Document evvXXjg59qODpNEbQg0XZYk34

U.S. Department of Justice Land and Natural Resources Division The Attorney General's Asbestos LiabilityRepor to the Congress Pursuant to Section 8(b) of the Asbestos School Hazard Detection & Control Act of 1980 September 21, 1981 CSQ14 2461 SUMMARY AND RECOMMENDATIONS AND INTRODUCTION TO REPORT N O' PJ CS014 ASBESTOS LIABILITY REPORT SUMMARY AMD RECOMMENDATIONS As a result: of occupacional health problems associated with inhalation of asbestos fibers, people have become concerned that asbestos products in schooLs may pose a hazard to the future health of children now in school. Accordingly, on June L4, 1980, che Asbestos School hazard Detection and Control Act of 1980 was enacted. _!/ The purpose of the Act is to assist states and local educational agencies to ascertain the extent of the danger to the health of school children and employees from asbestos products in schools; and to provide grants assisting the identification of asbestos hazards and loans for the mitigation of asbestos hazards. Section 8(b) of the Act directed the Attorney General to: conduct an investigation to determine whe ther, by using all available means, che United States should or could recover, from any person determined by the Attorney General to be liable for such costs, che amounts expended by che Uniced States to carry out this Act [federal grants and loans to detect, remove and contain friable asbestos in the schools]. Within one year after che effec tive dace of this Act, che Attorney General shall submit to che Congress a report con taining che results of che study, together with any appropriate recommendations. 2/ A detailed report setting forth che results of our factual investigation and legal research is attached. Our summary, and recommendations, are as follows: Asbestos is a terra for a group of naturally occurring mate rials chat separate into fibers. Asbestos is a valuable product with many uses, including noise and heat insulation and use as a binder. However, tiny asbestos fibers, if r eleased into che air and then inhaled into che lungs, can cause d each from raesoche lioma, and death or disablement from asbescosis and lung cancer. General Background, Section III, infra. J Pub.L. 96-270 (June 14, 1980) , 94 Scat. 495, 20 U.S.C. 3601 et seq. / 20 U.S.C. 3607(b). oco*n* .p iouP u - 11 - Ac lease one court has concluded chac knowledge of che dangers of airborne asbestos fibers can be accribuced co che asbescos manufacturing industry as early as che mid-1930's and "conduct throughout che induscry despite che danger has been summarized as one of indifferenc silence.v Hardy v. JohnsManville Sales Coro., 509 F.Supp. 1353, 1355 '(E7t>. Tax.' 1'9'81) . As many as 10,000 cases have been filed by people, usually workers, alleging deach or injury resulcing from asbescos fibers since che landmark decision of 3orel v. Fibreboard Pater Products Corn., 493 F.2d 1076 (5ch Cir. 1973), cerc. denied, 419 U.S. 869 (19)4), which allowed recovery by an asbescosis and mesochelioma victim under che tore cheory of strict liability, predicated on "failure to warn" and "failure co cesc." Despite che danger, che industry was "silent with respect co the dangerous relationship between asbescos and cancer." Hardy v. Johns-Manville Sales Corn., supra, 509 F.Supp. at 1355. Further, a convincing case can be made based upon induscry documents pro duced in licigacion, chac cercain induscry officials actively sought co obscure data linking asbestos and fatal diseases. General Background, Section IV, infra. Mesothelioma, like asbestos, has a long latency period. The latency period -- 35 co 40 years Z_! -- is so long chat it is noc yet possible co correlate mesothelioma deaths with che use of sprayed asbescos in che schools, which occurred primarily between 1946 and 1972. Unlike asbescosis, which generally requires expo sures over a long period of time, mesothelioma, "extraordinarily painful and always fatal . . . may result from one exposure co asbescos dust or fibers." Hardy v. Johns-Manville Sales Coro., supra, 509 F.Supp. at 1355. Congress has determined chac "medical science has noc estab lished any minimum level of exposure co asbescos fibers which is considered co be safe co individuals exposed co fibers" and "che presence in school buildings of friable or easily damaged asbescos creates an unwarranted hazard co che health of che school children and school employees who are exposed co such materials." 20 U.S.G. 3601(a)(3), (6). ' Noc all uses of asbescos are dangerous. If che fibers are encased in a hard produce such as cile, chere should ordinarily be no danger, although if hard materials are damaged, fibers may be released. Accordingly, che Acc is concerned wich "friable or easily damaged asbescos." 