[*1]
State of New York v Chevron Corp.
2016 NY Slip Op 50855(U) [51 Misc 3d 1228(A)]
Decided on May 17, 2016
Supreme Court, Albany County
Platkin, J.
Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.
This opinion is uncorrected and will not be published in the printed Official Reports.


Decided on May 17, 2016
Supreme Court, Albany County


State of New York, Plaintiff,

against

Chevron Corporation, as successor in interest to TEXACO, INC., DEAN SHEPARD, and MARCIA SHEPARD, Defendants.




L-00088-13



Eric T. Schneiderman, Attorney General
Attorney for Plaintiff
(Jeremy R. Feedore, of counsel)
The Capitol
Albany, New York 12224

Young, Sommer, Ward, Ritzenberg, Baker & Moore, LLC
Attorneys for Dean and Marcia Shepard
(Kevin M. Young and Kristin Carter Rowe, of counsel)
Executive Woods, 5 Palisades Drive
Albany, New York 12205


Richard M. Platkin, J.

In this cost-recovery action brought pursuant to Navigation Law article 12, the State of New York ("State") moves: (a) pursuant to CPLR 3025 (c), to amend the ad damnum clause of [*2]the complaint to reflect additional remediation expenses incurred during the pendency of this action; and (b) pursuant to CPLR 3212, for summary judgment in the sum of $145,531.82, which allegedly reflects all recoverable clean-up costs, together with pre-judgment interest, costs and disbursements. The two remaining defendants, Dean and Marcia Shepard ("the Shepards") oppose the motion and cross-move for partial summary judgment, seeking a declaration that they are entitled to the set-off from liability established by General Obligations Law § 15-108 (a).



BACKGROUND

This action arises from the alleged discharge of petroleum at a service station located at 72 Northville Road in Edinburg, New York ("Site"). The subject spill, which was reported to the Department of Environmental Conversation ("DEC") on October 16, 2006, allegedly contaminated nearby groundwater and soil.

This was not the first petroleum spill at the Site. There was a discharge of about 1,000 gallons of petroleum in 1976 ("1976 Spill") as a result of a leaking underground storage tank ("UST"). At the time, the USTs at the Site were owned by Texaco, Inc. ("Texaco"). The State alleges that Texaco initiated some cleanup of that spill, including replacement of the leaking UST.

On March 18, 1981, the Edinburg fire house, which is located across the street and downgradient of the Site, reported the presence of gasoline in the drinking water. After Texaco declined to address the issue, the State retained a contractor to investigate. Monitoring wells were installed to determine the magnitude of the contamination, and the contractor ultimately recommended the installation of two replacement drinking-water wells that would not be impacted by the petroleum contamination. This work was performed at the State's expense. No other remediation was performed by Texaco or the State with regard to any of the contamination that remained in the soil and water from the 1976 Spill.

In February 1986, the State and Texaco entered into a settlement agreement ("Texaco/State Settlement"). Texaco obtained a release from the State in exchange for the payment of $54,445.20, which represented the State's cost of investigating the contaminated drinking water and installing new wells for potable water. Thereafter, the State closed its file on that spill.

The Shepards acquired the Site in May 1995. Their purchase included a petroleum storage and dispensing system ("System") that had been installed in 1986, including two 4,000-gallon USTs. According to the Shepards, they regularly monitored their petroleum inventory and tested the USTs over the next ten years, without ever having received any indication of a spill or the loss of product.

The Shepards sold the Site to NY Joe, LLC ("NY Joe") in December 2005. As part of the transaction, the Shepards informally agreed to remove and replace the System. This work did not commence until September 2006, after the ground had thawed and the peak summer season had concluded.

The Shepards retained Precision Environmental Services, Inc. ("Precision") to excavate and replace the System. There was no sign of any defects or release points in the System, but Precision encountered soil contaminated by gasoline below the piping infrastructure, as well as gasoline odors directly beneath and just to the south of the pump island. Precision notified DEC of the contamination, and DEC directed a subsurface investigation and remediation plan.

