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NEW JERSEY DEPT. OF ENVTL. PROTECTION v. GLOUCESTE

August 25, 1992

NEW JERSEY DEPARTMENT OF ENVIRONMENTAL PROTECTION Plaintiff,
v.
GLOUCESTER ENVIRONMENTAL MANAGEMENT SERVICES, INC., et al., Defendants.



The opinion of the court was delivered by: STANLEY S. BROTMAN

 Brotman, District Judge:

 Presently before the court is the motion of the individual operator defendants, Anthony Amadei, Richard Winn and David Ehrlich, for partial summary judgment dismissing the claims asserted against them pursuant to the Sanitary Landfill Closure and Contingency Fund Act N.J.S.A. 13:1E-100 et seq. The individual operator defendants argue that summary judgment is appropriate because they cannot be held liable as "owners or operators" *fn1" of the GEMS Landfill as defined by the Sanitary Landfill Closure and Contingency Fund Act since each of them owned less than a majority share of Amadei Sand & Gravel, Inc., [AS & G], and Gloucester Environmental Management Services, Inc., [GEMS], the two corporations formed to operate the GEMS Landfill. The court holds that although the individual operator defendants own less than a majority share of the corporations, they may be held personally liable as "owners or operators" under the Sanitary Landfill Closure and Contingency Fund Act if they had a high degree of personal involvement in the operation and decision-making of the corporations. As genuine issues of material fact exists regarding the role of each individual operator defendant as an active operator of the GEMS Landfill, the court denies the defendants' motion for summary judgment.

 I. FACTS AND PROCEDURE

 The New Jersey Department of Environmental Protection, now known as the New Jersey Department of Environmental Protection and Energy, ("NJDEPE"), originally brought suit against the operator defendants in October, 1980. *fn2" The NJDEPE asserted various statutory and common law causes of action arising from the disposal of allegedly hazardous substances at a landfill located in Gloucester Township, known variously as the Gloucester Township Landfill, the Amadei Sand & Gravel Landfill and the GEMS Landfill, ("the Landfill"). Specifically, the NJDEPE has alleged that the Sanitary Landfill Closure and Contingency Fund Act N.J.S.A. 13:1E-100 et seq, (the Closure Act) has been violated. This Act imposes liability on owners and operators of a sanitary landfill for the improper operation or closure of a sanitary landfill.

 In Count V of the Fourth Amended Complaint, the NJDEPE alleges that AS & G and GEMS, as the corporate entities operating the GEMS Landfill, violated the Closure Act by failing to operate and close the Landfill as required by law. The NJDEPE further alleges in Count X of the Fourth Amended complaint that AS & G and GEMS were "sham corporations which . . . failed to observe the formalities of corporate law and have been used by defendants . . . to insulate themselves from individual liability for their misconduct in operating the Gloucester Township landfill." The NJDEPE demands that these three individual operator defendants be held individually, jointly and severally liable under the Closure Act as operators of the GEMS Landfill.

 The individual operator defendants, Anthony Amadei, Richard Winn and David Ehrlich, have filed a motion seeking partial summary judgment dismissing claims asserted by the NJDEPE in Count V of the Fourth Amended complaint as applied to them through Count X. They also seek a declaration that they have no individual liability to compensate NJDEPE for monies paid out from the Sanitary Landfill Facility Contingency Fund for any damages to third parties allegedly related to the GEMS Landfill. The individual operator defendants claim that because none of the individual operator defendants owned a majority interest of either AS & G or GEMS, the two corporations formed to operate the GEMS Landfill, they cannot be considered "operators" of the GEMS Landfill as defined by the Closure Act.

 The individual operator defendants owned less than a majority interest of both AS & G and GEMS. Anthony Amadei was the former president and a shareholder of AS & G. When AS & G was formed Amadei owned 50 percent of the stock and has thereafter owned "owned less than 50 percent of the share in the stock of AS & G." See Affidavit of Anthony Amadei.3 In 1975, when GEMS was formed to take over the operation of the landfill from AS & G, Amadei received 27 percent of the shares of stock. Id. The only other shareholders included Richard Winn who received 40 percent of the stock, see Affidavit of Richard Winn, and David Ehrlich who received 27 percent of the stock. See Affidavit of David Ehrlich. Dennis Dubin initially received 6 percent of the stock, but turned over his 6 percent to Ehrlich and Winn who each received 3 percent. See Affidavit of Richard Winn; Affidavit of David Ehrlich.

