Full opinion text
ORDER BLATT, Senior District Judge. I. BACKGROUND From 1930 to 1977, Koppers Company, Ine. (hereinafter “Koppers”), now known as Beazer East, Ine. (hereinafter “Beazer”), operated a wood treating plant on approximately 45 acres of property in a part of Charleston, South Carolina known as the “neck” area. The property immediately south of the former Koppers property (tax map numbers 464-00-00-012 and -029) was originally the location of Ashepoo Phosphate Works and is what is described as the Dent property for purposes of this ease. All of the various claims arise from the necessary remediation (clean-up) of creosote contamination generated by the wood treating plant operated by Koppers on the property adjacent to the Dent property. Both properties are now part of a proposed Superfund site. The United States is not a party to this suit since the CERCLA claims were brought as private party actions under that statute. Conoco has a common law claim against Beazer arising from an indemnity provision in a lease agreement for the use of a portion of the Dent property by Koppers during Conoco’s ownership of the property. Agrieo has a common law claim for equitable indemnification against Beazer for the contamination of the property during Agrico’s ownership of the Dent property. This order addresses the responsibilities of the respective parties for the necessary remediation of the site under CERCLA, as well as the common law indemnification claims against Beazer. This action was originally brought by plaintiffs H. George Dent, Jr., Ashley Realty Company, Inc., and Southern Dredging Com-. pany, Inc ., (“the Dent plaintiffs”) against defendants Beazer East, Inc. (“Beazer”), Agrieo Chemical Company (“Agrieo”), Continental Oil Company, American Agricultural Chemical Company and Fos-Kem Liquidation Company (collectively “Conoco”) seeking recovery under various common law causes of action.and under CERCLA. Beazer asserted cross claims against Conoco and Agrieo and a third party claim against Braswell Shipyards (“Braswell”). Conoco and Agrieo asserted cross claims against Beazer and filed third party claims against Braswell. Conoco and Agrieo’s third party claims were resolved by consent order prior to trial. All defendants settled with the Dent plaintiffs prior to trial. Following the trial, Beazer settled its claims with Braswell. The only remaining claims are cross claims between the defendants. This court held a bifurcated trial, with a jury and a non-jury phase. In the first phase, beginning September 22, 1993, the common law claims and two factual issues regarding indemnity claims by the defendants Conoco and Agrieo against the defendant Beazer were submitted to the jury. Following the first phase of the trial, the CERCLA portion was tried before this court sitting without a jury beginning on October 18, 1993. With regard to the remaining issues before the court, each party seeks the following relief: Beazer seeks: 1. Contribution for response costs it incurred at the Dent Property with regard to wood treating constituents, pursuant to § 107(a) of CERCLA; 2. Recovery of response costs it incurred at the Dent Property with regard to fertilizer constituents pursuant to § 107(a) of CERCLA; 3. Contribution for response costs relating to the release or disposal of hazardous substancés on the Dent Property pursuant to § 113(f)(1) of CERCLA; and 4. A declaration liability for future costs under § 113(g)(2) of CERCLA, without an allocation of any such costs. Conoco seeks: 1. Contribution for response costs pursuant to § 113(f)(1); 2. A declaration of liability for future response costs under § 113(g)(2) of CERCLA, with an allocation of such costs; and 3. Recovery of settlement costs, attorneys’ fees and expert fees under contractual and equitable indemnity theories. Agrieo seeks: 1. Contribution for response costs pursuant to § 113(f)(1); 2. A declaration of liability for future response costs under § 113(g)(2) of CERCLA, with an allocation of such costs; and 3. Recovery of settlement costs and attorneys’ fees under an equitable indemnity theory. II. STIPULATIONS In the interest of judicial economy, and for the convenience of the jury, the parties to this action stipulated and agreed to the following statement of facts: 1. The former Koppers Co., Inc. was purchased by Beazer, and its name was changed to Beazer East, Inc. Beazer East, Inc. assumes all liability incurred by the former Koppers Company. (Jury Tr. Excerpt p. 3, Is. 17-20, September 27,1993). 2. The Continental Oil Company, Conoco, purchased the assets of American Agricultural Chemical Co., and is a successor in interest as Lessor to the Lease Agreement dated October 20, 1953, between Koppers and American Agricultural Chemical Company, pertaining to the four acre site, which is part of the plaintiffs’ property. 3. In 1960, Koppers purchased one acre of the four acres which had been leased from Conoco. 4. The Lease was in full force and effect from 1953 through 1968. 5. Conoco sent a letter to Beazer dated July 10, 1992, demanding that Beazer indemnify, hold harmless and defend Conoco from the plaintiffs’ claims. 6. Beazer has denied any such obligations. 7. From 1963 to 1972, with the exception of the one acre of the leased premises which was purchased by Koppers in 1960, Conoco owned the property now owned by Ashley Realty Co., referred to as the Dent tract in this ease. 8. From 1972 to 1978, Agrieo owned the property now owned by Ashley Realty Co., referred to as the Dent tract in this case. 9. By the end of May, 1993, Conoco and Agrieo had agreed to settle all of the plaintiffs’ claims against Conoco and Agrieo, including the plaintiffs’ common law claims, which this court had already ruled could not be maintained against Conoco and Agrieo. (Jury Tr. Excerpt p. 3, 1. 17 through p. 4,1. 23, September 27,1993). 10. Conoco and Beazer stipulate that if the court determines that a portion of the legal services are attributable to the defense of Dent’s common law actions, such as fraud, and are not recoverable, the amount to be set aside by the court as non-recoverable is $50,527.95. (Cercla Tr. Excerpt p.10,1. 5 through p. 11,1. 17, December 15,1993). III. FINDINGS OF FACT In 1985, investigation of the property associated with Koppers’ former wood treating operation revealed that this site posed a high degree of risk to public health and the environment due to contamination from chemical constituents used in wood treatment. The determination of the issues in this case is largely dependent upon an understanding of the nature and scope of the Koppers operation, including its effect, not only upon the Koppers property, but also upon the neighboring property, including the Dent property, and its effect on the natural resources in the area. A. THE REMEDIATION IS DRIVEN BY HOPPERS’ WOOD TREATING CHEMICAL CONSTITUENTS For nearly 50 years, Koppers was the sole user of wood treating chemical constituents in this area. Koppers’ method of disposal of its waste was environmentally unsound, and resulted in massive subsurface contamination of the property to its south (the Dent property) as well as waters of the adjoining Ashley River. The driving force behind the present remediation of the Dent property is the presence of chemical constituents from wood treatment. Based upon documentary evidence, expert testimony established that an estimated five (5) to seven (7) million gallons of creosote have been released into the environment as a result of Koppers’ wood treatment practices. (Cerela Tr. Vol. II, p. 122,1. 