Tire manufacturer sued for $1-million fuel spill

 

A Fast Fuel Services Ltd. tractor-trailer was involved in a serious accident on Highway 16 near Port Clements in the Queen Charlotte Islands in November 2000. A considerable part of the truck's load of fuel oil, owned by Imperial Oil, spilled. In addition to damage to the vehicle and loss of the cargo, the cleanup of spilled fuel oil cost about $1.5 million dollars. So far, Imperial Oil has recovered $1 million from ICBC, the insurer of the vehicle.

ICBC and Imperial Oil allege that the accident occurred because of a failure of one of the truck's Michelin tires, so they commenced a subrogation action against Michelin. You can read the latest court ruling on this case at

http://www.courts.gov.bc.ca/jdb-txt/sc/07/17/2007bcsc1713.htm.

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$972,000 settlement for gas station leak ends 14-year legal battle

 

Environmental claims are notoriously difficult to resolve and very costly. Environmental regulations mean that it is difficult or impossible to secure effective release of liability upon resolution of a lawsuit. Our insurers have just settled a loss 14 years after the claim was first presented to our client, a well established underground tank installer. In 1992, our client installed a new underground tank, complete with new pumps and underground connections, at a Thunder Bay, Ontario service station. Soon after completion of the work, a leak was discovered in the supply line between the tank and the pump. Gasoline was found to have escaped from the line and contaminated the surrounding soil, which was cleaned up promptly for about $175,000. The work was completed in the summer of 1993.

Regulators would not provide the owner of the site with a completion certificate and indeed demanded ongoing sub-surface monitoring, so the file remained open to satisfy annual monitoring expenses.

In the mid-90's, the service station changed hands. The ongoing monitoring and the absence of a completion certificate made the purchase negotiations very difficult.

In 2004, additional contamination was discovered, and it appeared likely that although the original remediation was approved by all parties, including the regulators, the plan had not been completely successful.

Unlike other sorts of liability claims, environmental laws have no statutory prescription period, so the claim file was reactivated 14 years later.

After negotiation, a further $600,000 was paid toward the latest remediation. With legal expenses, the total cost of this claim was $972,000, almost the full policy amount.

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$220-million settlement for Athabasca Oil Sands fire

 

Eight days after production began at the massive Muskeg River Mine in January 2003, production was interrupted by a series of fires and explosions. Production was halted for a further three months.

The $220-million business interruption settlement was less than half of the original claim for $500 million. Settled separately for an undisclosed sum, the repair costs were said to have been elevated by the cost of shipping custom-made parts to the remote site.

News Boardusually reports only on liability losses but this settlement, which is likely the largest business interruption loss ever in Canada, was too big to ignore.

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Inco to pay $10-million for gas leak

 

Inco Ltd. has agreed to pay about $10 million to compensate Sudbury residents for a massive poison gas leak from its Copper Cliff acid plant in November 1995.

The payments to as many as 10,000 people affected by the leak include amounts for physical or psychological injuries, property damage, out-of-pocket expenses and loss of income. The original claim for $200 million shrank drastically during 18 months of negotiation, giving way to a process that will likely pay out about $10 million.

Inco had previously settled with 24 individuals, but they will also get any advantages of the class action settlement.

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$14.5-million settlement for waste incinerator blast

 

Bovar Inc. of Calgary, Alberta and its property insurers have agreed to a $14.5-million settlement after a massive explosion in the main incinerator at Bovar's hazardous waste treatment plant in Swan Hills, Alberta.

A tank-trailer full of benzene-laced sludge was waiting to discharge its cargo in July 1997. It sat too long in the hot sun, over-heating the contents. When the tank was opened for discharge, a blast of benzene vapour hissed through the pipes. The vapour mixed with outside air to create a volatile combination that, at first, snuffed out the burners. When staff re-ignited the burners, they triggered a massive explosion that blew apart inch-thick metal valves and threw a giant elbow pipe over the plant tower to land almost 100 metres away.

The explosion shut down the plant until January 1999. Bovar sued its insurer for $30.9 million in damages, but the parties agreed to settle the dispute privately for $14.5 million in April 1999.

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$53-million tab to fix mine spill in Spain

 

Boliden Ltd. of Toronto has allocated Cdn$53 million to the cost of repair and cleanup caused by the failure of a tailings dam at their Los Frailes zinc mine in Spain.

