Search Site
Menu

NJ Supreme Court: Environmental Litigation Over Cleanup Cost Allocation May Proceed

 Sets New Environmental Law Precedent

New Jersey’s highest court has ruled that in private contribution claims arising under the Spill Act, “a party determined to be a discharger and held responsible for the cost of cleanup by the DEP is entitled to bring a contribution claim against other potentially responsible parties before the final tally of cleanup costs.” Today’s decision in Magic Petroleum Corp. v. Exxon Mobil Corp., — N.J. — (2014) answered the open question of whether a company (or individual) responsible for cleaning up contaminated property must await state approval of its cleanup plan before suing others also believed to have contributed to the contamination. This was a critical question because the environmental investigation and remediation of a contaminated property can take many years and involve substantial expense. Now, parties engaged in environmental clean ups can rest assured that they may immediately pursue contribution from others who are also responsible for the contamination.

The case before the New Jersey Supreme Court related to the cleanup of a gas station located in Millstone Township, New Jersey. At issue were two adjoining gas stations. One was previously an Exxon station and one was operated by a company called Magic Petroleum. When the New Jersey Department of Environmental Protection (DEP) filed administrative actions against Magic Petroleum to compel the a cleanup of a regional gasoline spill, the company in turn filed a lawsuit in New Jersey Superior Court alleging that Exxon Mobil was in fact responsible for most of the cleanup costs. The trial court found that Magic Petroleum’s “contribution” case was premature because the state DEP had not yet approved a final cleanup plan for the site. The trial court believed that allocation of liability between Magic and Exxon would be more accurate if adjudged after the DEP performed its role in overseeing investigation and cleanup. The appellate court, relying on the doctrine of primary jurisdiction, affirmed the dismissal and stated that any party seeking contribution must obtain DEP’s written approval of a cleanup plan for filing a contribution claim.

Property Owners Need Not Wait to Sue Those Responsible for Contamination

In today’s ruling, the State Supreme Court held that a party who incurs cleanup and removal costs may immediately pursue a claim for contribution against other parties responsible for the contamination. This right to pursue contribution lawsuits grows out of the express language of New Jersey Spill Compensation and Control Act (Spill Act), as well as common law (as codified in the Joint Tortfeasors Contribution Law and the Comparative Negligence Act). The court determined that primary jurisdiction was not applicable and that “plaintiff property owners or other responsible parties are permitted to file contribution claims in Superior Court, and a court may allocate liability before the final resolution of a site remediation plan by the DEP.” In finding that a DEP-approved remediation plan was not a prerequisite to filing a contribution claim, the high court noted the distinction between (1) an allocation of liability and (2) the total amount of cleanup costs. While recoverable ‘cleanup and removal costs’ may include only those approved by the DEP, a court may allocate a percentage of responsibility for a particular site. Thus, the court concluded that a “trial court may determine, subject to proofs” whether one or more dischargers are responsible for contamination and “may assign liability to responsible parties, based on evidence presented at trial.”

Today’s decision provides clarification for the regulated community. Those engaged in the often expensive endeavor of investigating and remediating environmental contamination do not need to defer their efforts to obtain contribution from other potentially responsible parties.

 Additional Resources:

 

Leave a Reply

Your email address will not be published. Required fields are marked *

Our Attorneys

Recent Twitter Posts

  • New Jersey sets emergency water standards for new chemicals. https://t.co/trgaaLL1mD
    5 months ago
  • How will New Jersey manage stormwater as the climate changes and flooding increases? https://t.co/dhVLALyzZ2
    5 months ago
  • Unprecedented storms are slamming NJ – learn how to be the best advocate for your clients when the next flood hits.… https://t.co/TicH6iAjP0
    5 months ago
  • Trenton Water Works has removed 25 percent of lead pipes throughout its service area. https://t.co/KUvhMsJlvU
    5 months ago

Recent Blog Posts

Supreme Court concludes that attorney review period is not a requirement of absolute auction contracts

On June 9, 2022, the New Jersey Supreme Court unanimously decided that attorney review period is not a required contractual provision for a residential real estate sale by absolute auction.
Read More
Supreme Court concludes that attorney review period is not a requirement of absolute auction contracts

It Depends on the Language – The Non-Disparagement Clause

How enforceable is a non-disparagement clause in an agreement? As is always the case with any contract or agreement, it depends on the language. On May 31, 2022, the Appellate Division
Read More
It Depends on the Language – The Non-Disparagement Clause

DCA Tries Again to Use RSIS to Limit Municipal Stormwater Controls

By Michele Donato, Esq. and Stuart Lieberman, Esq. In the 1990’s, developers claimed that municipal residential development ordinances lacked uniformity, increased development costs, and caused uncertainty in the development process. In
Read More
DCA Tries Again to Use RSIS to Limit Municipal Stormwater Controls

Previous Property Manager Charged with Embezzling and Laundering Stolen Funds from Hamilton Park CO-OP.

Nicolas DePaola of Ewing New Jersey was indicted on twelve charges for embezzling and laundering stolen money from his prior client, Hamilton Park CO-OP. On April 1, 2022, a Mercer
Read More
Previous Property Manager Charged with Embezzling and Laundering Stolen Funds from Hamilton Park CO-OP.

In The Media

  • Gulf Coast Town Center facing foreclosure

    Naples Daily News, September 16, 2015

    Wells Fargo filed a lawsuit Sept. 8 against an affiliate of CBL & Associates, the owners of the decadeold, 1.2 million-square-foot mall in south Fort Myers for a $190.9 million unpaid loan. The center has 94 stores on 204 acres, with such anchors as Super Target, Belk, Best Buy, Dick’s Sporting Goods, Marshalls and Costco...

    Read More
  • Town liable for private company's leaking underground tanks, court rules

    NJ.com Jul 26, 2017

    CRANFORD -- A couple that owned a businesses in town and became sick from leaking underground tanks owned by an adjacent business can sue the township for damages because the tanks were partially ...

    Read More
  • Dark Waters: How a Class Action Catapulted NJ to Forefront of 'Forever Chemicals' Battle

    NJ Law Journal Jan 09, 2020

    As property owners become increasingly aware of PFAS contamination, and as individuals exposed to PFAS learn of the health risks associated with exposure, liability will likely affect entire supply chains.

    Read More
  1. 1
  2. 2
  3. 3
  4. 4
  5. 5
Contact Our Firm

Quick Contact Form