Montfort Square Shopping Center, Ltd. v. Goodyear Tire & Rubber Company
Filing
47
MEMORANDUM OPINION AND ORDER granting in part and denying in part 36 Motion for Summary Judgment filed by Montfort Square Shopping Center, Ltd. (Ordered by Chief Judge Sidney A Fitzwater on 6/21/2012) (Chief Judge Sidney A Fitzwater)
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF TEXAS
DALLAS DIVISION
MONTFORT SQUARE SHOPPING
CENTER, LTD.,
Plaintiff,
VS.
GOODYEAR TIRE & RUBBER
COMPANY,
Defendant.
§
§
§
§
§ Civil Action No. 3:10-CV-1673-D
§
§
§
§
§
§
MEMORANDUM OPINION
AND ORDER
In this environmental cleanup case, plaintiff moves for partial summary judgment on
certain elements of some of its statutory and common law causes of action. The court
concludes that plaintiff has met its burden as to some, but not all, of the issues and claims
on which it moves for summary judgment, and it therefore grants the motion in part and
denies it in part.
I
A
Plaintiff Montfort Square Shopping Center, Ltd. (“Montfort”) is the owner of a
shopping center located at 13305 through 13331 Montfort Drive in Dallas (“Shopping
Center”).1 The property on which the Shopping Center is located was purchased as
1
In recounting the factual background, the court summarizes the evidence in the light
most favorable to Goodyear as the summary judgment nonmovant and draws all reasonable
inferences in its favor. See, e.g., Owens v. Mercedes-Benz USA, LLC, 541 F.Supp.2d 869,
undeveloped real estate in approximately 1971. Within approximately one year of the
purchase, Montfort’s predecessors entered into a lease (“Lease”) with defendant Goodyear
Tire & Rubber Company (“Goodyear”). The original Lease was amended on August 24,
1994 (“1994 Lease Amendment”) and again on November 30, 2008. The court will refer to
the original lease, the 1994 Lease Amendment, and the 2008 Lease Amendment, collectively,
as the “Lease.” Under the Lease, Goodyear operated an automobile repair center and retail
store (“Service Center”) at 13331 Montfort Drive from 1973 until 2008. Goodyear remained
Montfort’s tenant until it purported to terminate the Lease effective February 2010. During
the Shopping Center’s existence, Goodyear has been the only tenant in the space used for
the Service Center.
The service and repair area of the Service Center included eight service bays, each
equipped with a hydraulic lift for performing service and repair work. Each hydraulic lift
system included a below-ground storage tank that held petroleum-based hydraulic oil.
Goodyear also maintained other oil storage units at the Service Center, including units that
stored unused fluids and waste fluids. Specifically, from approximately 1973 until 1993,
Goodyear used a 550-gallon underground storage tank (“UST”) to store waste oil from
vehicles. Goodyear also used a 250-gallon aboveground storage tank (“AST”) to store waste
oil and another 250-gallon AST to store oil that had not yet been used on vehicles. The AST
for unused oil was installed at the outset of Goodyear’s operations in 1973, and the 250-
870 n.1 (N.D. Tex. 2008) (Fitzwater, C.J.) (citing U.S. Bank Nat’l Ass’n v. Safeguard Ins.
Co., 422 F.Supp.2d 698, 701 n.2 (N.D. Tex. 2006) (Fitzwater, J.)).
-2-
gallon AST for waste oil was installed in the mid-1990s. Both ASTs remained in use until
Goodyear ceased operations in 2008.
In June 1993 Goodyear removed the 550-gallon UST used for waste oil. According
to Montfort, Goodyear determined that the soil under and surrounding the UST was
contaminated with petroleum hydrocarbons, volatile organic compounds (“VOCs”) (such
as benzene, ethyl benzene, toluene, and xylene); and several metals (including lead).
Montfort also alleges that free product (i.e., oil) was observed in the excavation area where
the UST had been located. Goodyear asserts that, based on the discovery of certain soil
contamination, consisting of total petroleum hydrocarbons (“TPH”) in excess of minimum
target limits of 100 mg/kg in the UST pit, Goodyear reported a release of TPH to the Texas
Natural Resource Conservation Commission (“TNRCC”). According to Goodyear, the
target cleanup concentration of 100 mg/kg represented a conservative, generic target level
based on then-applicable Petroleum Storage Tank (“PST”) Program2 guidance.
Between October 1993 and March 1994, Goodyear excavated the UST pit, at least
four times removing contaminated soils from around the pit. In April 1994 it conducted a
subsurface investigation, installing and sampling 11 soil borings to determine whether all
contaminated soils had been removed. Based on the results of the investigation, Goodyear
conducted another excavation action to remove impacted soils not previously removed. Soil
was excavated until all tests reflected TPH levels below the target cleanup requirement of
2
The PST Program was created by the Texas Commission on Environmental Quality.
-3-
100 mg/kg or until visible “clean rock” was encountered at the base of the excavation. After
completing the excavation, Goodyear sent the TNRCC a report detailing its cleanup efforts
and requesting closure of the UST removal. In response, the TNRCC stated [in a November
1, 1994 letter] that Goodyear had satisfied its cleanup standard and that “no further action”
was necessary. D. App. 188.