The April 1998 dam failure was one of Spain's worst environmental disasters. About four million cubic metres of acidic water and 1.1 million cubic metres of tailings discharged into the nearby Rio Agrio. The toxic sludge poured over farmland and narrowly missed contaminating a nearby national park.

A company spokesman said responsibility for cleaning up the spill has been divided between the company and Spanish government authorities.

Boliden acquired the mine site, including the dam, from Spanish owners in 1987. Operations at the mine were halted for over a year following the tailings dam failure

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Tanker implodes — $50,000 repair bill

 

A stainless steel tank trailer valued at $75,000 was severely damaged in a freak accident in March 1995. A waste transfer station, which separates and treats oily water, was pumping out the liquid contents of the tank trailer. The driver left the site to get a cup of coffee. While the rig was unattended, the vent on the top of the trailer was blown shut, probably by high winds.

Once the vent was closed, the pump created a powerful vacuum, which literally crushed the tank. The rig operator sued the transfer station for the damage to the trailer. Although the trailer was valued at nearly $75,000, the owner agreed to settle for repairs costing $38,500 plus expenses of $8,168.

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$2.5-million fire at Mississauga recycling depot

 

A June 1995 fire destroyed a Mississauga, Ontario plastic recycling plant and its contents. The fire marshal estimated the damage at $2.5 million.

The sprinkler system had been disabled in violation of the fire protection warranty in the fire insurance policy, so the insurer denied the policyholder's claim. Because of the provisions of the mortgage clause, the insurer was unable to enforce the breach of the warranty against the mortgagee, and the insurer paid about $800,000 to satisfy the mortgagee's claim.

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Waste industry vulnerable to large property and casualty losses

 

The recycling and waste management industry attracts a lot of attention in the news media with stories of spectacular fires and spills of toxic waste that threaten the health of nearby communities.

Although the waste management has an elevated environmental risk, the following cases indicate that this industry is also vulnerable to higher-than-average property and general liability losses.

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Other environmental claims

 

• The Vancouver Sun reported that an August 1989 spill of liquid fungicide into the Fraser River caused the cancellation of the fishery at the annual sockeye salmon run.
  
   
• In April of 1993, local fisherman accepted a $1.5 million out-of-court settlement as a result of economic losses. The settlement included about $670,000 in plaintiffs' legal costs. Several defendants contributed to the settlement and incurred significant defence expenses, probably equal to the plaintiffs' costs.
  
   
• The MOE identified a spill of heavy oil into a river as having come from our client's sewer. The client was ordered to clean up the spill at a cost of about $175,000.
  
   
• We determined that the spill was caused by a negligent third party and subrogated for a recovery. Even though the case appeared to be open and shut, the recovery took almost three years and $40,000 in legal expenses.
  
   
• About 600 litres of hydraulic oil escaped from mobile equipment at a construction project over the weekend. The oil was absorbed into the sandy soil and leached into a creek. The MOE ordered a cleanup at a cost of $35,000.
  
   
• A fire in a warehouse spread to a depot containing materials to be recycled. The recyclables were badly damaged by the fire and their contents, a hazardous material, were washed off-premises by the fire fighters water. Total cost of cleanup was about $400,000.
  
   
• Mercury used in an industrial application was flushed into the sewer inadvertently. The sump trap failed to prevent the escape of the material into the local municipality's sewage treatment plant.
  
   
• The MOE ruled that the solid sewage waste, a sludge that was normally trucked to the town dump, now contained hazardous levels of mercury that required it to be shipped to a hazardous waste landfill out of the province. Additional disposal costs and down-time cost about $90,000.

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Dishwashing liquid cleans up highway mess

 

They shovelled. They scrubbed. They used sand and delivered blasts from high-pressure water hoses. They even tried solvents. But it wasn't until highway crews used Dawn dishwashing liquid that they were able to remove a 25,300-litre spill of animal fat that had kept a stretch of interstate highway near Cincinnati, Ohio closed for 3 1/2 days in May 1998.

Proctor & Gamble Co., a local employer and maker of Dawn, donated 3.2 tonnes of the dishwashing liquid--worth US$12,000 at retail prices--to clean up the five-acre mess.

The spill happened when a tanker truck overturned during morning rush hour traffic at a busy highway intersection. The cargo of animal fat, bound for a plant where it was to be included in fabric softeners, spilled from the heated tanker. It flowed into the highway's grooves and pores, then cooled and congealed.

