Source: Star-Ledger (NJ), February 9, 2014
Posted on: http://envfpn.advisen.com
When A&S Russo Real Estate Co. tried to sell its Union Township property two years ago, it learned a consultant hired more than a decade ago to clean up an underground heating oil spill hadn’t really done the remediation.
So when it tried to force the consultant to pay for the cost of the cleanup, a Superior Court judge threw out the claim, saying A&S waited too long to sue.
With a slew of conflicting rulings at the trial and appellate court levels over the statute of limitations for environmental remediation cases, the owners of polluted properties like A&S say New Jersey’s law governing cleanup responsibility is too murky. They’re looking to a case currently before the state Supreme Court to provide the final word on whether the owners of properties where spills of hazardous substances have occurred are restricted to a six-year limit on bringing lawsuits against the responsible polluters to help with cleanup.
“The question is, who’s really responsible at the end of the day? Who should bear those costs?” said attorney Gregory Pasquale, who represents A&S. “Hopefully the Supreme Court will make a decision that will identify how best to allocate those costs.”
He said cleanup of the property can take several years and will have a price tag for his client “in the six figures.”
At issue is whether the state’s Spill Act has a statute of limitation in bringing lawsuits against responsible polluters. Pasquale said the most recent definitive word on this came in a 1994 Appellate Division decision that concluded the 10-year limit argued in that case didn’t apply to the Spill Act. But it didn’t say whether the Spill Act had any limit.
So since that ruling, some courts have said there are limits and some have said there aren’t.
That’s why Lawrenceville attorney Janine Bauer said she formed the Innocent Landowners Group, a loosely affiliated group of property owners — including A&S — who want clarification. The group is asking to file a friend-of-the-court brief in the Supreme Court case even though they’re not direct parties in the lawsuit.
Bauer said statutes of limitations in environmental cleanup cases were generally believed as necessary to speed up the remediation process. But that hasn’t been the result, she said, because tracking pollution plumes and finding the polluters is a lengthy and complicated process.
“People thought imposing a statute of limitations was going to result in quicker cleanups and faster (lawsuit) filings,” she said. “But it’s not.”
Also seeking to join in the case is the New Jersey State League of Municipalities. Ed Purcell, staff attorney for the league, said state laws governing environmental cleanup responsibility are inconsistent. In one law, the Industrial Site Recovery Act, there is no statute of limitations for municipalities to sue previous owners of property they obtain through foreclosures. But as the Spill Act has often been interpreted through the courts, there is a statute of limitation for towns when they buy contaminated property outright or obtain it through eminent domain.
“It doesn’t make any sense,” Purcell said.
The case to be decided by the Supreme Court was brought by property owner Morristown Associates, which owns Morristown Plaza in Morristown.
Morristown Associates sued several heating oil companies and the previous owners of a dry-cleaning business it claims was responsible for the pollution of heating oil at the shopping center through leaking fill pipes leading to an underground storage tank. It says they have a responsibility to help pay for the cleanup.
But in its ruling last year, the Appellate Division said New Jersey’s Spill Act has a six-year statute of limitations and that Morristown Associates had long passed that deadline when it filed its lawsuit in 2006.
Morristown Associates said it only learned about the contamination in 2003, from an adjoining property owner.
Agreeing with the trial court, the appellate panel said Morristown Associates should have known about the underground pollution because it has owned the property since 1979 and the dry-cleaning business had been receiving heating oil deliveries since then.
Arguments in the case have not been scheduled.
Depending on how the state’s highest court rules, Pasquale said, this much-anticipated decision will either let responsible parties off the hook for environmental cleanups — leaving the current owners shouldering the high costs of remediation — or will spread the liability to former owners who thought they had relinquished all ties with the property.
Pasquale said that if the court upholds a statute of limitations, he’d like it to start the clock ticking from the time property owners incur the cleanup costs, not from when they knew or should have know there was contamination. He said that would make it fair to property owners involved in complicated and onerous cleanups.