Blue Mountain Environmental Management Corp. v. Chico Enterprises, Inc. , 190 F. App'x 150 ( 2006 )

Opinions of the United
2006 Decisions States Court of Appeals
for the Third Circuit
7-13-2006
Blue Mt Env Mgmt v. Chico Entr Inc
Precedential or Non-Precedential: Non-Precedential
Docket No. 04-4208
Follow this and additional works at: http://digitalcommons.law.villanova.edu/thirdcircuit_2006
Recommended Citation
"Blue Mt Env Mgmt v. Chico Entr Inc" (2006). 2006 Decisions. Paper 752.
http://digitalcommons.law.villanova.edu/thirdcircuit_2006/752
This decision is brought to you for free and open access by the Opinions of the United States Court of Appeals for the Third Circuit at Villanova
University School of Law Digital Repository. It has been accepted for inclusion in 2006 Decisions by an authorized administrator of Villanova
University School of Law Digital Repository. For more information, please contact Benjamin.Carlson@law.villanova.edu.
NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
Nos. 04-4208; 05-2888; 06-1532
BLUE MOUNTAIN ENVIRONMENTAL
MANAGEMENT CORPORATION
vs.
CHICO ENTERPRISES, INC.; AUGUST ENVIRONMENTAL, INC.,
Appellants in 04-4208 & 06-1532
(D.C. No. 01-cv-00460)
CARIO PARTNERSHIP,
Appellant in 05-2888
vs.
CHICO ENTERPRISES, INC.
(D.C. No. 02-cv-00366)
____________
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF PENNSYLVANIA
(D.C. Civ. No. 01-cv-00460)
Magistrate Judge: Honorable Amy Reynolds Hay
(D.C. Civ. No. 02-cv-00366)
District Judge: Honorable William L. Standish
____________
1
Argued May 17, 2006
Before: RENDELL, VAN ANTWERPEN and WEIS, Circuit Judges.
(Filed July 13, 2006)
_______________
Alan S. Miller, Esquire (ARGUED)
Picadio Sneath Miller & Norton, P.C.
4710 U.S. Steel Tower
600 Grant Street
Pittsburgh, PA 15219
Counsel for Appellant Cario Partnership in 05-2888
Avrum Levicoff, Esquire (ARGUED)
Joshua N. Perlman, Esquire
Levicoff, Silko & Deemer, P.C.
Centre City Tower, Suite 1900
650 Smithfield Street
Pittsburgh, PA 15222
Counsel for Appellee Chico Enterprises, Inc., in 05-2888, and Counsel for Appellants
Chico Enterprises, Inc. and August Environmental, Inc., in 04-4208 and 06-1532
Elaina A. Smiley, Esquire (ARGUED)
Robert E. Dauer, Jr., Esquire
Meyer, Unkovic & Scott LLP
1300 Oliver Building
Pittsburgh, PA 15222
Counsel for Appellee Blue Mountain Environmental Management Corporation in 04-
4208 and 06-1532
_______________
OPINION
2
WEIS, Circuit Judge.
These cases arise out of a common occurrence and, in the interests of
judicial efficiency, we consolidate all of these appeals. Because this opinion is not
precedential and the parties are familiar with the details, we recite only those facts
relevant to our disposition of these three cases.
On January 31, 2000, an automobile collided with a gasoline pump at a
service station owned by Chico Enterprises (“Chico”). To retrieve
gasoline leakage caused by the accident, Chico used a vacuum truck and sponges. Soon
after the incident, tenants of an office building on property owned by Cario Partnership
adjacent to the gas station premises smelled gasoline fumes. The tenants evacuated the
building and did not re-enter it for some months thereafter.
