Property owners who suffer damages as a result of contamination must be aware of time limitations to recover damages.   A New Jersey appellate court recently upheld the rule that, unlike recovery of cleanup costs in contribution actions under the New Jersey Spill Compensation and Control Act, recovery of other damages under tort theories, such as lost sales, lost rental values and the like, remain subject to the six-year statute of limitations.  In 320 Assocs., LLC v. New Jersey Natural Gas Co., (A-1831-16T2) (June 29, 2018), the Appellate Division, upheld a lower court’s decision dismissing Plaintiff’s claims for money damages as untimely.

The owner of commercial property located near a New Jersey Natural Gas property sued the gas company for damages resulting from coal tar that had migrated onto the owner’s property.  The owner asserted common law claims against the gas company for negligence, per se negligence, strict liability, nuisance and trespass.  It sought damages for a lost sale and lost rental value as well as an order mandating the gas company to cleanup up both properties.

The Appellate Division determined that, since Plaintiff discovered the contamination in 2008, the six year statute of limitations barred all but one claim.  Only the nuisance survived for further fact finding because nuisance is considered ongoing so long as the nuisance can be abated.

The case is a reminder that property owners with common law claims need to be aware that, while environmental statutes permit claims for cleanup and cleanup costs without time limitations, other damages are not recoverable if they are asserted after the statutory limitations periods.

On February 12, 2018, the Trump Administration released its much-anticipated Infrastructure Plan. While the bulk of the more than 50-page document proposes a wide array of funding and reforms for various infrastructure programs, as well as ways to streamline and fast-track permitting for infrastructure projects, it also proposes changes to Brownfield redevelopment programs, including the federal Superfund law (CERLCA).  The plan seeks to incentivize the redevelopment of contaminated properties and address related legal and financial risks.

The proposed changes include allowing National Priorities List sites to be eligible for Brownfield revolving loan fund and grant programs, clarifying and expanding the liability protections for state and local governments that acquire contaminated properties through tax foreclosures and the like, expanding EPA’s authority to enter into administrative agreements with brownfield developers, and eliminating restrictions on funding for infrastructure projects that could be integrated with a remediation.  This would mean even more change at EPA, which has been busy implementing the Superfund Task Force Recommendations released last year.

 

 

Earlier this week, the New Jersey Supreme Court clarified in NL Industries, Inc. v. State of New Jersey, (A-44-15) (March 27, 2017), that the State of New Jersey retains its sovereign immunity under the New Jersey Spill Compensation and Control Act (Spill Act), N.J.S.A. 58:10-23.11 to 23.24, for discharges of hazardous substances that occurred prior to the 1977 enactment of that law.

In a Spill Act contribution claim against the State and several private parties for the costs to remediate parts of the Raritan Bay impacted by contaminated slag used in the early-1970s to construct a seawall, NL Industries alleged that the State was a liable “person” under the Spill Act and subject to a private party contribution claim.  The State had approved the construction of the seawall and the disposal of the contaminated slag in the Raritan Bay.

When the Spill Act was adopted in 1977, it created a Spill Fund to pay for the clean-up of hazardous substances discharged by “any person” after the law was enacted.  The Spill Act defined “person” to include the State.  In 1979, the Legislature amended the Spill Act to allow the State, but not private parties, to use the Spill Fund to remediate discharges that occurred prior to the enactment of the Spill Act.  In 1991, the Spill Act was amended again, imposing strict liability on any responsible “person” for cleanup costs “no matter by whom incurred,” and allowing private party contribution claims to recover costs from any such “person,” including for pre-Spill Act discharges.  NL Industries argued that these amendments worked together to allow private party contribution claims against the State for pre-Spill Act discharges.  NL Industries also agreed with the trial court’s conclusion that the State’s sovereign immunity for pre-Spill Act discharges was waived based on the Supreme Court’s decision in Department of Environmental Protection v. Ventron Corp., 94 N.J. 473 (1983), which applied Spill Act liability retroactively for pre-Spill Act discharges.