In 2008 Goodyear commissioned a Phase I/II Environmental Site Assessment
(“ESA”) in connection with plans to surrender possession of the Service Center to Montfort
at the conclusion of the lease term. The ESA identified seven in-ground hydraulic lifts as
the only recognized environmental conditions at the Service Center. Goodyear then
conducted a subsurface investigation by installing soil borings adjacent to each in-ground
lift and collecting soil samples from each boring. The soil samples registered contaminants
such as the metals arsenic and lead and the VOCs toluene and xylene. According to
Goodyear, however, only one sample contained detectable TPH concentrations, and these
concentrations were below the levels established under the PST Program for determining
whether a cleanup is required.
When Goodyear removed the seven in-ground hydraulic lifts and excavated the area
around the bay of the eighth lift (“Bay 4”), the excavation revealed detectible but minor
amounts of hydraulic oil and TPH concentrations in Bay 4. Montfort alleges, and Goodyear
does not dispute, that groundwater samples collected in connection with Goodyear’s removal
of the hydraulic lifts showed the presence of hydrocarbons; various levels of metals (such
-4-
as arsenic, barium, chromium, selenium, and lead); and other contaminants (such as the
VOCs acetone, carbon disulfide, ethyl benzene, tetrachloroethene, toluene, xylene, 1,2,4trimethylbenzene, and 2-butanone). Montfort also asserts that groundwater was found in the
excavation areas at the former locations of two underground tank holds that housed service
bays 1 and 4, and that a sheen of oil was found in the excavation area that corresponded with
Bay 4. Finally, Montfort alleges that the inside of one of several subsurface drainage pipes
was coated with a black, oily grit that Montfort alleges had no other known source or origin
other than the products that were used and spilled in the service area during Goodyear’s
operations. According to Goodyear, however, all concentrations of hydraulic oil and TPH
were below the PST Program action levels and Goodyear reported its activities and findings
to the PST Program.
Montfort asserts that, although Goodyear excavated the soil surrounding the hydraulic
lifts and corresponding storage tanks when it removed them in 2008, it did not remove the
excavated soil, but instead returned excavated soil to the ground near the former service
bays.
In July and November 2009, Goodyear conducted additional investigative activities
in response to comments received by the Texas Commission on Environmental Quality’s
(“TCEQ’s”) PST Privatization Contractor. According to Goodyear, with one exception, the
additional tests revealed no chemicals of concern, including VOCs, polycyclic aromatic
hydrocarbons, TPH, or metals at or above specified PST action levels or the residential
-5-
protective concentration levels of the TCEQ Texas Risk Reduction Program. Goodyear
maintains that arsenic was the only chemical of concern originally thought to have been
detected in concentrations exceeding acceptable levels. It contends, however, that the
arsenic concentrations were consistent with naturally-occurring arsenic concentrations in the
area of the Service Center and, in any event, were far below any applicable cleanup standard.
Goodyear posits that, when the water in the excavation area in Bay 4 was pumped out and
allowed to re-accumulate on two occasions, neither light non-aqueous phase liquids nor
sheen was observed on either occasion.
Based on its 2009 findings, Goodyear requested the TCEQ to approve closure of the
Service Center location under the PST Program. In 2010 the TCEQ conducted an
investigation of the Service Center location and identified three remaining areas of concern.3
Goodyear posits that these three areas of concern do not require additional assessment,
testing, or remediation because all testing conducted since the removal of the hydraulic lifts
in 2008 has shown that there is no contamination at the Service Center location that is at or
above any applicable regulatory limits. Goodyear also states that, although it is willing to
work with the TCEQ to address any remaining concerns, Montfort has refused Goodyear
3
Specifically, the TCEQ (1) identified two monitoring wells that were not properly
screened across the shallow affected zone and requested that both be replaced and resampled; (2) requested the installation of a monitoring well east of an identified potential
source of TPH, tetrachloroethylene, and several metals and an assessment of both soil and
groundwater for VOCs, TPH, and total metals; and (3) noted spillage in the vicinity of the
used oil and new oil ASTs and requested one shallow soil boring north of the new oil AST
to determine whether the spills in the area had affected the soil.
-6-
access to the Service Center location to complete the cleanup activities under the TCEQ’s
PST Program.
B
Montfort filed the instant lawsuit seeking declaratory and injunctive relief and
damages. It asserts claims under §§ 7002(a)(1)(A) and (B) of the Resource Conservation
and Recovery Act (“RCRA”), 42 U.S.C. § 6901 et seq.; § 107(a) of the Comprehensive
Environmental Response, Compensation, and Liability Act (“CERCLA”), 42 U.S.C. § 9607;
and § 361.344 of the Texas Solid Waste Disposal Act (“SWDA”), Tex. Health & Safety
Code Ann. § 361.344 (West 2010). Montfort also alleges common law claims for breach of
contract, negligence, and nuisance. It moves for a partial summary judgment that Goodyear
is liable as a “person” responsible for “solid waste,” under 42 U.S.C. § 6972(a)(1)(B); that
Goodyear is liable as a “responsible person,” under 42 U.S.C. § 9607(a); that Goodyear is
liable as a “person responsible for solid waste,” under Tex. Health & Safety Code Ann. §
361.344; that Goodyear failed to comply with Lease provisions that make it responsible for
removal of excavated soils and all contamination at the Shopping Center; and that Goodyear
is liable under the negligence principle res ipsa loquitur.
