OPINION
The state appeals from the district court’s grant of respondents’ motion for *824 summary judgment. The district court ruled that the state’s claims are time-barred by the statute of limitations provision of the Minnesota Environmental Response and Liability Act (MERLA). On appeal, respondents filed notices of review, asking this court to review a prior district court order denying their motions for summary judgment on numerous constitutional grounds. Additionally, respondent Home Insurance Co. (Home) challenges an order denying its motion for partial summary judgment concerning a settlement agreement it had previously negotiated with Ford Motor Company. We affirm in part, reverse in part, and remand.
FACTS
The state commenced this action pursuant to the Minnesota Landfill Cleanup Act (LCA) and the cost-recovery provisions of the Minnesota Environmental Response and Liability Act (MERLA). The LCA permits the state to bring a direct action against respondent insurers to recover response costs 1 incurred by the state for cleaning up two landfills located in Oak Grove and East Bethel, Minnesota. See Minn.Stat. §§ 115B.39-.445 (2000).
MERLA is Minnesota’s legislative solution to problems arising from the release of hazardous substances into the environment. The primary purposes of MERLA are:
(1) to impose strict liability on those responsible for harm caused by release of hazardous substances; (2) to allow the state to clean up contamination and collect costs later; and (3) to fund state cleanup activity.
Musicland Group, Inc. v. Ceridian Corp.,
The Minnesota Pollution Control Agency (MPCA) is the agency responsible for implementing MERLA. Minn.Stat. §§ 115B.02, subd. 3; 115B.17 (2000). MERLA requires the MPCA to identify contaminated sites in the state and the parties who are potentially responsible for the contamination (the “potentially responsible parties” — PRPs). Minn.Stat. §§ 115B.17, subds. 1, 3, 13; 115B.03, subd. 1 (2000). MERLA authorizes the MPCA to take remedial action if, after requesting the PRPs to take such action, the MPCA determines that the PRPs will not take the action in the manner or within the time requested. Minn.Stat. § 115B.17, subd. 1. When the MPCA spends public money to take a response action, MERLA authorizes the MPCA to recover its costs from the PRPs. Id., subd. 6.
MERLA was amended in 1998 to establish the accrual period for actions seeking recovery of response costs. 1998 Minn. Laws ch 341, § 2. Such actions must be brought within six years after commencement of physical on-site construction of a response action. MinmStat. § 115B.11, subd. 2(a) (2000).
The LCA was enacted in 1994 to create a more effective and less costly way for the state to cleanup landfills by authorizing the state to assume direct responsibility for remediating certain closed landfills. Minn.Stat. § 115B.40, subd. 7(b)(1). Because the state assumes the responsibility for the cleanup on behalf of a PRP, the state is permitted to recover costs, in part, through any existing insurance coverage a *825 PRP may have acquired. Minn.Stat. §§ 115B.40-.41, 115B.441. To ensure the state’s right to recover response costs, the LCA included a provision suspending the statute of limitations for such cost-recovery actions until 2004. Minn.Stat. § 115B.40, subd. 8. The LCA was amended in 1996 to permit the state to file a direct action against the responsible party’s insurer. 1996 Minn. Laws ch. 370, §§ 1-5 (codified at Minn.Stat. §§ 115B.441-.445).
In the present case, following extensive discovery, respondents moved for summary judgment challenging the constitutionality of the LCA. On June 13, 2001, the district court denied respondents’ motions. Respondents, via notice of review, ask this court to review the denial of their motions.
On June 18, 2001, respondents filed a second summary judgment motion, arguing that the state’s claims were barred by the statute of limitations. The district court granted respondents’ motion, finding that the MERLA statute of limitations as originally enacted in 1983 barred the state’s cost-recovery claims. The court applied the discovery-accrual rule, under which a cause of action accrues when a party discovers facts giving rise to the cause of action. Because the state had knowledge of the pollutants in East Bethel in 1982 and in Oak Grove in 1984, the court found that the state’s claims, brought in February of 2000, were time barred in 1988 and 1990 (prior to the passage of the LCA and its provision temporarily suspending the statute of limitations). The state appeals.
