SUMMARY
In Morristown Associates v. Grant Oil Co., the New Jersey Supreme Court unanimously ruled that a six-year statute of limitations does not apply to private claims for contribution of costs incurred to remediate contaminated property under the Spill Compensation and Control Act, N.J.S.A. 58:10-23.11 (the “Spill Act”). Relying on legislative intent and the “plain” meaning of the statute, the Court concluded that the Spill Act only authorizes a contribution defendant to assert enumerated defenses in the Spill Act, and the six-year statute of limitations defense for property damage was not one of them.
When a private party remediates a discharge of hazardous substances, the Spill Act grants that person a right of contribution against all other persons who are liable for the cost to remediate the discharge. See N.J.S.A. 58:10-23.11f(a)(2)(a). The Spill Act neither expressly includes or excludes the application of statute of limitations to a contribution action. Although silent on statute of limitations for contribution actions, the Spill Act does state 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). For private parties, those limited enumerated defenses are “an act or omission caused solely by war, sabotage, or God, or a combination thereof” and what is commonly referred to as the “innocent purchaser” defense. Relying on the rules of statutory construction, the court found the statute’s language expressly restricting the defenses under the Spill Act to provide “significant support for a conclusion that no statute of limitations applies.”
For practitioners, key practice points from Morristown Associates include:
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The decision forecloses a contribution defendant from asserting a six-year statute of limitations defense when facing a private claim for cleanup and removal costs under the Spill Act. However, the Spill Act statutory defenses of “an act or omission caused solely by war, sabotage, or, or a combination thereof” still apply. Also, nothing in this decision alters a contribution defendant’s ability to assert the Spill Act’s “innocent purchaser” defense under N.J.S.A. 58:10-23.11g(d)(2) and (5).
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This decision supersedes all the prior federal court opinions, interpreting the Spill Act, which did apply a statute of limitations to contribution claims. Federal courts in the future should defer to the decision of New Jersey's highest court on this significant interpretation of state law.
