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South Florida Water Management Dist. v. Montalvo

June 03, 1996

THE SOUTH FLORIDA WATER MANAGEMENT DISTRICT, NEW FARM INC., PLAINTIFFS,
v.
JUAN MONTALVO, CHEMAIRSPRAY, INC., CHEMSPRAY, INC., GLADES FORMULATING CORP., DEFENDANTS-THIRD PARTY PLAINTIFFS-APPELLANTS, CIBA-GEIGY CORP., DU PONT (E.I.) DE NEMOURS & CO., MONSANTO CO., ROHM & HASS CO., COCA-COLA CO., GRIFFIN CORP., SHERWIN-WILLIAMS CO., BOYTON (J.T.) FARMS, INC., CAMAYEN CATTLE CO., GULF & WESTERN INC., HATTON BROS., INC., ROBERT (C) HATTON, MANATEE PLANTATIONS, INC., SOD CO., SEMINOLE SUGAR CORP., SUGAR CANE GROWERS, CORP., TAILISMAN SUGAR CORP., TRUCANE SUGAR CORP., UNITED CANE COOPERATION ASSOC., HERCULES INC., CAMAYEN FARMS CO., DOUBLE D PROPERTIES INC., DEFENDANTS-THIRD-PARTY DEFENDANTS-APPELLEES. THE SOUTH FLORIDA WATER MANAGEMENT DISTRICT, NEW FARM INC., PLAINTIFFS, V. JUAN MONTALVO, CHEMAIRSPRAY, INC., CHEMSPRAY, INC., GLADES FORMULATING CORP., DEFENDANTS-THIRD-PARTY PLAINTIFFS-APPELLANTS, CIBA-GEIGY CORP., DU PONT (E.I.) DE NEMOURS & CO., MONSANTO CO., ROHM & HASS CO., DEFENDANTS-THIRD-PARTY DEFENDANTS, COCA-COLA CO., DEFENDANT-THIRD-PARTY DEFENDANT-APPELLEE, GRIFFIN CORP., SHERWIN-WILLIAMS CO., BOYTON (J.T.) FARMS, INC., CAMAYEN CATTLE CO., GULF & WESTERN INC., HATTON BROS., INC., ROBERT (C) HATTON, MANATEE PLANTATIONS, INC., SOD CO., SEMINOLE SUGAR CORP., SUGAR CANE GROWERS, CORP., TAILISMAN SUGAR CORP., TRUCANE SUGAR CORP., UNITED CANE COOPERATION ASSOC., HERCULES INC., CAMAYEN FARMS CO., DOUBLE D PROPERTIES INC., DEFENDANTS-THIRD-PARTY DEFENDANTS.



Appeals from the United States District Court for the Southern District of Florida. (No. 88-8038-CIV-MOORE). K. Michael Moore, Judge.

Before Hatchett and Black, Circuit Judges, and Clark, Senior Circuit Judge.

Author: Black

BLACK, Circuit Judge:

In this appeal, we are asked to define the limits of "arranged for" liability under § 107(a)(3) of the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (CERCLA), 42 U.S.C. § 9607(a)(3). Third-Party Plaintiffs Juan Montalvo, Chemairspray, Inc., Chemspray, Inc., and Glades Formulating Corporation (collectively, "the Sprayers") sued a group of landowners in south Florida (the Landowners) claiming the Landowners were liable under CERCLA for cleaning up property in Palm Beach County, Florida, that had become contaminated with pesticide wastes. The district court dismissed the Sprayers' CERCLA claim after concluding the Sprayers had failed to allege the Landowners "arranged for" the disposal of hazardous substances within the meaning of § 107(a)(3). We affirm, concluding the allegations of the Sprayers' third-party complaint do not state a claim for relief under CERCLA against the Landowners.