 II. DISCUSSION

 A. The Standard

 Pursuant to Rule 56(c), the court may grant summary judgment only when the record reveals "that their is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(c); see Hersh v. Allen Prod. Co., 789 F.2d 230, 232 (3d Cir. 1986). In deciding whether there is a disputed issue of material fact the court must resolve all inferences and reasonable doubts in favor of the non-moving party. Meyer v. Riegel Prod. Corp., 720 F.2d 303, 307 n.2 (3d Cir. 1983), cert. dismissed, 465 U.S. 1091, 79 L. Ed. 2d 910, 104 S. Ct. 2144 (1984); Smith v. Pittsburgh Gage & Supply Co., 464 F.2d 870, 874 (3d Cir. 1972). The threshold inquiry is whether there are "any genuine factual issues that properly can be resolved only by a finder of fact because they may reasonably be resolved in favor of either party." Anderson v. Liberty Lobby, 477 U.S. 242, 250, 91 L. Ed. 2d 202, 106 S. Ct. 2505 (1986).

 The Supreme Court articulated the allocation of burdens between the moving and nonmoving parties in a motion for summary judgment in Celotex Corp. v. Catrett, 477 U.S. 317, 91 L. Ed. 2d 265, 106 S. Ct. 2548 (1986). The Celotex Court held that the moving party has the initial burden of demonstrating that no genuine issue of material fact exists, but this burden did not require the moving party to support their motion with affidavits or other materials to negate the nonmoving party's claim. Id. at 323; Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586, 89 L. Ed. 2d 538, 106 S. Ct. 1348 (1986); Adickes v. Kress & Co., 398 U.S. 144, 157, 26 L. Ed. 2d 142, 90 S. Ct. 1598 (1970). The Supreme Court also held that "Rule 56(e) requires the nonmoving party to go beyond the pleadings and by [their] own affidavits, or by the 'depositions, answers to interrogatories, and admissions, on file,' designate 'specific facts showing that there is a genuine issue for trial.'" Celotex Corp., 477 U.S. at 324 (quoting Fed. R. Civ. P. 56(e)).

 "A motion for summary judgment must be granted unless the party opposing the motion can adduce evidence which, when considered in light of that party's burden of proof at trial, could be the basis for a jury finding in that party's favor." J.E. Mamiye & Sons, Inc. v. Fidelity Bank, 813 F.2d 610, 618 (3d Cir. 1987) (Becker, J., concurring) (citing Anderson, 477 U.S. 242, 91 L. Ed. 2d 202, 106 S. Ct. 2505 (1986) and Celotex Corp., 477 U.S. 317, 91 L. Ed. 2d 265, 106 S. Ct. 2548 (1986)). The court may grant summary judgment, however, if the nonmoving party's evidence is merely "colorable" or is "not significantly probative." Anderson, 477 U.S. at 249-50.

 B. Statutory Construction

 In construing a statute, the court must first look at the evident wording of the statute to ascertain its plain meaning and intent. Renz v. Penn Cent. Corp., 87 N.J. 437, 440, 435 A.2d 540 (1981). The court "should try to give effect to every word of the statute, and should not assume that the legislature used meaningless language." Medical Soc'y v. Dep't of Law and Pub. Safety, 120 N.J. 18, 26, 575 A.2d 1348 (1990) (citing Gabin v. Skyline Cabana Club, 54 N.J. 550, 555, 258 A.2d 6 (1969)). The court should not construe a statute so as to render any part of it inoperative or superfluous. Paper Mill Playhouse v. Millburn Township, 95 N.J. 503, 521, 472 A.2d 517 (1984); Abbotts Dairies, Inc. v. Armstrong, 14 N.J. 319, 328, 102 A.2d 372 (1954). The underlying policy and purpose of enacting a statute provides additional assistance in correctly interpreting the statute. Cedar Cove, Inc. v. Stanzione, 122 N.J. 202, 584 A.2d 784 (1991).

 The Closure Act provides that "every owner or operator of a sanitary landfill facility shall be jointly and severally liable for the proper operation and closure of the facility, as required by law, and for any damages, no matter by whom sustained, proximately resulting from the operations or closure." N.J.S.A. 13:1E-103. In their motion for partial summary judgment, the individual operator defendants assert that because none of them own a majority interest of AS & & or GEMS they are not "owner or operators" of the GEMS Landfill as defined by the Closure Act so as to be jointly and severally liable for the damages resulting from improper operation or closure of the Landfill.

 It is undisputed that none of the individual operator defendants have owned more than fifty percent of the stock, or a majority interest, of either AS & G or GEMS. *fn4" The NJDEPE, however, argues that the individual operator defendants fit well within the definition of "owner or operator" set forth in the Closure Act.

 'owner or operator' means and includes, in addition to the usual meanings thereof, every owner of record of any interest in land whereon a sanitary landfill facility is or has been located, and any person or corporation which owns a majority interest in any other ...


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