United States: Case Settled! New Jersey Supreme Court Says No Time Limits To Spill Act Contribution Claims

Last Updated: February 6 2015
Article by Kevin J. Bruno and Kevin R. Doherty

Action Item: Defendants can no longer assert a statute of limitations defense to claims of contribution under the New Jersey Spill Compensation and Control Act, N.J.S.A. 58:10-23.11, et seq. ("Spill Act"). Following this week's unanimous decision by the New Jersey Supreme Court in Morristown Associates v. Grant Oil Co., et al., a responsible party cleaning up a contaminated site can pursue claims against other potentially responsible parties without worrying that their claims may be time-barred. Simply put, there is no statute of limitations applicable to statutory claims for contribution brought under the Spill Act.

Facts & Procedural History

In 1979, plaintiff Morristown Associates purchased a strip mall in Morristown, New Jersey. One of the strip mall's tenants, a dry cleaning business, had installed a steam boiler and an underground storage tank ("UST") to house fuel for the boiler. The dry cleaning business was later sold and resold several times to different individuals. In 2003, when oil contamination was subsequently discovered in the soil surrounding the strip mall, it was determined that the contamination was caused by the dry cleaner's leaking UST.

Morristown Associates took steps to remediate the property, and in 2006, filed Spill Act claims against one of the fuel companies that had serviced the UST, seeking contribution for costs related to the cleanup. Over the next three years, Morristown Associates filed three amended complaints, adding the owners and prior owners of the dry cleaning business and several other oil companies as additional defendants.

The defendants moved for summary judgment on the ground that the plaintiff's contribution claims, based on the Spill Act, were time-barred by the general six-year statute of limitations for property damage claims (N.J.S.A. 2A:14-1), arguing that the plaintiff should have been aware of the leaking UST by at least 1999, when another UST in the strip mall was investigated and found to be leaking. The trial court agreed, finding that the six-year statute of limitations applied to Spill Act claims for contribution and, as such, claims against the defendants for damage that occurred more than six years before a defendant was brought into the case were time-barred. Relying on reasoning contained in several New Jersey Federal District Court decisions, rather than an unpublished New Jersey Appellate Division decision that found otherwise, the Appellate Division affirmed the trial court, ruling that because the Spill Act does not address a statute of limitations, plaintiffs in Spill Act cases must comply with the general six-year statute of limitations applicable to common law property claims. The Appellate Division looked for guidance by looking to the Spill Act's federal counterpart, the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA"), which unlike the Spill Act contains several explicit statute of limitations periods applicable to private CERCLA contribution claims. In so doing, the court also applied discovery rule concepts in determining when the statutory period began to run, thereby not only applying a defense to a Spill Act contribution claim that previously had not existed, at least in New Jersey state courts, but doing so in what the plaintiff certainly believed to be a rather draconian way.

The New Jersey Supreme Court granted certification to answer once and for all whether the six-year statute of limitations applies to contribution claims under the Spill Act. It does not.

The Supreme Court's Analysis

The Supreme Court began by looking at the history and purpose of the Spill Act, noting that under the Act, any person who has discharged or is responsible for a hazardous substance, shall be strictly liable, jointly and severally, without regard to fault, for all cleanup and removal costs no matter by whom incurred. The Court also recognized, among other things, that the Spill Act was expressly amended to allow the party performing the cleanup to bring contribution claims against other potentially responsible parties to recoup the costs of the cleanup and removal.

Although the Spill Act is notably silent as to whether there is a statute of limitations for such contribution claims, the Act does list several specific defenses for contribution defendants. In turn, the Court focused on the Act's provision specifying that a defendant shall have "only" those defenses to liability available to it under N.J.S.A. 58:10-23.11g(d), i.e., "an act or omission caused solely by war, sabotage, or God, or a combination thereof." Recognizing that the Spill Act enumerates the only defenses available to contribution defendants, and that a statute of limitations defense is not included in the list, the Supreme Court found that the legislature could not have intended to permit the imposition of contribution liability on culpable dischargers to be frustrated by the imposition of a general and prior enacted, but unreferenced, statute of limitations. The Supreme Court differentiated the statute of limitations defense from other unlisted defenses that should presumably be maintained, such as challenges to venue, service of process, and subject matter jurisdiction, as those defenses are established by court rules under the jurisdiction of the Supreme Court, and are not subject to overriding legislation. Statutes of limitations, by contrast, are the product of the legislature.

The Supreme Court concluded that the plain text and a common-sense reading of the Act supports this view—that the only defenses available to contribution claims are the ones to which the legislature specifically referred. Moreover, the construction adopted by the Court "supports the longstanding view, expressed by the legislature and adhered to by the courts, that the Spill Act is remedial by design to cast a wide net over those responsible for hazardous substances and their discharge on the land and water of this state." Consequently, Morristown Associates is now permitted to move forward with its contribution claims against the partiesthat serviced the UST years ago.

Conclusion

The Supreme Court's ruling is welcome news to responsible parties performing cleanup work, as they no longer have to fear losing the opportunity to sue other potentially responsible parties for contribution due to time constraints. The ruling is consistent with the Spill Act, which is designed to facilitate the cleanup of contaminated sites and hold dischargers responsible for such cleanups. It undoubtedly allows more contributing defendants to be brought into the cleanup process, as the Court's decision once and for all closes the door on the statute of limitations defense (unless, of course, the legislature amends the Act).

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Kevin J. Bruno
Similar Articles
Relevancy Powered by MondaqAI
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions