A cornerstone of environmental legislation in New Jersey is The New Jersey Spill Compensation and Control Act (“Spill Act”), N.J.S.A. 58:10-23.11 et seq.; New Jersey’s analogue to the federal Comprehensive Environmental Response, Compensation, and Liability Act, more commonly known as CERCLA. Like CERCLA, the Spill Act is the primary tool for the State of New Jersey to hold polluters financially responsible and to force cleanup of contaminated properties.
And as with CERCLA, the Spill Act provides that individuals or entities that pay for remediation of property may seek contribution from others who bear a share of responsibility for clean-up costs. Unlike CERCLA, however, the Spill Act does not provide a statute of limitations for bringing such contribution actions.
In August 2013, the New Jersey Superior Court decided in Morristown Assocs. v. Grant Oil Co., 74 A.3d 968 (N.J. App. Div. 2013), that reimbursement/contribution claims under the Spill Act are governed by the six-year statute of limitations for actions for property damage in N.J.S.A. 2A:14-1. Superior Court also held that the limitations period for Spill Act claims would be triggered by the discovery rule.
Thus, the court engrafted on the Spill Act a six-year limitations period that begins to run once a plaintiff knows or should know that it possessed a claim against another party under the Spill Act. And the court specifically held that where “enough indications of environmental contamination were present to put the plaintiff on reasonable notice of a need to investigate further” the statute will begin running.
While the United States District Court for the District of New Jersey has applied the six-year statute of limitations to Spill Act claims for some time, see e.g. Kemp Indus. v. Safety Light Corp., 1994 U.S. Dist. LEXIS 21466, at *89-90 (D.N.J. Jan. 25, 1994), this decision represents a fairly substantial shift in the law at the state level, and was predictably appealed to the New Jersey Supreme Court who heard argument in the case on October 6.
An interesting question is whether the limitations period should apply retroactively, i.e., to existing claims, including claims which are more than six years old, which a putative plaintiff knew or should have known about, but for which suit has not been filed. Should the court hold that the limitations period is retroactive, such putative plaintiffs could suddenly find their claims time-barred. That, in turn, could lead to malpractice actions against attorneys who may have given advice that turned out to be incorrect.