Spill Act Contribution Claims Not Subject to Statute of Limitations

The Supreme Court of New Jersey recently held that private claims for contribution made pursuant to the New Jersey Spill Compensation and Control Act (Spill Act) are not subject to the general six-year statute of limitations that applies to injury to real property.

The court ruled that the Spill Act enumerated only specific defenses which did not include a statute of limitations, and that the absence of a statute of limitations was consistent with legislative intent and the Spill Act’s broad scope.

The Legal Background

The Spill Act provides a right of contribution for “dischargers or persons [who] clean[] up and remove[] a discharge of a hazardous substance” against “all other dischargers and persons in any way responsible for a discharged hazardous substance or other persons who are liable for the cost of the cleanup and removal.” The statute does not include a statute of limitations. However, the Spill Act does state that “[a] contribution defendant shall have only the defenses to liability available to parties pursuant to [N.J.S.A. 58:10-23.11g(d)], which are “an act or omission caused solely by war, sabotage, or God, or a combination thereof.”

The Facts of the Case

Morristown Associates v. Grant Oil involved fuel oil contamination at a strip mall shopping center located in Morristown, New Jersey. Plaintiff Morristown Associates purchased the property in 1979. At some point prior to January 1, 1978, one of its tenants, Plaza Cleaners, installed a steam boiler in a room at the rear of the leased space and an underground storage tank (UST) for fuel to operate the boiler. The business had been sold several times when monitoring of a well installed near Plaza Cleaner’s UST revealed fuel oil contamination in 2003.

A subsequent investigation revealed that although the UST was intact, the fill and vent pipes were “severely deteriorated, with large holes along a significant portion of their lengths.” Plaintiff’s experts concluded that those holes had developed as early as 1988 and, since that time, oil had been leaking from the pipes each time the tank was filled. Morristown Associates took responsibility for remediating the property and subsequently brought Spill Act claims against the oil companies that provided service to the property as well as the owners of the dry cleaning business.

The trial court applied the six-year statute of limitations contained in N.J.S.A. 2A:14-1 and concluded that the claims against defendants for damage that had occurred more than six years before that defendant was brought into the case were time-barred. The Appellate Division affirmed, reasoning that general statutes of limitations are applicable when particular statutes did not set forth a specific limitation period. The plaintiff appealed.

The Court’s Decision

The New Jersey Supreme Court sided with the plaintiff and several amici, including the Department of Environmental Protection and the New Jersey State League of Municipalities, which argued that the six-year statute of limitations does not apply to Spill Act contribution claims.

In reaching its decision, the unanimous court emphasized that the Spill Act specifically limited the defenses available. “The plain text supports that the legislature intended to include no statute of limitations defense for contribution defendants,” Justice Jaynee LaVecchia wrote. “A common-sense reading of the plain language chosen by the legislature supports that construction.”

She further explained: “[T]he construction we adopt supports the longstanding view, expressed by the Legislature and adhered to by the courts, that the Spill Act is remedial by design to cast a wide net over those responsible for hazardous substances and their discharge on the land and water of this state.”