K. Douglas Scribner and Laurie B. Scribner v. John M. Summers, Stephen A. Summers, and Jasco-Sun Steel Treating, Inc.

138 F.3d 471, 28 Envtl. L. Rep. (Envtl. Law Inst.) 21072, 46 ERC (BNA) 1573, 1998 U.S. App. LEXIS 4029
CourtCourt of Appeals for the Second Circuit
DecidedMarch 9, 1998
Docket131, Docket 96-9645
StatusPublished
Cited by13 cases

This text of 138 F.3d 471 (K. Douglas Scribner and Laurie B. Scribner v. John M. Summers, Stephen A. Summers, and Jasco-Sun Steel Treating, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Second Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
K. Douglas Scribner and Laurie B. Scribner v. John M. Summers, Stephen A. Summers, and Jasco-Sun Steel Treating, Inc., 138 F.3d 471, 28 Envtl. L. Rep. (Envtl. Law Inst.) 21072, 46 ERC (BNA) 1573, 1998 U.S. App. LEXIS 4029 (2d Cir. 1998).

Opinion

*472 PER CURIAM:

Plaintiffs K. Douglas and Laurie B. Scribner (the “Scribners”) appeal from a November 1996 judgment of the United States District Court for the Western District of New York, David G. Larimer, Ch. J., awarding them $12,000 for “several years of inconvenience and aggravation,” but no other damages, for barium contamination of their property caused by defendants John M. Summers, Stephen A. Summers and Jasco-Sun Steel Treating, Inc. (collectively, “Jas-co”).

The Scribners sought to recover from Jas-co under the Comprehensive Environmental Response Compensation and Liability Act of 1980, 42 U.S.C. § 9601 et seq. (“CERC-LA”), and on several common law grounds, including nuisance and'trespass. Among the harms alleged by the Scribners was their inability to sell or rent the property; there had been two commercial tenants and the Scribners had been negotiating with a potential buyer until shortly before the contamination was discovered.

In July 1995; Judge (now Chief Judge) Larimer found for the Scribners on their CERCLA claim and awarded all of their “response costs” under that act, but dismissed the common law claims. On appeal, this court reversed the dismissal of the trespass and nuisance claims, holding that Jasco was liable under both theories. We remanded for determination of damages and advised the district court that the Scribners were entitled to only one recovery. Scribner v. Summers, 84 F.3d 554 (2d Cir.1996).

On remand, Chief Judge Larimer did not conduct further evidentiary proceedings. In November 1996, he held that elimination of the contamination, which Jasco was allegedly already obligated to pay for under CERCLA and pursuant to a consent decree between Jasco and the New York State Department of Environmental Conservation (DEC), would fully restore the property. The judge therefore refused to award any damages for permanent injury to the property. As already indicated, he did award the Scribners $12,000 for the inconvenience and aggravation of having their property contaminated. However, the judge did not award any other damages. Because we think the record before us is insufficient for a proper determination of the issue of damages for permanent injury we vacate that part of the judgment of the district court and remand for further proceedings.

Under New York law, “the proper measure of damages for permanent injury to real property is the lesser of the decline in market value and the cost of restoration.” Jenkins v. Etlinger, 55 N.Y.2d 35, 447 N.Y.S.2d 696, 698, 432 N.E.2d 589, 591 (1982). The plaintiff, however, need only prove one of the two measures and it becomes the defendant’s burden to prove “that a lesser amount ... will sufficiently compensate for the loss.” Id. A plaintiff may also recover temporary damages, measured by the “reduction of the rental or usable value of the property” during the pendency of the injury. Guzzardi v. Perry’s Boats, Inc., 92 A.D.2d 250, 460 N.Y.S.2d 78, 82 (App.Div.1983); Jenkins, 447 N.Y.S.2d at 698, 432 N.E.2d at 591.

As indicated, the district court held that the cleanup to which the Scribners were already entitled would sufficiently remedy any permanent injury to their property. It is not clear to us from the record exactly what Jasco’s obligations are with respect to cleaning up the Scribners’ property and it is accordingly difficult for us to review the judge’s ruling on this point. As for temporary. injury to their property, the district court stated that it was .not convinced that the Scribners’ tenants moved off the property as a result of the contamination or that the failure to attract new tenants was attributable to the contamination. It therefore refused to award damages for such inability to rent the property. The Scribners argue that these rulings were error.

The Scribners argue that they proved decline in market value but Jasco failed to prove cost of restoration and that, under Jenkins, they are therefore entitled to damages for permanent injury equal to the decline in market value. To show such decline, the Scribners point to (1) evidence of offers to buy the property for up to $335,000 before the possibility of contamination became *473 known; (2) the pre-contamination appraisal of a plaintiffs expert that the property was worth $360,000; (3) the pre-contamination appraisal of a defendant’s expert that the property was worth $330,000; and (4) a plaintiffs expert’s testimony that the most even a speculator would pay for the contaminated property was $50,000. They argue that Jasco’s evidence as to the cost of cleanup is inadequate. Jasco’s expert testified that cleanup would .cost $37,700, but the Scribners contend that this figure omits both the cost to clean a heavily polluted strip of land at the boundary of-the Scribners’ property and the cost to remedy ground water contamination. The record tends to confirm that Jasco’s $37,700 figure is incomplete but, as discussed below, lacks some factual findings that would have been useful in deciding this question.

The Scribners also argue that, even if Jas-co proves the cost of cleanup, simply eliminating the physical contamination will not sufficiently compensate them because it will not remove the “stigma” that attaches to contaminated property in the public perception, depressing the property’s value. The Scribners rely on Commerce Holding Corp. v. Board of Assessors of the Town of Babylon, 88 N.Y.2d 724, 649 N.Y.S.2d 932, 673 N.E.2d 127 (1996), and Criscuola v. Power Authority of the State of New York, 81 N.Y.2d 649, 602 N.Y.S.2d 588, 621 N.E.2d 1195 (1993), in which the New York Court of Appeals acknowledged the existence of stigma from environmental contamination. Neither case is directly controlling, however. Commerce Holding, a tax certiorari case, listed “the stigma remaining after cleanup” among the factors to be considered when valuing contaminated property for the purpose of tax assessment. 649 N.Y.S.2d at 936, 673 N.E.2d at 131. However, the court held that cleanup costs alone were “an acceptable, if imperfect, surrogate to quantify environmental damage____” Id. Criscuola held that a land owner in a condemnation proceeding may recover the decrease in value due to the public’s fear of something on the land (in that case, electromagnetic emissions from power lines) even if the fear is unreasonable. 602 N.Y.S.2d at 588, 621 N.E.2d at 1195. However, the case did not involve fear persisting after the cause was removed.

The Scribners also draw our attention to Nashua Corp. v. Norton Co., 1997 WL 204904 (N.D.N.Y.1997), in which the Northern District, faced with facts similar to our own, held that a plaintiff may prove stigma in addition to cleanup costs because removal of contamination alone may not restore the property to its former condition. Id at *6. The district court in Nashua

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138 F.3d 471, 28 Envtl. L. Rep. (Envtl. Law Inst.) 21072, 46 ERC (BNA) 1573, 1998 U.S. App. LEXIS 4029, Counsel Stack Legal Research, https://law.counselstack.com/opinion/k-douglas-scribner-and-laurie-b-scribner-v-john-m-summers-stephen-a-ca2-1998.