A hearing before a U.S. magistrate failed yesterday to determine who is responsible for disposing of thousands of gallons of dangerous chemicals recently discovered in storage tanks in the small Eastern Shore community of Sharptown, Md.

The property, claimed by the Small Business Administration after the former owner defaulted on an SBA-insured loan, was sold to Baltimore real estate dealer Warren Klawans at an auction in June but Klawans says he has not yet taken title.

The question of who owns the land is crucial, since that dispute is holding up plans to dispose of the chemicals, which include at least one highly flammable solvent and a high concentration of the cancer-causing agent PCB.

While the informal hearing was going on in the chambers of Magistrate Daniel E. Klein Jr. in Baltimore, officials of the Environmental Protection Agency were continuing to run tests to make sure no fumes were leaking from the tank containing PCB, according to EPA official Howard Lamp'l.

That tank, according to Coast Guard Capt. J. William Kime, contains about 7,000 gallons of waste oil, which is laced with an "extremely high" concentration of PCB -- about 31 percent of 310,000 parts per million.

Tests also are continuing to determine the exact contents of the 39 10,000-gallon tanks. Disposal operations must wait two or three weeks until these tests are complete, according to Maryland's Assistant Attorney General John B. Griffith. "Nobody's going to move anything until we know what's in the tanks," he said.

The presence of the PCB and substantial amounts of the chemicals benzene and zylene were discovered after federal and state officials ran tests last month on the contents of the tanks, which used to be part of an oil reprocessing plant.

The Coast Guard officers have contacted at least three disposal firms to determine whether they could handle the job of removing the tanks' contents, and Kime said he forsees no problem with the disposal of the benzene and xylene, but it may be difficult to find a site to bury the virtually indestructible polychlorinated biphenyl, or PCB.

Although it has a $20 million fund to pay for cleanup of oil spills or areas where spills could occur, Kime said the Coast Guard is prohibited from using that fund if another federal agency owns the property involved.

The SBA is claiming in federal court that Klawans owns the property: the real estate dealer is claiming it is the SBA's responsibility.

More hearings on the ownership question are scheduled Friday and Oct. 18.