Respondent Home Insurance Company challenges the district court’s denial of its separate summary judgment motion concerning a settlement agreement signed by Ford Motor Company (Ford). The agreement resolved Ford’s claims for coverage under policies issued by Home for Ford’s liability at several hazardous-waste sites around the country. The district court denied Home’s motion because Ford failed to procure the state’s approval prior to entering the settlement agreement as required by Minn.Stat. § 115B.444, subd. 2.
ISSUES
1. Does the statute of limitations provision in MERLA as enacted in 1983 bar the state from recovering response costs for cleaning up contaminated landfills?
2. Do the amendments to the Minnesota Landfill Cleanup Act constitute an impairment of contracts in violation of the Minnesota and U.S. Constitutions?
3. Does the federal CERCLA preempt the Minnesota Landfill Cleanup Act?
4. Do the amendments to the Minnesota Landfill Cleanup Act violate the Commerce Clause of the Minnesota and U.S. Constitutions?
5. Does the settlement, release, and policy buy-back agreement between Home Ins. Co. and Ford preclude the state’s recovery against Home Ins. Co. under the Minnesota Landfill Cleanup Act?
ANALYSIS
“On an appeal from summary judgment, we ask two questions: (1) whether there are any genuine issues of material fact and (2) whether the lower courts erred in their application of the law.”
State by Cooper v. French,
I.
The state argues that the district court’s application of the discovery-accrual rule is erroneous. First, the state argues that its claims are timely under the amended MERLA statute of limitations provision that existed when the state brought this action. Second, the state argues that even under the statute prior to its amendment, the state’s claims are timely. Respondents argue: (1) the amendments to MERLA do not act to revive the state’s claims, and (2) under the original provisions of MERLA, the district court was correct in applying the discovery-accrual rule and barring the state’s claims. We agree with the state’s second argument and conclude that, under MERLA as originally enacted, that is, prior to its amendment, the state’s claims are timely.
The construction and applicability of a statute of limitation is a question of law, reviewed de novo.
Benigni v. County of St. Louis,
Statute of Limitations Provision of Original MERLA
MERLA created four distinct causes of action for recovery of 1) environmental-response costs; 2) natural-resource damages; 3) economic damages; and 4) damages for death, personal injury, and disease. Minn.Stat. §§ 115B.04, 115B.05, 115B.17 (2000). With respect to the original statute of limitations provisions, it reads in pertinent part:
*827 No person may recover damages pursuant to sections 115B.01 to 115B.15 unless the action is commenced within six years from the date when the cause of action accrues. In determining when the cause of action accrues for an action to recover damages for death, personal injury or disease, the court shall consider factors including the following:
(1) When the plaintiff discovered the injury or loss;
(2) Whether a personal injury or disease had sufficiently manifested itself; and
(3) When the plaintiff discovered, or using due diligence should have discovered, a causal connection between the injury, disease, or loss and the release of a hazardous substance.
Minn.Stat. § 116B.11 (1984). (This language remained the same after the 1998 amendments.) Noticeably, the statute does not define when a “cause of action accrues” for a cost-recovery action, nor are there any Minnesota appellate cases defining the phrase. Federal courts construing MERLA ruled that the accrual date for cost-recovery actions is the same as that provided under Minnesota common law for damages to real property: six years from the date of discovery.
Union Pacific R.R. Co. v. Reilly Indus., Inc.,
Here, the district court, relying primarily on the Union Pacific decisions, adopted the discovery-accrual rule and held that the MERLA statute of limitations as it originally existed in 1983 time-barred the state’s cost-recovery claims. The district court found that the state had knowledge of the contamination at the two sites in 1982 and 1984. Because the court found that the applicable accrual standard in MERLA cost-recovery actions is the date of discovery, it determined that the state’s claims were time-barred in 1988 and 1990, respectively.
The state contends that because of the statute’s silence and the possible conflicting interpretations, the statute is ambiguous, and therefore the court erred in not applying the rules of statutory construction to determine the intent of the legislature. The state argues that the intent of the legislature was always for the state to have six years from the date of remedial construction to recover response costs and that the 1998 amendment was to clarify that intent.
The state correctly points out that, on its face, the original MERLA is silent about the accrual date for cost-recovery actions by the state and speaks only to personal injury claims. Respondents, however, point to the statute’s use of the word “person” and its corresponding definition to support their argument that the discovery-accrual rule applies:
“Person” means any individual, partnership, association, public or private corporation or other entity including the United States government, any interstate body, the state and any agency, department or political subdivision of the state.
