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Harry Stephens Farms, Inc. v. Wormald Americas

October 24, 2007

HARRY STEPHENS FARMS, INC.; AND HARRY STEPHENS, INDIVIDUALLY AND AS MANAGING PARTNER OF STEPHENS PARTNERSHIP PLAINTIFF
v.
WORMALD AMERICAS, INC., SUCCESSOR TO ANSUL, INC.; AND HELENA CHEMICAL CO., INC. EXXON MOBILE CORPORATION SUCCESSOR TO MOBIL CHEMICAL CO. DEFENDANTS



The opinion of the court was delivered by: James M. Moody United States District Judge

ORDER

Pending is Defendants' joint motion for summary judgment. (Docket # 72). Plaintiffs have responded and Defendants have filed a reply. For the reasons stated below, Defendants' motion is granted.

Facts

Plaintiffs' claims arise from the disposal of various chemicals at a chemical plant commonly known as the Cedar Chemical site located in the Helena-West Helena Industrial Park in Phillips County, Arkansas. Plaintiffs own and cultivate several hundred acres of farmland which borders the industrial park. Plaintiffs allege that Defendants conducted operations at the chemical plant which resulted in soil and water contamination of their property. Defendants argue that Plaintiffs' claims are time barred.

Harry Stephens Farms, Inc. ("Stephens Farms") is an Arkansas corporation incorporated in 1971. Harry G. Stephens III, commonly known as Harry G. Stephens, ("Stephens") owns 78% of Stephens Farms, his sister owns 11% and his two sons each own 5.5%. Stephens has served as the manager and president of Stephens Farms from 1993 through 2006. Stephens Partnership was formed in 1993. The partners of Stephens Partnership are Stephens, Stephens Agco, Inc., and Bypass Agco, Inc. Stephens is and has served as the president of Stephens Agco, Inc. since its incorporation in 1993. Stephens is and has served as the president of Bypass Agco, Inc. since its incorporation in 1993. Stephens is and has served as the only managing partner or chief officer of Stephens Partnership. Stephens was the sole person associated with the Plaintiffs who made the decision to file the present action on behalf of Stephens Farms and Stephens Partnership.

Stephens Farms owns farmland in Phillips County, Arkansas which borders an industrial complex where the former Cedar Chemical Corporation chemical plant ("Cedar Facility") is located ("Farmland"). From 1993 to the present, Stephens Farms has cash-rented its Farmland to Stephens Partnership. The Defendants are alleged to have released contaminants into the ground at the Cedar Facility which ultimately contaminated the water and soil on the Farmland.

On October 19, 1994, Stephens, on behalf of Stephens Farms, signed an Access Agreement ("1994 Access Agreement") with Cedar Chemical Corporation ("CCC"). The purpose of the 1994 Access Agreement was to permit CCC's consultant to "sample, analyze and monitor groundwater" in "areas on [Stephens Farms'] property" in connection with CCC's investigation of the Cedar Facility. Plaintiffs acknowledge that this agreement was signed by Stephens but deny any knowledge of the purpose of the investigation. Plaintiffs affirmatively state that they were never informed of the reason for the investigation and were refused access to any results of the groundwater sampling on their property.

Defendants contend that CCC's investigation of the Farmland was required as part of an agreement it reached with the Arkansas Department of Pollution Control and Ecology (now the Arkansas Department of Environmental Quality ("ADEQ")) to investigate conditions at its Cedar Facility. Plaintiffs' deny this allegation.

Sometime after its October 19, 1994 execution date, either in 1994 or 1995, test wells were placed on the Farmland, pursuant to the 1994 Access Agreement, as well as on adjacent land rented by Stephens Partnership. Defendants contend that Stephens knew that the test wells placed on the Farmland and the adjacent land rented by Stephens Partnership pursuant to the 1994 Access Agreement were placed there so as to test for water and soil contamination. Plaintiffs affirmatively state that they were unaware of the reasons for the placement of the test wells.

Defendants contend that the deposition testimony of Stephens establishes that he became "worried" that the groundwater at the Farmland might be contaminated following his execution of the 1994 Access Agreement. Plaintiffs state that following the 1994 Access Agreement, Stephens became concerned as to why the wells were placed on his property and made every reasonable effort to determine the purpose of the wells. Plaintiffs contend that Shephens was assured that there was nothing to worry about and was repeatedly told that his property was not contaminated. Plaintiffs also contend that Stephens was denied access to test results and only became aware of the contamination when notified by the Arkansas Department of Health in November of 2004.

In July 2001, as part of the investigation of contamination from the Cedar Facility, EnSafe, Inc. ("EnSafe") sampled monitoring and irrigation wells on the Farmland. Defendants allege that during that July 2001 sampling, Stephens talked with an EnSafe employee and expressed his concern that contamination in the groundwater at the Farmland would prevent the use of his irrigation wells before the end of the growing season. When the EnSafe employee told him that the results of the sampling would not be available until after the end of the growing season, Stephens expressed relief at his ability to continue using the wells that year without interference. Plaintiffs deny this allegation and state that Stephens spoke with an Ensafe employee during the 2001 sampling and was told that there was no contamination of his property.

In a September 21, 2001, Groundwater Monitoring Report for the Facility, prepared by EnSafe and submitted to ADEQ, EnSafe reported that 1,2 dichloroethane (also known as "EDC") had been detected again in off-Facility monitoring wells and in irrigation wells on the Farmland. EnSafe further noted in its 2001 Report that the owner (Stephens Farms) of the irrigation well in which EDC had been detected had been contacted. Plaintiffs deny receiving any notification from EnSafe.

On January 9, 2002, Stephens, on behalf of Stephens Farms, signed an Access Agreement ("2002 Access Agreement") with CCC. The purpose of the 2002 Access Agreement was to permit CCC's consultant to "sample, analyze and monitor groundwater" in "areas on [Stephens Farms'] property" in connection with CCC's groundwater investigation of the Cedar Facility. Again, Plaintiffs deny that they had knowledge the sampling was performed in connection with CCC's groundwater investigation of the Cedar Facility. Plaintiffs state that they were never given a reason for the groundwater sampling and were intentionally mislead as to the reasons for the sampling.

Defendants claim that CCC's investigation of the Farmland was required as part of an agreement it reached with ADEQ to investigate conditions at its Cedar Facility and that Stephens understood in 2002 that samples were wanted from the test wells or holes that were already out on the Farmland and adjacent land Stephens Partnership rented because ...


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