-7-
II
Because Montfort will have the burden of proof at trial on its claims (including the
issues that are components of these claims), to obtain summary judgment, it “must establish
‘beyond peradventure all of the essential elements of the claim[s]’” and issues. Bank One,
Tex., N.A. v. Prudential Ins. Co. of Am., 878 F. Supp. 943, 962 (N.D. Tex. 1995) (Fitzwater,
J.) (quoting Fontenot v. Upjohn Co., 780 F.2d 1190, 1194 (5th Cir. 1986)). This means that
Montfort must demonstrate that there are no genuine and material fact disputes and that it
is entitled to summary judgment as a matter of law. See, e.g., Martin v. Alamo Cmty. Coll.
Dist., 353 F.3d 409, 412 (5th Cir. 2003).
“The court has noted that the ‘beyond
peradventure’ standard is ‘heavy.’” Carolina Cas. Ins. Co. v. Sowell, 603 F.Supp.2d 914,
923-24 (N.D. Tex. 2009) ( Fitzwater, C.J.) (quoting Cont’l Cas. Co. v. St. Paul Fire &
Marine Ins. Co., 2007 WL 2403656, at *10 (N.D. Tex. Aug. 23, 2007) (Fitzwater, J.)).
III
The court first considers whether Montfort is entitled to partial summary judgment
on its claim under 42 U.S.C. § 6972(a)(1)(B).
A
42 U.S.C. § 6972(a)(1)(B) provides that any person may commence a civil action on
his own behalf
against any person. . . and including any . . . past or present
owner or operator of a treatment, storage, or disposal facility,
who has contributed or who is contributing to the past or present
handling, storage, treatment, transportation, or disposal of any
-8-
solid or hazardous waste which may present an imminent and
substantial endangerment to health or the environment[.]
The statute vests jurisdiction over § 6972 claims in the district court. Id. § 6972(a). And it
empowers the court to “restrain any person who has contributed or who is contributing to
past or present handling, storage, treatment, transportation, or disposal of any solid or
hazardous waste,” to order such person to take other such action as may be necessary, and
to apply appropriate civil penalties under § 6928(a) and (g). Id.
Montfort seeks partial summary judgment on its § 6972(a)(1)(B) claim, arguing that
the term “person” includes corporate entities like Goodyear; that Goodyear’s Service Center,
storage tanks, and other equipment are “facilities”; that Goodyear “operated” the Service
Center, storage tanks, and other equipment; that petroleum-based products and other
commercial byproducts are “solid waste” within the meaning of the statute; and that
Goodyear handled, stored, and disposed of “solid waste” and byproducts at the Service
Center. Goodyear does not dispute these elements of Montfort’s RCRA claim. It argues
instead that Montfort lacks standing to pursue this claim and that Montfort has failed to
establish that the solid waste at issue presents an imminent and substantial endangerment to
health or the environment.
B
The court begins by addressing Goodyear’s argument that Montfort lacks standing
to pursue its RCRA claim. Goodyear maintains that all samples of soil and groundwater
taken at the Service Center demonstrate that no chemicals of concern exist at actionable
-9-
levels. Accordingly, it posits that there is no imminent or substantial endangerment to health
or the environment and that Montfort cannot demonstrate that it has suffered or will suffer
any injury in fact as a result of Goodyear’s operations at the Service Center.
Although phrased in terms of “standing,” the basis of Goodyear’s argument is that
Montfort cannot prevail on the merits of its RCRA claim because there is no evidence to
support one element of the claim. “It is inappropriate for the court to focus on the merits of
the case when considering the issue of standing.” Hanson v. Veterans Admin., 800 F.2d
1381, 1385 (5th Cir. 1986) (citation omitted). And although, as the court later explains,
Montfort cannot recover on its RCRA claim if it cannot prove that there is an imminent or
substantial endangerment to health or the environment, this fact (if established) would not
necessarily mean that Montfort has not suffered an injury in fact. Montfort alleges that it has
suffered an injury in fact on the basis that Goodyear contaminated Montfort’s property with
chemicals and other substances. Accordingly, Montfort has standing to pursue its 42 U.S.C.
§ 6972(a)(1)(B) claim.
C
The court considers next whether Montfort is entitled to partial summary judgment
on this claim. Montfort cites cases that hold that a plaintiff can obtain summary judgment
on the issue of liability even though the issue of damages remains to be tried. Montfort
moves the court to hold that Goodyear is “liable under [42 U.S.C. § 6972(a)(1)(B)] because
it is a ‘person’; who owned or operated a storage or disposal facility; and at the facility,
- 10 -
Goodyear handled, stored, and disposed of solid waste.” P. Br. 12 (emphasis added). But
to prove that Goodyear is liable under § 6972(a)(1)(B), Montfort must show the existence
of an imminent and substantial endangerment to human health or the environment. See, e.g.,
Cordiano v. Metacon Gun Club, Inc., 575 F.3d 199, 211 (2d Cir. 2009) (affirming summary
judgment dismissing § 6972(a)(1)(B) claim where plaintiff failed to produce evidence that
alleged contamination “‘may present an imminent and substantial endangerment to health
or the environment.’” (quoting 42 U.S.C. § 6972(a)(1)(B))); Tilot Oil, LLC v. BP Prods. N.