I. BACKGROUND

For an undisclosed number of years, Chemspray and Chemairspray provided pesticide formulating and aerial spraying services in south Florida. The location of their businesses, the "Chemairspray Site," is comprised of two separate pieces of realty in Palm Beach County. Chemairspray, the company providing spraying services, leased a 10-acre parcel on which it maintained an airstrip. The other corporation, Chemspray, owned a 14-acre plot adjacent to the airstrip with a hangar and storage facilities. Chemspray formulated pesticides from chemicals supplied by chemical manufacturers. Juan Montalvo allegedly controlled both Chemspray and Chemairspray while they were in business.

Chemairspray contracted with farmers and ranchers throughout south Florida to spray their lands with aerial pesticides and herbicides. As a result of Chemairspray's operations, the Site became contaminated with pesticide wastes. This contamination was due in part to pesticides being spilled on the airstrip and surrounding land during the mixing and loading of pesticides into the applicating tanks of planes. Pesticide wastes were also released when, after spraying runs, the applicating tanks of the planes were rinsed out, and the contaminated rinse water was allowed to drain onto the Site.

The property leased by Chemairspray was eventually purchased by New Farm, Inc. In 1985, Florida Department of Environmental Regulation sued New Farm to compel a clean up of the Site. As part of its investigation, New Farm discovered the contamination had spread to adjacent lands owned by New Farm and the South Florida Water Management District (SFWMD).

In 1988, New Farm and SFWMD initiated the present litigation when they sued Chemairspray, Chemspray and Montalvo claiming they were liable under CERCLA for cleaning up the Site and neighboring lands. By the time this suit was filed, both Chemairspray and Chemspray had been dissolved. New Farm and SFWMD later joined Glades Formulating Corporation as a defendant alleging the company was a successor corporation to Chemspray, the pesticide formulator. All four defendants, the Sprayers, eventually admitted their liability under CERCLA. Following a bench trial, the district court found the Sprayers jointly and severally liable for 75%*fn1 of the costs incurred in cleaning up the Site.*fn2

The Sprayers thereafter filed their third-party complaint seeking contribution under CERCLA from, among other parties, various farming and ranching corporations that had contracted with the Sprayers for aerial spraying services.*fn3 The allegations supporting CERCLA liability against each of these companies are virtually identical, alleging that each corporation:

contracted with Third-Party Plaintiffs [the Sprayers] to apply and/or distribute herbicides, insecticides and/or pesticides ... which [the defendant] owned throughout the application and/or distribution processes. The generation of hazardous wastes from these products was a necessary incident of the application and/or distribution processes by virtue of mixing and loading the products into the aerial applicating plane at the CHEMAIRSPRAY site, as well as rinsing out the applicating tanks at the CHEMAIRSPRAY site following application to [the defendant's] land. Third-Party Plaintiffs' actions in handling, storing and disposing of such hazardous wastes at the CHEMAIRSPRAY site were performed as agents/independent contractors for [the defendant]. By virtue of its contracts and commercial relationships with the Third-Party Plaintiffs, industry practices, and all other relevant circumstances [the defendant] arranged for the disposal of such wastes.

A number of the farming and ranching companies, whom we collectively refer to as "the Landowners," moved to dismiss the Sprayers' CERCLA claim under Fed.R.Civ.P. 12(b)(6).*fn4 The district court granted the Landowners' motion concluding the Sprayers had not alleged facts stating the Landowners had "arranged for" the disposal of hazardous substances within the meaning of § 107(a)(3) of CERCLA. In particular, the district court found the Sprayers had not alleged any "substantial ties" between the Landowners and the Sprayers' disposal of pesticide wastes.*fn5 The court entered final judgment on the CERCLA claim against the Landowners from which the Sprayers now appeal.

II. STANDARD OF REVIEW

In reviewing de novo a dismissal pursuant to Rule 12(b)(6), we apply the same standard as did the district court. Marshall County Bd. of Educ. v. Marshall County Gas Dist., 992 F.2d 1171, 1174 (11th Cir. 1993) (citation omitted). The factual allegations of the plaintiff's complaint are accepted as true for the purposes of a motion to dismiss. Id. The motion must be denied unless ...


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