New York's Oil Spill Act, Article 12 of the New York Navigation Law, assigns strict liability to any person who has discharged petroleum, for all cleanup and removal costs associated with the cleanup of the petroleum, as well as all direct and indirect damages, such as attorney's fees. N.Y. Navigation Law (1). A discharge of petroleum, sufficient to incur liability under the Oil Spill Act, includes any intentional or unintentional action or omission resulting in a release of petroleum into water, or into soil from which the petroleum could flow or drain to water. NL 172(8). New York generally interprets any and all spills of petroleum onto soil as falling within the jurisdiction of the Oil Spill Act, without any demonstration that the petroleum will actually find its way to the waters nominally protected by the Act.
Could fracking in North Dakota's Bakken shale formation have a direct impact on New York State? Yes, but the impact isn't limited to prices at the gas pump or home energy heating bills. Instead, the fracking operations are leading to a surge in freight trains hauling crude oil along the state's rail lines to a terminal at the port of Albany, New York. Shale formations such as the Bakken produce crude oil along with natural gas during fracking operations, and some claim that Bakken crude may "more dangerous to ship by rail than crude from other areas."
If you're familiar with the harsh reality of property owner liability under the New York State Navigation Law's Oil Spill Act, this headline shouldn't raise any eyebrows. However, the holding of State of New York v. C.J. Burth Services, Inc., 79 A.D.3d 1298, 915 N.Y.S.2d 174 (N.Y. App. 3rd Dep't 2010), once again confirms the Draconian nature of strict liability for property owners in Spill Act cases.
1. Any person who has discharged petroleum shall be strictly liable, without regard to fault, for all cleanup and removal costs and all direct and indirect damages, no matter by whom sustained, as defined in this section. In addition to cleanup and removal costs and damages, any such person who is notified of such release and who did not undertake relocation of persons residing in the area of the discharge in accordance with paragraph (c) of subdivision seven of section one hundred seventy-six of this article, shall be liable to the fund for an amount equal to two times the actual and necessary expense incurred by the fund for such relocation pursuant to section one hundred seventy-seven-a of this article. 2. The fund shall be strictly liable, without regard to fault, for all cleanup and removal costs and all direct and indirect damages, no matter by whom sustained, including, but not limited to:
New York's Oil Spill Act, Article 12 of the New York Navigation Law, provides a natural and attractive starting point for people seeking to recover cleanup costs for petroleum spills. The Act's imposition of strict liability holds out the promise of avoiding litigation over events and states of mind for which little or contradictory evidence exists, or that may be vulnerable to highly subjective interpretation long after the fact. Under the Oil Spill Act, if someone's actions caused or contributed to a discharge of petroleum, he is liable for its cleanup, without regard to his state of mind or relationship to others at the time. However, the Oil Spill Act's powerful mechanism of strict liability is not available to everyone who may have been forced to pay for a cleanup of an oil spill. For instance, property owners who are unaware that a fuel oil tank on their property is leaking oil are nevertheless at fault for the spill under the Oil Spill Act, and therefore may not seek full recovery of their cleanup costs from others who may bear more responsibility for the leaky tank. For such a property owner, the only available recourse under the Oil Spill Act may be a contribution action, under which the property owner could only recover part of the total cleanup costs.