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City of Marlborough v. Wecare Environmental, LLC

United States District Court, D. Massachusetts

June 5, 2015

CITY OF MARLBOROUGH, MASSACHUSETTS, Plaintiff,
v.
WECARE ENVIRONMENTAL, LLC, Defendant.

MEMORANDUM AND ORDER ON MOTION FOR PARTIAL SUMMARY JUDGMENT

F. DENNIS SAYLOR, IV, District Judge.

This action involves allegations that WeCare Environmental, LLC, which operates a municipal solid waste facility in Marlborough, Massachusetts, caused or allowed its facility to emit unpleasant odors and failed to manage harmful effluent emanating from the facility. The City of Marlborough, which has a contract with WeCare, has brought claims under state environmental laws and for nuisance, breach of contract, negligence, and trespass. WeCare has counterclaimed for breach of contract, indemnification, and breach of the implied covenant of good faith and fair dealing.

WeCare has moved for partial summary judgment as to three issues relating to its breach-of-contract claim. Specifically, WeCare seeks an order interpreting the contract between the parties as requiring the City (1) to remit certain monthly payments to WeCare, (2) to refrain from charging WeCare for sewer use, and (3) to permit immediate, round-the-clock access to the WeCare facility. The City denies that it owes the specific amounts claimed by WeCare and contends that it is authorized to charge for sewer use and that it need not permit access to the facility outside of certain hours that are defined in the agreement.

For the reasons set forth below, the motion will be granted in part and denied in part.

I. Background

A. Factual Background

Unless otherwise noted, the following facts are undisputed for the purposes of this motion.

1. The 1998 Agreement and the Solid Waste Facility

In 1998, the City of Marlborough entered into an agreement (the "1998 Agreement") with a company known as Bedminster Marlborough LLC in which Bedminster agreed to provide the City with services related to recycling and solid waste disposal. (McCarthy Aff. ¶ 3; City Resp. to WeCare SMF ¶ 1).[1] On February 25, 2003, Bedminster assigned the contract to WeCare. (McCarthy Aff. ¶ 3; City Resp. to WeCare SMF ¶ 2; Assignment and Amendment Agreement at 1).

The 1998 Agreement contemplated the construction and operation of a solid waste disposal facility adjacent to the City's Easterly Wastewater Treatment Facility. ( See 1998 Agreement at 1, 7). WeCare now operates such a facility at that location, pursuant to the terms of the 1998 Agreement. (McCarthy Aff. ¶ 1). According to the complaint, the facility consists of eight structures, including a "biosolids receiving building, " a "compost aeration building, " and a "biofilter building." (Compl. at 1). As a result of its operations, the facility discharges a certain quantity of liquid effluent, or leachate, directly into the Easterly Wastewater Treatment Plant. (Compl. ¶ 9; see 1998 Agreement § 5.07(b)).

2. The Provisions of the 1998 Agreement

Section 1.01 of the 1998 Agreement defines a number of relevant terms.

The term "Delivery Hours" is defined as "the hours during which waste and sludge shall be accepted at the Facility." (1998 Agreement at 3). The term "Normal Delivery Hours" is defined as "the hours between 8:00 a.m. and 5:00 p.m., Monday through Friday, and between 8:00 a.m. and 3:00 p.m., Saturday, excluding, however, New Year's Day, Thanksgiving, Christmas, Memorial Day, Labor Day, Veterans Day and July 4." (1998 Agreement at 3-4). In the 2003 assignment agreement, the weekday hour reference in the definition of "Normal Delivery Hours" was changed to "the hours between 7:00 a.m. and 6:00 p.m., Monday through Friday." (Assignment ¶ 4(a)).

The term "Facility" is defined in Section 1.01 as

the solid waste co-composting plant and ancillary facilities, including without limitation the recycling and rubbish drop-off center, together with roadways, equipment and other improvements to be constructed and maintained by [WeCare] on the Site as contemplated by this Agreement, all equipment and vehicles used in connection therewith (excluding haul vehicles necessary for the removal of Residue from the Site), as described in more detail in Schedules 1 and 2 hereto, and all modifications thereof, replacements and additions thereto.