NY Joe commenced operation of the new System in or about October 2006. The Shepards assert that, under the new owner, the fuel dispensing system was not supervised around the clock, and that only gravel (rather than pavement) was in place between the pump island and the convenience store for almost two years.[FN1]

In a January 22, 2007 report, Precision advised that laboratory analysis of soil samples taken in the vicinity of the pump island revealed volatile organic compounds ("VOCs") consistent with "aged" gasoline. A second consultant hired by the Shepards, Alpha Geosciences ("Alpha"), observed Precision's work and agreed that this contamination likely predated the Shepards' ownership of the Site. Despite their belief that the contaminated soil was attributable to pre-existing contamination, the Shepards caused almost 93 tons of soil to be excavated and removed from around the pump island area and transported to an off-Site facility for remediation.

The State then requested that Dean Shepard initiate a comprehensive, subsurface investigation of the Site. He refused, relying upon the consultants' reports indicating that the contamination came from a pre-1985 spill. DEC was concerned, however, that neither Precision nor Alpha had sampled the groundwater. The State believed that this omission was significant because the 1976 Spill had infiltrated the groundwater and contaminated a nearby water well. When the Shepards failed or refused to conduct any further investigation, DEC retained EmpireGEO Services, Inc. ("Empire").

In September 2007, Empire installed six monitoring wells and drilled additional soil borings. Water samples from five of the six wells tested positive for the presence of VOCs, which is indicative of petroleum contamination. Samples taken from MW-16, near the pump island, tested positive for VOCs from beneath the surface to a depth of at least 15 feet, similar to Precision's findings. Empire concluded that petroleum had been released from near the ground surface and migrated downward into the water table.

Samples taken from MW-9 and MW-12 on September 17, 2007, and from five of the six wells on November 26, 2007, contained significant levels of VOCs. The two wells in close proximity to the pump island, MW-12 and MW-16, were contaminated with particularly high levels of VOCs. These results led Empire to conclude that the most severe groundwater contamination was located in the immediate vicinity of the pump island.

The samples taken from MW-12 also disclosed high levels of MTBE, a gasoline additive, and benzene, a component of gasoline. The Shepards do not dispute the presence of these contaminants in the samples, but emphasize that the levels detected were orders of magnitude less than the contamination discovered in 1981. Based upon the test results, Empire concluded that there had been a spill at the Site sometime between 2002 and 2006. After consultation with DEC, Empire began remediating the Site through the infusion of oxygen into the ground, which has resulted in a significant decline of contaminants.

The State commenced this cost-recovery action on or about October 9, 2013, seeking to recover $82,789.72 in remediation costs. In their answer, the Shepards raised a host of [*3]affirmative defenses, alleged three counterclaims against the State, and cross-claimed against Chevron Corporation ("Chevron"), as successor in interest to Texaco. Chevron, in turn, cross-claimed against the Shepards.

By Decision & Order dated May 5, 2015, the Court dismissed the Shepards' three counterclaims, which sought: (1) a declaration that the Shepards are not liable as dischargers under the Navigation Law; (2) a declaration that the State acted unlawfully, willfully and/or maliciously in responding and/or failing to respond to petroleum contamination at the Site; and (3) a declaration that the State had been negligent and/or grossly negligent in their response to and/or in failure to contain, remove or remediate the contamination at the Site. The latter two claims were dismissed based upon the immunity conferred by Navigation Law § 176 (2) (b), and the request for a declaration of non-liability was denied as unnecessary because the Shepards' liability as dischargers under the Navigation Law necessarily would be adjudicated in the context of the State's claim for affirmative relief.

In a Stipulation filed with the Albany County Clerk on December 10, 2014, the State discontinued all claims against Chevron. The cross claims between the Shepards and Chevron/Texaco then were discontinued via Stipulation dated March 30, 2015, following a confidential settlement in which an unspecified monetary payment was made to the Shepards.

Following the completion of disclosure, the State filed a trial-term Note of Issue on September 30, 2015, and the case was assigned a day certain for trial of June 6, 2016. The instant motion practice ensued, with the dispositive motions having been made returnable sixty days prior to trial. This expedited Decision & Order follows.