20 U.S.G. 3601(a)(5). The nose common use wich which we are concerned is sprayed-on, "friable" asbescos CS014 2464 3/ Selikoff, Hammond and Seidman, Latency of Asb scos "isease 1 ^ * n f n r '/ o r c i m n I ! n t f s. r* + * t* r- Ill -- most often used on classroom, corridor, shop, gym, music room., boiler room, or storage room ceilings, in a noise insulation or decorative product. "Friable" means chat the substance, which has a spongy, irregular, or textured appearance, can be crumbled by hand. Asbestos- may constitute from two to fifty per cent or more of the sprayed product. . Spraying for fireproofing and insulation purposes of mate rials containing more chan one percent asbestos was banned by the Environmental Protection Agency in 1973 (and in 1978 for* virtually all purposes), because of the hazard posed by release of fibers into the air during Che spraying. The application of asbestos products by trowel, however, has not been*banned. Asbestos fibers are microscopic and sub-microscopic in size so that once disturbed they remain airborne for extended periods of time. Even after settling to Che ground, the fibers will again become airborne if disturbed by walking or sweeping - normal activities in classrooms and corridors. Friable asbestos will release fibers into schoolroom air if disturbed by vibrations from operation of machinery, maintenance activities, ventilation systems, product deterioration, inten tional or accidental student contact, and water damage. In New Jersey, experts visited a sample of 48 asbescos-containing schools, "and 33 of these were found to have visible evidence of damage to asbestos concents." 4/ The preparers of this Report' have per sonally observed in schools visited, evidence of fiber release including: places where large sections of friable asbestos have simply fallen away as a result of deterioration, loss of bonding, or water damage; gouge marks presumably made by long-handled objects in shop classrooms; holes made by thrown objects including an embedded pencil; and the recollections of two teachers regard ing the falling away of pieces of asbestos for many years from ceilings in their classrooms. Fortunately, it appears that most of the nation's schools do not contain any friable asbestos. However, in the schools that do contain friable asbestos -- and these schools range geographi cally from Massachusetts to California -- the square footage of coverage and therefore the cost of removal or containment, can be quite extensive. The Cinnarainson Township Board of Education, Bur-* lington County, New Jersey, alleges that it has expended over one nj million dollars to deal with the asbestos problem in three schools. As an example of the extent of the problem, approximately 20% of 01 New York City public schools and 10% of New Jersey schools have been found to contain asbestos materials in scudent use areas. 5/ 4/ S.Rep. No. 96-710, 96th Cong., 2d Sess. 7 (1980). 5/ ' Id. - IV - Abatement of school asbestos hazards currently rests in the hands of local and state governments, since Congress has not appropriated any funds under the Act to make federal grants and loans. Also, the Environmental Protection Agency has cancelled plans to promulgate a rule under the Toxic Substances Control Act requiring school authorities to take corrective action -- it "has concluded that identifying hazards will provide local school districts with enough information to take corrective action on their own." 6/ FINDINGS AND RECOMMENDATIONS 1. The parties most likely liable are the asbestos processors and manufacturers, and manufacturers of the asbestos spray-on products. It will be necessary to establish that the known danger to asbestos workers should have caused these parties to: (1) test to determine whether friable asbestos could be hazardous as a result of indoor environmental exposures; and (2) warn that asbestos fibers had caused deaths and injuries in occupational settings, and if released from asbestos products, could prove harmful as a result of indoor environmental exposures. General Background, Sections III, IV, infra. In the case study we examined in the greatest detail, the school district was not even informed that the products applied in its schools contained asbes tos. However, to establish liability, it will also be necessary co prove either as a matter of law or by trial of a factual issue, that friable asbestos is hazardous. The desirability of including as defendants other partie's in addition to asbestos and asbestos spray-on manufacturers, such as distributors, installers, archi tects, and contractors, would best be determined on a case-by-case basis. 2. It is often possible through investigation, architect or contractor recollection, plans and specifications, or state archives, to ascertain the identity of the manufacturer of the asbestos product used in a particular school. General Background, Section VI, infra. 3. Despite the potential liability of the asbestos and asbestos spray-on manufacturers, the United States should not attempt to recover for the elementary reason that no funds have been appro priated to make federal grants and .loans unaer the Act. (Moreover, there are no indications that funds will be appropriated in the future). 4. Even if funds were to be appropriated, this recommendation would remain unchanged for the following reasons: 6/ i* For) . Boo 77 79* Cinri1 77 lQfln CS014 2466 -V- (a) The fiscal impact of providing federal aid co school authorities to remedy the asbestos problem should be under stood in advance. 