Anderson Insulation Co. v. Department of Public Health
Docket: No. 98-P-341
Court: Massachusetts Appeals Court; October 13, 1999; Massachusetts; State Appellate Court
The appeal involves a dispute over urea formaldehyde foam insulation (UFFI), revisiting issues from the Borden, Inc. v. Commissioner of Pub. Health case. Plaintiffs, UFFI installers, argue that due to the time elapsed since the 1983 ruling, UFFI should no longer be deemed hazardous, and that thirty-two repurchase certificates issued by the Department of Public Health (DPH) were unlawful. Following the Borden decision, DPH established regulations allowing property owners to request repurchase of UFFI, which requires the installer to bear removal costs and reimburse the purchase price. Owners could seek repurchase until July 1, 1991, or within eighteen months of acquiring the property. Claims must include installation dates and installer information, while hearings are limited to determining if the UFFI was installed by the identified party. Evidence regarding formaldehyde levels and health impacts is not permitted in these hearings.
Additionally, a UFFI Trust Fund was created by the Legislature to cover removal costs when formaldehyde levels exceed 0.10 parts per million, with contributors exempt from repurchase obligations. The plaintiffs did not contribute to this fund, thus remaining subject to the repurchase regulations. The DPH had previously declared UFFI hazardous due to health concerns, banning its sale and mandating repurchase. The plaintiffs contend that by 1990, the harmful emissions from UFFI had sufficiently dissipated, questioning the validity of the repurchase regulations. They reference the trust fund act, which suggests that removal is unnecessary at formaldehyde levels below 0.10 parts per million, while the repurchase regulations lack a similar threshold. DPH maintains that the plaintiffs are precluded from re-litigating the validity of the regulations due to principles of res judicata established in the original Borden decision.
Application of res judicata requires (1) a final judgment on the merits, (2) identity of parties, and (3) commonality of subject matter, as established in Gloucester Marine Ry. v. Charles Parisi, Inc. The plaintiffs argue that new material facts emerged post-Borden decision, which should affect the outcome. However, the Borden case addressed the causal connection between low-level off-gassing from UFFI and consumer complaints, determining that causation was irrelevant under G. L. c. 94B. Under this statute, once a material is classified as hazardous by the DPH, manufacturers, distributors, or retailers must repurchase it without proving causation, provided the claimant exhibits related symptoms and ownership of the affected property. Changes to the trust fund act introduced a threshold of 0.10 parts per million formaldehyde concentration for claims against the trust fund, benefiting installers and expediting consumer compensation. This does not imply that lower concentrations are harmless, nor does it exempt installers from claims. The act preserves private rights and mandates that individuals recovering from the trust fund assign their claims against noncontributory installers to the DPH. An article cited by plaintiffs discusses the trust fund legislation as a health policy adjustment but does not enhance the legal argument. The challenge to administrative proceedings claims they are arbitrary for not requiring proof of harmful formaldehyde levels; however, G. L. c. 94B does not stipulate such a requirement, allowing consumers to seek removal and reimbursement for hazardous materials.
DPH faced allegations of unreasonable delay in issuing repurchase certificates for claims made by plaintiffs, with a deadline for requests set for July 1, 1991. Plaintiffs asserted that DPH did not timely notify them of twenty-two claims made before July 1, 1987, although a letter dated May 28, 1987, informed the president of Anderson Insulation Co., Inc. of pending claims. DPH's delays were attributed to efforts to establish a trust fund for claims, which was deemed a reasonable cause as it aimed to expedite claims for trust participants. Plaintiffs did not demonstrate any prejudice from the delays in adjudication.
Additionally, plaintiffs argued that claims violated statutory limitation periods under G. L. c. 260 pertaining to tort and consumer protection actions. However, the repurchase claims arose from an administrative scheme established by the Commissioner of Public Health under G. L. c. 94B, not from common law or court statutes. The authority to set specific limitation periods for repurchases was supported by precedents indicating that tolling provisions of G. L. c. 260 apply only to common-law actions.
The Superior Court's judgments affirming DPH's repurchase decisions and validating the right to repurchase certificates were upheld. The definition of an "installer" under 105 Code Mass. Regs. 650.222(1) includes anyone making a retail sale of UFFI. The plaintiffs' complaints included claims for declaratory relief and administrative review, with later regulatory changes eliminating the requirement to show physical effects associated with UFFI. The discrepancy in claim counts between DPH and the plaintiffs was noted, with plaintiffs asserting twenty-two claims based on their provided data.
