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New Jersey Department of Environmental Protection v. Exxon Mobil Corporation

420 N.J. Super. 395, 22 A.3d 1 (App. Div. 2011)

ENVIRONMENTAL LIABILITY —The New Jersey law that extends the statute of limitation within which the state may sue an alleged polluter based on violation of an environmental law encompasses claims under the common law.

The state filed two complaints against an oil refinery owner asserting Spill Act claims and common law claims of public nuisance and trespass. It sought natural resource damages for the discharge of hazardous substances at two sites. Over the refiner’s objections, it then moved to amend the complaints to include strict liability counts. The refiner asked for partial summary judgment asserting, among other things, that the statute of limitations had expired on the state’s common law claims for nuisance and trespass, and that a New Jersey statute extending the statute of limitations for certain environmental claims did not apply. The lower court granted that motion, and the state did not seek interlocutory relief. The refiner then moved for partial summary judgment to dismiss the common law strict liability claim using the same statute of limitations rationale. The lower court granted that motion and dismissed that count. It rejected the state’s argument that the common-law claim could fit into the extension statute as being a state environmental law because environmental laws often involve aspects of strict liability.

On appeal, the state argued that the lower court erred in dismissing the strict liability claim. It argued that the common law is a component of the state’s environmental laws and therefore the extension statute applied; the lower court’s conclusion was contrary to caselaw; and the conclusion reached by the lower court would lead to absurd results. The Appellate Division noted that the extension statute lacked the article “a” before “law or regulation,” meaning that the statute made general reference to environmental laws, and was not restricted to one or more such laws. It also held that the extension statute did not have a savings clause referring to the common law. Further, the law’s approach to preemption, seeking to foreclose any action that a local government entity may undertake, is to be restrictive and that preemption is contrary to the expansive attempt to maintain regulatory authority over polluters. Lastly, the Court held that the statute was clear and unambiguous. It surveyed the legislature’s intent and found that the goal was to provide the state with additional time to pursue environmental claims and thus the legislature crafted the statute without using words of restriction. At the end of the day, the Court was reluctant to interpret the extension statute to foreclose common law causes of action unless the legislative intent specifically provided otherwise.

The Court next noted that the only cases cited as the basis to contend that the lower court’s ruling was contrary to other caselaw were unpublished cases and, thus, not precedential or binding on the lower court. In considering the absurdity argument, it noted that federal law sources underscored the relevance of the timing of the commencement of natural resource damages claims. To insist that common law claims must precede the statutory claims would turn this rational procedure on its head. That reasoning that would allow for such a scenario would indeed generate an absurd result.

The Court concluded that the legislature extension used the words “any other law” to encompass common law strict liability claims, such as the one at issue. Thus, it reversed the lower court’s decision and remanded the matter to the lower court.

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