Am., Inc., ___ F.Supp.2d___, 2012 WL 124395, at *5 (E.D. Wis. Jan. 17, 2012) (granting
summary judgment dismissing RCRA claim where evidence failed to establish that there
might be imminent and substantial danger to health or the environment); Lewis v. FMC
Corp., 786 F.Supp.2d 690, 708-10 (W.D.N.Y. 2011) (same). Accordingly, Montfort’s
evidence that Goodyear is a “person,” that Goodyear operated a storage or disposal facility,
and that Goodyear handled, stored, and disposed of solid waste at the facility is insufficient
to establish Goodyear’s liability under § 6972(a)(1)(B) without evidence that the alleged
contamination may present an imminent and substantial endangerment to health or the
environment.
Montfort acknowledges the possibility of a fact dispute concerning the issue whether
the alleged contamination may present an imminent and substantial endangerment to health
or the environment. Because Montfort has failed to meet its heavy summary judgment
burden regarding this issue, it is not entitled to partial summary judgment holding that
- 11 -
Goodyear is liable to Montfort under § 6972(a)(1)(B).
D
To the extent Montfort is seeking partial summary judgment on the discrete issues
outlined above rather than as to liability on its claim under § 6972(a)(1)(B), the court denies
the motion without prejudice.
Although Fed. R. Civ. P. 56(a)4 permits the court to enter partial summary judgment
as to discrete components of a claim, a court “in its discretion in shaping the case for trial,
may deny summary judgment as to portions of the case that are ripe therefor, for the purpose
of achieving a more orderly or expeditious handling of the entire litigation.” Powell v.
Radkins, 506 F.2d 763, 765 (5th Cir. 1975). The Advisory Committee Note to the recentlyrevised Rule 56(g) explains that, where the court “cannot grant all the relief requested by the
motion, it may properly decide that the cost of determining whether some potential fact
disputes may be eliminated by summary disposition is greater than the cost of resolving
those disputes by other means, including trial.” Rule 56(g) advisory committee’s note; see
also 10B Charles Alan Wright, et al., Federal Practice and Procedure § 2737, at 319 (3d ed.
1998) (noting that if “entering a partial summary judgment by identifying the facts that no
longer may be disputed would not materially expedite the adjudication, [the court] may
decline to do so”). It appears that the narrow issues on which Montfort seeks partial
4
Fed. R. Civ. P. 56(a): “A party may move for summary judgment, identifying each
claim or defense—or the part of each claim or defense—on which summary judgment is
sought.”
- 12 -
summary judgment regarding its § 6972(a)(1)(B) claim are largely undisputed. The benefits
from eliminating these narrow issues by partial summary judgment are outweighed by the
efficiency of the court’s insisting that the parties stipulate to these undisputed facts. Rule
16(c)(2)(C) provides a mechanism for the court to consider “obtaining admissions and
stipulations about facts . . . to avoid unnecessary proof[.].” Because the parties should be
able to stipulate to undisputed matters such as whether Goodyear is a “person” under
§ 6972(a)(1)(B), whether Goodyear operated a storage or disposal facility, and whether
Goodyear disposed of solid waste at the facility, it denies this component of Montfort’s
motion for partial summary judgment. The court will revisit this matter before trial, if
necessary, if stipulations are not timely made.
IV
Montfort next seeks summary judgment regarding Goodyear’s status as a “responsible
person” under § 107(a) of CERCLA, 42 U.S.C. § 9607(a).
Section 107 of CERCLA governs the cleanup of hazardous industrial waste and
places the cleanup costs on those who are responsible for the contamination. See Burlington
N. & Santa Fe Ry. Co. v. United States, 556 U.S. 599, 602 (2009). CERCLA imposes strict
liability for environmental contamination on four broad classes of potentially responsible
parties (“PRPs”), one of which includes “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.” 42 U.S.C. § 9607(a)(2). “Once an entity is identified as a PRP, it may
- 13 -
be compelled to clean up a contaminated area or reimburse the Government for its past and
future response costs.” Burlington N. & Santa Fe Ry., 556 U.S. at 609.
There are four elements to a CERCLA cost-recovery action,
such as the one here: (1) the site must be a “facility” under §
9601(9); (2) the defendant must be a “responsible person” under
§ 9607(a); (3) a release or threatened release of a hazardous
substance must have occurred; and (4) the release or threatened
release must have caused the plaintiff to incur response costs.
Licciardi v. Murphy Oil U.S.A., Inc., 111 F.3d 396, 398 (5th Cir. 1997) (citing Amoco Oil
Co. v. Borden, Inc., 889 F.2d 664, 668 (5th Cir. 1989)).