Minn.Stat. § 115B.02, subd. 12. (1984). But respondents’ argument fails to address the fact that the legislature prescribed a discovery-accrual rule only for damage actions for death, personal injury, and disease, while remaining silent on the other causes of action that may be brought under MERLA, including cost-recovery causes of action.
Where a statute is silent on a key point and is subject to different plausible interpretations, the statute must be considered ambiguous.
Burkstrand v. Burkstrand,
(1) the legislature does not intend a result that is absurd, impossible of execution, or unreasonable;
(2) the legislature intends the entire statute to be effective and certain; [and]
⅜ ⅜ ⅜ ⅜ ⅜ ⅜
(5) the legislature intends to favor the public interest over any private interest.
Minn.Stat. § 645.17 (2000).
Here, the district court determined that in the absence of words to the contrary, the discovery-accrual rule applied to response cost-recovery claims. In reaching its decision the court relied primarily on Union Pacific 7, the federal district court decision.
As an initial matter, federal court interpretations of state law are not binding on state courts.
See Jendro v. Honeywell, Inc.,
In relying on Union Pacific I, the district court discusses a Minnesota Supreme Court case that the Union Pacific I court relied on, Minn. Mining and Mfg. Co. v.
Travelers Indem. Co. (SM),
The district court (as well as the federal district court) also cites an unpublished opinion of this court in support of its conclusion,
Hustad Dev. Corp. v. Browning-Ferris Indus.,
No. C5-94-2241,
Such an interpretation of the legislature’s silence fails to consider the legislative purpose and intent of MERLA. It also fails to consider that the legislature, in enacting MERLA, departed significantly from common law by imposing liability for environmental cleanup that is joint and several, retroactive, and strict. Minn.Stat. §§ 115B.03, subd. 1 (2000), 115B.04, subd. 1. Moreover, it fails to consider that MER-LA is a “remedial statute” and should therefore be broadly construed in favor of the government in order to effectuate its remedial objectives.
Musicland Group, Inc. v. Ceridian Corp.,
We look first to the words of the statute. Here, the legislature expressly provided what is essentially the common-law discovery-accrual rule
3
for personal injury claims, but remained silent as to when a cause of action accrues for the remaining causes of action authorized in the statute.
See
Minn.Stat. § 115B.11. When the legislature applied the common-law discovery-accrual rule to personal injury actions, it had the opportunity to apply the same rule to response cost-recovery actions, but chose not to do so. This omission implies that the legislature intended some other rule than the common law accrual rule for state actions seeking recovery of response costs.
See Nichols v. Metro. Bank,
Bearing in mind the rule that the legislature does not intend a result that is absurd or impossible of execution, we begin with the fact that in 1970 — before MERLA was even enacted — the legislature was aware of approximately 250 landfills creating water-pollution problems, many of which had leached contaminants into the water table. Gov. Wendell R. Anderson, First Annual Report on the Quality of the Environment, 41 Jan. 1974. 4 *830 Given the sheer number of contaminated sites known to the legislature when it enacted MERLA in 1983, if the accrual period were to begin when the contamination was discovered, then by definition, no cost-recovery actions could be brought with respect to these sites. The result is a statute impossible of execution. Moreover, such a result is impractical and frustrates the very purposes of MERLA: to impose strict liability upon responsible parties and to allow the state to collect costs after cleaning up the contamination. Only if a cause of action to recover response costs accrued at the time of on-site construction of a permanent response action, would the state be able to recover its cost for cleaning up those landfills known to be contaminated prior to the enactment of MERLA. See Minn.Stat. § 115B.02, subd. 16 (defining remedial response actions as those actions consistent with a permanent remedy).
Additionally, the legislature imposed certain initial administrative tasks on the MPCA before it could take any remedial action. First, MERLA required the MPCA to establish and adopt rules by July 1, 1984, and also to establish a list of priority sites for taking remedial action. Minn.Stat. § 11533.17, subd. 13. Further, the MPCA was not permitted to expend public money on site cleanup unless it first determined that responsible parties would not take the remedial action in the manner or within the time requested, a process that takes considerable time and would further delay the state’s ability to bring an action. Id., subd. 1(a). Given the limited resources the MPCA had to conduct investigation and cleanup, a discovery-accrual rule for cost-recovery actions would have forced the MPCA to begin litigation at countless sites around the state immediately after MERLA was enacted, instead of devoting its resources to cleanup and establishing rules and identifying sites and responsible parties as required by the statute.
