Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

08/26/94 WILLIAM SANDERS AND LILLIE SANDERS v.

August 26, 1994

WILLIAM SANDERS AND LILLIE SANDERS
v.
JAMES W. WARR, AS DIRECTOR OF THE ALABAMA DEPARTMENT OF ENVIRONMENTAL MANAGEMENT



Appeal from Houston Circuit Court. (CV-89-614). Michael Crespi, Trial Judge.

As Amended. Second Correction February 3, 1995. Released for Publication December 2, 1994.

Maddox, Hornsby, C.j., and Shores, Houston, Steagall, and Ingram, JJ., concur.

The opinion of the court was delivered by: Maddox

MADDOX, JUSTICE.

The issue in this case is whether a third party, who claims to have suffered property damage as a result of a substantial leak in an underground gasoline storage tank, can recover compensation for the damage from the Alabama Underground and Aboveground Storage Tank Trust Fund under the provisions of Ala. Code 1975, § 22-35-5. The facts are undisputed. William Sanders and his wife, Lillie Sanders, owned and operated a gasoline service station/grocery store in Rehobeth, Alabama. On June 30, 1989, the Sanderses' business was rendered unfit for any business purpose as a result of a substantial gasoline leak from an underground storage tank. The underground storage tank was owned by Slocomb Oil Company, and the gasoline in it was purchased from Slocomb Oil Company. Slocomb Oil Company is registered with the Alabama Department of Environmental Management as an owner of three underground storage tanks. The Sanderses sued Douglas Laye, Tucker McLaughlin, and Slocomb Oil, alleging that negligence, wantonness, and trespass on their part had caused the leak and the resulting harm to their business. Subsequently, the Sanderses amended their complaint to add Leigh Pegues, the director of the Alabama Department of Environmental Management ("the director"), as the legal representative of the Trust Fund. *fn1 The Sanderses' claim against the Trust Fund was a third-party claim made pursuant to Ala. Code 1975, § 22-35-5.

On October 2, 1991, the trial court entered a judgment against Slocomb Oil Company in accordance with a consent agreement; the trial Judge specifically stated in an amended order dated October 15, 1991, that nothing in the final judgment "shall be construed as determining the liability of the Alabama Storage Tank Trust Fund (AUST Trust Fund), nor shall it be construed as binding on the Fund, nor shall it determine the damages, if any, which the Fund shall pay in connection with this case."

The director, as legal representative of the Trust Fund, moved for a summary judgment, arguing that the Trust Fund was not obligated to pay third-party claims, because, he argued, the Environmental Protection Agency ("EPA") had extended the compliance dates for tank owners to meet the financial responsibility requirements for third-party claims. Stated in legal terms, the director took the position that § 22-35-4(3) set indemnification limits for third-party claims against the Trust Fund and that § 22-35-4(3) tied these indemnification limits for third-party claims to that of tank owners complying with the financial responsibility requirements as set forth in Subtitle I of the Resource Conservation and Recovery Act. The trial court entered a summary judgment in favor of the director and made that judgment final pursuant to the provisions of Rule 54(b), Ala.R.Civ.P. The Sanderses appeal. We agree with the director's position, and we affirm.

To decide the legal issue in this case, we must interpret several acts of the Alabama legislature, especially as those acts relate to provisions of federal laws and regulations concerning underground storage tanks, the subject of this action.

The Hazardous and Solid Waste Amendments of 1984 (HSWA) extended and strengthened the provisions of the Resource and Conservation and Recovery Act (RCRA), a federal act. HSWA created Subtitle I, which provides for the development and implementation of a regulatory program concerning underground storage tanks. Section 9003(a) of Subtitle I requires the administrator of the EPA to promulgate requirements for petroleum release detection, prevention, and correction as necessary to protect human health and the environment.

The Superfund Amendments and Reauthorization Act of 1986 (SARA) amended sections 9003(c) and (d) of Subtitle I to mandate that the EPA establish financial responsibility requirements for underground storage tank owners and operators in order to assure the costs of corrective action and third-party liability caused by accidental releases from underground storage tanks.

On April 17, 1987, the EPA proposed a rule setting out financial responsibility requirements for underground storage tanks containing petroleum. On October 26, 1988, after analyzing the comments on the proposed rule, the EPA promulgated financial responsibility requirements applicable to owners and operators of underground storage tanks containing petroleum, under section 9003(c) and (d) of the RCRA. 40 C.F.R. § 280.93. The rule establishes requirements for demonstrating financial responsibility for taking corrective action and compensating third parties for bodily injury and property damage caused by accidental releases arising from the operation of underground storage tanks containing petroleum. The EPA carefully considered where to allow flexibility in the financial responsibility program while ensuring adequate protection for covering the costs of petroleum underground storage tank releases. Based primarily upon their ability to comply, the EPA adopted a phased-in schedule for compliance for owners and operators of underground storage tanks. For instance, petroleum marketers owning or operating 1,000 or more underground storage tanks and non-marketers with more than $20,000,000 in tangible net worth were required to comply with the financial requirements on or before January 24, 1989, three months after the date the rule was promulgated. Small marketers, such as Slocomb Oil Company, were scheduled for compliance by April 26, 1990, because the EPA recognized that they would rely primarily on state assurance funds. However, on May 2, 1990, the EPA extended this compliance date to April 26, 1991, and later extended it to December 31, 1993. This schedule provided time for the development of state assurance programs. The EPA recognized that state funds could provide an important means for compliance with financial responsibility requirements at the onset of the program, and the EPA encouraged the development of such funds. Such a mechanism was already in place in Alabama. The Alabama legislature had established the Alabama Underground and Aboveground Storage Tank Trust Fund ("Trust Fund"), Ala. Code 1975, §§ 22-35-1 to 22-35-13, on May 3, 1988, as a means of allowing owners and operators of petroleum underground storage tanks to meet the financial responsibility requirements of Subtitle I.

The Sanderses argue that the director has attempted to incorporate into the Trust Fund an exemption that is incompatible with the intent of the Trust Fund. Section 22-35-1 states the legislative intent:

"The legislature intends for this chapter to provide evidence of financial responsibility for owners and operators of underground and aboveground storage tanks under the Resource Conservation and Recovery Act, subtitle I, the Superfund Amendments and Reauthorization Act of 1986 and other federal laws."

The Sanderses argue that the EPA's financial responsibility requirements were intended only to establish a limit for third-party claims and were never meant ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.