Chico, through its affiliate, August Environmental, Inc. (“August”),
engaged Blue Mountain Environmental Management Corporation (“Blue Mountain”) to
perform testing and initiate remediation action. Blue Mountain proceeded with its work
without a written contract and sent invoices to Chico periodically. At the end of its
engagement, Blue Mountain contended that Chico owed it the outstanding amount of
$209,982.29. When Chico refused to pay this amount, Blue Mountain filed suit. The
District Court entered summary judgment for Chico, concluding that there was an
“account stated” between the parties.
3
Cario sued Chico for damages it allegedly sustained as a result of the
gasoline migrating to its land. The District Court concluded that the gasoline that leaked
from the cracked valve could not have caused the contamination and entered summary
judgment against Cario.
Chico and Cario have appealed the respective grants of summary judgment
against them.
I. STANDARD OF REVIEW
A court may grant summary judgment if, drawing all inferences in favor of
the nonmoving party, “the pleadings, depositions, answers to interrogatories, and
admissions on file, together with the affidavits, if any, show that there is no genuine issue
as to any material fact and that the moving party is entitled to a judgment as a matter of
law.” Fed. R. Civ. P. 56(c). A motion for summary judgment will not be defeated by
“the mere existence” of some disputed facts, but will be denied when there is a genuine
issue of material fact. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986).
In determining whether the dispute is genuine, the court’s function is not to
weigh the evidence or to determine the truth of the matter, but only to determine whether
the evidence of record is such that a reasonable jury could return a verdict for the
nonmoving party. Id. at 248-49. All inferences must be drawn in the light most favorable
to the nonmoving party. Pa. Prot. & Advocacy, Inc. v. Pa. Dept. of Welfare, 402 F.3d
374, 379 (3d Cir. 2005) (“We are required to review the record and draw inferences in a
4
light most favorable to the nonmoving party, . . . yet the nonmoving party must provide
admissible evidence containing ‘specific facts showing that there is a genuine issue for
trial.’”) (quoting Fed. R. Civ. P. 56(e)).
II. BLUE MOUNTAIN vs. CHICO
Under Pennsylvania law, an “account stated” is an account in writing,
examined and accepted by both parties. Leinbach v. Wolle, 61 A. 248 (Pa. 1905).
Acceptance need not be express and may be implied from the circumstances. Robbins v.
Weinstein, 17 A.2d 629, 634 (Pa. Super. Ct. 1941). A party’s retention of a statement of
account for an unreasonably long time, without objection, may be a manifestation of
assent. See Restatement (Second) of Contracts § 282(1) (1981); see also, Donahue v.
City of Philadelphia, 41 A.2d 879, 881 (Pa. Super. Ct. 1945).
The parties do not dispute the statement of the law contained in the report
the magistrate judge prepared in this case. Chico argues, however, that there is a genuine
issue of material fact as to whether the parties assented to the account. That is, Chico
disputes whether the parties agreed to the accuracy or correctness of the debt.
The issue here is somewhat complicated by the fact that Chico was to be
reimbursed for its remediation expenditures through an insurance fund and its adjuster
was assigned to monitor the bills submitted by Blue Mountain. The first Blue Mountain
invoice totaled $208,630.46, but the adjuster approved only $114,556.84. The first check
Chico issued to Blue Mountain on May 3, 2000 was for $114,556.84, the same amount
5
the adjuster had approved.
Don Killmeyer, an official of both Chico and August, testified at his
deposition that he did not personally examine the Blue Mountain invoices. Instead, he
said it was August’s policy to turn the invoices over to the adjuster upon receipt and allow
him to determine what amount August should pay. According to the deposition, the
adjuster told Killmeyer in May 2000 that he believed there were significant overcharges
in the initial invoices. (App. in No. 04-4208 at 179).
Over the next few months, Killmeyer met several times with personnel at
Blue Mountain and discussed the accounts receivable. He disclosed that Chico had talked
with “the adjustor to see if they would reconsider any of their decisions in that respect.”
Id. at 180.