AMENDMENT OF AD DAMNUM CLAUSE

The State seeks permission to amend the ad damnum clause of its complaint to reflect additional clean-up costs incurred since the commencement of this action. Plaintiff now seeks to recover remediation costs totaling $145,531.82. This branch of the State's motion should be granted. The affidavit of Wayne Sickler, the Assistant Director of the New York Environmental Protection and Spill Compensation Fund ("Fund"), and Russell Huyck, a DEC environmental engineer, suffice to demonstrate potential merit, and the Shepards have not established any cognizable prejudice that would warrant denial of the proposed amendment.



SUMMARY JUDGMENT

To obtain summary judgment, a movant must establish his or her position " sufficiently to warrant the court as a matter of law in directing judgment'" in his or her favor (Friends of Animals v Associated Fur Mfrs., 46 NY2d 1065, 1067 [1979], quoting CPLR 3212 [b]). The proponent of a summary judgment motion must make a prima facie showing of entitlement to judgment as a matter of law, tendering sufficient evidence to eliminate any genuine material issues of fact from the case (see Alvarez v Prospect Hosp., 68 NY2d 320, 324 [1986]). The failure to make such a showing mandates denial of the motion, regardless of the sufficiency of the opposing papers (see Winegrad v New York Univ. Med. Ctr., 64 NY2d 851, 853 [1985]).



A. Navigation Law Liability

Navigation Law § 173 (1) prohibits the discharge of petroleum (see Snyder v Jessie, 164 AD2d 405, 408 [4th Dept 1990], lv dismissed 77 NY2d 940 [1991]; Gendron v State of New York, 161 AD2d 936, 936 [3d Dept 1990]). When a discharge occurs, DEC has the authority to [*4]directly undertake the removal of the discharge or to retain agents or contractors for such purpose (see Navigation Law § 176 [1]; State of New York v Stewart's Ice Cream Co., 64 NY2d 83, 87 [1984]). Any person responsible for the discharge is strictly liable for all costs associated with the cleanup and removal (Navigation Law §§ 181, 187; see State of New York v Speonk Fuel, Inc., 3 NY3d 720, 723 [2004]; State of New York v Joseph, 29 AD3d 1233, 1234-1235 [3d Dept 2006], lv denied 7 NY3d 711 [2006]). This liability is joint and several (State of New York v Getty Petroleum Corp., 89 AD3d 262, 267 [3d Dept 2011]).

The State contends that the Shepards are strictly liable as dischargers by dint of their ownership of the Site and System from May 1995 through at least December 2005. Settled law holds that,

while liability for remediation costs cannot be premised solely on land or system ownership, owners who have control over activities occurring on their property and reason to believe that petroleum products are stored there are liable as a discharger. Thus, liability is predicated on control over the contaminated premises, that is, a party's capacity to take action to prevent an oil spill or to clean up contamination resulting from a spill. Imposition of strict liability does not require proof of fault, knowledge or wrongful acts or omissions, i.e., owners with such capacity are strictly liable as a discharger, even in the absence of any evidence that the owner caused or contributed to the discharge, and their strict liability cannot be avoided by demonstrating that another party actually caused the discharge or contributed to the contamination in issue.

(State of New York v Slezak Petroleum Prods., Inc., 96 AD3d 1200, 1202 [3d Dept 2012] [internal quotations and citations omitted]; see also Speonk Fuel, Inc., 3 NY3d at 723-724; State of New York v Green, 96 NY2d 403, 407 [2001]).

The State also submits proof, in the form of the opinion of its environmental engineering expert, Russell Huyck, that the contaminated groundwater and soil in the vicinity of the pump island is the product of a petroleum discharge that occurred during the Shepards' ownership of the Site, commingled with contamination remaining from the 1976 Spill.