25 through p. 123, Is. 1-2; Conoco Ex. 127B). The polynuclear aromatic hydrocarbons (PAHs) detected on the Dent property are associated with creosote, based upon fingerprinting analysis and odor. (Jury Tr. Vol. V, p. 702,1. 7 through p. 703,1. 7; Conoco Exs. 32 and 37). The characteristic creosote fingerprint is present in most of the samples collected at the site. (Jury Tr. Vol. V, p. 733, Is. 12-14). When phenanthrene, fluoranthene, and pyrene are present in samples at concentrations representing one-third of the PAHs present, it is considered definitive for the presence of creosote. (Jmy Tr. Vol. V, p. 734,1. 24 through p. 735,1. 3). The distribution of the PAHs here is strongly indicative of creosote. (Jury Tr. Vol. I, p. 177, 1. 21 through p. 178, 1. 1). The Constituent of Concern (COC) which drives this cleanup is a wood treating chemical constituent called benzo(a)pyrene. (Jury Tr. Vol. V, p. 741, Is. 6-13). Benzo(a)pyrene, a PAH found in creosote (Conoco Ex. 37), is classified as a class B2 carcinogen (a substance that may cause cancer in animals). B. THE DENT PROPERTY IS CONTAMINATED BY PASSIVE MIGRATION OF CREOSOTE FROM HOPPERS’ WOOD TREATING OPERATION There are three possible ways by which creosote could have reached the Dent property, namely dumping, surface water flow, and subsurface migration. (Jury Tr. Vol. V, p. 712, Is. 20-25). Evidence did not indicate that Koppers placed creosote or other wood treating chemical constituent waste directly on the Dent property, thereby excluding dumping as a cause of this contamination. (Jury Tr. Vol. V, p. 764,1. 8 through p. 765,1. 1). ■ Surface water flow drained naturally from the eastern to the western part of the Koppers property until ditches were constructed to drain the water elsewhere. (Jury Tr. Vol. V, p. 689, Is. 5-9; Conoco Ex. 1). Moving westerly toward the Ashley River the slope of the land decreases in elevation from approximately 12 feet to 3 feet. (Jmy Tr. Vol. V, p. 691, Is. 5-8; Conoco Ex. 35). The ground water flow follows the decreasing elevation of the property toward the west to the Ashley River or toward the marshy areas on the Dent property. (Jury Tr. V, p. 691,1. 15 through p. 692, 1. 1). The subsurface groundwater flow would have cut through the old impoundment. (Jury Tr. V, p. 693, Is. 18-25; Conoco Ex. 36B Cross-section location map showing subsurface groundwater flow). The marsh line in 1926 ran near the old impoundment in a north-south direction. (Jury Tr. Vol. V, p. 694,1. 13 through p. 695, 1. 1; Conoco Ex. 38 — 1926 survey). Expert testimony established that the most probable pathway to the Dent property was through subsurface movement as demonstrated by the large amount of creosote in the fill area and in the old impoundment area. (Jury Tr. Vol. V, p. 713, Is. 5-7). Dense non-aqueous phase liquids (DNAPL) from creosote have migrated underground from the former drainage ditch on the Koppers property to the current drainage ditch south of Braswell Street and to the subsurface of the former impoundment area. (Jury Tr. Vol. V, p. 699,1. 22 through p. 700, 1. 5; Conoco Exs. 36D and 36E). The old wooden flume ditch originating at the Koppers separating tanks was located north of and adjacent to the current drainage ditch south of Braswell Street. (Jury Tr. Vol. V, p. 701, Is. 7-25). C. THE KOPPERS WOOD TREATING OPERATION For Koppers’ wood treating process, creosote was stored in tanks, then moved to working tanks, and pumped into and out of treatment cylinders. The storage tanks were located on the northeastern portion of the property. The tank farm consisted of a containment dike and six above-ground tanks for creosote storage. Numerous above-ground working tanks were located on an elevated platform in the southeastern portion of the property. The treatment process required stripping bark from logs, primarily for telephone poles and cross-ties, and transporting the stripped timber by rail to the treatment cylinders. (Jury Tr. Vol. V, p. 683, 1. 21 through p. 684, Is. 11-17). The treatment cylinders were located in the southeastern comer of the property and were approximately 8 feet in diameter and 133 feet in length. In 1940, Koppers had two treatment cylinders in use. In 1948, a third was added, and a fourth was added in 1952. There was an additional cylinder for a period of time, but it was shipped to another location. (Jury Tr. Vol. V, p. 786, Is. 2-8). One cylinder was dedicated to treatment with the chemicals pentachlorophenol (POP) and ehromated copper arsenate (CCA); three cylinders were exclusively dedicated to creosote treatment. 1. Koppers ’ Disposal System Inside the cylinders, creosote was injected into the wood until it was saturated; the remaining creosote was pumped back to the storage tanks. A locomotive would then pull the creosote treated wood out of the cylinder to the drip track area located along the southeastern portion of the property. The drippings were collected in a “sump pit” (also referred to as a “collection basin”). A creosote and water effluent was created from the creosote injection process which was released into a drain and then pumped into separation tanks (also located at the southeastern corner of the property), where the creosote would settle to the bottom while the water remained at the top. The creosote was drawn from the bottom of the settling tanks and pumped to a dehydrator, where it was heated to reduce the moisture content. The creosote was then pumped back into the working tanks. Any waste effluent left from the recycling process went into the ditch on Koppers’ property that ran along the south side of the property parallel to Braswell Street, and ultimately discharged into the Ashley River. (Jury Tr. Vol. V, p. 787, Is. 20-25). The conclusion that the source of contamination on the Dent property is massive subsurface migration from the Koppers property is inescapable from the history and topography of the property and is consistent with the weight of the expert testimony and documentary evidence submitted in this case. Koppers’ method of creosote disposal is important in the court’s approach to assessing liability. 2. Koppers’Ditches A vital element in reaching the conclusion that any contamination problem during Conoco’s or Agrico’s ownership resulted from massive subsurface migration, as opposed to active dumping, is the construction and configuration of the drainage ditches on the Koppers property. For practically all of its nearly 50 years of operation, Koppers’ major method of disposal for its industrial waste was a series of ditches that ran on its property to the Ashley River. One drainage ditch ran along the southern end of Braswell street from the settling tanks to the middle of the Koppers property. From there, the ditch turned northward to join a central ditch which diverted the effluent and carried it westward down to the Ashley River. (Jury Tr. Vol. Ill, p. 357, Is. 7-12; Jury Tr. Vol. VI, p. 790, Is. 2-7). The central ditch was the largest (approximately three feet wide and four feet deep) and it extended all the way to the Ashley River carrying effluent from another ditch which ran down the middle of the property. (Jury Tr. Vol. V, p. 790, 1. 19 through p. 791,1. 