When choosing between possible definitions of a statutory term, the reviewing court must adopt the interpretation that appears to be the more logical in concept and the more practical in application.
In re Welfare ofC.P.K,
We note that our analysis is not unlike that of federal courts’ interpretations of CERCLA. Because MERLA was modeled after the federal CERCLA of 1980, federal interpretation of CERCLA is instructional. As with MERLA, CERCLA did not expressly provide an accrual period (or even a statute of limitations period) for cost-recovery response actions, but did provide a three-year statute of limitations from the date of discovery for action to recover damages to natural resources. See 42 U.S.C. § 9612(d) (1982). Due to CERCLA’s silence regarding the accrual period for cost-recovery response actions, federal courts applied the rules of statuto *831 ry construction to determine Congress’ intent.
Courts interpreting CERCLA’s statute of limitations provision began with the proviso that the remedial intent of CERCLA required a liberal statutory construction designed to avoid frustration of the act’s purpose.
United States v. Mottolo,
The Mottolo court found that Congress created a “silent exception” to CERCLA’s three-year statute of limitations by omitting any reference to claims for cost reimbursement. Id. at 903. The court held, therefore, that no statute of limitations applied to governmental actions for reimbursement of remedial-response costs. Id. at 909-910. 5
Similarly, other federal courts concluded that in the absence of an express statute of limitations for cost-recovery response claims, the government was not time-barred in bringing its claims.
See United States v. Dickerson,
Thus, our holding that the legislature did not intend to apply a common law accrual rule to the MERLA statute of limitations provision is consistent with federal courts’ interpretation of similar provisions in CERCLA.
Assuming, as we have, that the state first incurred environmental response costs related to the construction of remedial action at the two landfills in 1995 and 1996, we conclude that the state’s claims are not time-barred by the statute-of-limitations provisions of MERLA as originally enacted, and that therefore summary judgment was inappropriate. In light of this conclusion we need not decide whether the 1998 amendments to MERLA revived the state’s claims.
We turn next to respondents’ constitutional challenges to the statutes.
II.
Respondents argue that the Insurance Recovery Amendments to the LCA, which permit the state to bring a direct action against an insurer, violate the Supremacy Clause of the U.S. Constitution and the Contracts Clauses of the U.S. and Minnesota Constitutions for two reasons: (1) the amendments wipe out essential provisions of the insurance contracts at issue and thereby substantially impair the respondents’ contracts with their policyholders without justification; and (2) the amendments are preempted by the federal CERCLA. Respondent Home also argues that the LCA violates the Commerce Clause.
*832 The district court denied respondents’ summary judgment motions, finding that respondents did not meet their threshold burden of proof showing a substantial impairment of a contractual obligation in violation of the Contracts Clause of the U.S. and Minnesota Constitutions. Similarly, the district court found no statutory conflict between the LCA and CÉRCLA in violation of the Supremacy Clause. Finally, the court found that respondent Home failed to show that amendments to the LCA placed an unconstitutional burden on interstate commerce in violation of the Commerce Clause of the U.S. Constitution.
On appeal from the denial of a motion for summary judgment, we examine the record to determine whether any genuine issues of material fact exist and whether the district court erred in applying the law.
Offerdahl v. Univ. of Minn. Hasps. & Clinics,
“Minnesota statutes are presumed constitutional, and our power to declare a statute unconstitutional should be exercised with extreme caution and only when absolutely necessary.”
In re Haggerty,
The LCA was enacted to create a more effective and economical program to achieve landfill cleanup than was attainable under MERLA by authorizing the MPCA to assume environmental responsibility for qualified closed landfills. Minn. Stat. § 115B.40 (2000). To help pay the state for the cost of cleaning up the landfills, the statute initially authorized the state (1) to issue bonds; (2) to assess a solid-waste-assessment tax on all residential and business customers; and (3) to permit the state to seek contribution for response costs from insurance companies that had previously sold liability policies to PRPs. See Minn.Stat. §§ 115B.42 (2000) (bonds); .22 (2000) (hazardous waste generator tax); .44 (1994) (contribution from insurance companies) (repealed by 1996 Minn. Laws ch. 370, § 7).