In opining that a petroleum discharge occurred during the Shepards' ownership of the Site and System, Huyck relies, in part, on the presence or absence of MTBE in samples taken from the Site. According to Huyck, MTBE was used in Upstate New York from about 1985 until January 1, 2004, when the State banned its use as a gasoline additive ("MTBE Ban"). Thus, Huyck opines that the presence of MTBE in the groundwater samples taken from the monitoring wells, particularly the samples taken from MW-12, is proof of a spill that occurred no later than 2004. Further, given that MTBE is highly soluble and prone to rapid migration in groundwater, Huyck concludes that the MTBE detected in the groundwater just downgradient of the pump island could not have come from a discharge more than five years or so prior to detection in Fall 2007. Thus, Huyck joins Empire in attributing at least a portion of the contamination to an accidental discharge of petroleum that occurred sometime between 2002 and January 1, 2004.

Huyck also relies upon the presence or absence of benzene in the samples as another indicator of the age of the spill. Benzene is the one of the four basic components of gasoline and is the first to volatize. For this reason, both Precision and Alpha relied on the absence of benzene from the soil in concluding that the contamination likely pre-existed the Shepards' ownership of [*5]the Site.[FN2] Conversely, Huyck opines that the presence of benzene in the water samples taken from the monitoring wells in 2007 is indicative of a more recent spill, one that occurred between 2002 and 2006.

The Court concludes that the proof submitted by the State suffices to demonstrate, prima facie, that at least a portion of the petroleum contamination discovered at the Site is attributable to accidental petroleum discharges between 2002 and 2004 and that, as the owners of the Site and System during this period, the Shepards bear joint and several liability for remediating the contamination. Accordingly, the burden shifts to the Shepards to raise a triable issue of fact or legal defense against the imposition of strict liability under the Navigation Law.

The Shepards argue principally that the contamination of the Site primarily was caused by the 1976 Spill, in which more than 1,000 gallons of petroleum accidentally was discharged by Texaco. The Shepards emphasize that the 1976 Spill was not remediated, other than the replacement of the leaking UST and the drilling of new drinking-water wells. They further observe that the levels of contamination found in 1981 are vastly higher than the levels discovered in 2006 and 2007. Thus, the Shepards assert that the State's purposeful decision to leave contamination from the 1976 Spill in the soil and water without adequate remediation constituted an election on the part of the State to forego the recovery of future clean-up costs.

The Court does not find this argument persuasive. The issue raised by the State's motion for summary judgment is not whether some, or even most, of the contamination is attributable to the 1976 Spill. Under the Navigation Law, the Shepards are subject to strict joint and several liability if a petroleum discharge occurred during their period of ownership. Thus, to defeat the State's motion, the Shepards must come forward with proof sufficient to raise a triable issue of fact with respect to the State's prima facie showing that at least a portion of the contamination discovered in 2006 and 2007 is attributable to an accidental petroleum discharge that occurred between 2002 and 2006.

The Shepards recognize this burden and the need to explain the presence of MTBE in the groundwater samples. They further acknowledge that the MTBE contamination cannot be linked to the 1976 Spill and, instead, is indicative of a more recent spill. Thus, in addition to arguing that the overwhelming majority of the contamination is attributable to the 1976 Spill, the Shepards maintain that there must have been "newer but very limited spill[s]" that occurred under the Site's new owner prior to the groundwater sampling by Empire in late 2007.

In particular, the Shepards' expert, Thomas Johnson, opines that there must have been a another spill after the Shepards sold the Site to NY Joe in December 2005 and after the new System was installed and entered into service in October 2006. Thus, Johnson dates the newer spill to sometime between October 2006 and Fall 2007. Defendants and their expert emphasize the absence of pavement in the vicinity of the pump island during this period and the allegedly unsupervised nature of the dispensing operation. Relatedly, the Shepards insist that there were no System failures or other evidence of a spill during their ownership of the Site and System.

In seeking to establish that the subsequent spill could have occurred under the Site's new ownership, the Shepards challenge the State's use of MTBE levels to date the discharge. The [*6]State's expert relies upon the presence of MTBE in the groundwater samples to establish that the more recent contamination occurred prior to the MTBE Ban. The Shepards, however, insist that this is not a reliable method of dating the newer discharge. More specifically, the Shepards' expert asserts that MTBE still may be present in gasoline sold in New York State subsequent to the MTBE Ban as an incident to the normal process of producing and shipping gasoline.

