R.R. Street & Co. v. Pilgrim Enters.

R.R. Street & Co. v. Pilgrim Enters.

Opinion

 [*235]  JUSTICE O'NEILL delivered the opinion of the Court.

JUSTICE JOHNSON did not participate in the decision.

The owner of several dry-cleaning facilities filed this suit under the Texas Solid Waste Disposal Act ("SWDA") seeking to recover costs that it incurred to remediate environmental contamination. SWDA imposes responsibility for solid waste cleanup costs on persons who "arranged" to dispose of solid waste. In this case of first impression, we must decide the intended scope of "arranger liability" under SWDA, in particular when the alleged arranger was an equipment and chemical supplier who provided waste disposal advice and improperly discarded test-vial [**4]  waste fluid. We hold that under the circumstances this case presents, the supplier was not an arranger subject to potential liability under SWDA based upon its giving advice regarding waste disposal. We also hold that a fact issue exists as to whether the supplier is potentially liable as an arranger based upon its own disposal of test-vial waste fluid. The court of appeals therefore erred in failing to remand the case for  [*236]  a new trial on the SWDA cause of action, and we reverse the court of appeals' judgment in part and remand to the trial court for further proceedings consistent with this opinion.

I. Background

The Robertson family bought Pilgrim Laundry & Cleaners ² in 1945, and over a span of five decades Pilgrim operated a chain of dry-cleaning facilities in Houston and San Antonio. Pilgrim used perchloroethylene ("PCE")  [**5]  in its dry-cleaning operations, a chemical solvent commonly used in the industry. In 1994, in the course of selling its assets, Pilgrim conducted a mandatory environmental assessment which revealed that the soil and groundwater at sixteen of Pilgrim's twenty facilities were contaminated with PCE. Pilgrim notified the Texas Natural Resources Conservation Commission ("TNRCC" or "the Commission") ³ of the findings and entered into a voluntary cleanup agreement to remediate the sites. The TNRCC approved the remediation and closure plans, and the total cleanup cost to conduct the activities approved under the plans amounted to over $ 7 million.

 [**6]  Pilgrim purchased PCE and equipment from R.R. Street & Co. Inc., which designed, manufactured, and distributed dry-cleaning equipment and products. For nearly forty years, from 1958 to 1997, Pilgrim's principal contact at Street was Harold Corbin. Corbin had complete access to Pilgrim's facilities, and Pilgrim dealt almost exclusively with him. Among other products, Corbin sold Pilgrim equipment that recycled dirty PCE for reuse. One piece of such equipment, a filter, circulated dirty PCE through cartridge filters, which had to be replaced periodically. Following common industry practice, Pilgrim disposed of the used cartridge filters that had collected PCE by simply discarding them in dumpsters located on the premises. Another piece of equipment Street manufactured and sold to Pilgrim was called a still. Dirty PCE was heated in the bottom of the still until it evaporated and rose to the top along with some water. The soils and unevaporated PCE that remained at the bottom were also discarded by Pilgrim in dumpsters, again pursuant to industry practice at the time. The evaporated PCE was partially separated from the water and reused. Corbin advised Pilgrim to dispose of the remaining [**7]  PCE-contaminated "separator water" by pouring it down the drain, which Pilgrim did. Corbin also advised Pilgrim to dispose of PCE-contaminated separator water that remained after the clothes-drying process in the same way. In 1985, in accordance with new federal regulations, Pilgrim hired Safety-Kleen, a waste disposal company, to dispose of the PCE waste at proper facilities. In 1991 Pilgrim switched companies and began using AAD for its disposal needs.

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