Business and Society Comprehensive Environmental Response, Compensation and Liability Act, or CERCLA, business and finance homework help

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In 1979, Paul and Joan Reardon purchased sixteen acres of land located next to a manufacturing plant in Massachusetts. In 1983, a state environmental agency, responding to a citizen’s report, tested soil samples from both properties and discovered extremely high levels of polychlorinated biphenyls (PCBs) on the plant site and on the Reardons’ property where it bordered the site. Shortly thereafter, the Environmental Protection Agency (EPA) cleaned up the contaminated areas. In 1985, the EPA notified the Reardons that they might be liable for clean-up costs. An EPA investigation of the property in 1987 revealed that some soil was still contaminated. This time the Reardons cleaned up the property themselves. 

In March 1989, the EPA placed a lien for an unspecified amount on all of the Reardons’ property to secure payment for any clean-up costs that the Reardons might be liable. The EPA told the Reardons that they could settle the claims against them for $336,709 but noted that this amount did not limit the Reardons’ potential liability. 

The Reardons filed a motion for an injunction, arguing that filing a lien against their property without any prior notice or hearing violated their due process rights under the Fifth Amendment, which states that no person can be deprived of life, liberty, or property without due process of law. 

Superfund (the Comprehensive Environmental Response, Compensation and Liability Act, or CERCLA, of 1980, as amended in 1986) gives the government several powerful tools to use when attempting to collect clean-up costs from responsible parties. Among those tools is the authority to place a lien on a responsible party’s property without providing for a reasonable hearing before placing the lien.

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When answering, let’s try to discuss the legislative purpose behind the Superfund, let’s look at responsibility of the parties, let’s discuss if we think anyone else should be a party to this action, and let’s look at the due process issues.  Does CERCLA violate citizens due process rights by allowing the government to place a lien on a parties property without a hearing?  What do you think?  Put yourself in the Reardon’s shoes (leaving aside the issue of having the property tested before purchase) what would you do if you invested all of your assets in a piece of real estate and then found out it was contaminated?  What would your options be?

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