Participation by PRPs in the LCA cleanup program is voluntary. If a PRP chooses not to enter into a settlement with the state, the PRP may bring a contribution claim against other PRPs under MERLA or CERCLA for response costs. Conversely, by entering into a settlement with the state, a PRP is relieved of the cost and burden of environmental cleanup under MERLA and in exchange, the PRP assigns any right to liability coverage under its insurance policies to the state. Minn. Stat. §§ 115B.40, subd. 7(b)(2); 115B.43, subd. 2(a)(2)(h) (2000).
Under the Insurance Recovery Amendments to the LCA, the state is permitted to bring a direct action for response costs against insurance companies who have issued policies to PRPs. Minn.Stat. §§ 115B.441-.445 (2000). The PRP is required to cooperate with the state in preparation for negotiating a settlement with its insurance company. Id. As part of any settlement, the insurer must waive its contribution and subrogation rights for any amounts paid in the settlement. Minn. Stat. § 115B.443, subd. 9.
*833 It is important to note that if the parties do not settle, the insurers retain the right to assert the same defenses they would have if the LCA not been enacted. The state obtains no greater rights against insurer defendants than the insurers’ policyholders would have if they were the parties seeking to enforce the coverage provisions of their policies. Minn. Stat. § 115B.444, subd. 1. And the LCA preserves the right of the insurance company to assert the same defenses against the state that it could assert in a suit by a third party against the PRP insured. Id. Thus, insurance companies are allowed both to deny coverage under their policies and to contest their policyholders’ underlying cleanup liability as well. In this respect, the LCA merely codifies the result that the state could obtain under common law principles relating to subrogation by satisfying a PRP policyholder’s liability under MERLA.
Impairment of Contracts
Respondents argue that the direct action and cooperation provisions of the Insurance Recovery Amendments to the LCA unconstitutionally impair the obligations of the insurers’ contracts with their policyholders in three ways. They argue the amendments substantially impair their contract rights by: (1) effectively removing the “no action” clauses from the policies at issue; (2) diminishing their contractual rights to policyholder cooperation and subrogation; and (3) altering their contract rights retroactively. See Minn.Stat. §§ 115B.442, subd. 4 (stating that PRPs must provide information regarding liability insurance coverage); 115B.443, subd. 9 (setting forth settlement terms for insurers regarding contribution, subrogation, and effect of settlement on joint and several liability).
The United States Constitution provides that “[n]o State shall * * * pass any * * * Law impairing the Obligation of Contracts.” U.S. Const. art. I, § 10, cl. 1. The Minnesota Constitution provides similar protections. Minn. Const. art I, § 11. Minnesota Contract Clause challenges are analyzed using the same three-part test.
Jacobsen v. Anheuser-Busch, Inc.,
Upon reviewing the record, we conclude that respondents did not meet this threshold burden sufficient to compel summary judgment for several reasons:
1. Respondents presented insufficient facts to demonstrate that since the amendments were passed, respondents have been subject to an increase in claims-related expenses due to the amendments.
2. The state presented evidence that PRPs are able to provide basic factual information required under the LCA without violating cooperation clauses in their contracts while simultaneously assisting the insurer’s defense against such claims. The district court therefore found that there was insufficient evidence presented that the amendments will cause PRPs to dishonor their contractual duty to cooper *834 ate with the insurers in such a way that would create a pecuniary loss.
3. There was no showing that any alleged altering of contribution rights has injured the respondents financially, and respondents have not presented factual evidence that connects the statutory removal of the right to contribution to any financial loss.
4. Respondents admit that it is “impossible to know” how substantial the statute’s financial burden will be on them, and although factual certainty regarding the exact level of economic harm is not essential to a finding of serious economic harm, there must be at least some specific evidence that proves the actual existence of calculable economic harm.