"We're delighted it worked," a P&G spokesman said. "This is, by far, the most extreme case of grease we've ever dealt with."

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Spill of heat transfer fluid costs $65,000

 

In 1997, we settled a pollution loss arising from the loss of heat transfer fluid used in our client's paint line heat recovery system. The equipment was located on the plant roof.

An employee left an inspection plate off, allowing the escape of about 106 litres of the liquid. About 68 litres were recaptured on the roof and elsewhere on the insured's premises, but about 38 litres leaked into an adjacent creek.

Our client acted quickly to report and clean up the spill. Nonetheless, the spill resulted in a $62,000 recovery and cleanup expense. Without our client's quick action, a larger quantity of fluid might have been lost, resulting in a much more serious loss.

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Saint-Basile-le-Grand's PCBs Alberta-bound — 10 years later

 

In 1998, the town of Sainte-Basile-le-Grand, Quebec finally said au revoir to its PCB waste, which had been stored at the site since a fire in a PCB warehouse almost 10 years before. The huge fire forced 3,500 people to be evacuated from their homes, and the resulting mess was described as Canada's most contaminated site.

Trucks took containers full of material laced with polychlorinated biphenyls to Swan Hills, Alberta, where the contaminants were incinerated.

The Quebec government spent $90 million cleaning up the site but wasn't permitted to dispose of the waste either by incinerating it on-site or by transporting it away.

An attempt to ship the waste to the U.K. was stopped by environmental protesters. Alberta's hazardous waste site at Swan Hills agreed to accept the waste but Ontario wouldn't permit the PCBs to be transported across its roads until 1998. Some less hazardous material was incinerated in Quebec.

The Quebec government won a $36-million judgment against the owner of the site back in 1995. He now lives in Florida, so Quebec hasn't been able to enforce the judgment.

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$1.4-million award for Houston carpet retailer

 

A 47-year-old man who was operating a power lift for a carpet display device at a Houston, Texas carpet retailer was seriously injured when the cable supporting the carpet failed, causing the carpet and a supporting arm to fall on him in March 2001.

He sued his employer, the carpet store, together with the Ontario manufacturer of the carpet-lifting device and the cable supplier.

The action against the employer could not proceed because the plaintiff had accepted Texas workers' compensation benefits, but the action against the other two parties was not so barred.

The cable manufacturers secured a release for $10,000, but the case against the device manufacturer was settled at mediation in November 2003 for US$850,000. With defence fees, this settlement will cost about Cdn$1.4 million.

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U.S. EPA reaches into Canada for Columbia River cleanup

 

The U.S. Federal Environmental Protection Agency (EPA) wants a Canadian mining company to pay for environmental studies to examine health risks from pollution dumped in the Columbia River, which runs from British Columbia into Washington State.

The EPA wants the firm to pay for extensive studies into ecological and human health effects of pollution migrating down the Columbia River and to reimburse the EPA for about US$1.8 million already spent on preliminary studies.

Mining company Teck Cominco has operated a huge smelter in Trail, B.C. for more than a century. If the environmental studies suggest that Teck is responsible for the health hazards, the cost of damages and cleanup expenses could be massive.

Washington-based environmental groups want the EPA to designate sections of the Columbia River as a "superfund" site. Such a designation permits the EPA to commence cleanup of the river and recover expenses from any "potentially responsible party," regardless of fault.

At issue is whether the U.S. environmental regulators can reach into Canada to force U.S. law on the company over river pollution downstream from one of its smelters.

Teck argues that the smelter in Trail, about 16 kilometres from the U.S. border, is not subject to U.S. law and that the EPA should examine other U.S. sources of pollution. In a letter from the Canadian ambassador to the U.S. State Department, the Canadian government has also expressed its opposition to the application of U.S. domestic laws on a company operating legally within Canada.

A Teck proposal to pay $13 million for a human health and ecological impact study was rejected by the EPA as not up to U.S. standards.

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$3.2-million settlement for tainted water

 

Seven hundred people who became ill because of a parasite in their drinking water in the spring of 2001 will share in a $3.2-million settlement. The City of North Battleford and the Government of Saskatchewan announced the deal in August 2003. Negotiations continue toward settlement with another group of about 100 residents.

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Supreme Court rules polluters must pay

 

The Supreme Court of Canada (SCC) has ruled that Quebec's minister of the environment has the power to order Imperial Oil to pay for the cleanup of a fuel depot it owned for more than 50 years in Levis, Quebec&emdash;years after the land had been sold and later flipped to developers.

