Suit over old Studebaker site will continue

By John O'Brien | Jan 27, 2009


INDIANAPOLIS (Legal Newsline) - The Indiana Supreme Court has decided the City of South Bend may seek reimbursement for the cleanup of costs at an old Studebaker site but dismissed the City's common law claims.

The City alleges Studebaker, which once manufactured automobiles on the site, contaminated the area and has sued its corporate successor Cooper Industries. The statute of limitations bars the City's common law claims, but it can still seek relief through the Environmental Liability Action statute, the opinion says.

Studebaker officially no longer existed in 1967, and the City did not start acquiring the parcels of land it used to own until the 1980s. The suit wasn't filed until 2003.

"South Bend argues that its cause of action for damages to the Studebaker property did not accrue for limitation purposes until it became the owner of the property and had a right to commence the action..." Chief Justice Randall Shepard wrote.

"We cannot agree... Accepting South Bend's argument would have the practical effect of allowing the mere transfer of property to resurrect the claims of prior landowners and predecessors-in-interests who had actual knowledge of injuries to property."

The decision overturned a lower court ruling on the claims of negligence, trespass, public nuisance and private nuisance.

The ELA did not become law until 1998, allowing those claims for relief to fall under the six-year statute of limitations, the opinion says.

Consultants hired by the City have said that there may be a source of hydrocarbons below the site and the groundwater has heavy metal contamination. The suit will continue in Marion County.

From Legal Newsline: Reach John O'Brien by e-mail at john@legalnewsline.com.

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