.App.-Houston [1st Dist.] 1983, writ ref'd n.r.e.) (retroactive application of Tex. Civ. Prac. Rem. Code §§ 16.008 and 16.009 does not violate the right of access to court or the constitutional prohibition against ex post facto laws); Ellerbe v. Otis Elevator Co., 618 S.W.2d 870 (Tex.App.-Houston [1st Dist.] 1981, writ ref'd n.r.e.) (same); Texas Gas Exploration Corp., 828 S.W.2d at 32 (same). This Court finds that section 16.012, like the similar statutes of repose found to be free of constitutional infirmities, does not violate the Texas Constitution. Specifically, the Court finds, as prior courts have found for similar statutes, that section 16.012 does not violate the open courts provision or the Texas Constitution's prohibition against retroactive/ ex post facto laws.
As such, Poole's argument that section 16.012 should be interpreted so as to make it inapplicable to Poole's claims accruing prior to the effective date of section 16.012 is without merit. See, e.g., Texas Gas Exploration Corp., 828 S.W.2d at 32. The Legislature intended for section 16.012 to be applied retroactively. Poole had a reasonable window of nearly four months following the date that section 16.012 became effective in which to bring its suit. Poole failed to do so.
Here, section 16.012 bears a rational relationship to a legitimate state interest, thus defeating Poole's open courts argument. The open courts provision is applicable when a litigant bringing a common law cause of action is unreasonably denied access to the courts. See TEX. CONST. art. 1, § 13. Thus, where a litigant does not have the opportunity to bring suit within the statute of limitations, the statute may be unconstitutional as applied to that individual. Fiore v. HCA Health Services of Texas, Inc., 915 S.W.2d 233, 237 (Tex.App.-Fort Worth 1996, writ denied). To establish an open courts violation, Poole must show: (1) a well-recognized common law cause of action that is being restricted; and (2) the restriction is unreasonable or arbitrary when balanced against the purpose and basis of the statute. Moreno v. Sterling Drug, Inc., 787 S.W.2d 348, 355 (Tex. 1990). "In evaluating whether a statute violates the open courts provision, we consider both the general purpose of the statute and the extent to which the litigant's right is affected." Owens Corning v. Carter, 997 S.W.2d 560, 574 (Tex. 1999) (citing Sax v. Votteler, 648 S.W.2d 661, 665-66 (Tex. 1983)). "The purpose of repose statutes is to give absolute protection to certain parties from the burden of indefinite potential liability." Holubec, 111 S.W.3d at 37. The purpose behind the open courts provision is that a statute will be "rendered unconstitutional if it cuts off a cause of action before the action is known to exist or before suit can be brought." Fiore, 915 S.W.2d at 237. A statute of limitations is a procedural device that operates as a defense to limit the remedy available from an existing cause of action. Goad v. Celotex Corp., 831 F.2d 508, 511 (4th Cir. 1987).
A statute of repose creates a substantive right in those protected to be free from liability after a legislatively-determined period of time. . . . Statutes of repose are based on considerations of the economic best interests of the public as a whole and are substantive grants of immunity based on a legislative balance of the respective rights of potential plaintiffs and defendants struck by determining a time limit beyond which liability no longer exists. . . . [A] statute of repose is typically an absolute time limit beyond which liability no longer exists and is not tolled for any reason because to do so would upset the economic balance struck by the legislative body.First United Methodist Church of Hyattsville v. U.S. Gypsum Co., 882 F.2d 862, 865-66 (4th Cir. 1989).
As stated above, Poole was not completely cut off from court access. Poole's causes of action were not eliminated. Rather, Poole waited almost fifteen months after discovery of its claims before filing suit. See Hall v. Dow Corning Corp., 114 F.3d 73, 77 (5th Cir. 1997) (holding that a 15-month delay between discovery of claims and filing suit is unreasonable); Fiore v. HCA Health Servs. of Texas, Inc., 915 S.W.2d 233 (Tex.App.-Fort Worth 1996, writ denied) (13-month delay in bringing suit was excessive as a matter of law); LaGesse v. PrimaCare, Inc., 899 S.W.2d 43 (Tex.App.-Eastland 1995, writ denied) (12-month delay was excessive as a matter of law). The Legislature enacted section 16.012 to protect manufactures and sellers from being haled into court from products that were sold or manufactured more than fifteen years earlier. Poole's remedy was not removed — Poole still had a reasonable time to pursue its remedy. Section 16.012 does not violate the open courts provision of the Texas Constitution.