1). Storm water was also discharged through these ditches as well as through a third ditch which was located at the northern edge of the property. (Jury Tr. Vol. V, p. 791, Is. 2-9). A considerable amount of creosote was deposited along the length of the southern ditch. (Plaintiffs Ex. 38 — June 21, 1963 Memorandum from Fisher). Creosote contaminated residue in the ditches was shoveled out and placed on a roadbed on the Koppers property. (Jury Tr. Vol. Ill, p. 360, 1. 25 through p. 361, 1. 7; Jury Tr. Vol. V, p. 797, Is. 4-8). Koppers’ long-time plant manager testified that no open or surface drainage occurred from the southern ditch of the Beazer property to the Dent property from 1945 to 1978. (Jury Tr. Vol. V, p. 791, Is. 19-24). 3. Settling Tanks Undersized Undersized settling tanks used in the operation could not handle the rate of flow of the waste waters being pumped into them. This resulted in the overflow of considerable amounts of creosote which eventually entered the open ditch system along the southern edge of the property, thereby contributing to the amounts of creosote that migrated subsurface to the Dent property. (Jury Tr. Vol. Ill, p. 359, Is. 6-21). When Koppers added additional treatment cylinders between 1948 and 1952, the existing settling tanks were unable to hold the waste water generated, and Koppers failed to upgrade its existing separation tank system for treating its effluent waste. Consequently, creosote was not properly recaptured, and was instead released into the environment. Koppers knew, at least by 1963, that the undersized tank problem allowed more effluent to flow in the ditch. (Jury Tr. Vol. Ill, p. 359, Is. 9-12; Plaintiffs Ex. 38 — June 28, 1963 Memorandum from Fisher). In 1962, the South Carolina Water Pollution Control Authority requested Koppers to “proceed with renovation of (Koppers) creosote recovery equipment.” (Jury Tr. Vol. V, p. 813, Is. 4-15; Conoco Ex. 4.2 — letter July 10, 1962 to Koppers from Rhame). Three years later, this agency was still requesting that Koppers advise it as to what pollution controls and plans had been formulated; thus, the existence of these problems, and their adverse effect on the environment, were well known to Koppers. (Jury Tr. Vol. V, p. 814, Is. 12-23; Conoco Ex. 4.6). The time frame is significant because many of these problems occurred after the ditches along the southern edge of the property closest to the Dent property had been diverted to the center of the Koppers property. The evidence is persuasive that the overflow of creosote from the undersized settling tanks contributed to the volume of creosote on the Koppers property, which resulted in the subsurface migration that contaminated the Dent property. 4. Cylinders Cleaned With Fire Hoses Koppers’ unsound cleaning practices added to the amount of wood treating chemicals on its property which later migrated underground to the Dent property. The PCP and CCA treating cylinder was cleaned with a large volume of water from a fire hose. (Jury Tr. Vol. V, p. 879,1. 16 through p. 880, 1. 4; Conoco Ex. 146), This water, together with drainage from the pumps, pipes and the process area, entered the sump under the cylinders and was pumped periodically to five separating tanks, where some of the water would overflow and drain through the southern ditch. (Jury Tr. Vol. V, p. 879, 1. 22 through p. 880, 1. 6; Conoco Ex. 146). The loss of a considerable amount of wood treating chemicals to the environment is well documented. (Plaintiffs Ex. 38 — June 28, 1963 Memorandum from Fisher). 5. Cylinder Sludge Disposal For many years, Koppers’ disposal practice was to remove the creosote sludge from the treatment cylinders and dump it as fill on the northwestern end of its property by the rail track. (Jury Tr. Vol. Ill, p. 372, 1. 8 through p. 373, 1. 8). Logs, sawdust and creosote sludge created a very porous fill area and allowed subsurface migration of the chemical constituents in the direction of the Dent property. (Jury Tr. Vol. V, p. 711,1. 21 through p. 712, 1. 1). At no time was this disposal practice disclosed to any regulatory agency or were any permits requested. Wayne Fanning, a chemist from the South Carolina Department of Health and Environmental Control (DHEC), testified that the disposal of organic or inorganic material by Koppers without a permit violated the 1950 Water Pollution Control Act as well as the 1975 version of that Act. (Jury Tr. Vol. IV, p. 441, Is. 20-25; p. 442, 1. 20 through p. 443, 1. 6). There was expert testimony (using Koppers’ documents) that sludge disposed of on the Koppers property would have been the equivalent of thirty (30) truck loads per month until improvements were implemented and, thereafter, nine (9) truck loads per month. (Cercla Tr. Vol. II, p. 177, Is, 17-25). It is obvious that a large amount of creosote sludge was buried by Koppers on site over the years of its operation. 6. Dehydrator Malfunction In 1961, Koppers knew that creosote was also being lost into a ditch because its dehydrator was not working, and, as a result, Koppers could not give “good effluent in terms of good stream pollution prevention.” (Jury Tr. Vol. Ill, p. 382, Is. 19-24; Conoco Ex. 116). Koppers waited until such time as this practice actually became illegal before it dealt with this overflow of creosote to the ditch. 7. Other Creosote Uses by Koppers Koppers’ extensive use of creosote on site is best exemplified by its practice of regularly spraying creosote over its entire plant site as a weed control measure. (Jury Tr. Vol. Ill, p. 359, Is. 22-24). D. CREOSOTE CONTAMINATION OF ASHLEYRIVER During December 1987, the South Carolina Wildlife and Marine Resources Department (SCWMRD) detected a significant odor of creosote from various samples collected in .the Ashley River. Animals captured in nets were inedible because of contamination from mud laden with creosote. SCWMRD collected data from 1984 through 1986 which revealed the presence of PAHs in blue crabs and oysters within a 15 mile migratory pathway from the site. A DHEC document entitled “Special Organic Chemical Sampling of Charleston Harbor Sediment and Tissue” dated December, 1989, indicated the presence of PAHs in the Ashley River sediments downstream from the Koppers property. The most dramatic evidence of contamination from the site, and that which most focused attention on the Koppers’ plant, was a series of fish kills from 1963 to 1968. (Jury Tr. Vol. V, p. 874, Is. 19-21). There was a documented fish kill on or around July 7, 1967. Internal correspondence indicates that Koppers both resented the publicity about this fish kill and denied responsibility for the problem. (Jury Tr. Vol. Ill, p. 410, Is. 5-17; Jury Tr. Vol. V, p. 859, Is. 1-13; Conoco Ex. 131). Almost two years later, however, in February 1969, records indicate that Koppers knew that the plant outfall was very high in pollutant properties, i.e., phenol values exceeded thirty (30) times the allowable limit, and high levels of oil and PCP were present. (Jury Tr. Vol. Ill, p. 408, 1. 