Montfort only moves for partial summary judgment as to the first and second
elements of its CERCLA claim. It argues that Goodyear is a “person”; that Goodyear
allowed “disposals” within the meaning of CERCLA; and that Goodyear “operated” the
Service Center, storage tanks, and other equipment, which constituted “facilities” within the
meaning of CERCLA. Montfort also posits in a footnote that there are no genuine issues of
material fact that the waste that Goodyear disposed of includes several hazardous
substances.5 Goodyear does not dispute that it is a “person,” that it allowed “disposals,” that
the Service Center constituted a “facility,” or that it “operated” the Service Center.6
5
As an example, Montfort cites evidence that Goodyear used solvent cleaners at the
Service Center and that constituents of solvents (such as carbon disulfide and
tetrachloroethene, also known as tetrachloroethylene or perchloroethylene) have been found
at the Service Center. Montfort argues that both chemicals are “hazardous substances” under
CERCLA.
6
It is unclear whether Montfort intends to move for partial summary judgment on
whether the waste Goodyear disposed of constituted a “hazardous substance” within the
meaning of CERCLA. Montfort does seek summary judgment on Goodyear’s alleged PRP
- 14 -
As with Montfort’s RCRA claim, the court concludes that these narrow and
undisputed issues should be resolved by stipulation rather than decided by motion for partial
summary judgment. Accordingly, the court denies this component of Montfort’s motion for
partial summary judgment without prejudice. The court will revisit this matter before trial,
if necessary, if stipulations are not timely made.
V
Montfort moves for summary judgment on the first and fifth elements of its SWDA
claim. It argues that Goodyear is a “person responsible for solid waste” and that it has made
status. And to be considered a PRP under § 9607(a)(2), Goodyear must have disposed of a
“hazardous substance.” 42 U.S.C. § 9607(a)(2). Yet in its reply brief, Montfort states:
Montfort included footnote 64 in its initial summary judgment
brief to demonstrate there is evidence Goodyear disposed of
substances that qualify as CERCLA “hazardous substances,” but
Montfort would not move for summary judgment regarding the
full range of contaminants actionable under CERCLA because:
“There nonetheless may be outstanding issues regarding the
character of other contaminants at issue. As opposed to
asserting piecemeal arguments regarding the ‘hazardous’ nature
of the respective contaminants, Montfort only moves for partial
summary judgment regarding Goodyear’s status as the
‘responsible person.’”
P. Reply Br. 17. Goodyear argues in response that “[s]everal of the materials Montfort
alleges were involved in Goodyear’s operation at the Service Center are clearly considered
petroleum” and thus are subject to the petroleum exception provided in 42 U.S.C.
§ 9601(14). D. Br. 24. But Goodyear does not appear to dispute that it disposed of solvents
containing the chemicals carbon disulfide and tetrachloroethene at the Service Center or that
these chemicals are “hazardous substances” under CERCLA. That Goodyear may also have
disposed of chemicals subject to the petroleum exception does not prevent the court from
concluding that Goodyear is a PRP.
- 15 -
reasonable attempts to notify Goodyear of both the release and of Montfort’s intent to take
steps to eliminate the release.
A
The SWDA is the Texas counterpart to CERCLA. R.R. Street & Co. v. Pilgrim
Enters., Inc., 166 S.W.3d 232, 238 (Tex. 2005). Like CERCLA, the SWDA contains a
provision that permits private parties to bring contribution actions against other potentially
responsible parties. See id. Under that provision,
[a] person who conducts a removal or remedial action that is
approved by the [TCEQ] and is necessary to address a release
or threatened release may bring suit in a district court to recover
the reasonable and necessary costs of that action and other costs
as the court, in its discretion, considers reasonable.
Tex. Health & Safety Code Ann. § 361.344(a). To establish a claim under the SWDA, a
plaintiff must prove:
(1) the defendant is a “person responsible for solid waste” as
defined in section 361.271; (2) the TNRCC approved the
plaintiff’s removal or remedial action; (3) the action was
necessary to address a release or threatened release of solid
waste; (4) the costs of the action were reasonable and necessary;
and (5) the plaintiff made reasonable attempts to notify the
defendant of both the release and the plaintiff’s intent to take
steps to eliminate the release.
R.R. Street & Co., 166 S.W.3d at 240 (citing Tex. Health & Safety Code § 361.344).
B
For the reasons stated above, the court denies Montfort’s motion for summary
judgment as to the first element and directs the parties to stipulate as to the undisputed facts,
- 16 -
including whether Goodyear is a “person responsible for solid waste” under the SWDA.
C
On the disputed issue of notice, the court holds that Montfort has established beyond
peradventure that it made reasonable attempts to notify Goodyear of the release of solid
waste and of Montfort’s intent to take steps to eliminate the release. The SWDA requires
that “the person seeking cost recovery must have made reasonable attempts to notify the
person against whom cost recovery is sought (1) of the existence of the release or threatened
release and (2) that the person seeking cost recovery intended to take steps to eliminate the
release or threatened release.” Tex. Health & Safety Code Ann. § 361.344(c). In a March
5, 2010 letter, Montfort informed Goodyear, inter alia, that “[t]here have been documented
releases of contaminants at the [Service Center] attributable to Goodyear’s operations.” P.
