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Starlink Logistics Inc. v. ACC LLC

Court of Appeals of Tennessee, Nashville

March 11, 2015

STARLINK LOGISTICS INC.
v.
ACC, LLC, ET AL.

Assigned on Briefs December 04, 2014.

Appeal from the Chancery Court for Davidson County No. 121435II Carol L. McCoy, Chancellor.

William L. Campbell, Jr., Nashville, Tennessee, William T. Robinson, III, Christopher S. Habel, and Stephen N. Haughey, Cincinnati, Ohio for the appellant, StarLink Logistics Inc.

Sharon O. Jacobs, C. David Briley, Nashville, Tennessee, Thomas W. Hardin, Patrick M. Carter, and Kori A. Bledsoe, Columbia, Tennessee for the appellee ACC, LLC.

Elizabeth P. McCarter, Nashville, Tennessee for the appellee, Tennessee Solid Waste Disposal Control Board.

Arnold B. Goldin, J., delivered the opinion of the Court, in which J. Steven Stafford P.J., W.S. and Kenny Armstrong, J. joined.

OPINION

ARNOLD B. GOLDIN, JUDGE.

I. Background and Procedural History

Although the history leading up to the present appeal is both detailed and complicated, the basic facts forming the controversy are not in dispute.[1] In 1981, the State of Tennessee issued ACC a permit to construct a landfill south of the City of Mt. Pleasant in Maury County, Tennessee. ACC disposed wastes at the site from 1981 until September 1993. The landfill, which is a Class II solid waste disposal facility[2], encompasses approximately 14 acres of land on a larger parcel of 48.02 acres which is owned by ACC. During its period of active use as a landfill, the site was used for the disposal of aluminum recycling wastes from a smelting plant located in Mt. Pleasant. These wastes consisted almost entirely of "salt cake" slag[3] and bag-house dusts from the nearby plant's smelting operations. After ACC ceased using the landfill for the disposal of wastes, it performed final closure of the facility in accordance with the Closure/Post-closure Care and Corrective Action Plans that were approved by the State. TDEC certified completion of the closure in 1996.

Within a few years after the landfill had begun operations, both ACC and TDEC recognized that unacceptable levels of chlorides and ammonia were leaching out of the wastes and into the underlying groundwater and down-gradient surface water that drained into nearby Sugar Creek and Arrow Lake.[4] Various efforts were taken by TDEC and ACC to investigate and correct the leaching, but the problem was never resolved. It continued after final closure of the facility and unfortunately persists to this day.

In light of the continued leaching of contaminants at the site, TDEC contacted ACC in the summer of 2003 and requested that ACC submit a corrective action plan pursuant to Tenn. Comp. R. & Regs. 1200-01-07-.04(7)7 and 8. ACC submitted a plan meeting the regulatory requirements in December 2003. In its plan, ACC presented an assessment of the feasibility of the options available for the mitigation of the release of leachate and ultimately recommended that a "Wetlands Treatment Alternative" be pursued in order to enhance attenuation of releases and impacts. After a public hearing on the matter, TDEC allowed ACC to pursue the wetlands treatment pending the acquisition of an Aquatic Resource Alteration Permit.

On April 2, 2004, ACC submitted a remedial plan for a "Constructed Wetland System" down-gradient of the landfill that it asserted would not only retain and buffer leachate, but also improve the habitat and water quality of Sugar Creek and Arrow Lake. The wetland system was proposed to offer several benefits to the environment, including the reduction of surges of salt concentration downstream and the improvement of water quality by the reduction of erosion and breakdown of nutrients and organic matter. On May 4, 2004, TDEC's Division of Water Pollution Control issued public notice of its intent to issue an Aquatic Resource Alteration Permit to allow the proposed wetland restoration. TDEC's Division of Solid Waste Management approved the plan on June 2, 2004. Although the wetland system was subsequently built, site and drought conditions prevented the full development of the communities of salt-tolerant vegetation that were planned.

A compliance review meeting took place between TDEC and ACC in April 2008. Shortly thereafter, in a letter dated June 12, 2008, TDEC requested that ACC submit modifications to the original corrective action plan in light of ACC's failure to satisfy the previous remedial objectives. ACC submitted the required modified corrective action plan to TDEC approximately two months later. TDEC approved the modified plan for implementation on April 19, 2010.