20 through p. 409,1.1). Another fish kill occurred on July 6, 1969. (Jury Tr. Vol III, p. 406, Is. 6-15; Plaintiffs Ex. 228), and still another fish kill occurred in 1984, when George Dent attempted to dredge his barge slip (with a permit). Mr. Fanning, the state investigator, described dead fish that were covered with a sheen of oil which smelled like creosote. Promised improvements from Koppers were slow in coming. (Jury Tr. Vol. V, p. 814, Is. 12-28; Conoco Exs. 4.6 and 18.3— report by Talon dated October 10, 1967 — ; Jury Tr. Vol. V, p. 815, Is. 4-25; Conoco Ex. Ill — interoffice memorandum in 1968 from Fisher regarding effluent handling suggestions for wood preserving plants). Waste handling improvements promised following the 1967 fish kill included: a closed circuit steaming system whereby Koppers would steam the wood and take it back to a tank instead of venting the water or condensation out of the bottom of the cylinders (Jury Tr. Vol. V., p. 857); shavings placed as a filter in the ditch; discontinuation of spraying creosote to Mil weeds; and connecting the discharge into the North Charleston sewer district line. It was not until 1972, however, that Koppers effectuated a connection with the North Charleston City Sewer System. One of the problems that caused tMs delay was the fact that Koppers’ effluent had to be upgraded before it would be accepted into the North Charleston City Sewage line. (Jury Tr. Vol. III,-. 386, Is. 10-13). For example, as of July 25, 1968, Koppers’ effluent was ten times worse than the general sewage. (Jury Tr. Vol. Ill, p. 393, Is. 1-4; Conoco Ex. 129). E. CONOCOIBEAZER LEASE The American Agricultural Chemical Company (AACC) operated a fertilizer plant adjacent to Koppers’ wood treatment facility. On October 20,1953, AACC, Conoco’s predecessor in title, entered into a lease with Koppers, whereby Koppers leased four acres of AACC’s west end property located close to the Ashley River and adjacent to, and just south of, Koppers’ plant. (Plaintiffs Ex. 1.— Lease). Conoco is a successor in interest as lessor to the Lease between Koppers and AACC. The property leased to Koppers was part of the property later purchased by Dent. In summary, the above-mentioned Lease provided that: Koppers was only permitted to dispose of clean fill material consisting of wood chips, bark, sawdust and similar materials on the leased premises (Plaintiffs Ex. 1 — Lease—p. 2, ¶3); Koppers would save Conoco harmless from any and all claims arising from Koppers use of the leased property. (Plaintiffs Ex. 1 — Lease—p. 3, ¶8); and Koppers would not subject Conoco to liability (Lease p. 3, ¶ 8). Koppers leased the property from 1953 through 1968, at which time the Lease expired. Conoco acquired the property and the rights under the Lease in 1963. Prior thereto, in 1960, Koppers purchased one of the four leased acres. Koppers did in fact place fill material on the leased property, such as bark, ends of poles and whatever debris was generated in the stripping operation, all of which were untreated. (Jury Tr. Vol. V, p. 794, Is. 1-4; p. 799, Is. 15-21). Fill materials, including brick rubble, were deposited by Koppers in the leased area near the pole yard office and pole peeler. (Jury Tr. Vol. V, p. 853, Is. 3-13). No treating cylinder residue was deposited on the leased premises. (Jury Tr. Vol. V, p. 852, Is. 17-19; p. 853, Is. 14-16). Koppers and Conoco agree that no material was dumped on the Dent property other than the clean fill material in the leased area. (Jury Tr. Vol. Ill, p. 367,1. 2 through p. 368, .1. 5). The “lighter slip” area wMeh was on Koppers’ property was already filled in by the time the .deposit of the clean fill commenced on the leased property in 1953. (Jury Tr. Vol. Ill, p. 370, Is. 1-7; Conoco Ex. 3.4). In October, 1977, wood treatment activities on the Koppers property ceased. F. BRASWELL’S PURCHASE & SUBDIVISION OF THE KOPPERS ’ PROPERTY In October, 1977, real estate agent Dan Batten was retained by Koppers Real Estate Department representative Thomas Bourne to market the Koppers property. Subsequently, an offer was submitted by Elliot Braswell. (Jury Tr. Vol. Ill, p. 344, Is. 21-22). At the time of the sale, Koppers knew about the creosote contamination of the property and the potential that the creosote would need to be removed in order for the property to be usable. (Jury Tr. Vol. 1, p. 201, Is. 7-10; Plaintiffs Ex. 65). The Bras-well offer was accepted by Koppers and in 1978 the property was sold to Braswell. Between 1978 and 1982, Braswell subdivided the property and sold all the' parcels except parcels 019 and 035 (Tax Map Numbers). Since 1978, Braswell has operated a commercial and military ship cleaning, repair and refurbishing business on parcels 019, 035, 043 and 049. • FedServ Industries, Inc. (“FedServ”) leased the creosote storage tanks (parcel— 032) left by Koppers after it sold the property. (Jury Tr. Vol. IV, p. 446, Is. 3-9). FedServ used the tanks as a tank farm. (Jury Tr. Vol. VI, p. 945, Is. 14-17). The tanks were later abandoned and, in 1985, DHEC and EPA hired a contractor under the Superfund emergency remedial action program to clean wastes from the tanks and begin the process of removing the tanks. (Jury.Tr. Vol. TV, p. 446, 1. 25 through p. 447, 1. 2). After EPA issued- its administrative order, Koppers assumed control of the cleanup under the supervision of DHEC and EPA. (Jury Tr. Vol. VI, p. 945, Is. 20-23). As remediation efforts were underway, a backhoe encountered a black viscous liquid at about four (4) or five (5) feet of soil depth which smelled like creosote. (Jury Tr. Vol. IV, p. 448, Is. 18-22). State officials determined that this material was not spill from the tank and that this deeper contamination could not be addressed under the emergency action; rather, a determination was made that the contamination of the entire site needed to be addressed. (Jury Tr. Vol. IV, p. 449, Is. 9-13). The contaminated soil and tanks from the tank farm were removed. (Jury Tr. Vol. IV, p. 447,1. 24 through p. 448, 1.6). The tanks contained a top layer of used oil and solvent, a layer of waste water, and below that level several feet of sandy sludge that contained creosote. (Jury Tr. Vol. IV, p. 449, Is. 18-23). Peppers Industries also leased parcel — 044 (the location of the Koppers wood treatment building) from 1978 to 1982, using the creosote working tanks from the Koppers plant as part of a tank and boiler cleaning operation. Under an Administrative Consent Order issued by DHEC in August, 1983, Pepper Industries began a cleanup operation in the storage tank area, but later it declared bankruptcy prior to completing this cleanup. Braswell Shipyards cleaned these tanks, dismantled them, and completed cleanup of this parcel in January, 1987. (Jury Tr. Vol. TV, p. 453, Is. 15-16). Braswell later recovered 50% of the costs incurred in this cleanup from Beazer. These tanks contained both creosote sludge and other wastes added to the tanks by Pepper Industries. (Jury Tr. Vol. IV, p. 453, Is. 13-15). A Site Screening Inspection was performed by DHEC, on October 9, 1987, of the old Koppers work tanks (parcel — 044) and DHEC recommended that the site be reevaluated in the future using the EPA Hazard Ranking System (HRS). G. THE DENT PROPERTY The Dent property, which is immediately south of the former Koppers property, was originally the location of Ashepoo Phosphate Works. In 1921, the Dent property was transferred to the American Agricultural Chemical Co. of Connecticut, and later, in 1963, transferred to Continental Oil Company (currently known as Conoco, Inc.), and subsequently to Agrico Chemical Company. Agrico owned the property from 1972 until 1978, but fertilizer manufacturing operations ceased in mid-1975. In 1978, Agrico sold the property to Callowness Polymer Specialty Company. In 1981, Braswell purchased the Dent property from Callowness, and in 1983 and 1986, Braswell sold it in two separate transaction (parcels -012 and -029 respectively) to Dent. Under Dent’s ownership these two