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Bankruptcy Keyed to Levitan, 3rd Ed.
Jensen v. California Department of Health Services
Citation:
127 B.R. 27 (1991)Facts
The Jensens individually wholly-owned Jensen Lumber Company (JLC), which used fungicide tanks in its manufacturing process. On January 25, 1984, the California Regional Water Quality Control Board inspected JLC’s site and issued a letter, received by the Jensens on February 2, stating a hazardous waste problem existed. The Jensens filed for Chapter 7 bankruptcy on February 13, 1984, without listing any claim for hazardous waste cleanup. The Department of Health Services (DHS) became involved in March 1984 but did not expend funds for cleanup until substantially after that time. The Jensens received a discharge on July 16, 1984. In 1987, DHS informed the Jensens they were individually responsible for site cleanup costs and later assessed them 10% responsibility in a Remedial Action Plan. In 1989, the Jensens filed an adversary proceeding to determine that the DHS’s claim was discharged in their bankruptcy. The bankruptcy court granted summary judgment to DHS, holding that its claim arose postpetition when cleanup costs were incurred.
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