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You can search the entire site. or go to the recent opinions, or the chronological or subject indices. Federal Deposit Insurance Corporation v. Laidlaw Transit, Inc. (4/12/01) sp-5390

Federal Deposit Insurance Corporation v. Laidlaw Transit, Inc. (4/12/01) sp-5390

     Notice:  This opinion is subject to correction before publication in
the Pacific Reporter.  Readers are requested to bring errors to the attention of the
Clerk of the Appellate Courts, 303 K Street, Anchorage, Alaska 99501, phone (907)
264-0608, fax (907) 264-0878.


CORPORATION, as statutory     )    Supreme Court No. S-8540
successor to the Resolution   )
Trust Corporation, in its     )    United States District Court
capacity as Receiver for Sun  )    Case No. A97-0053 CV (JKS)
Savings and Loan Association, )
               Plaintiff,     )    
     v.                       )    O P I N I O N
LAIDLAW TRANSIT, INC. d/b/a   )    
LAIDLAW TRANSIT (AK), INC.,   )    [No. 5390 - April 12, 2001]
SANITATION CO., INC.,         )
               Defendants.    )

          Certified Question from the United States
District Court for the District of Alaska,
                 James K. Singleton, Jr., Judge.

          Appearances: Joseph R.D. Loescher and Carl
J.D. Bauman, Hughes Thorsness Powell Huddleston & Bauman LLC,
Anchorage, for Plaintiff.  Ann W. Resch and Richard L. Waller,
Brown, Waller & Gibbs, Anchorage, for Defendant Peninsula
Sanitation Company, Inc.  Nelson G. Page, Burr, Pease & Kurtz,
Anchorage, for Defendant Laidlaw Transit Alaska, Inc.

          Before:  Matthews, Chief Justice, Eastaugh,
          Fabe, Bryner, and Carpeneti, Justices.

          BRYNER, Justice.

          The Federal Deposit Insurance Corporation (FDIC), as
receiver of a failed bank's assets, acquired land that had been
contaminated by hazardous waste many years previously.  After
undertaking voluntary cleanup at the request of the Alaska
Department of Environmental Conservation, the FDIC filed suit in
federal court against the former landowner and the owner's tenants,
seeking to recoup its cleanup costs.  FDIC claimed a right to
compensation under AS 46.03.822, which imposes strict liability on
a joint and several basis for release of hazardous substances and,
in addition, allows responsible parties to sue for contribution.  
          Since this court had not yet determined whether
section .822 creates a private cause of action other than for
contribution or is governed by a statute of limitations, the
federal district court certified these questions to us.  We
conclude that the statute allows private parties to sue directly
for damages, not just for contribution, and that suits under the
statute -- both direct and for contribution -- are governed by a
statute of limitations. 
          For purposes of this decision, we accept the facts
alleged in FDIC's complaint.  In May 1988 Sun Savings and Loan
Association, F.A., foreclosed on land that was owned by Burton
Carver & Co. and that had been occupied by Carver and three
tenants, Laidlaw Transit, K Beach Parts and Equipment, and
Peninsula Sanitation Co.  Carver and these tenants allegedly had
contaminated the land by releasing various hazardous substances,
including fuel oil.
          In December 1989, a year and a half after Sun Savings
foreclosed on the land, the Alaska Department of Environmental
Conservation asked it to enter into a Compliance Order by Consent
for the purpose of investigating and remediating contamination on
the property.  Not long after this, Sun Savings failed, and the
Resolution Trust Corporation took over its assets.  In July 1990
Resolution Trust wrote two of Carver's tenants -- Peninsula
Sanitation and Laidlaw -- to inform them of the Department's
          Nearly seven years later, in February 1997, FDIC, which
by then had become the Resolution Trust Corporation's statutory
successor, filed suit in federal district court against Laidlaw, K
Beach Parts, Peninsula Sanitation, and Carver.  FDIC alleged that
these defendants were both strictly liable under AS 46.03.822(a)
and liable in contribution under AS 46.03.822(j) for cleanup costs
and other damages resulting from contamination of its land by their
release of hazardous substances.  FDIC alternatively alleged
liability for the same damages under other theories, including
continuing nuisance and trespass.
          Peninsula moved for summary judgment, alleging that
FDIC's claims are barred by AS 09.10.070(a), Alaska's statute of
limitations for liability created by a statute.  Finding that
FDIC's complaint and Peninsula's summary judgment motion raised
unresolved issues of Alaska law, the federal district court
certified four questions for our review:
          1.   Is a statute of limitations defense
available for a direct cause of action under AS 46.03.822(a)?

          2.   Does a private cause of action imposing
joint and several liability exist under AS 46.03.822(a)?

          3.   When does a cause of action for
contribution accrue under AS 46.03.822(j)?

          4.   Can continuing trespass and nuisance
claims for environmental contamination be brought where the
original act leading to the contamination occurred outside of the
limitations period?

          We accepted these questions under Alaska Appellate
Rule 407 and answer them as follows.
     A.   Standard of Review

          Under Appellate Rule 407, a decision by this court upon
certification from another court necessarily involves determinative
questions of Alaska law as to which there is no controlling
precedent. [Fn. 1]  Because we address questions of law and
essentially stand in the shoes of the certifying court, we must
exercise our independent judgment. [Fn. 2] 
     B.   Alaska Statute 46.03.822(a) Provides Private Plaintiffs

with a Cause of Action for Strict Joint and Several Liability.
          FDIC alleges that the defendants are subject to joint and
several strict liability under AS 46.03.822(a), which provides that
"the owner and the operator of a . . . facility, from which there
is a release . . . of a hazardous substance" are among those
"strictly liable, jointly and severally, for damages, for the costs
of response, containment, removal, or remedial action incurred by
the state, a municipality, or a village . . . ."  The passive
language of this provision does not specify whether a private party
may sue for damages.  But the legislative history of this provision
and our case law dealing with the creation of statutory causes of
action establish that it provides a private cause of action for the
owner of private property damaged by a release.
          1.   The legislative history behind subsection .822(a)

supports a private cause of action.
          The original version of AS 46.03.822, enacted in 1972,
created a cause of action imposing strict liability on polluters
who damaged private property: 
          To the extent not otherwise preempted by
federal law, a person owning or having control over a hazardous
substance which enters in or upon the waters, surface or subsurface
lands of the state is strictly liable, without regard to fault, for
the damages to persons or property, public or private, caused by
the entry. . . .[ [Fn. 3]]