App. 103. Montfort provided detail as to the specific contaminants that had been discovered
and the dates of discovery. On April 1, 20117 Montfort sent Goodyear a second letter,
informing Goodyear that it “intend[ed] to undertake a response at the site to accomplish [a
full investigation of the contamination at the property] and assure measures to evaluate and
remediate these releases in accordance with the [TCEQ] rules and regulations is performed.”
Id. at 118. Although Goodyear disputes that Montfort’s letters constituted notice under the
SWDA, it has failed to provide any basis other than its assertion that “Montfort’s purported
7
Although Montfort filed its complaint on August 25, 2010, it did not assert a claim
under the SWDA until it filed its amended complaint on August 23, 2011, four months after
it sent the April 1, 2011 notice letter.
- 17 -
provision of a notice letter to Goodyear under the SWDA borders on the ludicrous in this
case.” D. Br. 31. The court holds that Montfort has established beyond peradventure that,
in connection with its SWDA claim, it made reasonable attempts to notify Goodyear of both
the release and of Montfort’s intent to take steps to eliminate the release. Accordingly, the
court grants partial summary judgment as to the notice element of Montfort’s SWDA claim.8
VI
Montfort also moves for summary judgment on its breach of contract claim.
A
Under Texas law, to establish its breach of contract claim, Montfort must prove four
elements: (1) the existence of a valid contract; (2) that Montfort performed its duties under
the contract; (3) that Goodyear breached the contract; and (4) that Montfort suffered
damages as a result of the breach. See, e.g., Lewis v. Bank of Am. NA, 343 F.3d 540, 544-45
(5th Cir. 2003) (Texas law). Montfort only moves for summary judgment as to the third
element, arguing that Goodyear breached the Lease by leaving contamination at the
Shopping Center and by failing to remove excavated soil.
B
Montfort argues that Goodyear breached the Lease by leaving contamination on the
8
Because Goodyear disputes this element of Montfort’s SWDA claim, the court
addresses Montfort’s motion for partial summary judgment as to this issue.
- 18 -
Shopping Center property. Section 5.13 of the 1994 Lease Amendment9 provides, under the
heading “Surrender of property,” that “[u]pon surrender of the Demised Premises or
termination of the Lease, . . . [Goodyear] shall . . . leave no contamination from its use and
occupancy of the Demised Premises.” P. App. 91. Under Montfort’s interpretation of
§ 5.13, “under no circumstance is Goodyear allowed to leave contamination, of any kind, at
the Shopping Center now that Goodyear has ceased operating at the Shopping Center.” P.
Br. 20-21.
Goodyear does not challenge Montfort’s evidence that contamination has been
detected at the Shopping Center since Goodyear ceased operations. Instead, it points to a
different provision of the 1994 Lease Amendment and argues that it was only required to
clean the property to within applicable governmental and regulatory limits. Goodyear relies
on § 5.15, entitled “Clean up standard,” which provides: “No spill, discharge or release of
hazardous substances is permitted on the Demised Premises. In the event any spill,
discharge or release nonetheless occurs, [Goodyear] shall clean up and remove all
contamination to meet applicable standards of relevant governmental authorities or under
applicable environmental laws.” P. App. 91-92. Goodyear argues that § 5.15 is the standard
by which the Lease determines whether, under § 5.13, any contamination has been left
behind. Goodyear maintains that this is the logical reading because the lessor would not be
subject to any governmental penalty or clean up obligation concerning the premises if any
9
Because Goodyear does not dispute that this provision is controlling, the court
assumes that the terms of the 1994 Lease Amendment control in this respect.
- 19 -
contamination had already been cleaned to within applicable limits. Goodyear maintains it
has not breached the Lease because it has remediated any contamination to within the limits
established by the TCEQ.
C
“Under Texas law, the court’s primary concern when interpreting a contract is to
ascertain the parties’ intentions as expressed objectively in the contract.” Hoffman v. L &
M Arts, 774 F.Supp.2d 826, 832 (N.D. Tex. 2011) (Fitzwater, C.J.). “When the provisions
of a contract appear to conflict, [the court] will attempt to harmonize the two provisions and
assume the parties intended every provision to have some effect.” United Protective Servs.,
Inc. v. W. Village Ltd. P’ship, 180 S.W.3d 430, 432 (Tex. App. 2005, no pet.) (citing Edlund
v. Bounds, 842 S.W.2d 719, 726 (Tex. App. 1992, writ denied)). If the court is “unable to
harmonize the provisions and give effect to all clauses, and the contract is susceptible to
more than one reasonable interpretation, [the court] will find the contract is ambiguous.” Id.
(citing Royal Maccabees Life Ins. Co. v. James, 146 S.W.3d 340, 347 (Tex. App. 2004, pet.
denied)).
The court holds that these two sections can be harmonized so that each controls in the
proper context.
Section 5.13 of the 1994 Lease Amendment specifies Goodyear’s
obligations at the time it surrenders the Service Center property or terminates the Lease.
