## Facts

- Philadelphia Electric Company (PECO) owned and operated facilities along the Delaware River in Chester, Pennsylvania, and purchased an adjacent tract containing a former hydrocarbon resin plant site.
- The plant had been operated by Pennsylvania Industrial Chemical Corporation (PICCO), whose successor was Hercules, Inc. (Hercules).
- During its operations, PICCO disposed of resinous materials and by-products on-site, including in a pond area, and contamination later migrated toward the Delaware River.
- PICCO sold the property to Gould, Inc., which leased tanks to a waste-handling tenant that caused additional spills, including oil spills in the pond area.
- Before buying the site from Gould (after obtaining an option), PECO conducted repeated inspections, including along the riverbank and the pond, and knew the tenant had caused spills.
- After PECO became owner, Pennsylvania environmental authorities ordered PECO to abate pollution traced to the site; PECO incurred approximately $395,000 in cleanup costs.
- PECO sued Hercules seeking damages for its cleanup costs and injunctive relief requiring Hercules to eliminate the pollution.

## Issues

1. Whether a subsequent purchaser may recover from a predecessor owner (or its successor) in private nuisance for contamination conditions existing on the purchased land at the time of transfer.
2. Whether PECO had standing to recover damages for public nuisance based on pollution of the Delaware River absent a “special harm” different in kind from that suffered by the general public.
3. Whether PECO could shift its cleanup costs to Hercules under Pennsylvania common-law indemnity.

## Decision

- The Third Circuit reversed the judgment awarding PECO $394,910.14 against Hercules.
- The court held PECO could not recover on a private nuisance theory for pre-existing on-site conditions because the purchaser–seller relationship was governed by caveat emptor under the circumstances presented.
- The court held PECO lacked standing to recover damages for public nuisance because it did not allege a special harm different in kind from the public’s injury.
- The court rejected common-law indemnity as a basis to sustain the judgment.
- The court vacated the injunction ordering Hercules to take action to eliminate pollution on PECO’s property.

## Legal Principles

- Private nuisance concerns a nontrespassory invasion of another’s interest in the use and enjoyment of land and generally addresses conflicts among neighboring, contemporaneous land uses, not allocation of risk between vendor and vendee.
- In a commercial sale with opportunity for inspection and without misrepresentation or concealment, caveat emptor governs claims by a purchaser against a seller (or predecessor) for conditions existing at the time of sale, limiting tort recovery for the purchased property’s condition.
- A private plaintiff seeking damages for public nuisance must show special harm—injury different in kind from that suffered by the general public—not merely costs stemming from ownership and regulatory obligations relating to the plaintiff’s own property.
- Common-law indemnity in Pennsylvania is a fault-shifting doctrine typically requiring a legally cognizable basis to treat the indemnitee as secondarily liable and the indemnitor as primarily liable; it is not available simply to reallocate risks that could be addressed in the purchase transaction.

## Conclusion

The Third Circuit held that PECO, as a subsequent commercial purchaser with an opportunity to inspect, could not use private nuisance to recover cleanup costs for contamination existing on the land when acquired, lacked standing to seek damages for public nuisance without special harm, and could not obtain cost-shifting through common-law indemnity; the damages award and abatement injunction against Hercules were therefore set aside.


Philadelphia Electric Co. v. Hercules, Inc., 762 F.2d 303 (3d Cir. 1985)