The act defined "damages" to include "injury to or loss of persons
or property, real or personal, loss of income, loss of the means of
producing income, or the loss of an economic benefit." [Fn. 4]  A
separate provision, AS 46.03.870, specified that causes of action
under AS 46.03 "inure solely to and are for the benefit of the
state" "[e]xcept as provided under AS 46.03.822 - 46.03.828,"
implying that those sections provide for private causes of action.
[Fn. 5] 
          In 1989 the legislature amended section .822 to
"strengthen the State's ability to obtain cleanup of hazardous
substance spill sites." [Fn. 6]  The amendments explicitly allowed
the state and municipalities to recover damages, including cleanup
and remediation costs, under the strict liability language of
subsection .822(a):
          Notwithstanding any other provision or rule of
law and subject only to the defenses set out in (b) of this
section[,] . . . the following persons are strictly liable, jointly
and severally, for damages to persons or property, whether public
or private, including damage to the natural resources of the state
or a municipality, and for the costs of response, containment,
removal, or remedial action incurred by the state or a
municipality, resulting from an unpermitted release of a hazardous
substance . . . .

          . . . .

          (2)  the owner and the operator of a vessel or
facility from which there is a release . . . of a hazardous
substance[.][ [Fn. 7]]
Legislative history indicates that this amendment was modeled after
the Federal Comprehensive Environmental Response Compensation and
Liability Act (CERCLA), [Fn. 8] which Congress enacted in 1980.
[Fn. 9] 
          In 1991 the legislature passed a number of amendments to
AS 46.03.822.  First, it amended subsection .822(a) to add villages
to the governmental entities that could recover cleanup and
remediation costs. [Fn. 10]  In so doing, the legislature retained
the "public or private" damages language quoted above. [Fn. 11] 
Later in the same session, the legislature moved the damages
language from subsection .822(a) to a new subsection, .822(k), but
did not change its content. [Fn. 12] 
          In each of the foregoing amendments, the legislature also
retained AS 46.03.824, a provision defining damages to include
injuries to persons or property, real or personal, and loss of
income. [Fn. 13]  The legislature likewise retained the original
version of AS 46.03.870, which, as mentioned above, specifically
provides that causes of action under section .822 are not limited
to the state.  Moreover, every version of section .822 has
subjected polluters of either private or public property to joint
and several strict liability. 
          In sum, this history strongly suggests that the
legislature originally contemplated a private cause of action
against parties who release hazardous substances and that it never
repealed that cause of action.  It would be incongruous for the
legislature to create strict liability for damage to private land
without providing a way for private parties to get compensation for
that damage. 
          2.   Alaska Statute 46.03.822(a) necessarily implies a

private cause of action under the Hendsch Analysis.
          In Alaska Marine Pilots v. Hendsch, we identified six
factors as relevant to determine whether a statute implies a
private cause of action in tort: "the nature of the legislative
provision, the adequacy of existing remedies, the extent to which
a tort action will interfere with existing remedies, the importance
of the purpose of the provision, how drastically the new tort will
change the law, and the burden the [cause of action] will place on
the court system." [Fn. 14]  Here, these factors support a private
cause of action.
          (1)  Nature of subsection .822(a):  Subsection .822(a)
is easily amenable to individual enforcement.  The prohibited
conduct and the potential defendants are clearly identified by
subsection .822(a), which attaches strict liability for the release
of hazardous substances, and by subsection .822(k), which
identifies damage to "persons or to public or private property" as
a kind of damage covered by subsection .822(a). [Fn. 15]  An
injured property owner who, like FDIC, identifies parties
responsible for contaminating the property need only show that the
parties owned or operated the facility causing the contamination.
[Fn. 16] 
          (2)  Adequacy of existing remedies:  When the legislature
created a strict liability regime for hazardous substance
contamination, it expressed its judgment that negligence remedies
were not adequately controlling the hazardous substance
contamination problem.  Nevertheless, Peninsula and Laidlaw insist
that the subsection .822(j) right of contribution is an adequate
remedy.  We disagree.  Under subsection .822(j), a damaged party
can seek contribution only "during or after" an action against the
party under subsection .822(a).  Since private parties who
voluntarily undertake cleanup efforts cannot compel the state to
commence an action against them, they would be forced to wait for
government action and, if no action were brought, would lose funds
spent cleaning up another's contamination.  That is not an adequate
remedy.  A more convincing reading of subsections .822(a) and (j)
gives private parties the means to recover private damages, while
allowing defendants a way to spread the costs of that recovery
among the responsible parties.
          (3) Interference with existing remedies, and
(4) importance of purpose of the provision:  A private cause of
action under subsection .822(a) would not interfere with existing
remedies, such as contribution claims; and it would enhance the
important purposes of Alaska's contamination responsibility regime. 
As discussed above, allowing private parties to initiate cleanup
while they bring an action against others who may be responsible --
without waiting for government action -- promotes the goal of quick
response to discovered contamination.  At the same time, actions
for contribution allow the parties to sort out ultimate
responsibility for the contamination afterwards.  
          (5)  Scope of change in the law:  Allowing a private
cause of action under subsection .822(a) is not a departure from
the way the law already operates in Alaska.  In Chenega Corp. v.
Exxon Corp., for example, the parties litigated a complex private
strict liability claim under subsection .822(a) stemming from the
EXXON VALDEZ disaster. [Fn. 17]  No party questioned that
subsection .822(a) allowed the action, and Exxon ultimately
conceded strict liability, contesting only causation and damages.
[Fn. 18]                 (6)  Burden on the courts of creating a
private action: While allowing private parties to bring causes of
action may increase the number of claims under subsection .822(a),
it will be consistent with what the legislature intended.  We do
not see that as an undue burden on the courts.
          Because subsection .822(a) meets all of the criteria for
an implied cause of action under our Hendsch analysis, and since
the legislative history of the provision supports the conclusion
that the legislature meant to permit private actions, we hold that
subsection .822(a) creates a private cause of action for joint and
several strict liability.  In the following section, we briefly
consider the scope of this private action.
          3.   The private cause of action created in
               subsection .822(a) extends to potentially

