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Appeals court slashes contamination award from $154,632 to $7,383

December 19, 2013

Court-ordered environmental damages caused by PCB contamination at a Churubusco industrial site were reduced from a total of $154,632 to $7,383 on Thursday by a panel of the Indiana Court of Appeals.

In Dana Companies, LLC v. Chaffee Rentals, a/k/a, Chaffee Rentals and Storage, BRC Rubber Group, Inc., Charles V. Chaffee, Karen J. Chaffee and Clifford Chaffee,  92A03-1208-CC-358, Chaffee and BRC appealed a ruling in Whitley Circuit Court that BRC owed the six-figure sum to Dana Companies, which had caused the PCB pollution during Dana’s ownership of the site it operated from the 1960s to the mid-1980s as a car-parts manufacturing site. Dana also appealed.

Dana sold the property to Chaffee Rentals in the 1980s, which rented it to BRC, a maker of rubber parts for cars. As the site came under the purview of the Indiana Department of Environmental Management for the cleanup of PCBs left from Dana’s operation of the site, the parties in the 1990s executed a settlement agreement. Judge Rudy R. Pyle III wrote that the agreement continues to govern.

Pyle wrote that the trial court correctly ruled that the doctrine of fortuity didn’t apply and that BCR didn’t breach its contract, rejecting Dana’s appellate arguments. The court found that BRC was responsible only for non-PCB contamination found in an area of the site that it solely operated.

 “Of all the areas investigated and remediated ... the trash burning area ... was the only area of the plant used solely by BRC; Dana never used this area during the time it operated the plant. Confining recovery of damages to the settlement agreement, and effecting the intent of the parties as stated therein, BRC should hold Dana harmless for these costs,” Pyle wrote for the panel.

“We find that the trial court erred by not confining its allocation of costs to the four corners of the settlement agreement. Accordingly, we affirm the trial court’s award of damages to Dana, but reverse the amount awarded. Dana is entitled to damages of $3,608.87 in investigative costs and administrative costs of $1,818.01, for a total damage award of $5,426.88,” Pyle wrote.

Prejudgment interest in the sum of $1,956.32 also was ordered, bringing the total to $7,383.20.

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