N.J. Appellate Court Extends Time Limit for Bringing Strict-Liability Claim for Natural Resource Damages

Thanks to a special “extension statute” enacted in 2001, the statute of limitations that requires the State of New Jersey to commence a civil action within ten years of its accrual does not apply to an action for natural resource damages (NRDs) that is brought “pursuant to the State’s environmental laws.” The Appellate Division recently held that the Legislature intended “the State’s environmental laws” to include the common law — or at least the common law of strict liability — and revived a claim that otherwise would have been time-barred.

The State’s Department of Environmental Protection (DEP) filed two complaints against Exxon Mobil Corporation in August 2004, seeking natural resource damages for discharges of pollutants at sites in Linden and Bayonne under the Spill Act and common-law theories of nuisance and trespass. DEP later amended its complaints to add counts sounding in strict liability.

When the trial court dismissed the nuisance and trespass claims, finding that they were time-barred because the extension statute did not apply to such common-law claims, DEP did not appeal that ruling. But when the trial court reached the same conclusion about the common law strict liability claim, DEP filed an interlocutory appeal, which the Appellate Division agreed to hear. Reversing the trial court, the appellate court held that the extension statute did apply, such that DEP’s strict liability claim was not time-barred.

Prior to 1991, New Jersey courts followed the old doctrine of nullum tempus occurrit regi (roughly “time does not run against the king”), under which statutes of limitation did not run against the State. When the Supreme Court abandoned that doctrine in 1991, the Legislature enacted the general ten-year statute of limitations for civil actions brought by the State.

Ten years later, the Legislature exempted various environmental claims from the ten-year statute, and passed the extension statute, one provision of which established a four-year (later changed to 5½-year) limitations period for civil actions to recover NRDs “commenced by the State pursuant to the State’s environmental laws.” Moreover, the extension statute provided that such a cause of action could not accrue before January 1, 2002. (It now sets the accrual date as the later of January 1, 2002 or the completion of the remedial action.) Under the general statute, then, DEP would have had to commence its action by 2001; under the extension statute, its 2004 actions would be timely.

The Appellate Division was thus called on to decide the scope of “the State’s environmental laws,” which the extension statute defines as any one of nine different statutes “or any other law or regulation by which the State may compel a person to perform remediation activities on contaminated property.” In both of its rulings, the trial court had read “the State’s environmental laws” in context, noting that it came between a list of nine statutes and a reference to a “regulation,” which would be promulgated pursuant to a statute.

The Appellate Division took an entirely different tack, subtly transforming the statutory reference to “the State’s environmental laws” to mean “the State’s environmental law,” in the sense of a body of law. Noting that the statutory definition referred to “any other law” rather than using the definite article “a” — but neglecting to explain the distinction between “another law” and “any other law” — the Court first found the statute to be ambiguous. This conclusion allowed it to search elsewhere for clues about the Legislature’s intent.

The clues that the Appellate Division chose to consider ranged from minute textual details (the omission from the statute of a word of limitation such as “only”) to statements from legislative history. For example, there was no evidence that the Legislature had the intent of “curtailing the scope of DEP’s regulatory authority” or meant “to foreclose common law causes of action.” One might easily draw a distinction, however, between statutes that “curtail” or “foreclose” causes of action, and those that merely set time limits. Similarly, the Appellate Division accepted DEP’s argument — which cited provisions of CERCLA, the federal remediation statute — that it would not make sense to require the State to assert claims for natural resource damages before the underlying cleanup is completed. But even if strict liability claims were found to be outside the scope of the extension statute, the State would still have numerous statutory causes of action to recover NRDs. Indeed, the Court’s references to CERCLA would seem to help make the point that the statutory provisions, whether state or federal, apply to statutory causes of action.

The Appellate Division’s holding was limited to strict liability claims; DEP chose not to appeal from the trial court’s rulings that its trespass and nuisance claims were time-barred. Nor did the Appellate Division explicitly address other types of common law claims. For now, however, “time does not run against the State” when it seeks to assert a strict liability claim for NRDs — at least until the cleanup is done.

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