When this occurs, Goodyear is prohibited under § 5.13 from leaving any contamination on
the premises. In contrast, § 5.15 applies when any spill, discharge or release actually occurs,
- 20 -
but before Goodyear surrenders the Service Center property or terminates the Lease.
Although under § 5.15 no such spill, discharge, or release of hazardous substances is
permitted on the Service Center property, if one does occur, Goodyear must “clean up and
remove all contamination to meet applicable standards of relevant governmental authorities
or under applicable environmental laws.” P. App. 91-92. Therefore, §§ 5.13 and 5.15 can
be read together to refer to two different contexts. Section 5.13 governs at the time
Goodyear surrenders the Service Center property or terminates the Lease. Section 5.15
governs at the time a spill, discharge, or release of a hazardous substance actually occurs.
This means that, under the Lease, during the period when Goodyear was the lessee, if
Goodyear spilled, discharged, or released any hazardous substance, it was only responsible
for cleaning up and removing the contamination to the level required by “applicable
standards of relevant governmental authorities or under applicable environmental laws.” Id.
If the applicable standards and environmental laws permitted certain amounts of
contamination in the soil and groundwater, Goodyear was not required to remove all
contamination. But upon surrendering the Service Center property or terminating the Lease,
Goodyear could not leave any contamination on the property, even if the applicable
standards and environmental laws would permit some level of contamination.
Having concluded as a matter of law that the Lease prohibits Goodyear from leaving
any contamination on surrendering the Service Center property or terminating the Lease, the
court holds that Montfort has established beyond peradventure that Goodyear breached the
- 21 -
Lease on this basis.
D
The court next considers whether Goodyear breached the Lease by failing to remove
excavated soil. Section 5.17 of the 1994 Lease Amendment provides, in pertinent part, that
“[w]ith respect to the remediation undertaken by [Goodyear], it is agreed that [Goodyear]
will haul off and dispose of all dirt, whether contaminated or not that has been removed, in
a proper and lawful manner, complying with all laws, ordinances, rules and regulations of
all governmental authorities.” P. App. 92. Montfort argues that this provision required
Goodyear to “haul off and dispose of” all the soil that Goodyear had excavated, regardless
whether the soil was contaminated. It relies on the affidavit of Stanley M. Peskind
(“Peskind”), Manager of the general partner of Montfort, to establish that when Goodyear
excavated soil surrounding the location of the hydraulic lifts and corresponding storage tanks
in 2008, it did not remove the excavated soil. According to Peskind, Goodyear instead
returned the soil to the ground near the service bays where the hydraulic lifts had been
located.
Goodyear does not dispute that it excavated soil in 2008 or that it failed to “haul off
and dispose of” soil that it had excavated. It argues instead that the word “removed” in the
1994 Lease Amendment refers only to soil that has been excavated and removed from the
premises. In other words, Goodyear maintains that its obligation to dispose of this soil arises
only after the excavated soil has been removed from the premises. Goodyear posits that if
- 22 -
the soil has been excavated but not removed from the Service Center premises, it is not
prohibited from returning the soil to the place from which it was excavated.
In interpreting a contract, the court must “examine and consider the entire writing in
an effort to harmonize and give effect to all the provisions of the contract so that none will
be rendered meaningless.” Bank One, Tex., N.A. v. FDIC, 16 F.Supp.2d 698, 707 (N.D. Tex.
1998) (Fitzwater, J.) (Texas law). Goodyear in effect reads § 5.17 to say that, only if during
remediation Goodyear completely removes dirt from the Service Center premises is it
required to haul off and dispose of the dirt in a proper and lawful manner, complying with
all laws, ordinances, rules, and governmental regulations. The court disagrees for two
reasons with this interpretation of § 5.17.
First, it renders the term “haul off” superfluous. If soil has been completely removed
from the premises, there is still a need to dispose of the soil, but there is no need to haul off
that soil because it has already been removed from the premises.
Second, Goodyear’s reading of § 5.17 renders it superfluous. Section 5.15 imposes
a “Clean up standard” that prevents Goodyear from retaining on the premises dirt that is
contaminated at levels above applicable standards and environmental laws. See P. App. 9192 (requiring Goodyear to “clean up and remove all contamination to meet applicable
standards of relevant governmental authorities or under applicable environmental laws”
(emphasis added)). In order for § 5.17 not to be rendered superfluous, it must place on
Goodyear an obligation that § 5.15 does not already impose. Section 5.17 does impose such
- 23 -
an additional obligation: with respect to remediation involving dirt, it requires not only that
Goodyear comply with applicable governmental standards and environmental laws, but that
Goodyear haul off and dispose of all dirt “whether contaminated or not” involved in
remediation. Section 5.17 is not superfluous when § 5.15 is interpreted as setting forth the
general “clean up standard” for remediation and § 5.17 is interpreted as prescribing a higher
standard when remediation involves dirt removal. Therefore, properly interpreted, § 5.17
requires that, if remediation involves the removal of dirt, Goodyear is obligated to haul off
and dispose of all dirt—whether contaminated or not—involved in the remediation. In
failing to do so, Goodyear breached this provision of the Lease.