The term "Site" is defined in Section 1.01 as

that parcel of real property located in the Municipality adjacent to the Municipality's Easterly Wastewater Treatment Facility on which the Facility is to be constructed, as more particularly described in Schedule 2, together with licenses and rights of way for purposes of ingress, egress and utility lines necessary for [WeCare] to utilize the Site to perform its obligations under this Agreement.

Section 3.02 of the 1998 Agreement provides:

Exclusive Use of Site. The Municipality hereby agrees that [WeCare] shall have the exclusive right to occupy and use the Site, with all buildings and structures thereon, for the Term of this Agreement for use solely for the Facility in accordance with the terms of this Agreement. All buildings; structures and equipment placed on the Site by [WeCare] shall be and remain the property of [WeCare]. The Municipality agrees that [WeCare]'s use of the Site is a "public purpose" within the meaning of Chapter 59, Section 2B of the General Laws of Massachusetts and that [WeCare] shall not be assessed or taxed for the real or personal property comprising the Site or the Facility.

Section 4.02 provides: "Hours of Delivery. [WeCare] shall keep the Facility open for the delivery of Acceptable Waste at the Facility during the Normal Delivery Hours."[2]

Section 4.06 provides, in part: "Compliance with Laws. [WeCare] shall operate and maintain the Facility in full compliance with all applicable laws, regulations and rules, including over control and noise levels, and in accordance with the Consent Decree."

Section 4.10(a) appears under the heading "Traffic Flow Regulation" and provides:

[WeCare] may reasonably regulate the flow of traffic into the Facility and may deny admission to the Site to any vehicle carrying Hazardous Waste or Unacceptable Waste, any vehicle that may unreasonably leak, spill or allow waste or Residue to be blown or scattered, and any vehicle that is not in a safe condition for purposes of its operation at the Facility, and may otherwise promulgate reasonable safety and traffic rules applicable to the Site.

Section 5.04(b) appears under the heading "Recycling Obligations" and provides: "(b) [WeCare] shall design, permit, construct and operate the recycling and rubbish drop-off center that is part of the Facility in accordance with applicable laws and permits and the Consent Decree."

Section 5.07(b) appears under the heading "General Covenants with Respect to the Facility" and provides:

(b) Leachate Control. Stormwater or other water (including wash water) which comes in contact with solid waste being received, stored, processed or composted, or which mixes with leachate, will be considered leachate and will be reused in the process, treated to meet discharge standards, or discharged directly to the Municipality's Easterly Wastewater Treatment Facility if within the acceptable parameters for treatment at that facility. [WeCare] will be responsible for returning to the Municipality's wastewater treatment facility acceptable residual water to be treated by the Municipality. [WeCare] shall be responsible for the operation and maintenance of the entire leachate control system including pumping station and force main.

Section 7.04(a) appears under the heading "Electricity" and provides:

(a) During the Term, [WeCare] shall cause all electricity used by the Facility to be metered and shall timely pay all utility charges for such electricity; provided, however, that during the Term, the Municipality shall reimburse [WeCare] for one-third (1/3) of [WeCare]'s electric utility charges for the Facility. [WeCare] and the Municipality shall cooperate in good faith in selecting the supplier of electricity to the Facility.

Section 7.05 provides:

Water. (a) During the Term, [WeCare] shall cause all water used by the Facility to be metered and will timely pay all charges for such water; provided, however, that the Municipality will provide at its expense up to 3, 000 gallons of potable water per day and up to 74, 000 gallons of secondary water per day from the adjacent municipal water treatment facility for use in [WeCare]'s proceeding.
(b) [WeCare] will be responsible for pumping the water from the Municipality's treatment plant to the Facility and for returning residual water which shall be within acceptable parameters for treatment in the Municipality's treatment plant.

Section 9.02 provides:

Monthly Tipping Fees. Commencing on the Commencement Date of Operations and for each Monthly Billing Period thereafter, the ...

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