Acme Laundry Co., Inc. v. Secretary of Environmental Affairs

Brief Fact Summary. A corporation owned contaminated land, and the government placed a lien on the property.

Synopsis of Rule of Law. The government may place a lien on property which is contaminated to ensure a prompt and efficient clean up.

Facts. Acme Laundry Company, Inc. (Acme I) acquired a parcel of land and operated a laundry business. Acme I adopted a liquidation plan and conveyed twelve parcels of land to Acme Laundry Company (Acme II), which succeeded to the rights of Acme I. Prospective purchasers of the laundry site had environmental engineers examine it. And contamination was found. The Department of Environmental Quality Engineering sent a letter to Acme II stating that the company was liable for contamination and would be responsible for all costs associated with it. The Department warned that the liability was a debt and created a lien on all of Acme II’s property. Acme II stated that they would take necessary action. Acme III was then incorporated, and Acme II conveyed the contaminated property to Acme III. A lien was placed on the property owned by Acme III. Acme II and III filed an action requesting a declaration that the lien is invalid. They claim that the Department could not place a lien on their pr
operty because the Department had incurred no costs for the assessment, containment, and removal of hazardous materials, under the Massachusetts Oil and Hazardous Material Release Prevention Act.

Issue. Can a state place a lien on property, which is an environmental hazard?

Held. Yes.
The costs of an environmental cleanup are to be borne by those responsible for the release because they own or owned the land or because they caused the spill. The lien is a tool to aid the state in ensuring that cleanup is prompt and efficient.
Liability is created when the state engages in information gathering activities. If the Department incurs costs for these activities, then it has the authority and discretion to place a lien on all property of a responsible person. Once the state has incurred assessment costs, it may place a lien securing both the costs already incurred and those costs which will be incurred and become due in the course of ongoing monitoring and supervision of the contaminated site. Here, the lien has functioned effectively to secure the state’s recovery of its costs without interfering with the ability of the company to finance cleanup operations.

Dissent. The imposition of a lien on all of the property impairs the company’s capacity to complete the cleanup they agreed to undertake. It is not to be expected that an informed owners of a contaminated site would agree to undertake a cleanup project at his expense when he will also be liable for monitoring costs incurred.

Discussion. Land use regulations are imposed by environmental protection laws. Environmental regulations can restrict the buying and selling of real estate because of the government’s ability to place on lien on property involved in environmental h