Question

In: Economics

John and Mary’s chemical compound operated in Atlanta Georgia from 1981 to 2001. at that time...

John and Mary’s chemical compound operated in Atlanta Georgia from 1981 to 2001. at that time they split into two companies and Mary’s chemical compounding build a new plant in Oklahoma. in 2011 a chemical contamination is discovered on the Atlanta Georgia property. Who will be responsible for the cleanup costs? are there any situations in which the government will pay to clean up the property? if so, why//how?

Solutions

Expert Solution

STRUCUTURE YOUR ANSWER ON THE BASIS OF FOLLOWING POINTS;

1.Environement protection agency was established in 1970 with the goal to protect human ,societal and environmental health.EPA enforces waste,chemical and cleanup requirements related to mining,minerals,accidental releases and other hazardous wastes.

2. EPA has the primary objective of locating the parties primarily responsible for the hazardous release or contamination and make them liable for the cost of containment,cleanup and damages resulting from a release resultant of their own activities.

Two funds have been setup for covering the costs of cleanup
a) The Superfund
b)The oil spill liability trust

The SuperFund law finds four classes liable:
1. Current owners/operators
2. Past owners /operators at the time hazardous wastes were disposed.
3.Generators and parties that managed the disposal
4.Transporters of the waste

In the above mentioned study,the clause of past owners/operators will be applicable .As the harm caused by multiple parties (John and Mary) cannot be separated they both are jointly and severally liable,  any one potentially responsible party may be held liable. The parties cannot excuse on the pretext of industry standards. However the cleanup costs may be paid by the government but the parties have to reimburse the authority.

Government Liability

These funds may cover the costs of cleanup according to EPA's response system
1.When the responsible parties can't be identified.
2. When the parties refuse to cooperate.
However, in the 1. case the EPA continues to track the responsible party and seek payment after taking prompt action when it's an emergency.

Extreme cases where gov. is liable
1,Act of war
2. Act of god
3. Third party act with whom PRP(potentially responisble party) has no contractual relation.



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