The unanimous verdict of the SCC's nine judges strongly backs the "polluter-pays" principle found in almost every environmental law across Canada.

Environmentalists hailed the ruling as a huge victory. "The Quebec legislation reflects the growing concern on the part of legislatures and society about the safeguarding of the environment... and the living species inhabiting it," wrote Justice Louis LeBel.

The court found that the Quebec law and others like it signal an emerging sense "of an environmental debt to humanity and to the world of tomorrow" and give ministers broad powers to act in the public interest. The ruling has implications across Canada, according to environmental advocates.

"This decision gives the clear message that ministers of the environment have all the tools they need to aggressively proceed with cleanup orders for some 30,000 contaminated sites in Canada," said Beatrice Olivastri of Friends of the Earth Canada, which intervened in the appeal through the Sierra Legal Defence Fund.

"This is a ringing endorsement of the polluter-pays principle," said Sierra Legal Defence Fund managing lawyer Jerry DeMarco. "This is for years to come going to be considered the leading case on pollution law in Canada."

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Appeal court rules that pollution exclusion doesn’t apply to furnace fumes

 

The Ontario Court of Appeal has ruled in favour of an apartment owner in a case that has important implications for commercial GL policyholders. Tenants in the apartment building commenced a class action suit for injuries that they alleged were sustained due to carbon monoxide poisoning as a result of a defective furnace.

The GL insurer of the apartment owner declined to defend the loss, citing the terms of a standard environmental exclusion, and sought a declaratory judgment that it was not obliged to provide a defence or indemnity to the policyholder.

The trial court heard the case in December 2001. The trial court agreed with the policyholder’s argument that since the carbon monoxide remained within the premises, it could not be said that it had escaped, and thus the GL environmental exclusion was not triggered.

In September 2002, the case was brought before the Appeal Court of Ontario, which upheld the trial court verdict. The appeal court found few relevant Canadian precedents and relied instead on U.S. jurisprudence.

This important ruling from an influential court reduces the effectiveness of the standard environmental exclusion and will be seen by insurers as adverse to their interest. This case will probably be appealed to the Supreme Court of Canada. The verdict will likely prompt amendments to the standard environmental exclusion and accelerate the introduction of mould and asbestos exclusions into Canadian GL policies.

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Bacardi wins $4.8-million product recall case

 

A British company that makes gas for the soft drink industry must pay the makers of the market-leading cooler "Breezer" £2.125 million (Cdn$4.8 million) in damages following a contamination scare.

Bacardi Martini and other beverage-makers were forced to recall hundreds of thousands of bottles in 1998. The beverages were found to be contaminated with benzene, although the levels were too low to pose a risk to health.

The action by Bacardi Martini is the first of several similar actions that are expected to reach the courts soon. The contamination was traced back to carbon dioxide supplied by Terra Nitrogen of Bristol, which must pay the entire cost of the product recall. The ruling also exonerated other suppliers and bottlers in the supply chain from liability.

The July 2001 ruling in the U.K.'s Commercial Court is being hailed as a landmark in product liability law. When claims from the other beverage-makers are settled, the claim's total cost will be considerably higher.

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Baby swallows lamp oil, Texas family wins US$1.5-million settlement

 

A Texas family has secured a US$1.5 million (Cdn$2.34 million) settlement for injuries sustained by their infant son who ingested highly toxic lamp oil. The eleven-month-old boy was rushed to hospital in serious condition and remained in hospital care for more than two months. The family accumulated US$450,000 in medical bills. Medical specialists expect that the baby will suffer a 40% reduction in lung capacity. The container of lamp oil was packaged with a decorative oil lamp, a gift from a relative of the family. The container was clearly marked "keep out of reach of children" and was protected with a child-resistant cap. The family sued the US distributor of the lamp sets as well as the Canadian manufacturer. The Canadian suppliers of the plastic bottle and child-resistant cap were also named in the suit.

It seemed unlikely that an eleven-month old baby could have manipulated the child-resistant cap, but plaintiffs counsel argued that the clear plastic bottle displayed its brightly coloured contents in a way that would have been naturally attractive to a youngster. They also suggested that the contents might have weakened the child-resistant cap.

