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United States of America v. El Dorado County

July 8, 2011

UNITED STATES OF AMERICA,
PLAINTIFF,
v.
EL DORADO COUNTY, CALIFORNIA; AND CITY OF SOUTH LAKE TAHOE, CALIFORNIA, DEFENDANTS.



The opinion of the court was delivered by: Morrison C. England, Jr. United States District Judge

MEMORANDUM AND ORDER AND ALL RELATED ACTIONS

This litigation was filed by the United States in 2001, pursuant to the provisions of the Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C. § 9601, et seq. ("CERCLA"). The government sought to recover response costs to remediate pollution discovered on the site of a former landfill dump. That landfill was located within National Forest Systems lands near Meyers, California.

Although the United States Forest Service ("USFS") initially sited, constructed and operated the so-called Meyers landfill, beginning in the mid 1950's it was run under the auspices of the County of El Dorado ("County"). The facility stopped accepting waste in 1971.

After groundwater contamination was discovered at the site in the 1990's, the USFS insisted that the County and several other entities bear responsibility for remediation efforts. The present lawsuit ensued. After years of litigation, the various defendants sued by the USFS began to enter into Partial Consent Decrees in order to resolve the claims asserted against them. The last of those Partial Consent Decrees was entered into with Defendant County in August of 2010. The County now moves to modify that Partial Consent Decree ("PCD") on grounds that the design plans it incorporated, as prepared on behalf of the government, 1) contained numerous inaccuracies and misrepresentations regarding site conditions; 2) were substantially defective and not constructible as drafted; and 3) were not prepared in accordance with the standard of care applicable to professional engineers. As set forth below, the County's Motion will be granted.*fn1

BACKGROUND

Under the terms of the PCD between the USFS and the County,*fn2 the County agreed to consolidate the buried waste mass at the former Meyers landfill by capping the area with a synthetic liner. That cap was designed to reduce the potential that rainwater and snowmelt could infiltrate the garbage and leach potential contaminants into the site's groundwater. See Decl. Of Gerri Silva, ¶ 9. This was to be accomplished pursuant to the USFS's so-called "100% Final Remedial Design" (hereinafter "Design"), a plan consisting of detailed design drawings and specifications created by the USFS and its consulting and design firm, the Energy and Environmental Research Group ("ERRG"). According to the County, while it participated in some meetings about the plan as it was being developed, it was not asked to, nor did it prepare, the Design itself. Id. at ¶ 12. To the contrary, the County maintains it had access to the landfill site only under very limited circumstances as permitted by the USFS. The County alleges that access did not include verification of the plans and specifications as contained in the Design. See id. at ¶ 11.

Although the USFS was itself a potentially responsible party for remediation efforts under CERCLA as the owner of the landfill site, the County claims it decided to enter into the PCD after the government threatened to issue a Unilateral Administrative Order ("UAO") mandating cleanup by the County.

The County explained that issuance of such a UAO would force it to implement the Design with no financial assistance from the government, and could further have resulted in the imposition of additional daily and treble damages. Id. at ¶ 15. The County's decision to settle was further motivated by the fact that a UAO could also have prevented the County from obtaining indemnity under its insurance policies, funds the County needed in order to fund any settlement. Id. at ¶¶ 16, 21.

According to the County, it agreed to construct the Design based on bids predicated on the accuracy of the specifications contained in the Design. Although the winning bid came in at some $3.43 million, once construction began the County contends that serious survey, site investigation and engineering errors within the Design came to light. As a result of those alleged plan errors, the initially anticipated cost for the project has escalated to some $7.5 million, and after two subsequent redesigns of the plans the County alleges that even more additional costs may be required.

The errors within the Design plans were significant. Due to a surveying error, the elevation of the buried waste to be relocated was significantly lower than reflected in the plans. The County alleges this meant that instead of having to relocate 33,900 cubic yards of waste as shown in the Design estimate, in fact approximately 60,000 cubic yards of waste had to be moved. Decl. of Greg Stanton, ¶ 5. ///

Additionally, large amounts of waste were found beyond the parameters depicted in the Design drawings (see Ex. B to Decl. of Bryan A. Stirrat), which also meant that substantially more waste than anticipated had to be excavated and relocated. Stanton Decl., ¶ 6. Further, because of inaccuracies in the depth of the clay layer in the area where the Design called for a French drain to be installed, the County's contractor had to replace an additional 30,000 cubic yards of soil over the drain site. Stanton Decl., ¶ 7.

The cost estimate incorporated within the Design contained calculations of the units of work needed to construct the project. Those calculations were used by the County's contractor to bid the job, and ultimately proved to be grossly understated as a result of the above-described errors, among others. The Design plans as a whole reflected the need to relocate only 33,900 cubic yards of waste. Because some 106,000 cubic tons have currently been moved, the County claims that just the waste removal portion of the required work virtually tripled during construction. See Stanton Decl., ¶ 13. As indicated above, the flaws in the Design documents have already caused the USFS to redesign the project once, and according to the County the government is currently engaged in the second significant design of the remedial design drawings, plans and specifications. /// /// ///

In seeking relief from the terms of the PCD as presently constituted, the County alleges that the "100% Final Remedial Design Plan", as the name would appear to suggest, expressly represented just what the implementation of the Design entailed, both with respect to the scope and quantity of work to be performed as well as the surface and subsurface conditions present at the landfill.*fn3 The County argues that said "Final" Design therefore carried with it an implied warranty that the Design was both free of any major defect and prepared in accordance with the standard of care applicable to professional engineers and surveys. Because the USFS prepared the Design for use on its own property, and because the County relied on the accuracy of the Design in agreeing to the PCD, the County contends it would be unfair to saddle it with the cost overruns associated with actually constructing the Design. Consequently, the County asks this Court to rescind or modify the PCF going forward in order to relieve the County of the consequences of the USFS' misrepresentations as set forth in the design. /// /// ///

In opposing the County's request, the government does not dispute the inaccuracies contained within the Design plan, as enumerated by the County and discussed above. Instead, the government contends that because the terms of the PCD obligate the County to perform such additional work as to attain "performance standards" in remediating contaminants present at the site, it is the County that remains responsible for doing whatever ...


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