Caldo Oil Co. v. State Water Resources Control Board

This is an environmental cleanup case arising in the context of parallel federal and state statutes and regulations which establish what amounts to a government-run insurance pool. The pool reimburses owners of underground storage tanks who clean up leaks. Caldo Oil Company (Caldo) filed a petition seeking a writ of mandate against the State Water Resources Control Board (Board), which had consolidated two reimbursement claims into one claim, reducing the amount of reimbursement available. Caldo’s principal contention is that a statutory definition of the term “occurrence,” similar to the definition used in the insurance industry, is thwarted by a Board regulation purporting to implement the statute. We agree and reverse with directions.

Background

The Barry Keene Underground Storage Tank Cleanup Trust Fund Act of 1989 is designed to combat the large number of underground petroleum storage tanks which leak, endangering public health. (Health & Saf. Code, § 25299.10, subd. (b) further section references are to this code.) It was enacted in part “to avoid direct regulation by the federal government” by establishing, as permitted by federal law, a system of “financial…