Newly Weds Foods, Inc. v. Westvaco Corp.

14 Mass. L. Rptr. 728
CourtMassachusetts Superior Court
DecidedMarch 27, 2002
DocketNo. 995194C
StatusPublished

This text of 14 Mass. L. Rptr. 728 (Newly Weds Foods, Inc. v. Westvaco Corp.) is published on Counsel Stack Legal Research, covering Massachusetts Superior Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Newly Weds Foods, Inc. v. Westvaco Corp., 14 Mass. L. Rptr. 728 (Mass. Ct. App. 2002).

Opinion

Brady, J.

With the trial and disposition of this c. 21E/c. 93A case behind them, the parties each move for attorneys fees and costs under G.L.c. 21E, §4A(d) and (f). Plaintiff seeks $676,297.00 in attorneys fees, and $131,814.53 in expert witness fees and costs for a total of $808,111.53. Defendant opposes plaintiffs application, and seeks for itself fees and costs in the amount of $386,002.52. Notwithstanding the intensity with which this litigation has been waged, and that potentially $1,194,114.01 is at stake, neither party has requested a hearing. After review of the parties’ detailed submissions, for reasons which follow, I DENY each party’s fee applications.

G.L.c. 21E, §4A

Chapter 2IE, §4A spells out a procedure to be followed by a party who has undertaken or is undertaking a response action who asserts that others may be responsible for contribution, reimbursement, or equitable share of the pollution clean-up costs. The statute contemplates notification, exchange of information, negotiation, mediation, and hopefully a reso[729]*729lution among potentially liable parties. Those parties against whom an assertion of liability is made are not obliged to engage in the process, but if they do not, they may be liable to plaintiff, pursuant to subsection (d), for litigation costs and reasonable attorneys fees if they are later found responsible at trial, and:

(1) failed without reasonable basis to make a timely response to a notification pursuant to this section, or
(2) did not participate in negotiations or dispute resolution in good faith, or
(3) failed without reasonable basis to enter into or carry out an agreement to perform or participate in the performance of the response action on an equitable basis or pay its equitable share of the cost of such response action or of other liability pursuant to the provisions of this chapter, where its liability was reasonably clear.

Newly Weds’Application

In October 1995 NewlyWeds discovered oil contamination on the site which it purchased from Westvaco in 1981. In August 1996, Newly Weds’ local counsel, Robert Curry, sent a G.L.c. 21E, §4A notice letter to Westvaco. Westvaco turned the matter over to its in-house counsel, Francis Murphy. Curry’s letter described in reasonable detail the discovery of an abandoned underground storage tank (UST) and surrounding oil contamination in October 1995, and the response action to date. The letter enclosed copies of Newly Weds’ consultants’ reports, and set forth the costs incurred to date. Curry asserted that it was

apparent that the Westvaco UST is the principal source of contamination at the Property and will be the principal concern in remediating the site to a level of “no significant risk” as required by the Massachusetts Contingency Plan. Westvaco did not disclose the existence of this tank to NWF at the time of the sale of the Property to NWF. NWF has never assumed ownership or responsibility for operation and/or closure of this tank in accordance with applicable laws and regulations. The responsibility for this tank rests entirely with Westvaco.

Curry demanded that Westvaco reimburse it for all of its expenditures incurred to date, and asserted that Newly Weds would hold Westvaco for any other damages arising out of the presence of the UST.

Murphy, upon receipt of the letter, undertook an investigation. Because Westvaco had not been involved with the site since it sold it to Newly Weds 15 years before, his investigation did not turn up anyone with any knowledge or information about any oil releases at the site. He was able to obtain the sales documents, including the option agreement that provided that Westvaco sold the property to NewlyWeds “as is.” Murphy’s c. 21E, §4A response letter was brief and to the point. He disagreed with Mr. Curry’s contention that the oil released at the site must have come from oil put in the tanks prior to 1981 because the released oil was No. 6 fuel oil and Newly Weds used only No. 4 fuel oil, pointing out that the consultants had found the presence of No. 4 fuel oil in soil and groundwater at the site as well. Mr. Murphy also pointed out, citing Marenghi v. Mobil Oil Corporation, 420 Mass. 371 (1995), that under c. 21E, a former owner of property like Westvaco is not responsible for a claim involving a release of oil during that party’s ownership unless the claimant can establish that the former owner actually caused the release. In that respect, he said that Newly Weds had presented no information that Westvaco had acted “negligently in its alleged use of any tank at the Site or otherwise caused the release of oil.”

There the matter stood between them until 1999, when Newly Weds filed the subject lawsuit seeking to recover under c. 21E, §4 for its past response costs, and under c. 93A, §11 for property damage and punitive damages. The litigation proceeded in the usual manner. The docket does not reflect any serious discovery disputes. In the'fall of 2000, the parties cross moved for summary judgment, which motions were denied in December 2000.

A favorable development in the case for NewlyWeds was the testimony of Richard Sargeant who was deposed in August 2000. Sargeant was a former Newly Weds maintenance supervisor, who testified to certain conversations that he had with one James Fucci. Mr. Fucci worked for Westvaco from the 1960s, and continued to work for Newly Weds in the maintenance department after the 1981 sale. He died in 1993. According to Sargeant, Fucci told him about an excavation which occurred in 1979 in which an underground storage tank, “all messy with oil,” was uncovered. The testimony indicated that probably Westvaco stopped using the old tank in 1979, filled it with sand, left it in place, and installed a new underground storage tank nearby which it connected by piping to the boiler. It was the new underground storage tank which was in place when Newly Weds purchased the property, and which it continued to use until it converted its heating system to natural gas in 1995. The testimony provided evidence upon which Newly Weds could argue that Westvaco was negligent in failing to remove the contaminated soil.

The affidavits filed with the cross applications for fees indicate that the parties began to negotiate in May 1991. The parties utilized a mediator, and several offers and counteroffers were exchanged. At the beginning of trial, the parties’ settlement positions stood thus: Westvaco offered $225,000.00; Newly Weds demanded $515,000.00, plus an agreement by Westvaco to pay any future response costs.

The Chapter 2 IE, §4 claim was tried to a jury, which determined the reasonable response costs sustained by plaintiff to be $257,393.19 and, after rejecting plaintiffs “innocent owner” defense under Section 5(b) of c. 21E, equitably allocated 25% of the response costs to the plaintiff and 75% of the response costs to [730]*730the defendant.1 The Court heard the 93A claim jury-waived and found for Westvaco.

Mr. Murphy’s rejection of Newly Weds’ §4A demand was not unreasonable or in bad faith. Westvaco’s liability was never “reasonably clear.” At the outset, during the §4A process, the apparent fact pattern was similar to those held to be insufficient under Griffith v. New England Tel. & Tel. Co., 420 Mass. 365 (1995), and Marenghi v. Mobil Oil Corporation, 420 Mass. 371 (1995).

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Related

Griffith v. New England Telephone & Telegraph Co.
420 Mass. 365 (Massachusetts Supreme Judicial Court, 1995)
Marenghi v. Mobil Oil Corp.
420 Mass. 371 (Massachusetts Supreme Judicial Court, 1995)

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Bluebook (online)
14 Mass. L. Rptr. 728, Counsel Stack Legal Research, https://law.counselstack.com/opinion/newly-weds-foods-inc-v-westvaco-corp-masssuperct-2002.