In December 2000 or January 2001, Killmeyer had a telephone conversation
with the adjuster who repeated that he was concerned with the rates charged by Blue
Mountain. Id. at 182. In January and February 2001, Killmeyer met with personnel from
Blue Mountain and discussed the amounts due on its billings. Again, he told Blue
Mountain that Chico was waiting for the insurance fund to “figure it out and see what was
going to be forthcoming” and he “made representations that we would try to get them
paid.” Id. at 188-90. Killmeyer further stated, “I think we were very forthright in telling
everybody that we were waiting on USTIF [the insurance fund] to determine on the
invoices what was forthcoming.” Id. at 190.
6
These references in the record are in contradiction to the District Court’s
recitals that the defendants “acknowledged the amounts due and owing . . . [and]
confirmed an intention to pay . . . .” According to Killmeyer’s testimony, he told Blue
Mountain that the adjuster contested many of its charges and that whether the full amount
of the invoices would be paid could depend on what the adjuster approved.
Moreover, Blue Mountain knew in May 2000 that the adjuster had approved
only slightly more than half of its first invoice. This, of course, is far less than the two
years of delay in objecting to the amount of the bills that the District Court thought had
occurred.
We do not decide whether Killmeyer’s testimony was true, only that it
raises questions of material fact that undermine a finding of account stated. Because the
record shows issues of disputed fact with respect to whether the parties assented to an
account, the entry of summary judgment was in error. Consequently, we will reverse the
District Court’s grant of summary judgment in favor of Blue Mountain and remand for
further proceedings consistent with this opinion.
III. RULE 60(b) MOTION
Chico also appeals the District Court’s denial of its motion to vacate
brought pursuant to Federal Rule of Civil Procedure 60(b). Because the grant of
summary judgment will be reversed, we will dismiss the appeal of the denial of the Rule
60(b) motion as moot.
7
IV. CARIO vs. CHICO ENTERPRISES
Cario, the owner of premises located immediately adjacent to the service
station, claims its property was contaminated by the gasoline leakage and brought suit
under several theories, including the Pennsylvania Storage Tank and Spill Protection Act
(“Storage Tank Act”), 35 Pa. Cons. Stat. § 6021.1305(c).
The Storage Tank Act provides for a rebuttable presumption of liability
against the owner of a storage tank, such as the one here, “without proof of fault,
negligence or causation” for pollution within 2,500 feet of the tank. 35 Pa. Cons. Stat. §
6021.1311(a). The “presumption may be overcome by clear and convincing evidence that
the person so charged did not contribute to the damage, contamination or pollution.” Id.
But, “the owner or operator must affirmatively prove by clear and convincing evidence . .
. [that] the owner or operator did not contribute to the damages, contamination or
pollution.” 35 Pa. Cons. Stat § 6021.1311(b).
This statutory provision places the burden of proof on the tank owner.
Wack v. Farmland Indus., 744 A.2d 265, 267-68 (Pa. Super. Ct. 1999) (abrogated on
other grounds by Trach v. Fellin, 817 A.2d 1102 (Pa. Super. Ct. 2003)). Pennsylvania
law applies to this presumption. See Fed. R. Evid. 302.
A party with contaminated property is entitled to invoke the presumption
when (1) the defendant owns an underground storage tank; (2) the tank is within 2,500
feet of the contamination; and (3) the tank contains or contained “a regulated substance of
8
the type which caused the damage, contamination or pollution.” See Lehigh Gas & Oil
Co. v. Pa. Dep. Envtl. Res., 671 A.2d 241, 246 (Pa. Cmwlth. Ct. 1995) (quoting 35 Pa.
Cons. Stat. § 6021.1311(a)).
Don Killmeyer reported on February 1, 2000 that the shear valve cracked
after apparently being struck by a vehicle and, “the pumps beneath three dispensers filled
up with product. A Vac truck was used to remove the product and the shear valve was
replaced.” (App. in No. 05-2888 at 96).
