ARM 55 Chp 8

legal foundations for environmental liability
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Terms in this set (45)
legal foundations for environmental liability
1. liability for bodily injury to others or
damage to their property
2. the cost of cleaning up, or remediating
pollutants, either on the insured's own
property or on the property of others
organization environment liability incur under
1. tort
2. contract
3. statutory law
the source of environment liability losses
1. most frequently the actual or alleged
release of pollutants
2. the violation of a law designed to protect
human health and the environment from
those pollutants
3. the enforcement of environmental
protection laws that require remediation
expense payment
tort liability for pollution is based on
1. negligence
2. intentional acts
3. strict liability
pollution negligence
when pollution results from an organization failure to exercise the legally required degree of care under the circumstances
intentional torts
alleged in environmental claims are nuisance and trespass
potential nuisance environmental liability exposures
1. loud noises
2. noxious odors
3. bright lights
4. fog generation
5. electrical waves
6. electromagnetic fields
trespass, unlike nuisance
involves the physical deposition of pollutants on the property of the claimant alleging injury
trespass environmental claims could result from
1. the release of dust or particulate matter
into the air
2. discharge of chemicals into the stream
3. runoff of pesticides onto a neighbor's
property
4. thermal emissions into a river
strict liability
imposed by courts when manufacturing operations use inherently hazardous materials or processes, which eliminates the common-law defense normally available to the defendant in a negligence suit
materials that could create strict liability for environmental injury1. nuclear materials 2. explosives 3. pesticides 4. highly toxic chemicals 5. hazardous wastecontractual liabilityenvironmental losses under a contract that contains a hold-harmless agreementenvironmental statutes1. regulates materials that are reactive, corrosive, toxic, or flammable 2. contain provisions that can lead to injunctions, fines and penalties for noncompliance 3. contain provisions for the criminal prosecution of individuals, including corp, officersenforcement of environment lawsunder the Clean Air Act, the Clean Water Act, and several earlier environmental laws, compliance involved monitoring the outflow from pipes into streams and from smokestacks into the airenvironmental protection agencyset standards, counted contaminants in parts per million, and enforced statues with fines that could exceed hundreds of thousands of dollars per dayother environmental loss exposures1. property 2. personnel 3. net incomeproperty environmental loss exposuresenvironment pollution may prevent an organization from sellingpersonnel environmental loss exposuresenvironmental pollution because occupational exposures to hazardous materials can cause chemical burns or other on-the-job injuriesnet income environmental loss exposuresenvironmental pollution because any environmental contamination event is likely to result in some degree of business interruption, revenue reduction, negative press, and consumer boycottsenvironmental statues1. clean water act 2. clean air act 3. purpose of the motor carrier act of 1980 4. toxic substance control act 5. resource conservation and recovery act 6. comprehensive environment response, compensation, and liability act (CERCLA) 7. oil pollution act of 1990environment risk controlorganization can apply risk control measures which have elements of avoidance, loss prevention, and loss reduction to its environment loss exposuresenvironmental risk control measures1. source reduction 2. source treatment 3. disposalbasic risk control measures for source reduction1. changing or modifying equipment 2. substituting materials 3. redesigning process 4. redesigning the product 5. changing operations or human behaviorsource reduction1. A procedure to reduce pollutants that emanate from an already existing source. 2. a risk control strategy/procedure to reduce or eliminate environmental loss exposuressource treatmentA procedure to modify the pollutants that have already been produced.source treatment risk control measures1. recovery processes 2. physical and chemical processes 3. thermal processes 4. biological processesrisk management source treatment1. professionals should consider the pollutant's characteristics 2. the form it is in (solid, liquid, or gas) 3. the media contaminated or threatened 4. government demands and costsource treatment recovery processseparate, remove, and concentrate reusable material from the wastesource treatment reusable materialis often sold or recycled back into the reusable processexamples of recovery processes1. activate carbon absorption used in chemical spill response and industrial waste-water treatment exchange to recover metals from waste streams 2. distillation often used to recover solvents from waste streamsphysical and chemical treatment processes1. are available to reduce the volume of waste 2. permit more economical and effective treatment 3. make waste less hazardous, and destroy the toxic components of waste 4. used primarily for their treatment capabilities rather than for recovering and reusing materials 5. chemical processes alter the hazardous nature of the waterexamples of physical and chemical processes1. filtration used to treat material such as oily water waste 2. chemical precipitation commonly used to treat corrosives, and dehalogenation used to treat PCBs and contamination soilthermal processessolidification, stabilization, and encapsulation processesprocesses that used additives to reduce the mobility of pollutants so that the waste meets land disposal requirementstrespassentry to another's property without right or permissionnuisanceInterference with the enjoyment of either public or private propertystatement about environmental liabilityfederal law only serves as a baseline, and the environmental statutes of local governments may be even more restrictive than federal statutesassethow a polluted property a firms owns appears on its balance sheetinjunctionan order to stop certain business operations or activities and not uncommon to industries like timber and oil developmentenvironmental loss exposure to propertycontamination that prevents and organization from selling a piece of propertyworker health and safetyboth a financial and a social concerneconomic feasibilityconsideration that influences which risk control measures should be usedregulatory riskthe risk that an organization may be adversely impacted by strengthened disclosure requirements and performance standardstrading carbon creditsexample of risk transfer related to climate change riskweather derivativea financial contract whose value is based on the level of a weather related index derived from variables such as average temperatures, snowfall, precipitation, or wind velocity during a designated period