responsible parties.
          In arguing that the only remedy available to FDIC is a
subsection .822(j) action for contribution, the defendants place
great weight on FDIC's status as a potentially responsible party. 
They contend that potentially responsible parties should not be
allowed joint and several recovery, but should be limited to
contribution from other potentially responsible parties. 
          Any entity that may be required to take financial
responsibility for cleaning up a contaminated site is a potentially
responsible party.  Alaska Statute 46.03.822(a)(3) imposes strict
liability on the owners of a facility that releases hazardous
material.  Insofar as FDIC stands in the shoes of the owner of the
contaminated property at the time of the release -- allegedly Sun
Savings -- FDIC is a potentially responsible party and, as such, is
theoretically subject to the same liability as those who caused the
contamination. [Fn. 19]
          The defendants maintain that allowing one potentially
responsible party to claim direct damages under subsection .822(a)
from other potentially responsible parties would give the claimant
an unfair advantage over the defending parties, because the
claimant's joint and several recovery under subsection .822(a)
might include compensation for damages caused by absentee or
judgment-proof polluters; the claimant would then receive full
compensation despite being a potentially responsible -- and
possibly culpable -- party, whereas the defending parties might be
left with a worthless claim for contribution under
subsection .822(j).  The defendants reason that, in these
situations, cleanup costs should be borne by all potentially
responsible parties equally. 
          This argument seems to assume that courts cannot
distinguish among potentially responsible parties to avoid
inequitable results.  But federal case law shows that courts can. 
In Rumpke of Indiana, Inc. v. Cummins Engine Co., the Seventh
Circuit Court of Appeals found that when a potentially responsible
party sues for direct damages under the federal counterparts to
subsections .822(a) and (j), the federal statutes allow the claim,
but leave room for equitable distinctions upon conclusion of the
litigation. [Fn. 20]  Thus, the court approved a direct action for
joint and several liability by Rumpke -- a potentially responsible
party that denied actual responsibility for the contamination:
          [W]e see nothing in the language of sec.
[the subsection .822(a) analog] that would make it unavailable to
a party suing to recover for direct injury to its own land, under
circumstances where it is not trying to apportion costs (i.e.,
where it is seeking to recover on a direct liability theory, rather
than trying to divide up its own liability for someone else's
injuries among other potentially responsible parties).[ [Fn. 21]]

But the court went on to observe:  "If the facts show, contrary to
Rumpke's protestations, that it was partially responsible for the
mess . . . , it can proceed only under sec. 113(f)(1) [the
subsection .822(j) analog] in a suit for contribution." [Fn. 22]
          We agree with Rumpke that the possibility of inequitable
results need not bar a potentially responsible party who denies
responsibility from pursuing a direct cause of action for joint and
several strict liability against other potentially responsible
parties.  Insofar as a plaintiff is an "innocent" potentially
responsible party, that is, one who ultimately would not be liable
for contribution, that plaintiff should recover jointly and
severally.  On the other hand, if a plaintiff ends up being among
those responsible for the damage, the court may recast the direct
claim as a claim for contribution upon conclusion of the
     C.   Alaska's Statute of Limitations Applies to Actions Under

Subsection .822(a).
          The defendants contend that FDIC's action is barred by
the statute of limitations.  FDIC responds that subsection .822(a)
precludes a statute of limitations defense. [Fn. 23]  In advancing
this argument, FDIC points to the opening language of AS
               Notwithstanding any other provision or

rule of law and subject only to the defenses set out in (b) of this
section, the exception set out in (i) of this section, the
exception set out in AS 09.65.240, and the limitation on liability
provided under AS 46.03.825, the following persons are strictly
liable, jointly and severally, for damages [and other costs
associated with hazardous substance spills].[ [Fn. 24]]
Asserting that this provision's "notwithstanding" phrase plainly
excludes all "defenses" to a subsection .822(a) action except those
listed in subsection .822(b), FDIC argues that the provision's
plain meaning precludes a statute of limitations defense.
          We reject FDIC's plain meaning argument, for, as we
explain below, FDIC's literal reading of the "notwithstanding"
phrase strains common sense, is contextually implausible, and is at
odds with legislative history.
          "[T]he threshold question in ascertaining the correct
interpretation of a statute is whether the language of the statute
is clear or arguably ambiguous." [Fn. 25]  Here, subsection
.822(a)'s "notwithstanding" phrase's meaning may indeed seem clear
and unambiguous.  But "'words are necessarily inexact and ambiguity
is a relative concept.'" [Fn. 26]  Hence, even when a statute's
language meaning seems plain on its face, ambiguity may arise if
applying that meaning would yield anomalous consequences. [Fn. 27] 

          FDIC's proposal to enforce subsection .822(a)'s literal
meaning by categorically barring all "defenses" except those listed
in subsection .822(b) would have the nonsensical effect of
eliminating a host of generally available "defenses" serving vital
purposes wholly unrelated to the elements or underlying purposes of
a direct action arising under subsection .822(a).  If enforced 
literally, for instance, the "notwithstanding" phrase would bar a
defendant who had previously settled and paid a claim from
defending on the basis of accord and satisfaction.  A defendant who
had already prevailed in an identical action by the same plaintiff
could not raise the defense of res judicata.  A defendant sued by
a plaintiff who lacked an interest would be forbidden to claim lack
of standing; one sued by a minor could not assert the plaintiff's
lack of capacity; and one subjected to a claim without service of
process could not raise lack of personal jurisdiction as a defense. 
The anomalies -- all unavoidable consequences of adopting FDIC's
proposed "plain meaning" -- cast ambiguity on the seemingly clear
language of subsection .822(a)'s "notwithstanding" provision. [Fn.
          Moreover, because "plain meaning" cannot exist in a
vacuum, ambiguity is necessarily a creature of context.  "As the
Supreme Court has stated, 'in ascertaining the plain meaning of [a]
statute, the court must look to the particular language at issue,
as well as the language and design of the statute as a whole." [Fn.
29]  And "[w]hen a statute or regulation is part of a larger
framework or regulatory scheme, even a seemingly unambiguous
statute must be interpreted in light of the other portions of the
regulatory whole." [Fn. 30] 
          Considered in context with other relevant provisions,
subsection .822(a)'s meaning is hardly plain.  The
"notwithstanding" phrase must initially be read together with other
parts of section .822 to which subsection .822(a) specifically
refers: subsection .822(b)'s list of "defenses" and the "exception"
created in subsection .822(i). [Fn. 31]  The relevant language is
as follows:
          (b)  In an action to recover damages or costs,
a person otherwise liable under this section is relieved from
liability under this section if the person proves

