Environmental Law: Matter of Veltri v. New York State Office of State Comptroller

Appellate Division, Third Department

Environmental Law

Strict Liability — Discharges — Underground Tanks

Matter of Veltri v. New York State Office of State Comptroller
2011 N.Y. Slip Op. 00761
Article 78 Proceeding; Supreme Court, Albany County

Background: A landowner brought an article 78 proceeding, seeking to annul a determination of the New York State Environmental Protection and Spill Compensation Fund denying landowner’s application for damage compensation. Supreme court dismissed and this appeal followed.
The petitioner owns real property in the City of Rochester, Monroe County, which he purchased from A.R. Gundry in 1989. In 1987 and 1988, Leaseway Transportation Inc., which was leasing the property from Gundry and operating it as a trucking terminal, reported spills on the property to the Department of Environmental Conservation. Following several excavations and the removal of contaminated soil and multiple underground storage tanks, DEC issued a letter to Leaseway in September 1988 stating that its inspection of the area where the soil and USTs had been removed “reasonably suggest[ed] that the site is now free of the effects of underground fuel leakage,” but cautioned that “[t]his does not preclude the migration of contaminants off property or to other sections of the property.”
That same month, the petitioner entered into a purchase and sale agreement with Gundry that required Gundry to remove all USTs from the property, with the exception of one 1,000-gallon heating oil UST, as well as any petroleum contaminated soil in the area of the USTs.

Ruling: The court affirms holding that there was a rational basis in the record for a determination that a landowner owned an orphan underground storage tank from which a petroleum discharge occurred, and thus, the landowner was strictly liable as the owner of the system at the time of discovery of the discharge, regardless of fault or knowledge. The court reasoned that the landowner purchased the property in “as is” condition and failed to submit any proof that the transfer of the land did not include fixtures, and the record was otherwise devoid of any evidence that, as the title owner of the real estate, the landowner was not the owner of the orphan tank.

Amy L. Reichart of Knauf Shaw LLP for the appellant; Eric T. Schneiderman, attorney general, for the respondents