Indemnity/Contribution Claims
Poole argues that its indemnity/contribution claims are not within section 16.012's purview and said claims do not accrue until Poole becomes liable to BNSF for damages. See Pl. Br. at 8-9. Poole argues that although sections 16.008 and 16.009 expressly state that those two statutes apply to indemnity and contribution claims, section 16.012 fails to make such an express assertion. Skinner contends that the broad language of "any other theory or combination of theories, and whether the relief sought is recovery of damages or any other legal or equitable relief" is sufficient to encompass Poole's claims for indemnity and contribution arising out of the products liability claims. By common usage, "any" means "one or some indiscriminately of whatever kind." Webster's Third New International Dictionary 97 (1993). This expansive meaning is reinforced by the phrase indicating that such an action is considered a products liability action regardless of whether the action is based on one of the specifically enumerated theories or on "any other theory or combination of theories." See, e.g., Saporito v. Cincinnati Inc., 2004 WL 234378, *5 (Tex.App.-Houston [14th Dist.] 2004) (unpublished). Such broad language could certainly be held to encompass Poole's claims for indemnity and contribution against Skinner arising out of Poole's product liability claims and be subject to section 16.012. The Court finds that section 16.012 is plainly worded in such a manner as to encompass Poole's claims for indemnity and contribution.
Poole also argues that its claims for indemnity and contribution do not accrue until a plaintiff recovers damages or settles with BNSF. For statutes of repose, the accrual date is irrelevant. Poole's claims for indemnity and contribution were required to have been filed before October 28, 2003. As stated above, any claim that accrues after the repose period has expired is cut off. See Texas Gas Exploration Corp., 828 S.W.2d at 32 (citing Sowders, 663 S.W.2d at 647); Holubec, 111 S.W.3d 32, 37 (citing Trinity River Auth. v. URS Consultants, 889 S.W.2d 259, 261 (Tex. 1994) ("While either statute [of limitations or repose] sets deadlines for plaintiffs to file claims, the period set under a statute of repose is independent of the claims accrual or discovery.")). "Thus statutes of repose not only cut off rights of action within the specified time after they accrue, but also they may cut off rights of action before they accrue at all." Holubec, 111 S.W.3d at 37. As such, Poole's claims for indemnity and contribution would clearly fall under section 16.012's purview and be barred because more than fifteen years have passed since the completion of the sale/manufacture of the tanks (the date the 15-year period begins).
Preemption
Finally, Poole argues that because BNSF sued Poole under CERCLA, section 16.012 is pre-empted by CERCLA. Poole did not sue Skinner under CERCLA; rather, it sued Skinner under claims of negligence, strict liability, misrepresentation, breach of warranties, contribution, and indemnity which are, as Poole itself admits, all state law causes of action. See Pl. Br. at 9 ("since Poole Chemical has asserted its state law causes of action against Skinner Tank Company. . . ."). All of Poole's claims are products liability claims. Poole cites 42 U.S.C.A. § 9658(a) as the relevant CERCLA provision. It states as follows:
Although the Ninth Circuit Court of Appeals has held that CERCLA's discovery rule applies to actions that assert state-law claims without an accompanying CERCLA claim, this Court notes that other courts have reached the opposite conclusion. See A.S.I., Inc. v. Sanders, 835 F. Supp. 1349, 1355 n. 1 (D. Kan. 1993) ("The action is barred against defendants . . . since no CERCLA claims have been advanced against them, and hence there is no federal preemption as to the state statute of repose."); Becton v. Rhone-Poulenc, Inc., 706 So.2d 1134, 1137 (Ala. 1997) ("Most federal courts have limited the application of § 9658 to situations where an underlying CERCLA claim has been made. . . ."); Knox v. A C S, Inc., 690 F. Supp. 752, 757 (S.D. Ind. 1988) (discussing the committee report to Congress on the provision (now § 9658), and that the report states "its recommendations were limited to the scope of CERCLA itself" and the remedies discussed in the report are those "for which CERCLA provides cleanup and remedial activities"); id. ("In fact, the wording of § 9658 and its incorporation of the terms of CERCLA and the CERCLA definition of those terms indicate that the provision was limited to application in the situation where a state cause of action exists in conjunction with a CERCLA cause of action.") (emphasis added); First United Methodist Church of Hyattsville v. U.S. Gypsum Co., 882 F.2d 862, 868 n. 8 (4th Cir. 1989) ("[Defendant makes the counter-argument on this point that since [Plaintiff] has not pleaded a cause of action under CERCLA, it cannot avail itself of the preemptive effect of § 9658. See Knox, 690 F. Supp. at 757-58. . . . [W]e need not reach this issue.").