               (1)  that the release or threatened
release of the hazardous substance to which the damages relate
occurred solely as a result of 

                    (A)  an act of war;
                    (B)  except as provided under AS
46.03.823(c) and 46.03.825(d), an intentional or negligent act or
omission of a third party, other than a party or its agents in
privity of contract with, or employed by, the person, and that the

                         (i)  exercised due care with
respect to the hazardous substance; and
                         (ii) took reasonable precau
                         tions against the act or omis
                         sion of the third party and
                         against the consequences of the
act or omission; or

                    (C)  an act of God; and
               (2)  in relation to (1)(B) or (C) of this
subsection, that the person [discovered the release and began
containment and clean up within a reasonable period of time].

          . . . .

          (i) In an action to recover damages and costs,
a person otherwise jointly and severally liable under this section
is relieved of joint liability and is liable severally for damages
and costs attributable to that person if the person proves that 

               (1) the harm caused by the release
or threatened release is divisible; and

               (2) there is a reasonable basis for
apportionment of costs and damages to that person.[ [Fn. 32]]

          As can be seen, subsection .822(b) creates three defenses
to subsection .822(a)'s strict liability scheme: an act of God, an
act of war, or an unavoidable act of a third party.  Each of these
listed "defenses" centers on causation; each is triggered by the
intervention of an outside actor, to which the law attributes the
hazardous release, away from the original defendant.  Hence, this
specific category of defenses ameliorates the otherwise harsh
effects of strict liability.  So too, subsection (i) creates a
specific exception that, when triggered by particular circumstances
justifying the apportionment of partial responsibility to an
outside actor or third party, ameliorates the harsh effects of
joint and several liability. 
          The narrow focus of these defenses has significance in
its own right, because "[w]here . . . specific words follow[]
general ones, [the statutory interpretation doctrine of ejusdem
generis] restricts application of the general term to things that
are similar to those enumerated." [Fn. 33]  As applied to the
statutory phrase at issue, then -- "notwithstanding any other
provision or rule of law and subject only to the defenses set out
in (b) of this section, the exception set out in (i) of this
section" -- this interpretive canon strongly suggests that the
terms "defenses" and "exception" refer not to the entire universe
of potential general defenses, but to provisions and rules outside
the original legislation that specifically mitigate the effects of
joint and several liability.
          A companion provision of Alaska's 1989 hazardous
substances legislation lends further credence to this reading.  The
statute immediately following section .822 -- AS 46.03.823 --
expressly creates a partial exception to strict liability for
"hazardous substance response action contractors" (cleanup
contractors), making them liable for hazardous releases only on the
basis of negligence. [Fn. 34]  This provision certainly qualifies
as a "defense" to subsection .822(a)'s strict liability provision
-- at least in the broad sense of "defense" that FDIC urges us to
adopt insofar as it relates to the statute of limitations.  Yet
because this defense is not mentioned in subsection .822(a), it
necessarily conflicts with FDIC's proposed "plain meaning" of
subsection .822(a)'s "notwithstanding" phrase: according to FDIC,
the phrase's categorical preclusion of all conceivable defenses
except those set out in section .822 -- subsections .822(b) and
          To apply FDIC's plain meaning of subsection .822(a),
then, would nullify the section .823 defense, rendering the
provision entirely superfluous.  This, in turn would clash with the
rule of construction holding that, as a general rule, a "statute
should be construed so that effect is given to all its provisions,
so that no part will be inoperative or superfluous, void or
insignificant." [Fn. 35] 
          Legislation outside AS 46.03 reinforces the uncertainty
generated by section .823.  Just as subsection .822(a)'s
"notwithstanding" phrase must be considered in context with the
hazardous substances act as a whole, so too other relevant laws
must be considered, for "a seemingly unambiguous statute [may be]
restricted by another act or where it must be considered in pari
materia with another act." [Fn. 36]  In this regard, the
comprehensive regime of statutes of limitations listed in AS 09.10
is particularly relevant, [Fn. 37] because, as Laidlaw correctly
observes, "if, as FDIC suggests, sec. 822(a) has no statute of
limitations whatsoever, it appears to be the only cause of action
in Alaska with this distinction." [Fn. 38]  
          The final factor to consider in determining
subsection .822(a)'s meaning is its legislative history.  In our
view, this factor further indicates that the legislature did not
intend to exclude the statute of limitations as an available
"defense" to a private cost recovery action.  In 1989 the
legislature amended section .822, using the federal CERCLA statute
as a pattern. [Fn. 39]  Congress originally passed CERCLA in 1980,
including the defense-limiting "notwithstanding" language that
appears in subsection .822(a). [Fn. 40]  When first enacted, CERCLA
incorporated a three-year statute for damages actions. [Fn. 41] 
But two federal trial courts ruled that this statute of limitations
did not apply to cost recovery actions under 42 U.S.C. sec. 9607 --
the CERCLA analog to subsection .822(a). [Fn. 42]  
          In 1986, evidently responding to these rulings, Congress
added statutes of limitations specifically covering CERCLA's
counterparts to subsections .822(a) and (j). [Fn. 43]  Congress
codified these new statutes as separate provisions within CERCLA,
and did not amend CERCLA's "notwithstanding" language to mention
them as "defenses" to a cost recovery action under CERCLA. [Fn. 44] 
Obviously, then, Congress did not consider these statutes of
limitations to be included among the kinds of "defenses" that were
limited by CERCLA's "notwithstanding" provision -- a provision
directly corresponding to subsection .822(a).
          When the 1989 Alaska legislature revised section .822 by
incorporating many features of CERCLA, [Fn. 45] it omitted CERCLA's
internal statutes of limitations.  FDIC argues that this omission
evinces the legislature's intent to withdraw any statute of
limitations defense.  But the defendants respond that the Alaska
legislature's omission merely reflects its awareness that, unlike
federal law, Alaska law already incorporated general statutes of
limitations outside its hazardous substances act that would govern
a direct action brought under subsection .822(a). 
          The defendants' view is more plausible than FDIC's.  As
pointed out above, it is apparent that Congress considered CERCLA's
internal statute of limitations to lie outside the sphere of
"defenses" described by CERCLA's "notwithstanding" provision.  If
we accepted FDIC's proposed view of legislative intent, then, we
would have to conclude that the Alaska legislature meant to give
the "notwithstanding" language imported from CERCLA more
significance in subsection .822(a) than Congress gave it in the
federal context.  Since no legislative history supports this
interpretation, there is no reason to suppose that the Alaska
legislature intended subsection .822(a) to abrogate Alaska's
general statutes of limitations.
          In sum, we conclude that the limiting language of
subsection .822(a) does not preclude affirmative defenses, like the
defense of statute of limitations, that have no inherent relation
to subsection .822(a)'s imposition of joint and several strict
liability for release of hazardous substances.
     D.   An Action for Contribution Under Subsection .822(j) May

