First Fidelity holds the mortgage on property purchased by PCB, Inc. PCB is a manufacturer that disposed of chemicals in its manufacturing process on the 6 vacant acres of the land. Arrowhead Equipment was its major customer. Three years ago, PCB defaulted on the mortgage and First Fidelity took over the property and leased it to ASB, Inc., another manufacturer. PCB is now bankrupt and the EPA has expended $500,000 for clean-up of the six acres. Who is not liable to the EPA?

Question

Quizplus · Accepted Answer

Under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), liability for environmental clean-up can extend to the current owner/operator of the property, the owner/operator at the time of disposal of hazardous substances, and the companies that arranged for the disposal of hazardous substances. Arrowhead Equipment, as a customer of PCB and not directly involved in the disposal of chemicals or ownership of the contaminated property, would not be held liable under CERCLA's provisions.

First Fidelity Holds the Mortgage on Property Purchased by PCB