Poole did not assert a CERCLA cause of action against Skinner. Moreover, Skinner was not intended to be covered by CERCLA because the Superfund Amendment (which included § 9658) was intended to apply to owners and operators of a facility, along with transporters of hazardous substances. See Covalt v. Carey Canada, Inc., 860 F.2d 1434, 1436-39 (7th Cir. 1988). Skinner does not fall under any of these categories. Instead, Skinner merely manufactured and sold a tank to Poole in 1988. Although CERCLA intends to reach back and make prior owners and operators of a facility (along with transporters) responsible for the release and discharge of hazardous substances that occurred while they owned or operated the facility, there is no clear intent that Congress wished a non-owner/operator be liable many years after its sale/manufacture of a product had concluded.
(a) State statutes of limitations for hazardous substance cases
(1) Exceptions to State statutes
In the case of any action brought under State law for personal injury, or property damages, which are caused or contributed to by exposure to any hazardous substance, or pollutant or contaminant, released into the environment from a facility, if the applicable limitations period for such action (as specified in the State statute of limitations or under common law) provides a commencement date which is earlier than the federally required commencement date ["FRCD"], such period shall commence at the federally required commencement date in lieu of the date specified in such State statute.
(2) State law generally applicable
Except as provided in paragraph (1), the statute of limitations established under State law shall apply in all actions brought under State law for personal injury, or property damages, which are caused or contributed to by exposure to any hazardous substance, or pollutant or contaminant, released into the environment from a facility.42 U.S.C.A. § 9658(a)(1) and (2).
In explaining the meaning of the above-quoted statute, the Second Circuit Court of Appeals declared the following:
[T]he term "federally required commencement date" means the date the plaintiff knew (or reasonably should have known) that the personal injury or property damages referred to in subsection (a)(1) of this section were caused or contributed to by the hazardous substance or pollutant or contaminant concerned. . . . The language of § 9658(a)(1), specifying that the applicable state limitations period "shall commence at the federally required commencement date in lieu of" an "earlier" date provided by state law, makes it indisputably clear that Congress intended, in the cases to which § 9658 applies, that the FRCD preempt state law accrual rules if, under those rules, accrual would occur earlier than the date on which the cause of the personal injury was, or reasonably should have been, known to be the hazardous substance.Freier v. Westinghouse Elec. Corp., 303 F.3d 176, 196 (2d Cir. 2002).
However, the Second Circuit in Freier went on to hold that "[t]he FRCD preempts a more restrictive state law only with respect to the date on which a claim accrues, not with respect to the length of the limitations period." Freier, 303 F.3d at 196 (citing 42 U.S.C. § 9658(a)(1) as stating "if the applicable [state or common law] limitations period . . . provides a commencement date which is earlier than the federally required commencement date, such period shall commence at the federally required commencement date in lieu of the [state law] date") (emphasis added). The Second Circuit went on to hold that "[state] law still controls with respect to the length of the limitations period." Id. Thus, the Second Circuit reasoned that if a state law provides a period following the date of discovery for a plaintiff to commence a lawsuit, it would satisfy the federally required commencement date (FRCD). See id.
Under the FRCD, Poole's claims against Skinner accrued on the date of discovery (January 29, 2003). Here, Poole did indeed have a period of time following the discovery to file its lawsuit against Skinner. As discussed above, Poole still had nearly four months following discovery of the injury before section 16.012's repose period expired. No one disputes that Poole's injuries accrued on January 29, 2003, the date the tank ruptured.
