Strictly speaking

• By Peter A. Vandenbergh, PhD
• Jul 01, 2000

In 1984, the U.S. Environmental Protection Agency (EPA) estimated there were 2 million active underground storage tanks (USTs) scattered across the country, most of which contained petroleum products.¹ That same year, Congress directed EPA to establish regulatory programs to prevent, detect and clean up releases from UST systems storing petroleum or certain listed hazardous substances.² In December 1998, EPA promulgated a set of safety regulations for leaking underground storage tanks (LUSTs) and provided a 10-year compliance window. By 1998, the number of active USTs in the United States had dropped from two million to 892,000.³ Of those, EPA estimated that by the December 1998 deadline, just over 50 percent were in compliance with the regulations.⁴ In other words, approximately 400,000 USTs were not in compliance with EPA safety regulations as late as December 1998.⁵Since then, 25 states have provided statistics concerning the percentage of active USTs within their states that were not in compliance with EPA regulations.⁶ Those states and their respective percentages are shown in Table 1. USTs that are not in compliance with EPA safety regulations and those that are not adequately maintained pose a risk that they will leak or fail. In fact, more than 330,000 releases from faulty tanks have been reported in the past decade.⁸ These leaks present complex and costly legal and environmental problems, not to mention corporate headaches. One state environmental protection agency estimates that the cost of remediating a release from a leaking UST ranges between $50,000 and $250,000, not including associated legal costs.⁹ In addition to the possibility of state and federal cleanup actions, the property owner may face lawsuits filed by adjoining landowners for property damage and personal injury caused by petroleum products that have migrated off-site from a LUST. Those lawsuits often include a cause of action for "strict liability." Under that theory, the plaintiff need not prove that the land owner did anything wrong. Instead, the plaintiff need only establish that the tank leaked and that damages resulted from the leak. The requirements for establishing a claim for strict liability are set forth in section 519 of the Restatement (Second) of Torts, which provides "(1) one who carries on an abnormally dangerous activity is subject to liability for harm to the person, land or chattels of another resulting from the activity, although he has exercised the utmost care to prevent the harm; (2) this strict liability is limited to the kind of harm, the possibility of which makes the activity abnormally dangerous." To determine whether an activity is abnormally dangerous, courts consider the following six factors:

Existence of a high degree of risk of some harm to the person, land or chattels of others;

Likelihood that the harm that results from it will be great;

Inability to eliminate the risk by the exercise of reasonable care;

Extent to which the activity is not a matter of common usage;

Inappropriateness of the activity to the place where it is carried on; and

Extent to which its value to the community is outweighed by its dangerous attributes.