Be Filed When a Subsection .822(a) Action Is Brought but "Accrues"
for Purposes of the Statute of Limitations When Judgment Is Entered
or Settlement Is Reached.
          One of the certified questions before us is when a cause
of action for contribution "accrues" under subsection .822(j).  In
1989, when the legislature amended subsection .822(a) to mirror
CERCLA, it also enacted a new subsection, AS 46.03.822(j), that
gave defendants an action for contribution: 
          A person may seek contribution from any other

person who is liable under (a) of this section during or after a
civil action under (a) of this section. . . .  In resolving claims
for contribution under this section, the court may allocate damages
and costs among liable parties using equitable factors determined
to be appropriate by the court.  This subsection does not diminish
the right of a person to bring an action for contribution in the
absence of a civil action under (a) of this section.[ [Fn. 46]]
          The statutory language is clear that any party named in
a direct subsection .822(a) action may commence an action for
contribution at any time "during or after" the direct action. [Fn.
47]  We nevertheless conclude that even though subsection .822(j)
allows a contribution action to be brought while a
subsection .822(a) action is still in progress, the contribution
action does not "accrue" for purposes of the statute of limitations
until the subsection .822(a) action concludes. 
          Under CERCLA, an action for contribution accrues
according to a contribution-specific statute of limitations,
42 U.S.C. sec. 9613(g)(3).  Alaska has no analog to this provision
its books.  Because the legislature unreservedly specified that
contribution actions may be brought after a subsection .822(a)
action concludes, and since an action under the subsection .822(a)
could conceivably remain pending for many years after its
inception, the statute of limitations on such actions cannot
realistically begin to run upon commencement of the action under
subsection .822(a). [Fn. 48]  
          Moreover, interpreting subsection .822(j) to authorize
a contribution action accruing upon or after judgment comports with
general contribution case law elsewhere, [Fn. 49] as well as with
our own case law governing contribution in other contexts.  For
example, in Providence Washington Insurance Co. of Alaska v. McGee
we recognized "that a claim for contribution is substantively
separate from the underlying tort and does not arise until the
contribution claimant has paid more than his or her proportionate
share of the total claim." [Fn. 50]   
          In the absence of statutory guidance other than the
language of subsection .822(j), and because subsection .822(j)
specifically authorizes an action for contribution to be brought
"during or after" a direct action under subsection .822(a), we
conclude that a contribution action under subsection .822(j) should
not accrue for statute of limitations purposes until the direct
cost recovery ends, either by judgment, settlement, or the
conclusion of an administrative action. [Fn. 51] 
     E.   Nuisance and Trespass Actions Are Subject to Statutes of
Limitations and the Discovery Rule.

          Finally, we consider whether hazardous substance
contamination can escape the statute of limitations by being
characterized as a continuing nuisance or trespass.  FDIC maintains
that because the contamination of the Soldotna property "continued
over time, and continue[s] up to the present time," no statute of
limitations bars its claims for nuisance and trespass.  To support
this argument, it relies on our ruling in Alm v. Wood. [Fn. 52]
          We are not persuaded that Wood is controlling.  In Wood,
we let stand the superior court's ruling that the defendant's
failure to prevent the flooding of the Woods' property was a
continuing nuisance that should be abated. [Fn. 53]  FDIC reads
that case as describing a situation analogous to this case.  But in
Wood, the continuing nuisance was caused by a faulty dike for which
the defendants were responsible. [Fn. 54]  While damage did occur
soon after the dike began to leak, we recognized that compensation
for that damage was time barred. [Fn. 55]  Nevertheless, the
defendants were under a continuing obligation to prevent the
inundation of the Woods' land, which they continuously failed to
do; their leaky dike allowed water to seep onto the Woods' property
up to the day the suit was filed. [Fn. 56]
          In contrast, the defendants here are not exacerbating the
contamination that they allegedly caused during the late 1980s. 
And since they have lost their connection to the land, they cannot
be characterized as maintaining an ongoing nuisance.  Thus, we do
not see how the contamination in this case differs from the harm
ordinarily at issue in cases involving torts of a non-continuing
nature, where discrete wrongful acts often have lasting
          Insofar as there is a difference that relates to statutes
of limitations, it is that injuries from seeping pollutants may be
difficult to discover.  That characteristic, however, does not
militate in favor of describing the defendants' alleged actions as
a continuing nuisance or trespass.  Rather, the discovery rule
adequately addresses this problem by delaying a cause of action's
accrual until the plaintiff is aware, or reasonably should be
aware, of its existence. [Fn. 57] 
          Here, given the parties' briefing, the undisputed facts
discussed in the federal court's certification request, and the
available record, we conclude that FDIC's allegations do not lend
themselves to being framed as a continuing trespass or nuisance.
[Fn. 58] 
          In sum, we answer the certified questions as follows:
          1.   A statute of limitations defense is available for
a direct cause of action under AS 46.03.822(a).
          2.   Alaska Statute 46.03.822(a) creates a private cause
of action imposing joint and several strict liability. 
          3.   A cause of action for contribution under
AS 46.03.822(j) may be brought during the pendency of a direct
action under subsection .822(a) but does not accrue for purposes of
the statute of limitations until the direct action concludes.
          4. Continuing trespass and nuisance claims for
environmental contamination cannot be brought outside the
limitations period under the undisputed circumstances presented


