The developer of a proposed low-level radioactive waste dump near Needles has won the right to sue the State of California for damages.
The Fourth District Court of Appeal ruled against U.S. Ecology Inc.'s request that the court order the state to permit construction of the facility — a decision that suggests the project remains dead. But the court did find that there was a basis for U.S. Ecology to seek compensation for damages because it spent millions of dollars based on promises made by the state. The court sent the case back to San Diego County Superior Court for further proceedings.
The history of the Ward Valley site as a potential radioactive waste receptacle reaches back to the early 1980s, when Congress ordered the states to find regional solutions for disposing of the material. In California, the Department of Health Services (DHS) prepared a low-level radioactive waste (LLRW) management plan and, under direction from the Legislature, began pursuing creation of a dump.
In 1985, DHS selected U.S. Ecology as the license-designee to develop a radioactive waste dump. After extensive study, U.S. Ecology in 1988 settled on 1.7-square-miles of federally owned land in the Ward Valley about 15 miles west of Needles. U.S. Ecology continued to collect detailed environmental information about the site while the State Lands Commission moved to acquire the land. In 1989, U.S. Ecology submitted a 7,000-page project application to DHS. Two years later, DHS and the federal Bureau of Land Management issued a joint environmental impact report/environmental impact statement that said the dump would pose no significant adverse impacts. The state then issued a draft license to U.S. Ecology.
However, the State Lands Commission withdrew its application to acquire the site at the urging of Gray Davis, who at the time was state controller and a member of the commission. The Wilson administration then pursued the land through different means but could not complete a deal before the Clinton administration arrived in Washington. Clinton Interior Secretary Bruce Babbitt blocked the land transfer.
After assuming the governor's office in 1999, Davis appointed an advisory group to propose solutions for disposing of low-level radioactive waste and to find alternatives to the Ward Valley dump. Since then, Davis has made clear his opposition to the Ward Valley project and DHS has reassigned program personnel.
U.S. Ecology sued, claiming it completed its duties as both license-designee and licensee. The company said it incurred more than $162 million in development costs. In its lawsuit, U.S. Ecology alleged breach of contract, breach of implied contract and promissory estoppel. The company also asked the court to mandate that the state allow development of the dump.
San Diego County Superior Court Judge S. Charles Wickersham sustained the state's demurrer. On appeal, a unanimous three-judge panel of the Fourth District, Division One, upheld all of the ruling except the portion regarding promissory estoppel.
Citing Kajima/Ray Wilson v. Los Angeles County Metropolitan Transportation Authority, (2000) 23 Cal.4th 305, the court explained, "‘Promissory estoppel was developed to do rough justice when a party lacking contractual protection relied on another's promise to its detriment.'"
The court found that U.S. Ecology's allegations "fit within the classic model of a promissory estoppel claim." The company argued that DHS promised in a memorandum of understanding to use its best efforts to acquire property from the federal government, that DHS should have expected its promise to induce action by U.S. Ecology, that the company spent millions of dollars on the project, and that DHS abandoned the project without justification.
The state argued that DHS lacked statutory authority to make such promises, that enforcement of any promises would be contrary to public policy, and that DHS in fact fully met its commitments. The court rejected all three state arguments.
The court found, based on the unique nature of the relationship between DHS and the license-designee, that the Legislature did intend for DHS to make binding promises to U.S. Ecology. "The express statutory objective of the ‘expeditious establishment and operation by the private sector of a LLWR disposal facility' would be undermined if the agency charged with the responsibility for meeting this goal did not have the power to promise to use its best efforts to comply with its own obligations, particularly the obligation to acquire suitable property for the site," Justice Judith Haller wrote for the court.
The court ruled that the alleged violation of public policy was an open question, and that U.S. Ecology made an adequate argument that DHS broke the memorandum of understanding. The company "will still be required to prove its claims, and we offer no opinion as to the likelihood that [it] will do so," the court added.
In another important part of the case, the court held that a writ of mandate sought by U.S. Ecology was inappropriate because the state is not required by law to purchase the site or use the dump. "Mandamus cannot be used to compel the exercise of discretion in a particular manner or to order a specific result when the underlying decision is purely discretionary," Haller wrote.
The Case:
U.S. Ecology v. State of California, No. D036933, 01 C.D.O.S. 7886, 2001 DJDAR 9703. Filed September 5, 2001.
The Lawyers:
For U.S. Ecology: Karl Lytz, Latham & Watkins, (415) 391-0600.
For the state: Paul Reynaga, deputy attorney general, (916) 327-7854.
An environmental impact report for a proposed Oakland International Airport expansion has been found flawed on numerous grounds by the First District Court of Appeal. The court held that the Port of Oakland, which operates the airport, relied on outdated air pollution information, did not support its decision not to study health risks related to that air pollution, and failed to analyze adequately nighttime noise impacts.
In a 2-1 ruling, a Ninth U.S. Circuit Court of Appeals panel has ruled that federal agencies have the authority under the Clean Water Act to regulate "deep ripping" of wetlands by farmers.
A general plan requirement that placed a one-mile buffer on private land around a landfill in Placer County was supported by evidence in the record even though there appeared to be no scientific basis for it, the Third District Court of Appeal has ruled.
An appellate court has ordered the City of Concord's Rent Review Board to reconsider a request for rent increases filed by the owner of two mobile home parks.
A city resolution restricting parking on certain residential streets to residents with parking permits was categorically exempt from environmental review, the Second District Court of Appeal has ruled.
An exemption to the California Environmental Quality Act for construction of a sea wall below two houses has been upheld by the Fourth District Court of Appeal. The court ruled that the potential collapse of a bluff could threaten public safety and qualified for an emergency exemption under CEQA.
In a case that touched on redevelopment law, the California Environmental Quality Act and general plan compatibility, an appellate court has upheld San Francisco's handling of a project on the site of the historic Emporium department store.
The City of Los Angeles was correct to treat as one project a builder's various proposals for 21 new houses on existing parcels on two streets, the Second District Court of Appeal has ruled. The court rejected the builder's contention that the city could not demand an environmental impact report on the 21 houses, five of which have already been built.
Opponents of a proposed recycling center were too late in filing a lawsuit regarding a city's failure to prepare an environmental study on the city's sale of land to the recycling company, the Fourth District Court of Appeal has ruled.
The owner of appropriative water rights to a creek cannot exercise those rights in violation of state regulations intended to protect fish and wildlife, the Third District Court of Appeal has decided.
When a public agency acquires a property via eminent domain, only a trial court judge -- and not a jury -- can decide whether a business should receive compensation for loss of goodwill, a state appellate court has ruled.
The California Coastal Commission's decision to allow Malibu property owners who are building new houses to exchange existing public view corridors on their property for dedication of an off-site public access to the beach has been upheld by the Second District Court of Appeal.