5. The LCA amendments may well confer an economic benefit on respondents. For example, because the state steps into the shoes of the PRP policyholder, an insurer is able to assert all its available defenses in a single action brought by the state, rather than being required to assert liability defenses in one action bought by the state and coverage defenses in a second action brought by the policyholder (or its subrogee). Thus, attorney fees and litigation costs may be reduced. Further, the total cost of remediating landfills may be reduced due to the economies of scale available because a single entity, the state, has assumed the responsibility for cleaning a large number of sites. The result may well be a decrease in the amount the insurers will have to pay out in landfill cleanup claims on the policies they issued to the PRPs.
In light of the dearth of facts presented to the district court to establish a threshold showing of substantial impairment of their contractual obligations, we affirm the district court’s denial of summary judgment with respect to respondents’ Contract Clause challenges.
Federal Preemption
Respondents also argue that MERLA is preempted by CERCLA and therefore is unconstitutional. The Supremacy Clause of the U.S. Constitution invalidates state laws that interfere with or are contrary to the laws of Congress.
Wise. Pub. Intervenor v. Mortier,
Respondents do not argue that express preemption applies here. With respect to field preemption, 42 U.S.C. § 9614(a) states:
[n]othing in this chapter shall be construed or interpreted as preempting any State from imposing any additional liability or requirements with respect to release of hazardous substances within the State.
42 U.S.C. § 9614(a) (1994). Therefore, there is no intent by Congress to “occupy the field” and disallow any state regulation on the subject.
ARCO Envtl. Remediation, L.L.C. v. Dep’t of Health & Envtl. Quality of Mont.,
As to conflict preemption, the issue is whether the provision of the LCA that permits the state to file a direct action against insurers conflicts with the provision of CERCLA that establishes when a
*835
direct action against someone other than a responsible party may be brought under CERCLA.
See
42 U.S.C. § 9608(c) (1994); Minn.Stat. § 115B.444, subd. 1. Conflict preemption is found when it is impossible to comply with both federal and state law, or if the state law is an obstacle to the accomplishment of Congress’ objectives.
Nelson,
CERCLA does allow a direct right of action against “guarantors” in limited circumstances related to insolvency of the PRP when evidence of financial responsibility by the guarantor is provided. 42 U.S.C. § 9608(c)(1), (2). 6 Even so, an insurer is not necessarily a guarantor under CERCLA. A guarantor is defined as “any person, other than the owner or operator, who provides evidence of financial responsibility for an owner or operator under this chapter.” 42 U.S.C. § 9601(13) (1994).
Here, the district court found that there was no conflict between the acts because the LCA is part of a totally separate legislative scheme that does not even implicate CERCLA. We agree. There is nothing in CERCLA that denies a state the right to create direct actions under its own law. Indeed, as noted, CERCLA specifically states that
[njothing * * * shall be construed or interpreted as preempting any State from imposing any additional liability or requirements with respect to the release of hazardous substances within such State.
42 U.S.C. § 9614(a). Because the direct-action provisions of the LCA merely provide a remedy for a breach of a duty created under state law, and because CERCLA prohibits only direct actions to recover damages for claims brought under CERCLA, we conclude that the Supremacy Clause is not implicated and the direct-action provisions of the LCA are not preempted by CERCLA.
Respondents also argue that a number of contribution-related provisions of the LCA are preempted by CERCLA. CERCLA grants PRPs that are sued by the federal government for cleanup costs the right to seek contribution from other responsible parties for their fair share of the response costs.
Bedford Affiliates v. Sills,
However, respondents’ argument fails to consider that (1) CERCLA does not directly grant contribution rights to insurers; therefore, it does not primarily affect insurers; and (2) the waiver of contribution rights is optional for both insurers and PRPs under the LCA, (PRP or insurer can choose not to settle). Therefore, any contribution rights under CERCLA or the LCA remain available. Moreover, both CERCLA and the LCA provide that PRPs that enter into settlements with a state are entitled to contribution protection from future claims. 42 U.S.C. § 9613(f)(2) (1994); Minn.Stat. § 115B.443, subds. 8, 9. We therefore conclude that the LCA contribution waiver provisions do not conflict with *836 CERCLA and its provisions are constitutional.