parcels were operated by Southern Dredging. In 1989, these parcels were later transferred to Ashley Realty Company, another company which was wholly owned by Dent. At the time Dent purchased the original property, he had no information that creosote contaminants were buried on the property. (Jury Tr. Excerpt, p. 11, Is. 16-22, September 27, 1998). Dent inspected the property, but he did not observe creosote on the ground. (Jury Tr. Excerpt, p. 11, Is. 4-8, September 27, 1993). Later, in 1986, Dent purchased an additional eight acres from Braswell. (Conoco Ex. 2). After Dent purchased the property, the old impoundment area was filled. (Jury Tr. Excerpt, p. 62, Is. 4-8, September 27,1993). In November, 1984, Dent began dredging the old barge slip, which had silted-in over a period of years, into the bank on the Ashley River. (Jury Tr. Excerpt, p. 16, Is. 16-17, September 27,1993). Prior to this dredging, Dent received permits from the South Carolina Coastal Council and the U.S. Army Corps of Engineers. (Jury Tr. Excerpt, p. 13, Is. 7-13, September 27, 1993; Plaintiffs Exs. 217 and 218). The Coastal Council permit was issued on August 17, 1983, and the Corps of Engineers permit was issued on December 7, 1983. The dredging began at the Ashley River and proceeded toward land. (Jury Tr. Excerpt, p. 17, Is. 20-21, September 27, 1993). As the dredging proceeded, creosoted lumber, timber and pile butts were unearthed by the dredge. (Jury Tr. Excerpt, p. 19, Is. 8-10, September 27, 1993). An oily sheen appeared on the water and a strong odor of creosote was detected by Dent. (Jury Tr. Excerpt, p. 19, Is. 14-16, September 27, 1993). The dredge material was pumped to a disposal area which was owned by Braswell adjacent to the Dent property. (Jury Tr. Excerpt, p. 20, Is. 12-15, September 27, 1993). Approximately 35,000 cubic yards were dredged by Dent and placed in the spoils area on parcel 29. (Jury Tr. Excerpt, p. 72, 1. 24 through p. 73, 1. 3, September 27, 1993). This area was “diked in” to contain the material. (Jury Tr. Excerpt, p. 21, Is. 5-8, September 27, 1993). A spillway from a culvert through the dike allowed water to drain out of the disposal area into the marsh area. (Jury Tr. Excerpt, p. 60, Is. 16-18, September 27,1993). The dredging into the bank of the Ashley River, which exposed the creosote, timbers and soil, coincided with a fish kill in the Ashley River that was investigated by DHEC, as previously mentioned. (Jury Tr. Vol. IV, p. 429, Is. 4-14). Mr. Fanning of DHEC found a sheen of oily material in the river that smelled like creosote. (Jury Tr. Vol. IV, p. 429, Is. 12-13; Conoco Ex. 12A). The dead fish smelled of creosote. (Jury Tr. Vol. IV, p. 443, Is. 21-23; Conoco Ex. 12A XDecember 14, 1984 Fanning Fish Kill Report). Dent agreed to cap the exposed bank with clay. (Jury Tr. Vol. IV, p. 444, Is. 16-20). A further release from the dredged area occurred in 1987. (Conoco Ex. 138 — March 26, 1987, photograph taken by Mr. Fanning showing the side of the barge slip at the Dent property). Southern Dredging was required to take immediate action to contain the release so Dent installed containment booms and absorbent booms for this purpose. (Jury Tr. Vol. IV, pp. 430-431). In June, 1990, Braswell (in connection with Braswell Shipyards v. Beazer East, Inc. v. Elliot Braswell, Civil Action Number 2:89-455-8) retained RMT, Inc., to perform a site investigation on parcels — 019 and — 049 to determine, among other things, if creosote compounds were present at that site. Creosote constituents were detected in soil samples as well as a groundwater sample taken from various areas of these parcels. In 1990, Aquaterra, Inc., was retained by Dent to perform additional soil sampling of the Dent property. (Jury Tr. Vol. II, p. 228, 1. 20 through p. 232,1. 17). Aquaterra’s July 6, 1990, study entitled “Site Assessment Southern Dredging Company, Inc., Charleston, South Carolina”, concluded that organic contamination existed at various areas of the Dent property. (Plaintiffs Ex. 69). ' The sediment samples from the barge canal and other soil samples taken by Aquaterra revealed the presence of creosote-based contaminants. The samples contained the same family of constituents as creosote, as well as the appearance and odor of creosote (black and oily type substance). (Jury Tr. Vol. II, p. 231, Is. 19 through p. 232, 1. 1). Creosote was also found in the impoundment. (Jury Tr. Vol. II, p. 232, Is. 10-13; Plaintiffs Ex. 69) (Figure 2 is the enlargement of the location of the Aquaterra sampling). This recitation of facts outlines the history of Koppers’ operations and the impact that such operations had upon what has now become the Superfund site. The use and disposal of creosote in tremendous quantities over a long period of years has saturated this site to significant depths and has resulted in migration of the contamination to the adjacent Dent property. The court will hereinafter summarize the relationship of Conoco and Agrico to these two adjacent tracts which comprise the Superfund site, and the operations of each and their impact on the properties and the surrounding environment. H. GOVERNMENT INTERVENTION I. EPA Involvement CERCLA’s priority ranking system requires that a facility be evaluated and scored based upon the groundwater hazards, the soil hazards, and/or the surface water hazards that are found at the site. A hazard ranking score determines whether the site is eligible to be listed on the National- Priority List (NPL) pursuant to CERCLA. (Jury Tr. Vol. 1, p. 75, Is. 21-23). If EPA ranks the site with a score greater than 28.5, then the site will be proposed for listing on the NPL. (Jury Tr. Vol. VI, p. 964, Is. 14-19). Each investigative report of this site reached the same result, namely, that the constituents of concern in the area were wood treating chemicals. In February, 1985, NUS Corporation (NUS) performed a Site Screening Investigation of the Dent property (parcels -012 and -029) in response to the 1984 fish kill in the Ashley River. (Jury Tr. Vol. 1, p. 71, Is. 3-10; Plaintiff’s Ex. 74). This study investigated the potential for COC in the area of the barge canal, the dredged spoil disposal area, the on-site impoundment, the adjacent marsh area, and the Ashley River. (Jury Tr. Vol. 1, p. 71, Is. 11-16; Conoco Ex. 10). Priority pollutant metals and volatile organic compounds were detected in the surface water, soil, and sediment samples. Later, on August 16,1988, NUS conducted a Hazard Ranking System (HRS) Field Testing Project Site Investigation of the former Koppers wood treating site on behalf of EPA (Plaintiffs Ex. 74). The NUS Study encompassed 127 acres, which included properties to the north and south of the Koppers facility. Sediment, surface soil, and subsurface soil samples, as well as surface water and groundwater samples, were collected and analyzed as part of this investigation. (Plaintiffs Ex. 74). The field sampling investigation was designed to document, identify and characterize the impact of constituents on the surrounding environment and to satisfy the requirement of the HRS Field Testing Project. NUS concluded from their investigation that PAH’s had affected the sediments of the sensitive environment (marshlands) and recreational areas along the Ashley River downstream from the site, and that PAHs from the former wood preserving activities were present in all media (soil, sediment, surface water and groundwater). (Plaintiffs Ex. 74). NUS