LSI 2010 NRD Santa Fe final conference binder 072110.pdf

Allan Kanner of Kanner & Whiteley, L.L.C. Speaker 23: 35
unjust enrichment. 134
c. Costs
Another important measure of damages is the assessment and other transaction costs.
These damages include all costs, expenses and fees incurred by the state, including due diligence
and pre-litigation costs and attorney fees, in recovering the foregoing. Also included is the time
value of money. 135
Compensation for transaction costs means full restoration. It is important to
note that costs are not necessarily available under non-CERCLA state law theories unless equity
is involved.
2. Valuation
There are numerous approaches to determining value for NRD. One example is the
valuation approach of the DOI. 136
While it seeks restoration as its goal, the DOI program
sometimes works in the opposite direction, i.e. when a defendant is permitted to purchase a
cheaper replacement rather than restore the natural resource. Like many tort cases, it places an
emphasis on assessing damage in a monetary framework, as opposed to restoration, as the means
134 See Allan Kanner, Unjust Enrichment in Environmental Litigation, 20 J. ENVTL. L. & LITIG. Error! Main
Document Only. p. 111 (Spring, 2005).
135 See Natural Resource Damage Assessments, 43 C.F.R. Parts 11.84 (2001). Section 107 (a)(4)(c) provides that
responsible parties may be held liable for “damages for injury to, destruction of, or loss of natural resources,
including the reasonable costs of assessing such injury, destruction, or loss resulting from such a release.” However,
under section 107(f), a trustee may not recover for natural resource loses occurring before the date of CERCLA’s
enactment (December 11, 1980), or for losses identified in an environmental impact assessment, which are deemed
to be authorized by permit or license. Likewise, under section 107(c), the trustee may not recover in excess of $50
million unless a showing is made that the release resulted from willful misconduct or willful negligence, or from a
violation of federal safety or operating standards.
136 Under the DOI rules, the measure of damages “is the cost of restoration or replacement of the damaged resource.
Additionally, compensable value, the value of the lost services of the resource during the time period from the injury
until the baseline conditions have been reattained, is available for recovery at the discretion of the trustee. The
trustee can chose between several valuation methods for estimating compensable value, including market valuation,
appraisal, factor income, travel cost, hedonic pricing, unit value, contingent valuation, or other suitable valuation
methods. The use of contingent valuation for measuring option and existence value is available only when the
trustee determines there are no relevant use values.” James Peck, Measuring Justice for Nature: Issues in
Evaluating and Litigating Natural Resource Damages, 14 J. LAND USE & ENVTL. L. 275, 302 (1999).
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Law Seminars International | Natural Resource Damages | 07/16/10 in Santa Fe, NM