Accordingly, the court grants partial summary judgment on the third element of
Montfort’s breach of contract claim and holds that Montfort has established beyond
peradventure that Goodyear breached the Lease on this basis.
E
Although the court holds Montfort has established the breach element of its breach
of contract claims based on Goodyear’s leaving contamination at the Shopping Center and
failing to remove excavated soil, the partial summary judgment granted today is limited.
Monfort has neither moved for summary judgment on the entirety of its breach of contract
claims nor presented any evidence that, as a result of Goodyear’s breaches of contract, it has
suffered damages. Unless Montfort can prove the elements of causation and damages, it
cannot recover from Goodyear on its breach of contract claim.
- 24 -
VII
Finally, the court turns to Montfort’s negligence claim. Montfort argues that because
the releases of contaminants “of the kind at issue [here] should not occur in the absence of
negligence,” and because only Goodyear managed and controlled the storage tanks and other
equipment at the Storage Center, Montfort is entitled to summary judgment on its negligence
claim. P. Br. 22.
Under Texas law, the “elements of a negligence cause of action are the existence of
a legal duty, a breach of that duty, and damages proximately caused by the breach.” IHS
Cedars Treatment Ctr. of DeSoto, Tex., Inc. v. Mason, 143 S.W.3d 794, 798 (Tex. 2004).
Montfort has pleaded res ipsa loquitur, “which is simply a rule of evidence by which
negligence can be inferred by the jury.” Jones v. Tarrant Util. Co., 638 S.W.2d 862, 865
(Tex. 1982).
The purpose of res ipsa is to relieve the plaintiff of the burden
of proving a specific act of negligence by the defendant when
it is impossible for the plaintiff to determine the sequence of
events, or when the defendant has superior knowledge or means
of information to determine the cause of the accident.
Id. (citing Mobil Chem. Co. v. Bell, 517 S.W.2d 245 (Tex. 1974)). The doctrine “is
applicable only when: (1) the character of the accident is such that it would not ordinarily
occur in the absence of negligence; and (2) the instrumentality causing the injury is shown
to be under the management and control of the defendant.” Id. (citing Marathon Oil Co. v.
Sterner, 632 S.W.2d 571 (Tex. 1982)).
- 25 -
Montfort generally alleges that “releases of the kind at issue [here] should not occur
in the absence of negligence,” P. Br. 22, but it has failed to meet the heavy “beyond
peradventure” standard. Although it is possible (and the trier of fact may find it probable)
that the chemical releases at the Service Center were the result of Goodyear’s negligence,
Montfort has not shown that beyond doubt the character of the accident is such that it would
not ordinarily occur in the absence of negligence. See, e.g., Pearson v. BP Prods. N. Am.,
Inc., 449 Fed. Appx. 389, 392 (5th Cir. 2011) (per curiam) (holding in case against oil
company to recover damages for personal injuries allegedly resulting from exposure to
carbon disulfide that district court should not have instructed jury on res ipsa loquitur where
plaintiffs failed to show that the character of the accident is one that would not usually occur
absent negligence); Marathon Oil Co., 632 S.W.2d at 573 (holding that res ipsa loquitur jury
instruction was inappropriate because “[e]scaping gas in the vicinity of a complex chemical
plant could be due to an unexpected and unforeseeable mechanical failure or it could be due
to negligence” (citation omitted)).10
10
Montfort argues that, under Texas law, there is no requirement that it adduce
“testimony or evidence regarding the possibility of releases in the absence of negligence.”
P. Br. 22 (citing Jones, 638 S.W.2d at 865). But under Texas law, the first res ipsa loquitur
factor must be proved either by expert testimony or by general knowledge that the accident
would not ordinarily occur in the absence of negligence. See Mobil Chem. Co., 517 S.W.2d
at 252. Accordingly, a plaintiff who chooses to forgo expert testimony must establish that
it is generally known that the accident would not ordinarily occur in the absence of
negligence. E.g., Carlson v. Remington Hotel Corp., 2008 WL 2186449, at *3 (Tex. App.
May 22, 2008, no pet.) (mem. op.) (“Because appellants had no expert testimony, they
needed to show that it is generally known that carpet adjacent to a bathroom would not
become wet in the absence of negligence. We are aware of no such general knowledge, and
appellant has not shown that proposition to be true.”); see also Lynch v. Noram Energy
- 26 -
Because Montfort has not established beyond peradventure that the doctrine of res
ipsa loquitur applies and has not made any attempt to adduce evidence on the other elements
of its negligence claim, the court denies Montfort’s motion for summary judgment on this
claim.
*
*
*
For the foregoing reasons, the court grants in part and denies in part Montfort’s
motion for partial summary judgment.
SO ORDERED.
June 21, 2012.
_________________________________
SIDNEY A. FITZWATER
CHIEF JUDGE
Corp., 2000 WL 708419, at *5 (Tex. App. May 30, 2000, pet. denied) (mem. op.) (“To rely
on the doctrine [of res ipsa loquitur], the plaintiff must produce evidence from which the jury
can conclude, by a preponderance of the evidence, that both factors are present.”). Montfort
has failed to make this showing.
- 27 -
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?