Indeed. Although environmental consultants fill their days helping their clients manage environmental risks, they may inadvertently be subject to legal risks in the course of their work. Gunster attorneys Greg Munson and Rick Burgess recently prepared the following alert outlining several recent legal cases that have allowed third parties to seek damages from consultants for their activities in ways that are often surprising. Food safety audit Last October, a Colorado court allowed a suit to move forward against a consultant for a cantaloupe grower who conducted a food safety audit at the cantaloupe packing facility (but who was not hired for testing of the cantaloupe) after a listeria outbreak from the cantaloupe killed 33 people and made 147 people sick. Lopez v. Frontera Produce, Case No. 13CV31951 (District Court of Colorado, Adams County). In that case, the court ruled that the consultant knew or should have known that the audit would be used to identify or uncover conditions that led to the distribution of the contaminated cantaloupe. The Colorado case is only the most recent example of court decisions that seem oblivious to the risk of imposing liability on companies that are actually engaged in preventing or remedying the very harms that environmental laws are intended to address. Waste remediation The waste remediation field is particularly risky for contractors. Loose statutory language under the federal waste cleanup law known as the Comprehensive Environmental Response, Compensation and Liability Act (or CERCLA), has led to several instances where environmental consultants have been unable to dismiss litigation directed against them as so-called “arrangers” or “operators.” In Ganton Technologies, Inc. v. Quadion Corp., 834 F.Supp.1018 (N.D. Ill. 1993), for example, a federal court ruled that the remediation contractor and remediation engineers were potentially “operators” – and therefore potentially responsible parties for the cost of clean up under CERCLA – since they “were hired to deal with the hazardous material.” More recent CERCLA cases show that the Ganton Technologies case was not an isolated incident. For example:
- CERCLA liability for engineering firms hired to remediate a landfill – BancorpSouth Bank v. Environmental Operations, Inc., 908 F.Supp.2d 1016 (E.D. Miss. 2012)
- an environmental consultant could not be dismissed from a CERCLA lawsuit – Ford Motor Co. v. Edgewood Properties, Case No. 06-1278, 06-4266, and 08-774 (D. N.J. 2012)
The risk to environmental consultants extends beyond CERCLA, particularly if there are colorable claims of negligence or malpractice as in the Colorado decision involving diseased cantaloupe. These claims can involve not just former clients, but the former client’s employees. In Caldwell v. Bechtel, Inc. 631 F.2d 989 (D.C. Cir. 1980), a federal appeals court concluded that an engineering consultant could be responsible for the silicosis of a heavy equipment operator performing the clean up under the consultant’s cleanup plan. What can you do to reduce risk? Fortunately, with the right tools and training, consultants can avoid most of the risks posed by this expanding liability. For example:
- Well-drafted contracts can ensure there is no misunderstanding about what is – and what is not – the responsibility of the consultant.
- Good work practices are another means of protection. Too often, for example, emails between consultants and clients can suggest that consultants have more authority than they actually possess, triggering potential claims for malpractice, breach of contract, or statutory liability.
- Because general insurance policies are often carefully worded to avoid some environmental claims, specialized policies are also a good idea.
With the right preparation, and minimal cost, environmental consultants can continue solving their clients’ problems without creating problems of their own. See also Recent legal cases allow third parties to seek damages from environmental consultants (Gunster.com Alerts, 3/5/15) Image courtesy of Jeroen van Oostrom at FreeDigitalPhotos.net.