reported that contamination was “readily attributable” to the past wood preserving operations on the Koppers property. (Plaintiffs Ex. 74). EPA issued its evaluation of the site pursuant to the HRS on August 28, 1991. In this case, the HRS evaluation resulted in a much higher score than the threshold of 28.50. The Koppers site received a score of 50, indicating it posed a relatively high degree of risk to public health and the environment. (Jury Tr. Vol. V, p. 652, Is. 7-17). The HRS score was a result of three exposure routes: soil contamination with direct human exposure potential; groundwater contamination; and proximity to the Ashley River. (Jury Tr. Vol. 1, p. 193, Is. 16-24). Again, the conclusion was reached that the remediation necessary at the site was driven by wood treating chemical constituents from creosote. (Jury Tr, Vol. 1, p. 194, Is. 14-17). On February 7, 1992, based on this high score, EPA proposed to add approximately 102 acres to the NPL, which included the 45-acre Koppers site and 57 acres located adjacent to the Koppers site, including the Dent property. (See 57 F.R. 4824 — February 7, 1992; Conoco Ex. 66). On June 26, 1992, EPA sent Beazer a “Special Notice Letter for Remedial Investigation/Feasibility Study” for the Koppers/Treating Plant Superfund Site. This letter notified Beazer of its potential liability pursuant to § 107(a) of CERCLA. Subsequently, on January 14, 1993, Beazer and EPA entered into an Administrative Order of Consent which set forth the Scope of Work and a 705-day schedule for the completion of the Remedial Investigation/Feasibility Study Work Plan (R17FS or Work Plan). (Conoco Ex. 26 pp. 7-1 through 7-2). In May, 1993, Beazer’s consultant, ENSR Consulting and Engineering (ENSR), drafted the Work Plan for the NPL site, which included a site description, a summary of past land uses and investigations at the site, preliminary identification of remedial action alternatives and of cleanup levels, a field sampling and analysis plan, and a schedule for completion. (Conoco Ex. 26). The Work Plan contemplated a two-phase field sampling and analysis plan for remedial investigation. (Conoco Ex. 26). The Phase I sampling program was designed to include information to characterize the site, to establish background levels of the analyses, and to provide sufficient data to conduct the human health risk assessment. In June and July, 1993, ENSR commenced the Phase I field activities. The boring and monitor well installation program implemented during Phase I was intended to provide preliminary information regarding regional and local geology and hydrogeology, as well as the nature and extent of select constituents present in on-site and off-site soil and groundwater. The data collected by ENSR confirmed that the site was contaminated with wood treating wastes which required remediation. 2. DHEC’s Public Health Assessment DHEC generated a Preliminary Public Health Assessment dated January 18 and March 24, 1993. (Conoco Ex. 12.41). The assessment concluded that the site was an “indeterminant public health hazard” based on the preliminary nature of the human exposure data available. DHEC’s assessment also identified wood treatment constituents as the source of the public health hazard. (Conoco Ex. 12.41). The reports submitted regarding the site are totally consistent with the evidence in this record that extensive wood treating waste contaminants are located on the site and that these contaminants make remediation of the site necessary. (Conoco Ex. 12.41). Koppers was the only source of wood treating wastes in this area. The wood treatment chemical contamination of the Koppers and Dent properties is pervasive according to factual reports as well as expert opinions. One of the factors with which the court must be concerned, and which bears mention in conjunction with governmental involvement, is the attitude of the party or parties found to be responsible for the contamination. The court has evaluated Koppers’ practices and policies over the entire length of time Koppers operated the site, weighing Koppers’ cooperation and response against what was known generally, and in the scientific community, about the contamination found at the site. Giving Koppers the benefit of the doubt in an evolving period of environmental regulation, this court has concluded that Koppers acted in total disregard of the duty it owed to its neighboring landowners and to the various governmental agencies. This conclusion is similar to the jury’s finding in the retrial of Braswell Shipyards v. Beazer East, Inc. v. Elliot Braswell, Civil Action Number 2:89-455-8, awarding the plaintiff fourteen (14) million dollars in punitive damages against Beazer. During the time that the FedServ storage tank problem was being addressed in 1985, EPA and DHEC were concerned with additional and more wide spread contamination at the site. Koppers responded to this concern by promising that it intended, immediately upon conclusion of the tank farm cleanup, to install a groundwater monitoring well to sample and assess the site for other contaminants present. (Jury Tr. Vol. IV, p. 464, Is. 5-13). This was never undertaken. (Jury Tr. Vol. IV, p. 453,1. 24 through p. 454,1. 5). This conduct is consistent with Koppers’ reaction in the 1960’s and 1970’s to its waste water problems and the reported fish kills previously discussed. The NUS Corporation generated data indicating that there was- creosote moving into the Ashléy' River from the Koppers site and accumulating in the sediments of the river and in the various organisms, among them being fish and shellfish found in the river. (Jury Tr. Vol. IV, p. 455,1.18 through p. 456, 1. 1; Plaintiffs Ex. 74). In 1990, DHEC commenced enforcement action against Beazer to require it to install a containment boom and absorbent material in the drainage ditches on the property in an effort to stem the flow of creosote from the site into the river. Beazer opposed this action and, as late as June 10, 1991, Beazer contended that site wide cleanup activities should not be conduce ed by it until other potentially responsible parties had been identified and directed to join in the effort. Only after the EPA consent order was signed in January, 1993, did Beazer install the containment devices in the ditch. Beazer argues now that it could not earlier remediate the entire property because it did not have authorization to enter on the properties of the other property owners. (Jury Tr. Vol. IV, pp. 478,1. 18 through p. 479,1. 6). While the court agrees that any landowner would want certain notifications and require restrictions on access to its property, Beazer’s argument is not persuasive. It had little difficulty obtaining consent of the various land owners once it decided to cooperate with EPA. (Jury Tr. Vol. VI, p. 996, Is. 2-9). Indeed, Beazer admitted that it placed a condition for going forward with site wide investigation (even before it began negotiations with EPA) that all other Potentially Responsible Parties (PRPs) be brought into the site wide evaluation. An ENSR document characterized , its understanding of the Beazer corporate philosophy, i.e., be aggressive with EPA because Beazer had many other remediation projects underway. (Jury Tr. Vol. V, p. 842, 1. 17 through p. 843, 1. 