The defendants elected to settle with the family to avoid the expenses of a trial. The US distributor paid a third and the Canadian defendants paid two-thirds of the settlement. With defence expenses, this settlement will cost the defendants well over Cdn$3 million.

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$4-million settlement for 1994 recycling plant fire

 

Several Quebec property insurers have settled a lawsuit arising from a huge warehouse fire in Saint-Bruno, Quebec. The cost of the settlement, including defence expenses, will exceed $4 million.

An agricultural co-operative owned the warehouse and leased it to a company that collected waste newsprint for recyclers. The newsprint was baled and stacked until shipment. An adjacent building was occupied as a cold-storage warehouse.

In June 1994, the building owner agreed to install a steel guard rail inside the building to reduce damage from the operation of the recycler's fork-lift trucks. Rather than purchase a prefabricated unit, the building owner permitted two employees to install a guard rail from stock steel.

The work required the use of welding equipment, although neither employee was a licensed welder. They had little training and took insufficient provisions to watch for or prevent a fire. Sparks from their welding torch ignited a fire in a nearby bale of newsprint. Because of construction deficiencies, the fire quickly spread past the firewall to the adjacent property.

The local fire department could do little to control the fire, which caused extensive damage to the structures and contents. The cold-storage warehouse contained frozen blueberries worth about $2 million, from which no salvage was secured. Property insurers for the tenants and nearby businesses commenced legal actions to recover almost $7 million in losses.

In January 2000, shortly before the trial date, the main parties to the lawsuits agreed to settle by compromise for about $3.4 million. With legal expenses, the cost of this claim will likely be more than $4 million.

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Waste plant fire results in $3.9-million class action settlement

 

A class action lawsuit arising from a fire at a Hamilton, Ontario recycling plant has been settled for $3.9 million. The plaintiffs alleged that people living nearby were exposed to toxic smoke when the Plastimet recycling plant was destroyed by fire in July 1997.

Defendants in the suit included the Province of Ontario, the former Region of Hamilton-Wentworth, the former City of Hamilton, landowner Frank Levy, Plastimet, Plastimet's owner Jack Lieberman and various tenants and former tenants of the Wellington Street North plant.

Superior Court Justice David Crane approved the settlement in May 2001, following several months of negotiation among the parties involved. The 9,400 individual claims were capped at $200 per person. The settlement also provides a contingency fund for individuals with extraordinary claims and sets aside money for business losses, according to the June edition of Swiss Re Review.

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Auto parts maker must pay $81-million for fiery van crash in Texas

 

Insurers for a one-time Ontario manufacturer of automotive wheels and tires have reached a US$55-million settlement arising ftom a fiery crash that killed nine people in Duvall County,Texas.

In August 1998, a van crossed the median and collided head-on with another van. Both vehicles burst into flames. The driver of the at-fault vehicle and eight occupants of the other vehicle, which was travelling from a church service, were killed. Occupants of a third van witnessed the fiery death of their family members and friends.

Following the accident, more than 16 actions for wrongful death and derivative actions were initiated. The driver carried only minimal limits, so plaintiffs' counsel sued many defendants, including the wheel manufacturer who is alleged to have supplied the tires. The lawsuits allege that the left front tire blew, causing the crash. The fire left little tangible evidence to explain the cause of the accident, but one eye-witness said he thought he saw a puff of smoke from a tire just before the van crossed the median.

The manufacturer carried a $30- million general liability policy with Commonwealth Insurance Company of Vancouver. A currency provision in the policy expressed the limit in U.S. dollars for losses arising from U.S. operations. The company also carried $25-million umbrella coverage in excess of the primary general liability policy.

To avoid a trial in Texas, the carriers elected to settle with the plaintiffs for US$55 million (Cdn$8 1.5 million) plus their defence expenses.

Clif Moore, Senior Vice President with Commonwealth Insurance Company, said, "This is the largest product liability loss we have ever been involved with."

The Ontario-based manufacturer moved to the U.S. some time before the accident occurred.

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Fire at recycling depot

 

A March 1996 fire at a Calgary, Alberta recycling depot occurred because plastic bags containing flammable material were stored too close to an overhead heater. The company, which recycled used automotive and industrial oil filters, operated in rented premises.

The principal claim was for damage to the wall and roof of the rented premises. It was settled for $50,831 and $2,485 in expenses under the Tenants Legal Liability section of the COL policy.

