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Petroleum Underground Storage Tank Release Compensation Board v. Standard Oil Co.

Court of Claims of Ohio

May 17, 2019

PETROLEUM UNDERGROUND STORAGE TANK RELEASE COMPENSATION BOARD Plaintiff/Counter Defendant
v.
STANDARD OIL COMPANY, et al. Defendants and BP PRODUCTS NORTH AMERICA, INC. Defendant/Counter Plaintiff

          Sent to S.C. Reporter 6/20/19

          DECISION

          DALE A. CRAWFORD JUDGE

         {¶1} Plaintiff Petroleum Underground Storage Tank Release Compensation Board (the Board) and Defendants Standard Oil Company, BP Products North America, Inc., BP America, Inc., and Omega Oil Company (Defendants) have both moved for summary judgment. The motions have been fully briefed and the parties presented oral argument to the Court as well as additional briefs after oral argument. In support of their motions, the parties submitted evidence too voluminous to list individually. In all, the parties submitted over twenty depositions, several affidavits, and over 200 exhibits comprised of hundreds of pages of documents. For the following reasons, the Court shall grant Defendants' Motion for Summary Judgment and deny the Board's Motion for Partial Summary Judgment.

         {¶2} The Board's second amended complaint delineates the following 6 claims: 1) fraud, 2) destruction of plaintiff's rights of subrogation, 3) indemnification, 4) quasi-contract/unjust enrichment, 5) negligent misrepresentation, and 6) declaratory judgment. The Court agrees with Defendants that the Board's claims all "turn on the core allegation that Defendants had insurance that provided coverage for the same costs for cleaning up pollution" for which Defendants received reimbursement from the Ohio Petroleum Underground Storage Tank Financial Assurance Fund (the fund).

         {¶3} Of the claims asserted in Defendants' counterclaim, only the breach of contract and unjust enrichment claims remain.[1] While Defendants' motion seeks summary judgment as to all of the Board's claims, the Board's motion seeks judgment only as to Defendants' request for attorney's fees as a remedy.

         Civ.R. 56(C) states, in part, as follows:

Summary judgment shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, written admissions, affidavits, transcripts of evidence, and written stipulations of fact, if any, timely filed in the action, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. No evidence or stipulation may be considered except as stated in this rule. A summary judgment shall not be rendered unless it appears from the evidence or stipulation, and only from the evidence or stipulation, that reasonable minds can come to but one conclusion and that conclusion is adverse to the party against whom the motion for summary judgment is made, that party being entitled to have the evidence or stipulation construed most strongly in the party's favor.

See also Dresher v. Burt, 1996-Ohio-107, 75 Ohio St.3d 280 (1996). In Dresher, the Ohio Supreme Court held, "the moving party bears the initial responsibility of informing the trial court of the basis for the motion, and identifying those portions of the record before the trial court which demonstrate the absence of a genuine issue of fact on a material element of the nonmoving party's claim." A "movant must be able to point to evidentiary materials of the type listed in 56(C)." Id. at 292.

         {¶4} When the moving party has satisfied its initial burden, Civ.R. 56(E) imposes a reciprocal burden on the nonmoving party. It states:

When a motion for summary judgment is made and supported as provided in this rule, an adverse party may not rest upon mere allegations or denials of his pleadings, but the party's response, by affidavit or as otherwise provided in this rule, must set forth specific facts showing that there is a genuine issue for trial. If the party does not so respond, summary judgment, if appropriate, shall be entered against the party.

In seeking and opposing summary judgment, parties must rely on admissible evidence. Keaton v. Gordon Biersch Brewery Rest. Group, 10th Dist. No. 05AP-110, 2006 Ohio 2438, 2006 Ohio App. Lexis 2287, ¶18. The Court first considers Defendants' Motion for Summary Judgment.

         DEFENDANTS' MOTION FOR SUMMARY JUDGMENT

         • Facts

         {¶5} The fund, which the Board administers, reimburses gas station owner and operators for remediation and clean-up costs resulting from petroleum spills and leaks from underground storage tanks (USTs). The fund is financed via annual fees, which tank owners pay into the fund. Reimbursements are capped at $1 million and applicants seeking reimbursement must pay a $55, 000 deductible.

         {¶6} When seeking reimbursement, tank owners complete both an eligibility application and a reimbursement application. As the fund does not reimburse costs covered by insurance, both applications ask tank owners about the existence of insurance. The Board's exhibits 136-138 are eligibility applications which ask:

12) Is this release the subject of a filed third-party lawsuit or a settlement agreement?

13) Do you have coverage under any other forms of insurance * * * which you have or could make claim for reimbursement of costs of corrective action or third-party damages for the release which is the basis of your claim to the Financial Assurance Fund?

Likewise, the Board's exhibits 139-141 are example reimbursement applications which ask:

6) Do you have coverage, other than for your deductible, under any other forms of insurance which you have or could make claim for reimbursement of costs for corrective action or third-party damages for the release which is the subject of this application?

7) Has any suit been filed in which the owner and/or operator are attempting to recover the costs of performing corrective action or third-party damages associated with this claim?

8) Has the owner and/or operator collected or does the owner and/or operator intend to collect money from any other source for the costs of performing corrective action or third-party damages associated with this claim?

         In completing over 1, 200 eligibility and reimbursement applications, Defendants answered "No" to these questions. Defendants have received $33.9 million in reimbursements from the fund and have applications pending for millions in additional reimbursements.

         {¶7} Defendants' heritage entities, Sohio and Amoco, had an array of excess general liability insurance and captive insurance policies. Sohio, from 1985 forward, self-insured below $10 million per occurrence. From 1979 to 1985, Sohio's excess liability coverage did not attach below $6 million per occurrence. For costs above these amounts, Sohio bought third-party insurance. Beginning in 1971, these policies contained exclusions for leaks unless they were sudden and accidental. Beginning in 1986, these policies contained absolute pollution exclusions which barred ...


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