Footnote 1:

     Appellate Rule 407(a) provides: 

               The supreme court may answer questions of
law certified to it by . . . a United States district court . . .
when requested by the certifying court if there are involved in any
proceeding before it questions of law of this state which may be
determinative of the cause then pending in the certifying court and
as to which it appears to the certifying court there is no
controlling precedent in the decisions of the supreme court of this

Footnote 2:

     See M.A. v. United States, 951 P.2d 851, 853 (Alaska 1998).

Footnote 3:

     Ch. 122, sec. 1, SLA 1972 (emphasis added).

Footnote 4:


Footnote 5:

     Ch. 122, sec. 2, SLA 1972.  Title 46, Chapter 3 includes
AS 46.03.010-.900.

Footnote 6:

     Position Paper, March 16, 1989, Dennis D. Kelso, Commissioner,
Alaska Department of Environmental Conservation. 

Footnote 7:

     Ch. 39, sec. 2, SLA 1989 (emphasis added).

Footnote 8:

     See 42 U.S.C. sec.sec. 9601-9675 (1994).

Footnote 9:

     The Department of Environmental Conservation stated in its
position paper:

               The bill [CSHB 68 (Resources)] was
introduced at the request of the Governor.  The Department strongly
supports the bill and feels that it is necessary to provide
appropriate tools to ensure that hazardous substance releases may
be responded to properly.  The first two sections of the law
[including the re-enacted section .822] incorporate provisions
similar to [those in] the federal "Superfund" law into state law.

See Position Paper, March 16, 1989, Dennis D. Kelso, Commissioner,
Alaska Department of Environmental Conservation.

          In addition, Senate Judiciary Chairwoman Jan Faiks
explained that the 1989 amendments to AS 46.03.822 were modeled
after CERCLA.  See Committee Minutes, Senate Judiciary Committee
(May 2, 1989).

Footnote 10:

     See Ch. 83, sec. 9, SLA 1991.

Footnote 11:


Footnote 12:

     See Ch. 92, sec.sec. 1, 3, SLA 1991 (including "damage to
persons or to public or private property [and] damage to natural
of the state or a municipality" in subsection .822(k) among the
harms that trigger strict liability, as section .822 has always
done).  The amendments contained in sec.sec. 1 and 3 took effect
July 3,
1991.  In the same Act, these sections were to be repealed
effective July 1, 1992, with the language in the new subsection (k)
reverting to subsection (a).  See id. at sec.sec. 10, 12.  However,
repeal and re-enactment was itself repealed in 1992.  See Ch. 83,
sec. 15, SLA 1992.

Footnote 13:

     While the definition of damages does not expressly include
cleanup costs outside the context of those incurred by the state,
a municipality, or a village, other courts have held that damages
include cleanup costs.  See, e.g., One Wheeler Road Assocs. v.
Foxboro Co., 843 F. Supp. 792, 796-97 (D. Mass. 1994) (applying
Massachusetts law); Borough of Rockaway v. Klockner & Klockner, 811
F. Supp. 1039, 1051 (D.N.J. 1993) (applying New Jersey law).  The
inclusion of cleanup costs in damages also furthers the legislative
purpose of protecting the environment from pollution.  See Stock v.
State, 526 P.2d 3, 12 (Alaska 1974).  

Footnote 14:

     950 P.2d 98, 104-05 (Alaska 1997) (citing Restatement (Second)
of Torts sec. 874A cmt. h (1977)); see also Walt v. State, 751 P.2d
1345, 1351 n.12 (Alaska 1988).

Footnote 15:

     See AS 46.03.822(k) ("'[D]amages' has the meaning given in AS
46.03.824 and includes damage to persons or to public or private
property, damage to the natural resources of the state or a
municipality, and [certain damages caused by cleanup
contractors].").  AS 46.03.824 reads:  "Damages include but are not
limited to injury to or loss of persons or property, real or
personal, loss of income, loss of the means of producing income, or
the loss of an economic benefit."

Footnote 16:

     See AS 46.03.822(a).

Footnote 17:

     991 P.2d 769, 776 (Alaska 1999).

Footnote 18:

     See id.  Several Alaska superior courts have adopted similar
approaches.  See University of Alaska v. Texaco, No. 4FA-93-2486 CI
(Alaska Super., November 14, 1995) (memorandum decision); Parks
Hiway Enters., LLC v. CEM Leasing, Inc., No. 4FA-95-2117 CI (Alaska
Super., December 22, 1997) (memorandum and order granting
defendant's motion for summary judgment). 

Footnote 19:

     We note in passing that FDIC's exact status is not clear. 
FDIC is the ultimate receiver of property owned by Carver that was
pledged as security to Sun Savings.  The defendants allege that
FDIC is potentially responsible, but FDIC does not address the
question.  Under AS 46.03.826(8) "owner" and "operator" are defined
to exclude a person who "without participating in the management of
a vessel or facility, holds indicia of ownership primarily to
protect that person's security interest in the vessel or facility." 
The federal district court's certified questions do not require us
to interpret this provision or to determine whether FDIC is a
potentially responsible party, and we decline to do so here. 
Nevertheless, we note that federal courts that have interpreted the
CERCLA equivalent of this section are divided.  Compare United
States v. Fleet Factors Corp., 901 F.2d 1550, 1557-58 (11th Cir.
1990) (actual management unnecessary for secured creditor
liability) with In re Bergsoe Metal Corp., 910 F.2d 668, 672 (9th
Cir. 1990) ("[T]here must be some actual management of the facility
before a secured creditor will [be liable under CERCLA]."). 
Moreover, AS 46.03.822(a) differs from its federal counterpart in
the way it describes owner liability.  Compare AS 46.03.822(a)(2)
(imposing liability on "the owner . . . of a . . . facility, from
which there is a release . . . of a hazardous substance") with 42
U.S.C. sec. 9607(a)(1) (imposing liability on "the owner . . . of
a . . . facility").  Alaska's law appears to focus on the owner at
the time of the release, rather than on subsequent owners.

