Howard Davis P.C.

Case Studies

GASOLINE STATION CASE STUDY

Gas stations, from the small “mom and pop” shop to the large franchise, are subject to numerous environmental requirements. In addition to running a profitable business in a volatile market, today’s gas station owners and operators must take precautions to ensure that gasoline storage tanks are tight, that leaks are not occurring, and that spills and pollution do not occur. Despite taking all of the necessary precautions, leaks are detected, hazardous substance spills happen, or historical environmental contamination is discovered. Common environmental contamination sources include unknown underground storage tanks used by a prior owner, existing tanks with a faulty leak-detection system, corroded hazardous substance storage tanks, accidental overfills and spills, or negligent repairs. Gas stations with automotive repair shops may have contamination related to cleaning products such as perc, naptha/mineral spirits, or turpentine.

Environmental contamination can spread across soils and into groundwater, causing potential air contamination inside nearby buildings (known as a “vapor intrusion”). Vapor intrusion issues are of great concern to the New Jersey Department of Environmental Protection due to the potential human health risks involved and, depending on the level of contamination, urgent action may be necessary to remediate the contamination and comply with the applicable environmental laws. Our firm’s environmental lawyers assist clients by navigating the complex and overlapping environmental laws and finding effective solutions to help maintain and/or achieve compliance with these laws.

Environmental investigation and remediation costs can be significant, particularly if groundwater has been contaminated. This means that disputes often arise following the discovery of contamination about who caused the contamination, when the contamination started, where the contamination migrated and who should be responsible to investigate, cleanup or pay for contamination. As environmental lawyers, we assist clients seeking cost recovery from potential liable parties.

Determining the source and the timing of the discharge often depends on scientific forensic analysis. Thus, we often work with environmental scientists including geologists, hydrogeologists, forensic chemists, and metallurgists, as well as other experts, to develop the evidence necessary to defend or prosecute legal positions. 

In certain instances, discharges of hazardous substances alleged to have occurred from a client’s property comingles with other contamination or enters into a plume of existing groundwater contamination. In these instances, we work with an array of experts to attempt to differentiate contamination in order to refute the proposition that the pollution at issue could have been emitted from the site of our clients’ operations. 

We also use expert evidence to support conclusions as to the timing of contaminated discharges, and their occurrence during applicable insured periods. In these efforts, and in the face of competing expert evidence, we undertake the most searching and delicate documentary analyses.

Depending on the situation, funding to investigate and remediate environmental contamination may exist. As environmental lawyers, we help clients locate sources of funding to address environmental contamination, including insurance and State loans and grants.

In one recent gas station case, we negotiated with the historic insurers, who agreed to pay 75% of the environmental costs. In another case, we obtained 100% of the environmental costs from a State grant. Obtaining funding of this sort requires diligence and a thorough understanding of insurance recovery methods and grant application process. We have assisted many clients through this process and are adept at negotiating the procedures.

For those interested in purchasing a gas station or former gas station, it is important to recognize the magnitude of proper due diligence. Hasty transactions with poor due diligence can lead to the post-sale discovery of contamination and unplanned legal and financial obligations.