In February 2011, three inspections conducted by TDEC personnel revealed that leachate containing high levels of chlorides and ammonia continued to flow into Sugar Creek. As a result of this discovery, TDEC and ACC entered into a consent order on June 6, 2011, which set forth ACC's obligations in addressing the continued contamination. In addition to describing the historical problems leachate contamination had posed at the ACC landfill site, the order found ACC to be in numerous violations of the Water Quality Control Act and the Tennessee Solid Waste Disposal Act. In particular, ACC was cited for "causing or allowing unauthorized discharges to waters of the state, " in addition to "allowing the release of solid waste or solid waste constituents to the waters of the State." The order mandated that ACC develop plans to reduce leachate contamination on the site but stated that the plans which were developed and approved could be modified in the future upon the written approval of the TDEC Commissioner.

In addition, the order stated that the Commissioner could extend compliance dates for the plans developed "for good cause shown[.]" Although the order assessed a civil penalty against ACC in the amount of $318, 300.00, ACC was provided a means by which it could receive a credit in the amount of $90, 000.00 against the penalty if it proposed certain "Supplemental Environmental Projects." The remaining $228, 300.00 penalty was due and payable only if ACC failed to submit and implement the plans called for by the order. Moreover, the order provided that the Commissioner could waive ACC's noncompliance for demonstrated good cause. Shortly after this order was entered into, it was filed for entry as a judgment by consent in the Davidson County Chancery Court pursuant to Tennessee Code Annotated § 68-212-114(e), Tennessee Code Annotated § 68-212-215(f), and Tennessee Code Annotated § 69-3-115(e). StarLink, whose property adjoins the landfill, subsequently intervened in the case.

When TDEC, ACC, and StarLink were unable to resolve the issues among them, the Chancery Court remanded the matter for further proceedings before the Board as a contested case pursuant to the Tennessee Uniform Administrative Procedures Act. On May 17, 2012, TDEC gave written notice to StarLink that a hearing before the Board was set for August 7, 2012. Specific notice was given that ACC and TDEC would be asking the Board to adopt an Amended and Restated Consent Order which would supersede the June 2011 consent order. Although the Amended and Restated Consent Order ("Consent Order") found that ACC committed the same violations of the Water Quality Control Act and the Tennessee Solid Waste Disposal Act that were cited in the original consent order, the Commissioner's orders and assessments differed. In outlining a detailed remediation plan, the Commissioner ordered that ACC take several steps to improve conditions at the landfill site. In relevant part, ACC was ordered as follows:

A. [ACC] shall take the following actions to prevent the unauthorized discharge of leachate contamination in water flowing from the Site into the Arrow Lake impoundment of Sugar Creek:
1. Within 120 days of the effective date of this Amended and Restated Consent Order, or as is otherwise agreed to by the parties, [ACC] shall construct a berm upgradient of the site to divert uncontaminated storm water away from the Landfill prior to the commencement of any corrective action activities on the Landfill.
2. As part of [a] Corrective Action Plan . . . [ACC] shall submit to the Commissioner for his review and comment or approval a modified Discharge Reduction Plan . . . that incorporates TDEC's comments and revisions to [ACC's] draft DRP that was submitted to TDEC in September 2011. The modified DRP shall significantly reduce, particularly during periods of low area surface water flow, the loading of contaminants that are currently discharging from the Site via surface waters. The modified DRP shall include a schedule for implementation.
3. The DRP shall contain a plan to divert surface water away from the landfill area and the current wetland system. The DRP shall eliminate, to the extent practicable, the potential for surface water to migrate from the surface into the landfill and eliminate the potential for surface water to enter the excavated area of the landfill once corrective action begins.
B. [ACC] shall remove from the current landfill all solid waste, to the extent practicable, that has the potential for future contact with ground or surface water. All waste removed will be relocated to a new landfill cell constructed on the Site or to a permitted off-site landfill.
1. Prior to the Commissioner's approval of the Corrective Action Plan . . . but after commencement of waste removal activities, [ACC] shall capture ground water entering the excavated area, analyze the ground water to determine its chemical characteristics, and then either (a) redirect the collected water back into the landfill or (b) discharge the collected ground water directly into Arrow Lake if the water is consistent with background concentrations as approved by TDEC[.]
2. After the Corrective Action Plan . . . has been approved by the Commissioner, the list of constituents, their concentrations, and frequency of analysis shall follow the sampling plan contained in the approved Water Monitoring Plan as contained in the approved CAP[.]
3. As waste is removed from the Site, [ACC] shall capture ground water that is upgradient of the remaining waste and handle such ground water as described in the approved DRP, or as is otherwise required by the CAP. Treatment, transport or disposal of water is not required ...

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