When applying these factors, courts should avoid focusing on the abstract propensities or properties of the particular substance involved, or on the leak and resulting contamination. Instead, courts should examine the activity which preceded the leak; i.e., the storage of products in USTs. The Wisconsin Supreme Court in Grube v. Daun¹⁰ acknowledged this distinction when it held "the contamination is the resulting harm, not the alleged ultrahazardous activity itself. The proper inquiry...is whether the installation and use of a UST on a farm in the 1970s...constitutes an abnormally dangerous activity that requires imposition of strict liability in the event of harm to others." The court answered that in the negative.¹¹ As one court aptly noted, if the rule were otherwise, "virtually any commercial or industrial activity involving substances which are dangerous only in the abstract automatically would be deemed as abnormally dangerous. This result would be intolerable."¹² In UST cases, courts are especially heedful of the last three restatement factors - the extent to which the activity is not a matter of common usage, the appropriateness of the activity to the place where it is carried on and the extent to which its value to the community is outweighed by its dangerous attributes, respectively. In analyzing these factors, a number of courts have concluded that the "operation of underground storage tanks at a gasoline service station is not an abnormally dangerous activity."¹³ This is partly because "petroleum products are necessary for the functioning of our present society and there must be some means of delivering gasoline and other petroleum products to retail areas."¹⁴ One court even went so far as to describe USTs at a filling station as a "natural use of the land."¹⁵ In an analogous situation, the Washington Supreme Court in New Meadows Holding Co. v. Washington Water Power Co.¹⁶ found that the transportation of natural gas through an underground pipeline was not abnormally dangerous.¹⁷ It reached this conclusion despite acknowledging "the volatile and highly explosive nature of natural gas."¹⁸ Instead, the court focused on the utilitarian aspects of underground natural gas pipelines, relying on the fact that approximately 160 million Americans use natural gas for their residential needs and that 720,900 miles of distribution pipelines crisscross communities in every state in the country, including 10,062 miles in Washington state alone. Based on these statistics, the court ultimately found it to be "entirely appropriate and necessary for communities to have gas lines placed underground." The same can be said of USTs storing petroleum products. As noted above, as late as December 1998, there were nearly 1 million active USTs scattered across the country and, as recently as 14 years ago, there were twice that many active tanks. No one knows how many inactive USTs are still in existence. Because of the sheer numbers of USTs, the Pennsylvania Supreme Court in Smith v. Weaver,¹⁹ concluded that "the location of tanks at a gasoline service station is certainly appropriate and although the harm which may result from a leak may be great, this one factor pales in comparison to the others which point in favor of our ruling that the storage of petroleum products in underground storage tanks is not abnormally dangerous." Similarly, the U.S. District Court, Eastern District of Virginia in Arlington Forest Associates v. Exxon Corp.²⁰ held that "maintained, monitored, and used with due care, underground storage tanks present virtually no risk of injury from seepage of their contents. They are not abnormally dangerous."²¹ It appears that only one court has concluded, as a matter of law, that storing petroleum products in USTs is an abnormally dangerous condition for which strict liability may be imposed.²² However, that case involved an UST that was located directly above the aquifer. The U.S. District Court in the Virgin Islands found that the location of the tank was an inappropriate use of the land. It based its ruling in large part on its conclusion that the interests of the community in clean water outweighed the benefit of the service station to the community. This case appears to be an anomaly. Should you find yourself embroiled in litigation over damage allegedly caused by a leaking UST, a preliminary consideration should be taking steps to immediately dismiss any strict liability allegations. Avoiding the imposition of liability without fault should be of paramount concern. Endnotes ¹ Hazardous and Solid Waste Amendments of 1984, H.R. Conf. Rep. No. 98-11333, at 128, reprinted in 1984 U.S.C.C.A.N. 5649, 5699 (1984). ² In 1984, Congress passed the Hazardous and Solid Waste Amendments (HSWA) to RCRA and President Reagan signed them into law. In Title IV of the Amendments, Congress established a new program, Subtitle I, specifically devoted to the regulation of leaking underground storage tanks. Under Subtitle I, all federally regulated USTs must, among other things, "be registered, meet leak detection requirements, meet upgrade requirements, (i.e., spill, overfill, and corrosion protection)..., meet financial responsibility requirements, perform a site check and corrective action in response to leaks, spills and overfills..." ³ Platt's Oilgram News, December 23, 1998. ⁴ Fairfield County Business Journal, January 11, 1999. ⁵ Platt's Oilgram News, December 23, 1998. ⁶ Id. ⁷ Congressional Research Service - Report for Congress Leaking Underground Storage Tank Trust Fund (LUST), Nonna A. Noto (Economics Division, August 28, 1997). ⁸ Fairfield County Business Journal, January 11, 1999. ⁹ Mealey's Pollution Liability Report, November 1999. Estimates were from the New Jersey Department of Environmental Protection. ¹⁰ 213 Wis.2d 533, 570 N.W.2d 851 (Wis. 1997). ¹¹ See also, In re: One Meridian Plaza Fire Litigation, 820 F. Supp. 1460, 1476 (E.D. Pa. 1993); Erbrich Products, Inc. v. Wills, 509 N.E.2d 850 (Ind. App. 1987). ¹² Erbrich Products, Inc. v. Wills, 509 N.E.2d 850 (Ind. App. 1987). ¹³ In addition to the other cases cited in the body of this article, see also, Smith v. Weaver, 445 Pa.Super. 461, 665 A.2d 1215 (1995); Grube v. Daun, 213 Wis.2d 533, 570 N.W.2d 851 (Wis. 1997); Ergon, Inc. v. Amoco Oil Co., 966 F.Supp. 577 (W.D. Tenn. 1997) ; 750 Old Country Road Realty Corp. v. Exxon Corp., 645 N.Y.S.2d 186, 229 A.2d 1034 (1996); Walker Drug Co. v. LaSal Oil Co., 902 P.2d 1229 (Utah 1995); Hahn v. Chevron, U.S.A., Inc., 1995 U.S. App. LEXIS 17528 (6th Cir. 1995); Schwartzman, Inc. v. General Electric Co., 848 F.Supp. 942 (D.N.M. 1993); Arawana Mills Co. v. United Technologies Corp., 795 F.Supp. 1238, 1251-52 (D. Conn. 1992); Richmond, Fredericksburg & Potomac R.R. Co. v. Clifford, 787 F.Supp. 572, 575-76 (E.D. Va. 1992); Hudson v. Peavey Oil Co., 279 Ore. 3, 566 P.2d 175, 177-78 (1977). ¹⁴ Dominick's Finer Foods, Inc. v. Amoco Oil Co., 1993 U.S. Dist. LEXIS 17688 (N.D. Ill. 1993). ¹⁵ Peneschi v. National Steel Corp., 170 W. Va. 511, 295 S.E.2d 1 (W.Va 1982) (the court found that storing petroleum products in USTs is "not unduly dangerous for purposes of strict liability.") ¹⁶ 102 Wash.2d 495, 687 P.2d 212 (Wash. 1984). ¹⁷ Id. at 503, 687 P.2d at 217. ¹⁸ Id. At 501, 687 P.2d at 216. ¹⁹ 445 Pa.Super. 461, 665 A.2d 1215 (1995). ²⁰ 774 F.Supp. 387 (E.D. Va. 1991). ²¹ Id. At 389-93 ²² In re Tutu Wells Contamination Litigation, 846 F.Supp. 1243 (D. V.I. 1993).

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This article appeared in Environmental Protection magazine, July 2000, Vol. 11, No. 7, p. 22.

This article originally appeared in the 07/01/2000 issue of Environmental Protection.