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Bardon Trimount,
Inc. v. Guyott, 2007 WL 2705575 (Mass. Super.)
(Sept. 4, 2007) (van Gestel, J.). |
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After a jury-waived trial on a limited
set of questions following remand from the Appeals
Court, the Court concluded that plaintiff failed to
provide defendant sufficient notice under a Share
Purchase Agreement to trigger liability for cost-sharing
for an environmental clean up.
The Share Purchase Agreement expressly
dealt with allocation of costs for environmental
contamination claims associated with a certain property
located in Haverhill. The agreement required Bardon to
give notice to Guyott of any future costs associated
with the Haverhill site within five years of the closing
of the Share Purchase Agreement. The notice was required
to include reasonable identification and quantification
of expenses, along with a range of possible exposures
and a list of expected payees.
The court found that Bardon did provide
Guyott with notice of future costs (barely) within the
five-year period and analyzed whether it was adequate
under the terms of the Share Purchase Agreement. To
resolve this question, the court considered the context
and purpose |
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of the agreement’s cost-sharing
provisions. Both parties understood that the Haverhill
site was under EPA surveillance, but that definitive
knowledge of what the EPA would require for cleanup was
years away.
In this context of uncertainty, “Bardon
wanted to keep Guyott on the hook for cost-sharing for
as long a time as possible. The Guyott shareholders
wanted a definite time limitation on when they forever
could be free from liability for unknown future costs of
the Haverhill Site cleanup. The parties compromised.”
Id. at *9. Under the terms of the compromise, Guyott
was entitled to a realistic estimate of the costs
associated with cleaning up the Haverhill site in
particular. What Bardon provided, however, was merely a
generic estimate of costs incurred on other sites; there
was no “mention or description of an independent
investigation of conditions at the Haverhill Site.”
Id. at *10. Such notice was not sufficient under the
terms of the agreement and Guyott was not liable for any
future costs in connection with the Haverhill property.
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