The Court rejected NL Industries’ argument and the trial court’s reliance on Ventron.  The Court began its analysis by affirming that the State’s sovereign immunity can be waived only by a clear and unambiguous expression of legislative intent.  While the Court acknowledged that it may be possible to construe the language of the 1991 amendments to the Spill Act to allow for contribution claims against the State for pre-Spill Act discharges, the Court explained that this was not enough.  Neither the 1991 amendments, nor any other provision of the Spill Act, contained the deliberate, clear and unambiguous expression by the Legislature required to strip the State of its sovereign immunity for pre-Spill Act discharges.  The Court also clarified that the retroactive application of the Spill Act in Ventron applied narrowly to only pre-Spill Act discharges that the State remediated with Spill Fund monies and sought reimbursement for from private parties, leaving the State’s sovereign immunity protection from liability for its own pre-Spill Act discharges in place.

Justice Albin, in his dissent from the Court’s majority opinion, wrote that the Court’s interpretation of the Spill Act “leads to the absurd result” of a private party being held on the hook for the entire cost to clean-up a pre-Spill Act discharge even when the State and the private party are both jointly responsible.  Given that discharges of hazardous substances can occur decades before contamination is discovered and that the State can easily be one of many, if not the primary, “person” responsible for pre-1977 discharges, it is worth watching how the Court’s decision impacts a private party’s remediation at such sites now that the State is immune from contributing to the cleanup of pre-Spill Act discharges.

Last week, the New Jersey Department of Environmental Protection (NJDEP) announced a new Response Action Outcome (RAO) Notice, which allows Licensed Site Remediation Professionals (LSRPs) to issue an RAO for a site with contaminated sediment that migrated from an off-site source.  The new notice, entitled “Sediment Contamination From an Off-Site Source Not Remediated – General,” is the most recent addition to the growing list of RAO notices.

The notice can be used after a Preliminary Assessment and Site Investigation (PA/SI) confirms that the source of the sediment contamination is off-site and not related to the site being evaluated.  The off-site source must be reported to NJDEP and the resultant new incident number included in the Notice.  Furthermore, the LSRP can identify an existing NJDEP case if it is known to be the off-site source and is currently undergoing investigation or remediation.

Given that it is well-established law that you are not responsible for contamination coming from offsite, the primary purpose of this action appears to be to streamline the RAO process.  So, this is another tool in the LSRP toolbox for the often complicated sediment cases, which continue to garner regulator’s attention here in New Jersey and nationwide.

Read more on sediment contamination in these discussions:

JOIN THE CLUB: EPA Sizing Up Hackensack River for Superfund Listing

WE ARE JUST GETTING STARTED: EPA Issues Much Anticipated Cleanup Plan for the Lower 8.3 Miles of the Lower Passaic River

 

The Hackensack River may be joining the likes of the Passaic River, the Hudson River, Gowanus Canal, Newtown Creek, Fox River, the Eighteen Mile Creek, and other waterways that have been placed on the Superfund National Priorities List (NPL) by the United States Environmental Protection Agency (EPA) because of extensive contamination resulting from decades of industrial operations along their banks and tributaries.  EPA recently announced that it will begin sampling the Hackensack River’s sediment in 2016 to determine if it is also polluted enough to be placed on the NPL.

In February of this year, the Hackensack Riverkeeper, a non-profit advocacy and conservation group, petitioned the EPA to study the river for inclusion on the NPL.  In an uncharacteristically quick response, EPA agreed to and then commenced a Preliminary Assessment (PA) of the Lower Hackensack River, which is the 17-mile stretch of the river between the Oradell Dam and the mouth of the river in Newark Bay.  This section runs through Bergen and Hudson counties in New Jersey and has several tributaries.

The PA was released earlier this fall.  It comes as no surprise that contaminants including cadmium, lead, mercury, dioxin, benzo(a)pyrene, dibenzo(a,h)anthracene,  PCBs and dieldrin were identified at unacceptable concentrations.  Furthermore, because the tidal influence on the sediments causes both upstream and downstream migration of contaminants, it also comes as no surprise that EPA identified hundreds of facilities and sites as possible sources of the contamination, many of which could become potentially responsible parties (PRPs) as the investigation of the river unfolds.  Most significantly though, EPA assigned a preliminary Hazard Ranking System score of 50, well above the minimum score of 28.5 needed to get on the NPL.  EPA plans to sample the sediment next year as a next step in the process of determining whether to list the river on the NPL.

Given the long history of industrial activities on and near the Hackensack River, it is fully expected that the sediment sampling results will warrant listing on the NPL.  And, given EPA’s increasing attention on surface water and sediments, it is fully expected that EPA will move forward with the listing.  This would be just the start of years of studying the river to identify the most contaminated sections, develop remediation plans and, of course, identify the likely sources of the contamination and pursue claims against them as PRPs.