On March 1, 2000, Brian Dressel of August reported that, on January 31,
2000, “[i]t was estimated . . . that the bulk of the released product was recovered by Vac
truck” and that a subsequent hydrostatic test determined that the “sump was considered
tight in accordance with the manufacturer’s specifications.” Id. at 122-23.
Eighty gallons of gasoline from the damaged pump, however, were not
accounted for. Soil contamination was found at a point on Chico’s property designated as
MW-3, located seventy feet from the fuel pump and only ten feet from Cario’s boundary
line. Further, a site characterization report August submitted to the Pennsylvania
Department of Environmental Protection identified MW-3 as a location for remediation
following the accident that caused the broken value. Id. at 173. At another spot,
designated MW-20, located on Cario’s property some 200 feet from the tank,
contamination was also found. MW-20 had higher levels of contamination than any of
the other wells. Id. at 161.
9
Chico argues, however, that the leak on its property could not have caused
this contamination because evidence showed the historical directional flow of the ground
water was south-to-north, that is, away from Cario’s property. That argument, however,
is weakened by the contamination found at MW-3, which was south of the pump, and
suggests that migration was against the ground water directional flow. Chico’s own
expert concluded that the contamination at MW-3 came from one of the fuel dispensers
on Chico’s property. Id. at 176-77.
Moreover, in a submission to the District Court following the filing of the
magistrate judge’s report, Cario’s expert pointed out that several old foundations below
the surface of the properties could have produced pathways that would allow gasoline and
its vapors to migrate in a direction opposite to that of the general ground water flow. On
this record, Chico has failed to demonstrate that it did not contribute to the contamination.
Although much of the dispute revolves around whether gasoline in its liquid
form migrated to Cario’s property, there remains the possibility under Pennsylvania law
that the fumes from the spill that drifted onto Cario’s property were air pollution within
the scope of the Storage Tank Act. See 35 Pa. Cons. Stat. § 6021.1310 (providing that
“[i]t shall be unlawful . . . to cause air, soil or water pollution . . . .”). We need not and do
not, however, rule on that issue because the parties have not raised it before us.
We conclude that, the record before us is not adequate to establish that
Chico has rebutted the statutory presumption and it was erroneous to enter summary
10
judgment.
We also conclude that there is a genuine issue of material fact with respect
to Cario’s remaining counts. With respect to Cario’s negligence claim, the record reflects
that there is a genuine issue of material fact with respect to whether Chico in fact caused
the contamination on Cario’s property. There is also an issue of material fact with respect
to whether the release of gasoline contaminants onto Cario’s property was caused by
negligence on Chico’s part. Further, “a violation of the [Storage Tank Act] can serve as
evidence in a claim of negligence per se.” Centolanza v. Lehigh Valley Dairies, Inc. 635
A.2d 143, 150 (Pa. Super. Ct. 1993).
With respect to the breach of contract claim, there is a genuine issue of
material fact about whether the contaminants on Cario’s property constitute a “release”
that Chico was required to “remediate” per the access agreement.
Finally, there is a genuine issue of material fact with respect to whether the
alleged release of gasoline contaminants from Chico’s property amounted to a private
nuisance. A “private nuisance” is “‘a nontrespassory invasion of another's interest in the
private use and enjoyment of land.’” See Philadelphia Elec. Co. v. Hercules, Inc., 762
F.2d 303, 313 (3d Cir. 1985) (quoting Restatement (Second) of Torts § 821D) (applying
Pennsylvania law). Further, “while there must be a real and appreciable invasion of the
plaintiff's interests” for an action for private nuisance to stand, “[t]he type of harm
sufficient to permit recovery for nuisance is generally a question for the factfinder.” Jones
11
v. Wagner, 624 A.2d 166, 170 n. 2 (Pa. Super. Ct. 1993).
Accordingly, we will reverse and remand to the District Court for further
proceedings consistent with this opinion.
12