6; Conoco Ex. 148). ENSR is an environmental and engineering consulting firm which Beazer has employed to perform the RTFS on this Superfund site. This courts view of Beazer’s cooperation is similar to that expressed by DHEC’s Mr. Fanning, that is to say, Beazer only acted when required to do so. It appears to this court that passive migration of creosote has substantially contaminate ed the Ashley -River in the past and will continue to contaminate the Koppers and Dent properties until such time as remediation is complete. This court also believes that the needed remediation of the property will be completed only when remediation of the wood treatment constituents has been accomplished because the levels and locations of those constituents are the driving force behind necessary remediation of both properties. Since there is no documentation of visible surface migration, and since Beazer agrees that no direct dumping of contaminants occurred on the Dent property, the court finds that the massive contamination of the Dent property occurred through subsurface migration of creosote and other wood treating chemical constituents which originated from Koppers’ wood treating operation. Finally, as established by expert testimony, Beazer benefited over the years from its failure to upgrade the effluent waste handling system at its plant, in that it saved approximately $16 million dollars (present value) needed in upgrade costs (Cerela Tr. Vol. II, p. 125, Is. 16-24). Beazer will also realize an economic benefit from remediation of this site since it or its designee will acquire Dent’s property as a part of the settlement agreement between the two parties and, thus, it will receive the benefit of the expenditure of response costs on this property. (Cerela Tr. Vol. Ill, p. 344, Is. 2-12). On the other hand, Conoco and Agrieo will not realize any economic benefit from the cleanup of this site because they no longer own any property at this site. IV. CONCLUSIONS OF LAW AND SUPPLEMENTAL FINDINGS OF FACT A. CONOCO’S CONTRACT CLAIMS 1. The Lease Agreement is Binding on Conoco and Beazer Conoco brought an action for breach of contract against Beazer. South Carolina law governs the validity of the Lease in this case. The indemnity provision is clear and unambiguous. Where the terms of a contract are clear and unambiguous, its construction is for the court. Rental Uniform, Service of Florence, Inc. v. James E. Dudley, 278 S.C. 674, 301 S.E.2d 142, 143 (1983) citing Proffitt v. Sitton, 244 S.C. 206, 136 S.E.2d 257 (1964). In ascertaining the intention of the parties, the court must first look to the language of the contract. Blakeley v. Rabon, 266 S.C. 68, 221 S.E.2d 767 (1976). If the language of the contract is clear and capable of legal construction, the language alone determines the force and effect of the instrument. Superior Auto. Ins. Co. v. Maners, 261 S.C. 257, 199 S.E.2d 719 (1973). In this case, the Lease indemnity provision provided that the lessee would hold the lessor harmless for any claim made against the lessor arising out of the use of the leased premises. The indemnity was not restricted by the nature or the validity of the claim so long as it arose from use of the leased premises. (Pre-Trial Conference Tr., pp. 61-62, September 21, 1993). The court further holds that the indemnity provision covers the Dent claims against Conoco as well as Beazer’s claims against Conoco which arise from Koppers’ use of the leased premises. The contract is clear and requires Koppers to hold Conoco harmless from any and every claim arising out of the use by Koppers of the demised premises. 2. CERCLA Does Not Prohibit Private Parties From Allocating Liabilities for CERCLA Violations and the “Save Harmless” Agreement Includes CERCLA Under CERCLA, parties are free to contractually shift the burden for liability for response costs among themselves. 42 U.S.C. § 9607(e)(1) (“Nothing in [CERCLA § 107(e)(1) ] shall bar any agreement to insure, hold harmless, or indemnify a party to such agreement for any liability under [CERCLA § 107]”). See also, Channel Master Satellite Systems., Inc. v. JFD Electronics Corp., 702 F.Supp. 1229, 1231 (E.D.N.C.1988). (“Agreements to indemnify are not eliminated by the strict liability provisions of CERCLA.”); Jones-Hamilton Co. v. Kop-Coat, Inc., 750 F.Supp. 1022, 1026, 1027 (N.D.Cal.1990), rev’d on other grounds; Jones-Hamilton Co. v. Beazer Materials & Serv., Inc., 973 F.2d 688 (9th Cir.1992) (CERCLA does not limit “the freedom of private parties to contract amongst themselves”). Under CERCLA, private parties remain accountable to the government for the cost of liability, but such parties are free among themselves to contract out of CERCLA liability. [The] thrust of § 107(e) is that although one may not deny liability for response costs by virtue of an indemnity or hold harmless agreement, such agreements to indemnify are not eliminated by the strict liability provisions of CERCLA. (Emphasis added). Channel Master Satellite Sys., Inc. v. JFD Electronics Corp., 702 F.Supp. 1229 (E.D.N.C.1988) (emphasis added); See also, Jones-Hamilton Co. v. Kop-Coat, Inc., 750 F.Supp. 1022, 1026, 1027 (N.D.Cal.1990), rev’d on other grounds, Jones-Hamilton Co. v. Beazer Materials & Serv., Inc., 973 F.2d 688 (9th Cir.1992), following, Mardan Corp. v. C.G.C. Music, Ltd., 804 F.2d 1454 (9th Cir.1986) (CERCLA does not limit “the freedom of private parties to contract amongst themselves.”). In Jones-Hamilton, the court noted that CERCLA does not require more specific language in an agreement to indemnify against CERCLA liability than that which would be required under state law. Jones-Hamilton, 750 F.Supp. at 1027-28. Specifically, that court held that an indemnification agreement which encompassed “all losses, damages and costs” resulting from any violation of law was sufficient to release the indemnitee from CERCLA liability even though the agreement did not specifically mention CERCLA. Id. In Jones-Hamilton, the indemnity agreement was executed ten years before enactment of CERCLA, yet held to be effective under CERCLA. Jones-Hamilton makes it clear that indemnity agreements executed years prior to the enactment of CERCLA are sufficient to encompass indemnity for liability under CERCLA. In Jones-Hamilton Co. v. Beazer Materials & Serv., Inc., 973 F.2d 688 (9th Cir.1992), the Ninth Circuit Court of Appeals reversed the district court because material issues of fact existed regarding Beazer’s involvement in the disposal of toxic substances; however, the court inferentially upheld the district courts ruling that the indemnity agreement which was enacted prior to CERCLA still encompassed CERCLA liability. A recent Fifth Circuit case directly upholds this principle of law. In Joslyn Mfg. Co. v. Koppers, 40 F.3d 750, 754 (5th Cir.1994), the court stated: The Seventh Circuit recently recognized that a party may contract to indemnify another for environmental liability even though CERCLA was not in existence at the time of contracting. See Kerr-McGee Chem. Corp. v. Lefton Iron & Metal Co., 14 F.3d 321, 327 (7th Cir.1994). The broad language of the indemnification agreements at issue herein evidence a strong intent by the lessee to indemnify L & A for all liability arising in connection with the occupancy or use of the land. We hold that the indemnification agreements were intended to cover all forms of liability, including liability under CERCLA and LEQA, even though environmental liability under these statutes was not specifically contemplated at the time of contracting. The Jones-Hamilton indemnification clause is very similar to the Conoco