'while recovery may be obtained through litiga tion in some some .situations, it is by no means certain. The Act as currently enacted offers what may be an illusory hope of reducing federal expenditures through litigation. Thus, if federal funds are provided, the burden should be understood to fall on the federal taxpayer, unless liability is imposed on the asbestos manufacturer by statute similar to the Superfund and Black Lung programs, and similar to a provision in the Asbestos School Hazard Detection and Control Act deleted prior to enact ment. 77 (b) Even though most schools apparently do not contain friable asbestos, there are sti'll a large number of situations of potential liability across the nation. Case-'oy-case litigation brought by the United States under state law, is a comparatively inefficient means of addressing the problem. If Congress is convinced that liability should be federally'imposed on the manufacturers, other options should be reconsidered, including imposing liability or creation of a federal cause of action with a special statute of limitation. Also, appropriate federal agen cies could review their authorities under such statutes as the Toxic Substances Control Act and the Consumer Products Safety Act to determine whether the school asbestos problem should be addressed by administrative action. (c) Remedies can be more efficiently sought by local and state authorities, because the outcome of litigation will depend on distinct state *laws and varying factual situations. 5. Although this Report recommends that the United States should not sue, the government could recover if suit were brought co recover federal funds ultimately expended. The viable theo ries of recovery include: . (a) equitable restitution, Restatement of Restitution, 115; (b) strict liability, Restatement of Torts, 402A; (c) negligence; and . CS014 2467 ]_/ The present section 8 mandating this Report was substituted for the industry detection fund provision in the House Committee on Education and Labor mark-up of H.R. 1524 on May 1, 1979, which bill was then substituted into H.R. 3282 and reported out the same day. See generally, Usery v. Turner-Elkhorn Mining Co. , 428 U.S. 1 (19767 (upho Lding imposition on mining operators of burden of providing benefits co Black Lung victims). - vi - (d) breach of implied warrantees of merchancabilicy and ficness for a particular. purpose. The basis for the restitution claim is the contention that the asbestos manufacturers have a duty to abate the asbestos hazard in the schools, and that public authorities performing that duty have a right to restitution from the manufacturers. The strict liability and negligence claims are predicated on the manufacturers' failure to warn of the dangerous propensities of asbestos fibers, and failure to test to determine if friable asbestos could be hazardous. The implied warranty claims are based on the unsuitability of the product for its intended use. 6. The primary obstacles to successful litigation are: (a) A majority of American decisions have held that "economic loss" is not recoverable in tort. However, the presence of a hazardous product creates a situation in which it may be persuasively contended that tort recovery is appropriate against a manufacturer chat sold asbestos products used in schools in the absence of warnings or tests. (b) Because of the time, elapsed since installation of the asbestos, usually at least nine years, statutes of limitation constitute potential obstacles to recovery. However, the asbestos manufacturers continue to contend chat friable asbestos in schools is not dangerous. The manufacturers are faced with the dilemma of on the one hand arguing that the danger was obvious so as to commence the running of a "discovery" or "manifestation" statute of limitation, while on the ocher hand denying, even today, chat the product is dangerous. 7. School authorities faced with substantial expenditures in removing~or containing friable asbestos snould, as a matter of the utmost urgency, consult with qualified counsel to determine whether cnev should file litigation on their own, as at leas~t three school districts alreaav r.ave gone" Urgency is necessary because of statutes of limitation. Litigation on the theories sec forth in recommendation 5, supra, may prove to be a desirable method of reducing fiscal burdens on taxpayers. School districts contemplating litigation should consult with counsel to insure chat adequate tests and ocher measures are performed and retained to support the proof requirements of litigation. Finally, we note chat in the three cases we know of. filed by school districts to dace, each district retained qualified products liability counsel. 8. Though the problem of friable asbestos in the schools is in one sense a national one, the absence of a federal law assigning liability suggests chat the better solution is at the local or CSOIA 246B - Vll - as quickly as possibLe. Illusory hopes of federal assistance can obstruct rather chan aid accainraenc of this goal. Ac the same time, it is clearly in the national interest chac chose school districts facing substantial abatement expenditures be able to recover from chose who manufactured and sold asbestos products without warning of the dangers of breaching asbescos fibers. School districts should keep the Department of Justice informed about such litigation so chac the Deparmenc can determine whether assistance in the litigation is appropriate, The Departmenc contact for counsel representing state or local authorities is: Policy, Legislation and Special Litigation Section Land and Natural Resources Division Room 2615 Main Justice Building Washington, D.C. 20530 (202) 633-2847 CONCLUSION Litigation, but by school authorities racher chan the federal government, should be quickly investigated by school authorities and their counsel as one potential means of reducing the fiscal impact on taxpayers of abating asbescos hazards in the schools The federal government should support local school authorities Ln such litigation, but should not bring such actions on its own. o c p NtO>>0'