Moreover, the Court finds that CERCLA would not apply to Skinner. As Skinner argued in its Reply, it is not a "responsible person" as listed in CERCLA. Responsible persons are defined by CERCLA as
(1) the owner and operator of a vessel or a facility,
(2) any person who at the time of disposal of any hazardous substance owned or operated any facility at which such hazardous substances were disposed of,
(3) any person who by contract, agreement, or otherwise arranged for disposal or treatment, or arranged with a transporter for transport for disposal or treatment, of hazardous substances owned or possessed by such person, by any other party or entity, at any facility or incineration vessel owned or operated by another party or entity and containing such hazardous substances, and
(4) any person who accepts or accepted any hazardous substances for transport to disposal or treatment facilities, incineration vessels or sites selected by such person, from which there is a release, or a threatened release which causes the incurrence of response costs, of a hazardous substance. . . .42 U.S.C.A. § 9607(a)(1-4).
From the facts alleged and the record before this Court, it is apparent that Skinner does not fit under any of the four categories listed in § 9607(a) as covered persons. However, § 9658(3) states that "[n]othing in this section shall apply with respect to any cause of action brought under § 9607 of this title." 42 U.S.C. § 9658(3). However, and more importantly, it does not state the converse. Nothing in either § 9607 or § 9658 states that § 9607 was not intended to apply to § 9658. CERCLA was intended to apply to current and former owners, operator, and transporters of hazardous waste. See Covalt v. Carey Canada, Inc., 860 F.2d 1434, 1436-39 (7th Cir. 1988). Section 9658(3)'s exclusion of § 9607 from the application of § 9658 is not a clear intent to remove § 9658 from the basic presumptions of CERCLA — that the defendant be a covered person under § 9607. The Court notes that had Congress desired that § 9607 not apply to § 9658, it could have expressly provided so. After all, it provided for the converse — that nothing in § 9658 was to apply to § 9607. "In closing, [this Court] note[s] that this interpretation of CERCLA fully comports with the most fundamental guide to statutory construction — common sense." First United Methodist Church of Hyattsville v. U.S. Gypsum Co., 882 F.2d 862, 869 (4th Cir. 1989). To infer that Congress, by enacting CERCLA, intended to preempt state statutes of repose as applied to manufacturers/sellers sued in products liability actions, is to stretch the statute far beyond its intended reach. The Court believes an intermediate California appellate court reasoned soundly when it opined:
To establish a claim for cost recovery under CERCLA, a claimant must prove not only that the site in question was a "facility" and that a "release" or threatened release of a hazardous substance occurred, but must also show that the defendant falls within a category of "liable parties" as set forth in title 42 United States Code section 9607(a) and that the release or threatened release caused the claimant to incur "necessary costs of response." The four categories of "liable parties" as outlined in title 42 United States Code section 9607(a) are: (1) present owners and operators of a facility; (2) past owners and operators of a facility at the time of disposal; (3) arrangers for disposal or treatment; and (4) transporters. Noticeably absent from this list are manufacturers or distributors of products, the entities most likely to end up as defendants in a product liability lawsuit where personal injury is involved.Rivas v. Safety-Kleen Corp., 119 Cal.Rptr.2d 503, 514-15 (Cal.App. 2 Dist. 2002) (internal citations omitted).
However, the Court also notes that the intermediate California appellate court went on to state:
Clearly, Congress intended section 9658 to have impact beyond actions for recovery of expenses incurred in cleaning up toxic waste sites. It applies by its terms to individual lawsuits for "personal injury, or property damages," not just "necessary costs of response," and can be invoked regardless of whether the defendants meet the statutory definition of "liable party" under title 42 United States Code section 9607(a).Rivas, 119 Cal.Rptr.2d at 517 (Cal.App. 2 Dist. 2002).
This Court respectfully disagrees with the California court on its assertion that CERCLA preemption can be invoked "regardless of whether the defendants meet the statutory definition of `liable party' under . . . section 9607(a)." After a review of case law dealing with the interplay between § 9607 and § 9658, this Court was unable to find any other court, other than the California appellate court, drawing the same conclusion. Thus, this Court finds that Poole's state law claims against a party who is/was not a prior owner, operator, or transporter of hazardous substances, fall outside of § 9658's preemption.
V. CONCLUSION
For the reasons discussed above, Skinner Tank Company's Motion for Summary Judgment is GRANTED.
SO ORDERED.