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Recovering the Cost of Environmental Cleanup Washington Public Ports Association September 29, 2016 Mark Nadler, P.E. Liberty Waters The Nadler Law Group, PLLC Seattle, Washington


Two Routes to Recovery • Statutory Contribution – Washington Model Toxics Control Act (MTCA) RCW 70.105D – Comprehensive Environmental Cost Recovery and Liability Act (CERCLA) 42 USC 9607

• Contractual – The Port’s Insurance – Additional insured and indemnity agreements – Assigned insurance claims

Identifying Other Liable Parties • Travis Zandi

Identifying and Locating Contracts and Policies • Insurance – Comprehensive General Liability Policies – Prior to 1986 – Northwest Marine Terminals Association • Single policies issued to all member ports • Policies have been proved up in court, recently affirmed in (as yet) unpublished Court of Appeals decision on August 2, 2016

– Port’s financial records (don’t need the actual insurance policies)

Identifying and Locating Contracts and Policies

Identifying and Locating Contracts and Policies

Identifying and Locating Contracts and Policies • Leases – Indemnities • Indemnity from tenant • Pursue insurance on claim assigned by tenant • Confirm tenant tendered notice and perfected claim

Identifying and Locating Contracts and Policies • Leases – Insurance • Additional Insured • Assigned claims if not additional insured

• Real Estate Purchase and Sale Agreements – Indemnities

Strategies For Funding Cleanup • Allocating Among PLPs – Travis Zandi

• Identifying and Preserving Evidence – Identifying Testimonial witnesses (trigger, expectations and intent) – Preserving • Leases and contracts (now) • Documentation of contaminant releases (now) • Testimony (now)

Strategies For Funding Cleanup • Tendering and Perfecting Claims – Contractual indemnities • Prompt (or prompt as can be made under the circumstances) notice and tender

– Contractual insurance benefits • Prompt notice and tender • Confirmation that notice and tender promptly passed on to carrier and claim perfected

– Notice to insurers • Whom to notify • “As soon as practicable”--OSS Concerns

Specific Problems and Opportunities • Working cooperatively with tenants and other PLPs – “Participation” or “Common Interest” Agreements – Leveraging insurance • Additional insured • Assigned claims (in exchange for a release to the extent of the Port’s net recovery on the assigned claim) • Can take assignments from PLPs even if not tenants

Specific Problems and Opportunities • Bankrupt PLPs – Proofs of claim – Bar date – Anti-annulment statute

• Insurance carriers – Insist on your benefits—you paid for them – Obtain your defense benefits—may be more valuable than the indemnity benefit

Specific Problems and Opportunities – Insist on a coverage decision, especially for big claims (non-waiver agreements usually only benefit the insurer) – Insist on prompt payment of costs – Insist on a remediation that works for your Port • Compatible with future site use • Removal rather than containment if at all possible—As long term owners Ports will have to be responsible for the waste a long time • Be proactive with Ecology to get a workable remedial alternative selected

Specific Problems and Opportunities – If you have to litigate remember • $200 million worth of NWMTA policies are now proven • Can get your attorney fees if successful

• Use all available sources – PLPs • MTCA contribution • Assigned insurance

– Insurance – Ecology grants (when and if available)

Specific Problems and Opportunities • Success stories – – – – –

Port of Anacortes Port of Skagit Port of Everett Port of Port Angeles Port of Longview


THE NADLER LAW GROUP PLLC The Nadler Law Group, PLLC Pacific Building 720 Third Avenue, Suite 1400 Seattle, Washington 98104 206-621-1433

WPPA 2016 Env Seminar - Recovering Cost of Environmental Cleanup, Nadler  
WPPA 2016 Env Seminar - Recovering Cost of Environmental Cleanup, Nadler