Footnote 20:

     107 F.3d 1235, 1240-42 (7th Cir. 1997).

Footnote 21:

     Id. at 1240.  

Footnote 22:

     Id. at 1242 (citing Akzo Coatings, Inc. v. Aigner Corp., 30
F.3d 761 (7th Cir. 1994)).  More recently, other federal courts
have similarly allowed CERCLA's direct cost-recovery action to be
recast as an action for contribution when brought by a potentially
responsible party who is ultimately determined not to be
"innocent."  See, e.g., Pinal Creek Group v. Newmont Mining Corp.,
118 F.3d 1298 (9th Cir. 1997).  The Pinal court found that CERCLA's
analog to subsection .822(a) placed cleanup responsibility on the
plaintiff Pinal Group because it was a potentially responsible
party.  At the same time, Pinal Group was entitled to recover from
other potentially responsible parties for their share of the
cleanup costs under CERCLA's subsection .822(j) analog.  The court
found that "this duality is best implemented by permitting a
[potentially responsible party] who has incurred cleanup costs to
assert only a contribution claim against other [potentially
responsible parties]."  Id. at 1301.

Footnote 23:

     The defendants assert, without elaboration, that this case is
governed by AS 09.10.070(a), which establishes a two-year limit for
"an action . . . upon a liability created by statute." But it seems
that this case might alternatively be governed by AS 09.10.050,
which specifies a six-year limit for "an action for waste or
trespass upon real property."  Yet the relevant portion of the
federal court's certification order only asks us to address FDIC's
claim that no statute of limitations defense is available for a
direct cause of action under AS 46.03.822(a).  The question of
which statute applies has not been adequately briefed, and the
facts recited in the federal court's certification order suggest
that the point may be time-barred under any applicable limit. 
Given these circumstances, we decline to consider which statute of
limitations provision would govern FDIC's direct cause of action.

Footnote 24:

     AS 46.03.822(a) (emphasis added).

Footnote 25:

     K Mart Corp. v. Cartier, Inc., 486 U.S. 281, 293 n.4 (1988).

Footnote 26:

     State v. Alex et al., 646 P.2d 203, 208-09 n.4 (Alaska 1982)
(quoting United States v. United States Steel Corp., 482 F.2d 439,
444 (7th Cir. 1973) and adopting a sliding scale approach to
statutory interpretation). 

Footnote 27:

     Thus, courts adhering to the "plain meaning" rule of statutory
interpretation commonly define the rule to apply only "where
language of a statute is clear and construction according to its
terms does not lead to absurd consequences."  North Slope Borough
v. Sohio Petroleum Corp., 585 P.2d 534, 540 n.7 (Alaska 1978).

Footnote 28:

     At least one federal court interpreting CERCLA has recently
suggested that the "notwithstanding" language in the federal
statute should not be interpreted to bar defendants from asserting
res judicata, collateral estoppel, accord and satisfaction, or
statutes of limitations, because such an interpretation would yield
"absurd results that Congress could not have intended."  See Town
of Munster, Indiana v. Sherwin-Williams Co., Inc., 27 F.3d 1268,
1271-72 (7th Cir. 1994); cf. Alaska Sport Fishing Ass'n v. Exxon
Corp., 34 F.3d 769, 771-74 (9th Cir. 1994) (affirming dismissal of
section .822 claim on the ground of res judicata without expressly
considering the "notwithstanding" language).

Footnote 29:

     Homer Elec. Ass'n v. Towsley, 841 P.2d 1042, 1048 (Alaska
1992) (Compton, J., dissenting) (quoting K Mart Corp., 486 U.S. at
291); see also Nash v. State, Commercial Fisheries Entry Comm'n,
679 P.2d 477, 478 (Alaska 1984).

Footnote 30:

     Millman v. State, 841 P.2d 190, 194 (Alaska App. 1992). 

Footnote 31:

     Subsection .822(a)'s "notwithstanding" phrase currently refers
to two other provisions: "the exception set out in AS 09.65.240,
and the limitation on liability provided under AS 46.03.825."  See
AS 46.03.822(a).  But neither of these references appeared in the
originally enacted version of subsection .822(a).  See Ch. 39, sec.
SLA 1989.  Since both references were added after the original
enactment of subsection .822(a), they are not relevant to establish
the intent of the legislature that originally enacted the statute. 

Footnote 32:

     AS 46.03.822(b) & (i).

Footnote 33:

     2A Norman J. Singer, Sutherland Statutory Constructionsec. 47.17
(6th ed. 2000); see State v. First Nat'l Bank of Anchorage, 660
P.2d 406, 412-13 (Alaska 1982) (applying this doctrine).

Footnote 34:

     As originally enacted by chapter 39, sec. 3, SLA 1989, section
.823 provided, in relevant part:

          (a) A person who is a response action
contractor with respect to a release or threatened release of a
hazardous substance is not civilly liable for injuries, costs,
damages, expenses, or other liability that results from the release
or threatened release unless the release or threatened release is
caused by an act or omission of the response action contractor that
is negligent or grossly negligent or constitutes intentional
misconduct.  To show negligence by a response action contractor, a
claimant must show that the acts or omissions of the contractor
under the response action contract were not in accordance with
generally accepted professional standards and practices at the time
the response action services were performed.

          (b) The liability limitation under (a) of this
section does not apply to a response action contractor who would
otherwise be strictly liable under this section.

