United States: Sovereign Immunity Protects New Jersey From Spill Act Liability

Last Updated: April 11 2017
Article by Edward McTiernan and Michael D. Daneker

New Jersey's Spill Compensation and Control Act (the Spill Act) turns 40 this year.1 The defining feature of the Spill Act is its prohibition on any unpermitted discharges of hazardous substances.2 Because it imposes strict liability on dischargers and persons in any way responsible for discharges, limits defenses to acts of war, sabotage and acts of God, and includes a private right to seek contribution from other responsible parties, the Spill Act has prompted numerous environmental cleanups. However, after four decades, there are still many contaminated sites in the Garden State awaiting investigation and cleanup. As a result, the Spill Act is increasingly called upon to address regional situations ranging from groundwater pollution impacting entire aquifers to watershed-wide sediment contamination. In recent years, the Spill Act and its federal counterpart, the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA),3 have been applied to complex environmental problems related to urbanization and widespread industrial activities rather than unpermitted discharges from a single facility. Not surprisingly, the cost to remediate these regional problems can be staggering.4 If these 'mega-sites' are to be resolved in an efficient and cost-effective manner, all potentially responsible parties, including the government, will need to contribute their fair share. It is this backdrop that renders the New Jersey Supreme Court's March 27, 2017 decision in NL Industries, Inc. v. State of New Jersey5so perplexing.

The cleanup in NL is precisely the type of novel problem that the Spill Act and CERCLA are now routinely expected to address. The "site" at issue in NL is not a factory or landfill, rather it is the shoreline of Raritan Bay including a seawall and jetty that were apparently first developed by the federal Army Corps of Engineers (ACOE) in the 1880s on land partially owned by the State of New Jersey. In 1966, the ACOE rebuilt the jetty and created a public beach. Three years later an unrelated commercial party agreed to install additional improvements intended to protect the public beach from erosion. These improvements included construction of a new seawall and reinforcement of the jetty using industrial slag. Both the ACOE and the State of New Jersey (acting through the Department of Environmental Protection (DEP)) approved this plan. Thirty-five years after it approved the placement of industrial slag on its property, New Jersey, acting through DEP, detected contamination along the seawall and in the bay. A subsequent investigation by the United States Environmental Protection Agency (EPA) determined that NL was the source of the slag and that a clean-up, estimated to cost $79 million, was required. After EPA demanded that NL fund the cleanup, NL filed a complaint in state court seeking contribution from New Jersey pursuant to the Spill Act.

New Jersey sought to dismiss NL's Spill Act claim by invoking sovereign immunity. The trial judge noted that the State has always been listed as a potentially responsible person in the key Spill Act definition and that the Legislature has never immunized or otherwise excluded the State from the class of persons from whom a discharger may seek contribution. The trial court also relied upon longstanding precedent to conclude that the Spill Act imposes liability for discharges that predate its adoption and therefore applied to the slag deposited on land owned by New Jersey in the late 1960s.6 As a result, the trial court rejected New Jersey's motion and the Appellate Division affirmed.7 On appeal, the New Jersey Supreme Court conducted a detailed analysis of the history of the Spill Act and its various amendments. The Court agreed with NL and the lower courts that the State was expressly included in the definition of 'persons and therefore subject to contribution claims by other dischargers and responsible persons. However, the Court parted company with NL and the lower courts on the question of whether New Jersey could rely upon sovereign immunity to avoid liability for pre-Spill Act discharges. The Supreme Court placed a great deal of emphasis on the fact that the definition of 'person' predated the Spill Act amendments that created the private right of contribution. And, although it agreed that the State was liable for post-adoption discharges, in the final analysis the Court failed to find a sufficient statement of Legislative intent to retroactively abrogate sovereign immunity and reversed.

The NL decision is confounding on many levels. The dissent takes issue with the "interpretive acrobatics" relied upon by the majority and notes that the basic reasoning used by the majority is contrary to the Legislature's undisputed decision to encourage expeditious cleanups by making the State equally responsible with private parties.8

Many private responsible parties would agree. Moreover, courts in New Jersey, including the Supreme Court, have generally refused to expand the defenses available under the Spill Act. As recently as 2015, the New Jersey Supreme Court reasoned that because New Jersey's general statute of limitations was not listed among the available Spill Act defenses, "[w]e decline to handicap the Spill Act's intentionally broad effect" by reading any limitation into the right to seek contribution.9It is hard to understand why the Court departed from this line of cases when deciding NL. Finally, because the 11th Amendment generally prevents private parties from using CERCLA to recover from States, the holding in NL will inevitably slow cleanups at sites where New Jersey played a role prior to 1976. From now on private parties will be expected to shoulder the entire cost of such cleanups.10As the Spill Act enters its fifth decade it may be time for the Legislature to intervene to avoid a full-blown mid-life crisis.


1 N.J.S.A. 58:10-23.11 to 23.24.

2 See generally Magic Petroleum Corp. v. Exxon Mobil Corp., 218 N.J 390 (2014).

3 42 USC §§ 9601 et seq.

4 For example, EPA estimates that it will cost $1.38 billion to remediate sediments in the Lower Passaic River in New Jersey. See EPA News Release.

5 NL Industries, Inc. v. State of New Jersey, A-44-15(076550) (March 27, 2017), http://njlaw.rutgers.edu/.

6 In the seminal Spill Act decision, Department of Environmental Protection v. Ventron, 94 N.J. 473, 498 (1983), the New Jersey Supreme Court found that "the Legislature has expressly declared that the Spill Act should be given retroactive effect."

7 NL Industries, Inc. v. State of New Jersey, 442 N.J. Super. 428 (Law Div. 2014), aff'd 442 N.J. Super. 403 (App. Div. 2015).

8 Slip Opinion, Dissent at page 6.

9 Morristown Associates v. Grant Oil Co., 220 N.J. 360, 384 (2015).

10 See Seminole Tribe of Florida v. Florida, 116 S.Ct. 1114(1996).

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.

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
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please 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.


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.


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