Commerce Clause
Respondent Home argues that the Insurance Recovery Amendments to the LCA are unconstitutional because they burden interstate commerce in two ways: (1) they impose economic protectionism benefiting Minnesota at the expense of other states and to the detriment of out-of-state insurers and policyholders; and (2) they allow Minnesota to interfere with interstate commerce without any balancing of the minimal local benefit against the heavy restraint of commerce nationally.
The Commerce Clause grants Congress the power to regulate commerce among the several states. U.S. Const., art. I, § 8, cl. 3. The power to regulate commerce also encompasses an implicit or “dormant” limitation on the authority of states to enact legislation affecting interstate commerce.
Cotto Waxo Co. v. Williams,
regulates even-handedly to effectuate a legitimate local public interest, and its effects on interstate commerce are only incidental * * * unless the burden imposed on such commerce is clearly excessive in relation to the putative local benefits.
Pike v. Bruce Church, Inc.,
The U.S. Supreme Court adopted a two-tiered approach for analysis of state statutes under the Commerce Clause in
Brown-Forman Distillers Corp. v. N.Y. State Liquor Auth.,
Home argues that the provision in the LCA amendments that requires the attorney general to approve otherwise private negotiations between insurers and their policyholders directly affects interstate commerce. Home contends that the amendments impermissibly burden interstate commerce by effectively preventing settlements negotiated in consideration of a broad policy release, if the release might possibly affect the policyholder’s potential liability to the state at a Minnesota landfill. As an example, Home points to the district court’s ruling that partially invalidated Home’s agreement with Ford Motor Co. (Ford), because Ford did not seek approval from the attorney general’s office as required by the statute. Home argues that the LCA impermissibly enables Minnesota to take a disproportionate share of insurance proceeds collected nationally by authorizing a veto power over out-of-state settlements in the absence of any compelling or legitimate state interest.
The district court, in denying respondents’ summary judgment motion, found that the LCA does not directly burden *837 interstate commerce because the amendments do not directly target out-of-state insurers for regulation. The court also found no indirect burden under the Commerce Clause because respondents did not show that the statute has caused or will cause them any significant economic harm. We agree.
The statutory language at issue reads:
A policyholder may not enter a settlement that releases an insurer from any claims for which the state has an action under subdivision 1, unless the attorney general has given prior written approval to the settlement and the policyholder agrees to assign to the state any amounts recovered under the settlement from the insurer that are attributable to the resolution of the claims. 7
MinmStat. § 115B.444, subd. 2(b).
We initially note that the statute does not purport to regulate every settlement agreement that insurance companies may have with Minnesota companies; rather, it seeks to regulate only those settlements involving qualified landfill sites in which the state has a legitimate interest (not all landfills), because the state essentially assumed the liability of the PRP policyholder. The involvement of the state is therefore limited. Without a requirement for state approval of such settlements, insurers and their policyholders could deprive the state of any recovery to which it has an interest by entering into a settlement agreement that releases the insurer from further liability. Further, because the act pertains uniformly to settlements between PRPs and insurers, regardless of where the insurance company is domiciled, it does not discriminate against out-of-state insurers in favor of in-state insurers. Accordingly, we conclude that the act does not directly burden the Commerce Clause so as to be unconstitutional.
We turn next to whether the statute in directly burdens interstate commerce. As we have already noted in part,
[a statute] will be upheld unless the burden imposed on [interstate] commerce is clearly excessive in relation to the putative local benefits. If a legitimate local purpose is found, then the question becomes one of degree.
Pike,
The district court denied Home’s motion for partial summary judgment seeking to dismiss the state’s claims. Home contends that a 1999 settlement agreement with Ford released Home from any liability, thus barring the state’s claims against Home. The LCA requires PRPs to obtain state approval prior to entering into any settlement agreement purporting to release an insurer from liability under which the state may have a claim. Minn.Stat. § 115B.444, subd. 2(b).
Home argues on appeal that it should not be penalized for its settlement with Ford for Ford’s failure to obtain the state’s consent prior to entering the settlement agreement. Home argues that the state’s remedy should have been an action against Ford, not against its insurer. The pertinent provision in the February 1999 settlement agreement reads:
Effective as of its receipt of the Settlement Payment, Ford fully, absolutely, and unconditionally releases and for all purposes forever discharges Home, Risk Enterprise Management Limited (“REM”) and REM’s directors, officers, agents and employees from any and all Claims under, arising out of, or relating in any way to the Policies, except for Claims concerning the enforcement of this Agreement. Ford acknowledges that by this release and this Agreement, Home and REM have been relieved of all liability under, arising out of, or relating in any way to the Policies.