Johnson bases this claim on a September 25, 2003 memorandum of the Department of Agriculture and Markets ("A & M") that is said to allow petroleum to contain 0.5% MTBE. The A & M memorandum states that its purpose was to provide guidance to interested parties as to how "trace amounts" of MTBE would be treated by the agency for enforcement purposes. Through the memorandum, the agency advised regulated entities that it did not intend to take enforcement action where only "de minimus" levels of MTBE were found. Thus, A & M indicated that it would not pursue enforcement actions under the MTBE Ban where sampled petroleum contained less than 0.5% MTBE.

While the foregoing regulatory guidance may suffice to demonstrate the possibility that gasoline sold in New York State after the MTBE Ban could contain de minimis amounts of MTBE, the Shepards have not adduced competent, non-speculative proof linking the possible presence of trace amounts of MTBE in the gasoline supply to the contamination discovered at the Site. The fact that A & M will not initiate regulatory action based upon the presence of trace amounts of MTBE in gasoline is not competent proof that gasoline sold in New York State from October 2006 through Fall 2007 did, in fact, contain MTBE in appreciable levels and certainly not proof that MTBE was present at the maximum 0.5% level. Moreover, Johnson has not supplied an adequate science-based foundation for comparing the trace levels of MTBE that may exist in pure gasoline to the levels of MTBE detected in the samples of water. The Court therefore concludes that Johnson's opinion that the more recent contamination is attributable to a spill subsequent to implementation of the MTBE Ban is speculative, unsupported by competent evidence and lacks an adequate foundation.

Further, contrary to Johnson's repeated characterization, the State has not asserted that the contamination at issue herein is attributable to a surface spill. Rather, the State cites Empire's report, which found evidence indicative of a product release near the surface, which moved downward into the water table. This is in contrast to the 1976 Spill, which discharged from one of the buried USTs. Thus, Johnson's claim that a surface spill would not have been possible under the Shepard's ownership, due to the presence of paved asphalt in and about the pump island, is not probative. Moreover, evidence of a spill "near the ground surface", rather than from underground, is additional proof of petroleum discharges subsequent to the 1976 Spill.

The Court therefore concludes that defendants have not met their burden of coming forward with competent, non-speculative evidence sufficient to raise a triable issue of fact in response to the State's proof of a discharge sometime between 2002 and 2004. Similarly unsupported is defendants' claim of a discharge of petroleum at the Site between October 2006 and Fall 2007 under its new owner.

In view of the foregoing, any dispute between the parties regarding the extent to which the contamination is attributable to the 1976 Spill is not material to determination of the Shepards' strict liability under the Navigation Law. Even crediting, for purposes of the State's motion, the 2006 testing and analysis performed by Precision and Alpha, which found the [*7]presence of VOCs in the contaminated soil consistent with "aged" gasoline predating the Shepards' ownership of the Site and System, and further crediting the Shepards' contention that the absence of MTBE from the soil samples taken in 2006 is additional evidence of contamination predating their ownership, the Shepards remain subject to strict joint and several liability under the Navigation Law for the clean-up costs. Accordingly, the State's motion for summary judgment must be granted.



B. General Obligations Law § 15-108

In seeking to avoid financial responsibility for remediating contamination remaining from the 1976 Spill, the Shepards invoke General Obligations Law ("GOL") § 15-108, which prescribes the consequences that ensue when a plaintiff obtains a release from one of several tortfeasors alleged to be liable for the same injury. The Shepards maintain that, as a result of the Texaco/State Settlement in 1986 — pursuant to which Texaco was given a broad release in exchange for the payment of $54,445.20 in remediation costs — they are entitled to the set-off established in GOL § 15-108 (a). This issue is raised by the Shepards in opposition to the State's motion for summary judgment, as well as in a separately noticed cross motion for partial summary judgment.[FN3]

