Supreme Court of New Jersey Finds No Statute of Limitations Under The Spill Act
On January 26, 2015, the Supreme Court of New Jersey issued its much awaited decision in Morristown Associates v. Grant Oil Co., et al., __ N.J. __ (2015), rev’g 432 N.J. Super. 287 (App. Div. 2013), holding that “based on the plain language of the Spill Act, reinforced by its legislative history, … [the general] six-year statute of limitations [for injury to real property, N.J.S.A. 2A:14-1,] is not applicable to Spill Act contribution claims.”
In Morristown Associates, the plaintiff sought to recover from several oil delivery companies and a dry cleaner tenant at its shopping center the costs to remediate contamination resulting from a leaking fill pipe connected to an underground storage tank. The Appellate Division affirmed the trial court’s grant of summary judgment to defendants, finding that a six-year statute of limitations applied to private party contribution actions brought pursuant to the New Jersey Spill Compensation and Control Act, N.J.S.A. 58:10-23.11 (“Spill Act”), and that such limitations period had expired before the plaintiff asserted its claim. The court reasoned that sufficient indications of contamination should have prompted further investigation by the plaintiff earlier than six years before it commenced suit.
The Supreme Court granted certification on the question of whether the general six-year statute of limitations for damage to real property applied to a private claim for contribution under the Spill Act and, if so, whether the discovery rule - an equitable doctrine that tolls the start of the running of the statute of limitations until the condition is or reasonably should have been discovered - should be applied. Following extensive briefing and more than two hours of oral argument from the parties and interested amici, the Court declared that no statute of limitations exists for Spill Act contribution claims; as a result, it did not need to address the applicability of the discovery rule.
The Court based its decision on a careful parsing of the statutory language, specifically, the liability provision, N.J.S.A. 58:10-23.11g(c), and the defense provision, N.J.S.A. 58:10-23.11g(d). While both are mentioned in the contribution provision of the Spill Act, N.J.S.A. 58:10-23.11f(a)(2)(a), neither sets forth a statute of limitations nor, conversely, states that one does not apply. However, the Spill Act does provide 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)].” N.J.S.A. 58:10-23.11f(a)(2)(a). This list of available defenses includes only acts of war, sabotage or God – but no statute of limitations. The Court observed that interpreting the Spill Act to have no statute of limitations is consistent with the remedial intent of the Spill Act and of the Legislature in enacting it.
While a contribution plaintiff may no longer be compelled to file a claim within a legal time limit, the Court’s decision does not address the application of the equitable principle of laches to bar or limit recovery should inexcusable delay occur in the assertion of a claim. It therefore remains incumbent upon a party who may have been harmed by contamination caused by another party to investigate potential sources of contamination and not delay in bringing its claim. A potential plaintiff also should take care to develop and preserve such scientific proofs and other evidence necessary to support its claim; without the pressure of a statute of limitations, evidence could become stale or lost if a claim is allowed to linger.
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