Supreme Court Rules Against DEP on Spill Act Proofs

September 27, 2012 | No Comments
Posted by Paul H. Schneider

In a September 26, 2012 decision, the New Jersey Supreme Court decided that to recover money damages under the Spill Compensation and Control Act (Spill Act), it is not enough for DEP simply to prove that a defendant discharged a hazardous substance present at the contaminated site. Rather, to obtain monetary damages DEP must show a “reasonable link between the discharge, the putative discharger, and the contamination at the specifically damaged site.”

In DEP v Dimant, the Department of Environmental Protection sued to recover the costs of investigating and remediating contaminated groundwater that tainted private wells. The defendant had discharged PCE at a strip mall, and the soil and groundwater in the area were contaminated with PCE. There were other potential dischargers of PCE in the area, and both the trial court and Appellate Division decided DEP failed to establish that the defendant’s discharge caused or contributed to the groundwater contamination in issue.

In upholding the lower courts, the Supreme Court reaffirmed the strict, joint and several liability standard specified in the Spill Act, and stated that DEP need not meet the traditional common law “proximate causation” standard. Yet the Court ruled that to recover damages under the Spill Act, DEP must do more than simply prove that the defendant was responsible for a discharge. While the mere existence of a discharge is sufficient for DEP to obtain injunctive relief requiring that the discharge cease, “some casual link is undoubtedly required to impose liability for damages resulting from a discharge.” This requires that DEP prove that the defendant “committed a discharge that was connected to the specifically charged environmental damage of natural resources — the groundwater damage — in some real, not hypothetical, way. A reasonable nexus or connection must be demonstrated by a preponderance of the evidence.”

While the Supreme Court’s decision leaves intact the strict, joint and several liability standard upon which the Spill Act is premised, it assures that a defendant cannot be held liable for damages or cleanup costs based on mere hypotheses or speculation.

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