Pursuant to GOL § 15-108 (a), a release "given to one of two or more persons liable or claimed to be liable in tort for the same injury . . . does not discharge any of the other tortfeasors from liability for the injury . . . , but it reduces the claim of the releasor against the other tortfeasors to the extent of any amount stipulated by the release or the covenant, or in the amount of the consideration paid for it, or in the amount of the released tortfeasor's equitable share of the damages . . . ." Thus, the statute is an affirmative defense that "permits nonsettling defendants a monetary offset against the amount of a verdict" (Whalen v Kawasaki Motors Corp., U.S.A., 92 NY2d 288, 292-293 [1988]). "The purpose of the statute is to encourage settlement, although the statute is also concerned with ensuring equity. Plaintiffs should be fairly compensated, but nonsettling defendants should not bear more than their fair share of a plaintiff's loss [and] the possibility of double recovery should be avoided" (id., at 292).

Where such a release is given in good faith by the plaintiff to one tortfeasor, the released party is relieved from liability for contribution to any other party (GOL § 15-108 [b]), thereby "allow[ing] a defendant to settle a claim and obtain [a] release without fear of being brought back into the action by a nonsettling defendant seeking contribution" (Mitchell v New York Hosp., 61 NY2d 208, 216 [1984]). Likewise, the settling tortfeasor is barred from obtaining contribution from any other person (GOL § 15-108 [c]), which avoids "future litigation between a settling [*8]tort-feasor, who voluntarily bought [a] release from the case at a price [it] considered fair, and nonsettling tort-feasors" (Mitchell, 61 NY2d at 216).

In support of the cross motion, the Shepards cite the Texaco/State Settlement and the release given to Texaco, which discharged the oil company "from any and all cleanup and removal liabilities and costs, including those incurred by the State of New York or its contractual agents". The Shepards further contend that at least a portion of the contamination at issue is "aged" gasoline attributable to the 1976 Spill, relying on the same evidence cited above. The Shepards recognize that this action is one in which defendants may cross-claim for contribution under CPLR article 14 against one another (see White v Long, 229 AD2d 178, 181-182 [3d Dept 1997]; see also Hill v St. Clare's Hosp., 67 NY2d 72 n 7 [1986]), but argue that Texaco was relieved of liability for contribution under GOL § 15-108 (b). On the basis of the foregoing evidence and argument, the Shepards contend that they cannot be held liable for Texaco's equitable share of the State's clean-up costs.

In opposing the cross motion, the State does not dispute the applicability of GOL § 15-108 (a) to this action. Rather, the State argues that summary judgment must be denied based on a material issue of disputed fact: whether the Shepards waived the protections of GOL § 15-108 (a) in settling the cross claims with Chevron/Texaco ("Cross-Claims Settlement"). The State observes that parties always are free to waive known rights, including those created by GOL § 15-108, and that, as a result of the Cross-Claims Settlement, "the issue as to the share of liability [of] each set of defendants . . . may have been resolved, and become moot". The State therefore contends that, "in the absence of the provisions of [the Cross-Claims Settlement] agreement, the issue of the application of [GOL § 15-108] cannot be determined at this time."

The Court does not see merit in the State's opposition to the cross motion. Contrary to the State's apparent contention, the issue is not whether the Shepards waived the protections of GOL § 15-108 (c), which bars a released party such as Texaco from seeking contribution under CPLR article 14 (see Memorandum of Law in Further Support of Plaintiff's Motion for Partial Summary Judgment and in Opposition to Defendant's Cross Motion ["Cross-Motion Opp."], at 5 ["D. Parties are Always Free to Waive GOL 15-108(c)"] and 6 ["E. By Settling Its Cross-Claims with Texaco, the Shepard Defendants May Thereby Have Waived the Protections of 15-108(c)"]). Even if the Cross-Claims Settlement were found to constitute an express or implicit waiver by the Texaco and the Shepards of their respective rights under GOL § 15-108 (b) and (c) — a point that is by no means clear from the present record [FN4] — the State has not supplied any evidentiary or logical basis for concluding or inferring that the Shepards waived the protections of GOL § 15-108 (a) (see Hill, 67 NY2d at 84).