In May of 1995, prior to Home’s settlement agreement with Ford, the state sent both Ford and Home a letter explaining the LCA’s insurance-recovery provisions. As a result, Home knew that Ford could not execute the release without the state’s consent when it negotiated the settlement and release. Moreover, 1995 is the year the state took over cleanup liabilities at the Oak Grove landfill. The state points out that as of that time, the state became equitably subrogated to Ford’s rights to coverage under its policies with Home with respect to the state’s claims for response costs for this site and Ford had no authority to release those subrogation rights. Therefore, because Ford did not have the state’s approval as required by the LCA to execute such an agreement releasing Home from liability, the district court did not err in denying Home’s summary judgment motion.
DECISION
We reverse the district court’s grant of respondents’ summary judgment motion finding the state’s claims are time-barred by the statute of limitations provision in MERLA, and remand for further proceedings consistent with our holding. We affirm the district court’s denial of respondents’ summary judgment motions relating to respondents’ constitutional claims. We also affirm the district court’s denial of Home’s summary judgment motion seeking dismissal based on its settlement agreement with Ford.
Affirmed in part, reversed in part, and remanded.
Notes
Retired judge of the district court, serving as judge of the Minnesota Court of Appeals by appointment pursuant to Minn. Const, art. VI, § 10.
. Response costs are the costs of actions implemented to abate or remedy a release or threatened release of hazardous substances in order to protect the public health and environment. Minn.Stat. § 115B.02, subds. 15-18 (2000).
. The district court, in a footnote, refers to one of the state's responses to an interrogatory served by defendant Commercial Union, and says,
that the State * * * not only discovered the pollution at East Bethel in 1982 but also began remedial activities there later that year. Similarly, in its responses to the same interrogatories and document requests, the State admitted to discovering the pollution at Oak Grove in 1984 and beginning remedial activities there later that year.
The district court surmised “that even under the current version of MERLA,” the state’s claims "may not have been timely filed.” We initially note that the state did not say it undertook the activities it referred to in the response, only that "remedial activities commenced,” without indicating who undertook them. The affidavits of Douglas Day and Thomas Newman make clear that the state did not undertake physical activities at either site in the 1980s, but that such activities were undertaken by the responsible parties. Moreover, the state’s interrogatory response refers to ending the "migration of contaminants from the sites and the progressive damages caused by that migration.” It appears to us that the activities the state referred to were more in line with the temporary actions that the statute defines as “removal” ("actions necessary to ⅜ ⅜ * minimize * * ⅜ or mitigate the damage” (Minn.Stat. § 115B.02, subd. 17(5) (2000))), rather than with the permanent type of remedial action necessary for the cause of action to accrue ("actions consistent with a permanent remedy taken instead of or in addition to removal actions” (Id., subd. 16(a) (2000))). In any case, because we are to view the evidence in the light most favorable to the state, this opinion assumes that the state first incurred remedial costs in 1995 and 1996.
. Under Minnesota common law, a cause of action accrues and the statute of limitations begins to run when the plaintiff discovers or should have discovered the injury/damages.
See Dalton v. Dow Chem. Co.,
. Respondent Wausau asserts that this report was improperly submitted, though fails to explain how. In any event, "groundwater contamination has been recognized in Minnesota for many years,”
3M,
. Congress amended CERCLA in 1986 to include a six-year statute of limitations provision for the recovery of remedial response costs from responsible parties, commencing from the date of "physical on-site construction of the remedial action.” 42 U.S.C. § 9613(g)(2)(B) (1994).
. Certain CERCLA claims may be asserted directly against a guarantor providing evidence of financial responsibility for particular facilities if the person liable is in bankruptcy, reorganization or arrangement pursuant to the Federal Bankruptcy Code, 42 U.S.C. § 9608(c)(2)
. Subdivision 1 of the statute permits the state to bring a state action against any insurer for recovery of all environmental response costs incurred that are related to qualified facilities for which the state has assumed response action obligations or responsibilities. Minn. Stat§ 115B.444, subd. 1.