A MTCA Cleanups Should be "Ecologically Necessary" and "Economically Efficient"
In a case my client was involved in, a Federal District Court judge in Washington State recently wrote in a summary judgment decision that recoverable cleanup costs under the Model Toxics Control Act, Chapter 70.105D RCW, should be necessary to protect human health and the environment, and should be cost efficient. The judge’s ruling followed the reasoning of Taliesen v. Razore, a Washington Court of Appeals decision that substantially reduced a party’s recovery of soil disposal costs, because most of the soil did not exceed applicable cleanup levels, and the party seeking cost recovery did not segregate the regulated soil from the clean soil. given this significant reduction in cost recovery the Taliesene court found that the party was not a “prevailing party for attorneys’ fees and thus the Taliiesen Court substantially reduced the fee award as well.
Im my case, my client had proposed a containment/institutional control remedy for the site, which involved metallic debris scattered across three parcels, including my client’s and two adjacent parcels. Containment cost hundreds of thousands less than removal and disposal of the debris and soil. Ecology approved my client’s remedial approach, which was supported by a comprehensive site investigation and disproportionate cost analysis, pursuant to MTCA rules. My client decided not to join the cost recovery litigation against the two defendants, which was being prosecuted by my client’s neighbor. Instead, my client and I approached the defendants with a demand letter that highlighted our reasonable and cost-effective remedial approach. My client reached a favorable settlement of its cleanup costs, including most of its attorneys’ fees.
The neighbor pursued a different course: rejecting our containment approach for a removal remedy, which was substantially more expensive, while fighting the defendants and incurring huge attorneys’ fees. The court’s summary judgment ruling was a major factor in pushing the neighbor into an unfavorable settlement with the defendants by giving up a large portion of its cost recovery claim.
This cautionary tale underscores how important it is to pair up an environmental attorney and environmental consultant to think strategically before plunging into a remedial plan. The Washington courts are adopting the Taliesen rationale. You should not assume that the costs of a more permanent remedy, such as removal, will be recoverable if containment is just as protective and substantially more cost-efficient. If the defendant can show that another remedy is equally protective, but less costly than the one performed by the plaintiff, then the court may only award the cost of the defendant’s remedy. This “delta” could be a huge cost difference and reduce or eliminate the attorneys’ fee award too.