The State effectively concedes that it has no proof of waiver, instead maintaining that the issue of waiver cannot be determined in the absence of the agreement effectuating the Cross-Claims Settlement. But the State does not oppose the cross motion under CPLR 3212 (f) or otherwise cite the need for additional discovery. In fact, the cross claims were resolved approximately six months before the State filed a trial-term note of issue representing that all necessary discovery was complete. The State's mere hope that will be able to come forward with proof at trial establishing a waiver of GOL § 15-108 (a) is insufficient to give rise to a material issue of disputed fact or otherwise warrant denial of the cross motion.[FN5]

Nor has the State supplied any logical basis from which it may be inferred that the Shepards relinquished the GOL § 15-108 (a) set-off against the State in settling their cross claims against Chevron/Texaco. As the Shepards argue, the availability of a set-off against the State was no impediment to reaching a settlement with Texaco, which already had obtained the protection of a full release from the State. Given the release, there was no remaining liability running from Texaco to the State for which the Shepards "may have agreed to be responsible" (Cross-Motion Opp., at 7). Further, inasmuch as the Shepards engaged in voluntary remediation of contaminated soil at the Site that could be attributable, at least in part, to the 1976 Spill, there is no basis upon which to conclude that the Cross-Claims Settlement was intended to represent an agreement between Texaco and the Shepards as to their equitable shares of responsibility for the clean-up costs sought to be recovered by the State in this action.

Based on the foregoing, the Court concludes that the proof adduced by the Shepards in support of their cross motion demonstrates a prima facie entitlement to a set-off under GOL § 15-108 (a), and the State has failed to raise an issue of fact or present a viable legal defense in opposition to the motion. Accordingly, the cross motion must be granted to the extent of directing a hearing pursuant to CPLR 4533-b to determine the amount of the GOL § 15-108 (a) set-off.[FN6] It will be the Shepards' burden "to establish the equitable share attributable to [Texaco] [*9]so as to reduce the portion of damages for which [the Shepards are] responsible" (Maione v Pindyck, 32 AD3d 827, 828 [2d Dept 2006]; Bigelow v Acands, Inc., 196 AD2d 436, 438 [1st Dept 1993]).



CONCLUSION

Accordingly,[FN7] it is

ORDERED that the branch of the State's motion seeking amendment of the ad damnum clause is granted; and it is further

ORDERED that the branch of the State's motion seeking summary judgment on its first cause of action against the Shepards is granted in accordance with the foregoing; and finally it is

ORDERED that the Shepards' cross motion for partial summary judgment is granted in accordance with the foregoing.

This constitutes the Decision and Order of the Court. The original Decision and Order is being transmitted to counsel for plaintiff; all other papers are being transmitted to the Albany County Clerk. The signing of this Decision and Order shall not constitute entry or filing under CPLR Rule 2220, and counsel is not relieved from the applicable provisions of that Rule.



Dated: May 17, 2016
Albany, New York
RICHARD M. PLATKIN
A.J.S.C.

Papers Considered:

Notice of Motion, dated January 27, 2016;

Affirmation of Jeremy R. Feedore, Esq. in Support of Motion, dated January 26, 2016, with attached Exhibits A-J;

Affidavit of Russell Huyck in Support of Motion, sworn to January 27, 2016, with attached Exhibits 1-16;

Memorandum of Law in Support of Motion, dated January 27, 2016, with attached Exhibits 1-3;

Affidavit of Wayne Sickler in Support of Motion, sworn to January 26, 2016, with attached Exhibit A;

Affidavit of Kevin M. Young, Esq. in Opposition, sworn to March 15, 2016, with attached Exhibits 1-49;

Affidavit of Dean R. Shepard in Opposition, sworn to March 14, 2016, with attached Exhibits A-G;

Notice of Cross Motion, dated March 15, 2016;

Expert Affidavit of Thomas M. Johnson, sworn to March 15, 2016, with attached Exhibits A-L;

Memorandum of Law in Support of Cross Motion, dated March 15, 2016;

Attorney Affirmation and Memorandum of Law in Opposition to Cross Motion, dated April 5, 2016, with attached Exhibits 1-4;

Reply Affirmation of Jeremy R. Feedore, Esq. in Support of Motion and in Opposition to Cross Motion, dated April 5, 2016;

Affidavit of Russell Huyck in Further Support of Motion, sworn to April 5, 2016;

Affidavit of Joseph Antonucci, sworn to April 4, 2016, with attached Exhibits 1-6;

Memorandum of Law in Further Support of Motion and in Opposition to Cross Motion, dated April 5, 2016;

Reply Affidavit of Kevin M Young, Esq. in Response to Plaintiff's Opposition, sworn to April 7, 2016, with attached Exhibit A;

Reply Memorandum of Law in Further Support of Cross Motion, dated April 7, 2016.

