NJ High Court to Decide if 6 Year Statute of Limitation Applies to Environmental Cleanup Cost Recovery Claim Under the Spill Act

On October 6, 2014, the Supreme Court of New Jersey will be hearing oral argument in Morristown Assoc. v Grant Oil Co., 432 N.J.Super 287 (App. Div. 2013), a case involving the statute of limitations applicable to claims arising under the New Jersey Spill Compensation and Control Act (“Spill Act”). The Morristown case, which involves a lawsuit filed by the owner of a shopping center to recover environmental cleanup costs from oil companies and a dry cleaner, made waves last year for its ruling that Spill Act claims were subject to a six-year statute of limitation. Before the 2013 Morristown ruling, it had been widely understood that there was no statute of limitation on Spill Act claims.

The Spill Act is the centerpiece of environmental legislation in New Jersey. It is the law that requires those responsible for discharging hazardous substance to clean up contaminated property or reimburse others who have incurred cleanup costs (including the State of New Jersey through the Department of Environmental Protection). In Morristown, the plaintiff alleges that contamination of the soil and groundwater at its property was caused by a leaking underground storage tank (UST). The Appellate Division held that the claim was time barred because it was brought outside the six year period imposed by N.J.S.A. 2A:14-1, which began running in 1999 when the shopping center should have realized that contamination may have existed. The Court reasoned that enforcing the statute of limitations does not prevent a diligent plaintiff from recovering contribution under Spill Act claims; it just requires that a plaintiff under the Spill Act file in a timely manner. 

Supreme Court Ruling Could Have Widespread Impact for Industrial Property Owners, Business Community, and (Re)Developers

The ruling has the potential for wide-spread impact on hazardous site remediation, brownfield development, and other pending environmental litigation matters. The potential for state-wise impact by this ruling is so strong, it led to the New Jersey Department of Environmental Protection (NJDEP) and the New Jersey State Bar Association (NJSBA) to file amicus briefs, requesting that the State Supreme Court overturn the Appellate Division’s ruling. On behalf of its non-profit client, the Passaic River Coalition, Lieberman Blecher & Sinkevich P.C. also filed an amicus brief.

The Supreme Court will hear oral argument in the Morristown case on Monday, October 6, 2014. The oral argument will stream live on the judiciary’s website: https://www.judiciary.state.nj.us/webcast/

Our firm will be following the progress of this case very closely to ensure we can provide our clients with the best service in cases affected by the outcome of this ruling.