Footnote 35:

     Alascom, Inc. v. North Slope Borough Bd. of Equalization, 659
P.2d 1175, 1178 n.5 (Alaska 1983) (quoting 2A C. Sands, Statutes
and Statutory Construction sec. 46.06 (4th ed. 1973)).

Footnote 36:

     Hafling v. Inlandboater's Union of Pacific, 585 P.2d 870, 872
(Alaska 1978); see also Anderson v. Anderson, 736 P.2d 320, 321
(Alaska 1987) (seemingly unambiguous provision of Exemptions Act
affected by Alaska Limited Entry Act).

Footnote 37:

     AS 09.10.010 provides: "A person may not commence a civil
action except within the periods prescribed in this chapter after
the cause of action has accrued, except when, in special cases, a
different limitation is prescribed by statute."  AS 09.10.100
provides:  "An action for a cause not otherwise provided for may be
commenced within ten years after the cause of action has accrued." 

Footnote 38:

     See generally AS 09.10.010 - AS 09.10.100.  

Footnote 39:

     See supra note 8 and accompanying text.

Footnote 40:

     See Comprehensive Environmental Response, Compensation &
Liability Act of 1980, Pub. L. No. 96-510, Title I, sec. 107, 94
2767, 2781 (1980).

Footnote 41:

     See 42 U.S.C. sec. 9612(d) (1994). 

Footnote 42:

     See United States v. Dickerson, 640 F. Supp. 448, 450-51 (D.
Md. 1986); United States v. Mottolo, 605 F. Supp. 898, 901-10
(D.N.H. 1985).

Footnote 43:

     See Pub. L. No. 99-499, sec. 113(b), 100 Stat. 1613, 1647

Footnote 44:

     See 42 U.S.C. sec. 9613(g) (1994).  CERCLA's analog to
AS 46.03.822(a) appears at 42 U.S.C. sec. 9607(a).

Footnote 45:

     See supra note 8 and accompanying text.

Footnote 46:

     Ch. 39, sec. 2, SLA 1989.

Footnote 47:

     Conversely, subsection .822(j)'s "during or after" language
strongly suggests that a party has no right to seek contribution
before an action has been commenced under subsection .822(a).  Yet
subsection .822(j) also provides that "this subsection does not
diminish the right of a person to bring an action for contribution
in the absence of a civil action under (a) of this section."  In
light of our decision that subsection .822(a) creates a private
cause of action, these provisions are not contradictory.  In the
absence of a third-party claim under subsection .822(a), a
potentially responsible party is free to bring a private action
under subsection .822(a) against other potentially responsible
parties and, in so doing, may seek or ultimately be limited to
apportioned damages under subsection .822(j).  See, e.g., Pinal
Creek Group v. Newmont Mining Corp., 118 F.3d 1298, 1301 (9th Cir.
1997).  While this kind of anticipatory action might plausibly be
characterized as a claim for contribution under subsection .822(j),
because it derives from subsection .822(a)'s creation of a private
right of action, the anticipatory contribution action must accrue
with the related subsection .822(a) action and be governed by its
statute of limitations.

Footnote 48:

     In this regard, we believe that subsection .822(j)'s language
allowing potentially responsible parties to assert contribution
claims "during" a subsection .822(a) action must be read to extend
to actions prosecuted either in court or through administrative
proceedings.  If subsection .822(j) did not apply to parties who
became subject to DEC administrative compliance actions, the
benefit of a contribution action would accrue only to those who,
through their recalcitrance, forced DEC to court.  We do not
believe that the legislature intended to force such cases into
court.  We note, however, that before the state's administrative
process could qualify as an action, it would have to have the
formal attributes of an administrative proceeding, including "a
complaint-like  pleading, which in turn set[s] in motion a formal
process of dispute resolution."  Koss v. Koss, 981 P.2d 106, 108
(Alaska 1999); see also Agen v. State, CSED, 945 P.2d 1215, 1219
(Alaska 1997); cf. Hickel v. Halford, 872 P.2d 171, 176 (Alaska
1994) (listing a formal charging document that triggers a formal
mechanism for dispute resolution as indicia of an agency

Footnote 49:

     See Maurice T. Brunner, Annotation, When Statute of
Limitations Commences to Run Against Claim for Contribution or
Indemnity Based on Tort, 57 A.L.R.3d 867, 912-13 (1974).

Footnote 50:

     764 P.2d 712, 715 (Alaska 1988); see also Alaska General
Alarm, Inc. v. Grinnell, 1 P.3d 98, 106-07 (Alaska 2000).

Footnote 51:

     In our view, the rule we adopted in Providence Washington
Insurance Co. of Alaska v. McGee should generally govern the date
of accrual when a party who has paid damages assessed jointly and
severally under subsection .822(a) files a contribution action to
recoup the disproportionate payment.  In at least one situation,
however, reliance on the Providence Washington rule may not be
warranted.  When a party who has not been forced to pay an award or
make cleanup efforts under subsection .822(a) files a contribution
action to apportion liability for the damages, the contribution
action should be treated as accruing at the time of judgment on the
subsection .822(a) action.  Applying the Providence Washington rule
to such cases would encourage subsection .822(a) judgment debtors
to delay payment or cost recovery efforts, since any delay would be
essentially cost-free and they could always trigger a new period
for filing a contribution action by making a small payment on the
judgment.  In these situations and in other exceptional cases,
subsection .822(j)'s express grant of discretion to consider
"equitable factors determined to be appropriate by the court" will,
we believe, empower trial courts to treat the contribution action
as accruing upon entry of the subsection .822(a) judgment.

Footnote 52:

     516 P.2d 137, 142 (Alaska 1973).

Footnote 53:

     See id. at 141-42.

Footnote 54:

     See id.

Footnote 55:

     See id.

Footnote 56:

     See id. (indicating that the superior court judge viewed the
unrepaired conditions around the Woods' property).

Footnote 57:

     See Cameron v. State, 822 P.2d 1362, 1365-68 (Alaska 1991)
(laying out the discovery rule and its purpose).

Footnote 58:

     For the reasons that we advanced in discussing the
availability of a statute of limitations defense to direct actions 
under subsection .822(a), see supra Part III.C, we need not
consider what statute of limitations applies to FDIC's trespass