NL Industries v. State of New Jersey Spill Act Decision

Legal Update: New Jersey Spill Act Decision

The State of New Jersey can no longer assert that it should be exempt from liability under the New Jersey Spill Compensation and Control Act, N.J.S.A. 58:10-23.11, et seq. (“Spill Act”), based on a decision by the New Jersey Superior Court, Middlesex County in NL Industries v. State of New Jersey, Docket No. L-1296-14, affirmed by the Appellate Division this week (Docket No. A-0869-1413). In this case, Plaintiff NL Industries filed a complaint against the State seeking contribution under the Spill Act for cleanup costs associated with remediating contamination resulting from the construction of a sea wall and jetty at the Laurence Harbor shoreline in Old Bridge Township. The complaint alleged that the State, in accordance with its regulatory jurisdiction, approved the construction of a sea wall incorporating the use of heavy metal slag materials which ultimately caused or contributed to lead contamination for which the estimated cost of remediation was likely to exceed $75 million dollars. The State moved to dismiss, arguing, inter alia, that the Spill Act did not retroactively abrogate sovereign immunity, i.e., that they should not be held liable for any offending action or omission (in this case, lead contamination) that occurred prior to the enactment of the Spill Act in 1977 and that the N.J. Tort Claims Act requirements applied before the Spill Act liability could be imposed on the State.

In denying the State’s motion to dismiss Plaintiff NL Industries’ Complaint, Superior Court Judge Wolfson ruled that since the Spill Act’s definition of a “person” subject to the provisions of the Act expressly included the State of New Jersey, and because Spill Act liability extends to any person “who is in any way responsible” for discharging a hazardous substance, and granted a right of contribution against “persons who are in any way responsible” for discharging a hazardous substance,  it would be illogical to exclude the State from Spill Act liability. Judge Wolfson further ruled that the N.J. Tort Claims Act requirements did not apply to the State’s liability under the Spill Act.

Given this ruling, we can expect Plaintiffs and other parties involved in Spill Act litigation will be looking for opportunities to add the State as a party in their cases in appropriate situations.

If you have any questions about the NL Industries v. State of New Jersey decision or believe that it might apply to your case, please contact me, John M. Scagnelli.