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Leaking service station cost contractor $142,000

 

In the fall of 1990, our client contracted with a Thunder Bay, Ontario service station to install new gasoline pumps and underground tanks. The tanks were installed and pressure-tested, hut a December 1990 service call revealed that one tank was empty.

The contractor's investigation revealed a cracked fibreglass pipe, which was probably damaged as a result of excessive compacting of fill material.

The gas bar operator did not do daily inventory testing. As a result, discovery of the loss was delayed and quantum was aggravated. The repair was relatively minor, but the claim was exaggerated by the loss of approximately 35,000 litres of fuel, clean-up costs and several years of monitoring and vapour extraction expenses. The claim was finally settled for $127,552, plus $14,690 in legal and investigation expenses.

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Welder blown up - $380,000 settlement

 

A welder was seriously injured by an explosion in July 1994. He was hired by a Kitchener, Ontario, recycling company to weld a flange onto a storage tank used for liquid wastes. It was a small job, and they hired a Local "jobbing" welder who did work for them from time to time.

The employer had agreed to empty and vent the tank prior to the work being started. The welder peered into an open inspection hatch to see if the tank had been properly emptied while he was holding a lighted welding torch. The flame ignited fumes in the tank, causing an explosion that threw him almost 40 metres. He sustained serious burns to his face and upper body as well as other injuries.

Because he was a sole proprietor, he was not covered by Workers Compensation, so he sued the recycling company in tort. At mediation, the parties settled for $359,054 plus $15,000 defence expenses.

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$2.5-million fire at recycling depot

 

A June 1995 fire destroyed a Mississauga, Ontario recycling plant and its contents. The fire marshal estimated the damage at $2.5 million.

The sprinkler system had been disabled in violation of the fire protection warranty contained in the insurance policy, so the insurer denied the policyholder's claim. Because of the provisions of the mortgage clause, the insurer was unable to enforce the breach of the warranty against the mortgagee and the insurer paid about $800,000 to satisfy the mortgagee's claim.

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Hamilton plastics recycling depot destroyed by fire

 

It took three days for firefighters to control a huge blaze at a Hamilton, Ontario plastics recycling depot in July 1997. The damage to the building exceeded $2 million. The cost of disposing of the debris and the cleanup will be more than $10 million.

Local residents, fearing adverse health effects from the smoke and particulate produced by the fire, have commenced a class action against the property owners. The City of Hamilton is also named in the class action for failing to enforce the fire code, in spite of repeated fire code violations; for failing to handle the fire correctly; and for failing to evacuate the community from the area until the fire was extinguished.

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Juice company wins $3.5-million settlement for polluted water supply

 

Polluted water supply blamed for fruit-juice product recall, plant shut-down

Sundor Canada Inc., a Waterloo, Ontario fruir juice company, has accepted a $3.5-million settlement to pay for the recall of its prodocts in 1990.

The company used water from the local municipal water system to produce fruit juice from concentrate. In 1990, small quantities of the chemical NDMA, a suspected carcinogen, were fbund in the water supply. Sundor had to recall 120,000 cans from retailers' shelves, shut down the Waterloo facility and relocate production to another plant.

An investigation by the Ontario Ministry of Environment and Energy (MOEE) and the Regional Municipality of Waterloo indicated that the primary source of the NDMA contamination was the Elmira, Ontario plant of Uniroyal Chemical Ltd. Sundor sued Uniroyal, the MOEE, the Regional Municipality and the Township of Woolwich, alleging that the defendants were responsible for the contamination of the local ground water or for failing to detect such contamination. The lawsuit sought $20 million in damages.

In its defence, Uniroyal argued that Nutrite Ltd., a Waterloo manufacturer of agricultural and garden fertilizers, had caused or contributed to the contamination. The defendants all cross-claimed against each other.

Earlier this year, Sundor agreed to settle with all the defendants for $3.5 million, much less than their original demand. Uniroyal paid the largest contribution to the settlement.

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Waiver in environmental consultant's report upheld

 

An appeal court has upheld the decision of a lower court with respect to a report prepared by a firm of environmental consultants.

A company sued the consultant, alleging it was negligent in preparing an environmental report for the previous owner. The report included the statement "accepts no responsibility for damages, if any, suffered by any third party as a result of decisions made or actions based on this report."

The report, which admittedly contained negligent mis-statements, had been shown to the plaintiff before the sale. The plaintiff had no direct dealings with the defendants.

The action was dismissed by the trial court, and that verdict was upheld on appeal.

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