indemnification provision which provides that Conoco is to be held “harmless from any and every claim.” (Plaintiffs Ex. 1 — Lease p. 3, ¶8). As in Jones-Hamilton, Conoco’s indemnification agreement, though enacted prior to CERCLA, is nonetheless effective under CERCLA. A private party contract which apportions CERCLA liability must contain a provision which allocates risks of this nature to one of the parties. Rodenbeck v. Marathon Petroleum Co., 742 F.Supp. 1448 (N.D.Ind.1990). The Rodenbeck court upheld a contractual provision which provided that one of the parties shall be released “from all claims and obligations of any character or nature whatsoever arising out of or in connection with said agreement” as being sufficient to indemnify against claims arising under CERCLA vis-a-vis the other contracting party. Id. The Conoco indemnification clause does just that: The Lessee agrees that it will not do or permit to be done any act or thing upon said demised premises which shall or may subject the Lessor to any liability or responsibility for injury to any person or persons or to property by reason of any business or operation being carried on upon the demised premises or for any other reason; [Beazer] agrees to save [Conoco] harmless from any and every claim arising out of the use by [Beazer] of the demised premises or the construction or other work done thereon by [Beazer], (Plaintiffs Ex. 1 — Lease p. 3, ¶ 8) (Emphasis added). As in Rodenbeck, this contractual provision is sufficient to effect indemnification from claims arising under CERCLA against Conoco. The court finds that the indemnification clause in the Lease pertains to CERCLA claims and is valid; therefore, Beazer is liable to Conoco under the terms of the agreement for any and all CERCLA claims related to the use by Koppers of this property. 3. The Lease Indemnity Provision Covers Conoco’s Attorneys’ Fees, Expert’s Fees and Settlement Costs. A contract of indemnity will be construed in accordance with the rules of construction for contracts generally. Campbell v. Beacon Manufacturing Co., 313 S.C. 451, 438 S.E.2d 271, 272 (Ct.App.1993); Federal Pacific Elec. v. Carolina Production Enterprises, 298 S.C. 23, 378 S.E.2d 56 (Ct.App.1989), citing, Longi v. Raymond-Commerce Corp., 34 N.J.Super. 593, 113 A.2d 69 (1955). South Carolina follows the modem trend in looking to the principles of equity in construing the right to indemnity. See Stuck v. Pioneer Logging Machinery, Inc., 279 S.C. 22, 301 S.E.2d 552, 553 (1983). According to equitable principles, a right of indemnity exists whenever the relation between the parties is such that either in law or in equity there is an obligation on one party to indemnify the other, as where one person is exposed to liability by the wrongful act of another in which the first party does not join. (Id., citing, 41 Am.Jur.2d Indemnity § 2; 42 C.J.S. Indemnity § 21). Here the parties specifically contracted for Beazer to hold Conoco harmless from any and every claim arising out of the use of the demised premises. The court finds that the attorneys’ fees, settlement costs, and all other allowable costs incurred by Conoco in this action are recoverable under the indemnity agreement. As to attorneys’ fees, in actions of indemnity, brought where the duty to indemnify is either implied by law or arises under a contract, reasonable attorneys’ fees incurred in resisting the claim indemnified against may be recovered as part of the damages and expenses. Addy v. Bolton, 257 S.C. 28, 183 S.E.2d 708, 710 (1971), quoting, 22 Am.Jur.2d Damages § 166. As to settlement and other allowable costs, in South Carolina Electric & Gas v. Utilities Construction Co., 244 S.C. 79, 135 S.E.2d 613, 614 (1964), the South Carolina Supreme Court was asked to interpret an indemnity provision whereby the contractor agreed to hold SCE & G “harmless from any and all claims for damages ... arising out of or in any way connected with the performance of any work covered by [the] contract.” After settling a personal injury claim arising from Utilities’ work, SCE & G sought indemnity from Utilities under the contract. The indemnity provision was upheld and Utilities was required to pay settlement costs, attorneys’ fees and expenses to SCE & G. In order to recover attorneys’ fees under an indemnity agreement in South Carolina, the party must show that: 1) it had become involved in a legal dispute either because of a breach of contract by the defendant or because of defendant’s tortious conduct; 2) the dispute was with a third party— not the defendant; and 3) the party incurred attorneys’ fees connected with that dispute. If the attorneys’ fees were incurred as a result of a breach of contract by the defendant, that defendant will be deemed to have contemplated that his breach might cause the other party to seek legal services in the dispute with the third party. Addy, 183 S.E.2d at 709-710. Dent commenced this action against Conoco as a result of Beazer’s use of the leased premises. This issue was placed before the jury and it found that Conoco was sued solely because of Beazer’s use of the leased premises. (Jury Tr. Vol. VIII, p. 1210, Is. 4-14; p. 1301, Is. 18-20). Although Beazer maintained that Dent’s lawsuit included certain allegations that would not be covered by the hold harmless provision, mere allegations in a complaint do not control whether the noneulpable party is entitled to indemnification. Town of Winnsboro, 414 S.E.2d at 120-21. ■The jury found that Conoco was named in this lawsuit solely because of Beazer’s use of the leased premises and, thus, Conoco is covered by the indemnity agreement contained in the Lease. The determination of the amount and reasonableness of attorneys’ fees remains a question of law for the court. Federal Deposit Ins. Corp. v. Aroneck, 643 F.2d 164, 166 (4th Cir.1981) (Fourth Circuit interpreting South Carolina law on award of attorneys’ fees.). See also, Ex Parte Stevens, Stevens & Thomas, P.A., 277 S.C. 150, 283 S.E.2d 444 (1981). The court finds that the most appropriate way to determine the reasonableness of attorneys’ fees is to do so after a hearing which this court will hereinafter schedule, unless the parties can reach an agreement thereon. In addition, at that hearing, the court will decide any issue that pertains to the reasonableness of settlement costs and other allowable costs associated with this litigation. The parties shall be notified and will be allowed to present briefs and affidavits as to these particular issues. B. AGRICO’S EQUITABLE INDEMNITY CLAIM Dent sued Agrico on December 5, 1989. The Complaint set forth five state law causes of action against Agrico: negligence and negligence per se, ultrahazardous activity, money had and received, indemnity, and fraud. Agrico was forced to litigate with Dent and incur attorneys’ fees and costs because of the contamination of the Dent property by Koppers’ wood treating operations. Such expenditures of attorneys’ fees and costs were a natural and necessary consequence of Koppers’ creosote contaminating operations. Agrico did not join in and had no connection with these operations. Under South Carolina law, equitable indemnity allows a party to recover attorneys’ fees and costs of defending an action from the party whose wrongful act caused the first party to be sued. Town of Winnsboro v. Wiedeman-Singleton, Inc., 303 S.C. 52, 398 S.E.2d 500, 502 (Ct.App.1990), aff'd, 307 S.C. 128, 414 S.E.2d 118 (1992). The