Footnotes


Footnote 1:The Shepards claim that the area was not re-paved until May 2008, relying upon emails between employees of the State's remediation contractor. The owner of NY Joe avers in reply that the re-paving work was performed in April or May 2007. Ultimately, determination of this dispute is not material to resolution of the instant motion practice.

Footnote 2: Precision and Alpha similarly relied upon the absence of MTBE in the soil samples to conclude that contamination most likely occurred prior to 1985.

Footnote 3:The Shepards frame their cross motion as one seeking a declaration regarding the applicability of GOL § 15-108 (a). The State raises two threshold objections to the issuance of declaratory relief: (1) defendants sought essentially the same relief in their counterclaims, which were dismissed by Decision & Order dated May 2, 2015; and (2) this Court lacks subject matter jurisdiction over the requested relief. While the Court does not find these contentions availing, there is no need to entertain defendants' unpleaded claim for a declaratory judgment. As the State observes, the issues raised in the cross motion "mirror affirmative defenses already pleaded", and the motion effectively is one for partial summary judgment on the Shepards' claimed entitlement to a set-off under GOL § 15-108 (a), relief that the State opposes on the merits.

Footnote 4:The Cross-Claims Settlement resulted in a monetary payment from Chevron and/or Texaco to the Shepards. Such a settlement would not implicate GOL § 15-108 (c), which relieved the Shepards of liability for contribution to Texaco. Further, GOL § 15-108 (b), which relieved Texaco from liability for contribution to the Shepards, did not foreclose the Shepards' cross claim for indemnity. Moreover, despite the apparent bar on contribution claims imposed by GOL § 15-108 (b), Navigation Law § 176 (8) does entitle "every person providing cleanup [or] removal of discharge of petroleum . . . to contribution from any other responsible party", "[n]otwithstanding any other provision of law to the contrary, including but not limited to section 15-108 of the general obligations law".

Footnote 5: At a court appearance on May 5, 2016, the Shepards' counsel represented that the Cross-Claims Settlement includes a confidentiality provision that bars the Shepards from voluntarily disclosing it. However, at the Court's request, counsel did make a copy of the agreement available for in camera inspection. That review did not disclose any basis for State's waiver argument.

Footnote 6:It is unclear what, if any, issues remain outstanding for trial other than determination of the GOL § 15-108 (a) set-off. At court appearances on May 5, 2016 and May 10, 2016, the State maintained that it intended to pursue a claim of penalties under Navigation Law § 192. But the State's complaint does not plead a cause of action under that statute or otherwise demand an award of penalties (see ¶ 31 and Wherefore Clause); the branch of the State's motion seeking leave to amend its complaint does not seek to add a claim for penalties; and the State did not seek such relief on its motion for summary judgment (see Attorney Affirmation in Support of Summary Judgment, Wherefore Clause [requesting award of $145,176.62, together with pre-judgment interest, costs and disbursements]). Further, while the State's reply papers purport to seek summary judgment "on the First Cause of Action only" (Attorney Reply Affirmation In Support of Motion For Summary Judgment and Opposing Defendants' Motion), the complaint alleges only one cause of action against the Shepards. However, in the absence of any briefing or argument regarding the State's purported claim for penalties, the issue is not ripe for adjudication at this time.

Footnote 7: Having concluded that the Shepards are entitled to the GOL § 15-108 (a) set-off, the Court need not consider defendants' alternative argument that joint and several liability under the Navigation Law is not appropriate under the unique facts and circumstances of this case.