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Chemos Corp. v. State

Decided: December 15, 1989.


Antell, Bilder and Ashbey.

Per Curiam

[237 NJSuper Page 360] Plaintiff Chemos appeals from the action of the Department of Environmental Protection (DEP) rescinding its approval of a "negative declaration" that Chemos' leased industrial site could

legally be closed without penalty or cleanup under the Environmental Cleanup Responsibility Act (ECRA), N.J.S.A. 13:1K-6 et seq., and the rules, regulations and procedures adopted thereunder (N.J.A.C. 7:26B-1.1 et seq.).*fn1 We affirm based on our conviction that Chemos was not prejudiced by DEP error. Nonetheless, we write briefly concerning the absence of DEP regulations with respect to the actions which Chemos challenges.

We begin with a brief review of the Act. The Environmental Cleanup Responsibility Act (ECRA), N.J.S.A. 13:1K-6 et seq., was enacted in 1983 to provide for expeditious cleanup of industrial sites at the time they are closed, sold or otherwise transferred. The object of the statute was to impose:

The legislative intent was clearly expressed in its finding

To that end,

strict requirements are established requiring owners or operators of an industrial establishment planning to close, sell or transfer operations to give notice to

DEP, N.J.S.A. 13:1K-9 and to develop and implement a DEP approved cleanup plan unless DEP defers the cleanup in certain specified instances. N.J.S.A. 13:1K-9 & 11. [ Superior Air Prod. v. NL Industries, 216 N.J. Super. 46 at 62-63 (App.Div.1987).]

It is of course clear that ECRA is a "no fault" statute which carries sanctions for failure to comply. See N.J.S.A. 13:1K-13a; N.J.A.C. 7:26B-1.7(a),*fn2 and the courts have liberally interpreted its remedial language. See Dixon Venture v. J. Dixon Crucible, 235 N.J. Super. 105 (App.Div.1989) (ECRA remedies include incidental damages as between buyer and seller of ECRA regulated land); Matter of Fabritex Mills, Inc., 231 N.J. Super. 224 (App.Div.1989) (abandonment of hazardous substance manufacture leaving unlabeled drums is not a continuation of "storage" activity and triggers ECRA cleanup); Matter of Vulcan Materials Co., 225 N.J. Super. 212 (App.Div.1988) (closure of industrial establishment located on landfill does not trigger cleanup under the Solid Waste Management Act, but does trigger ECRA); In re Robert L. Mitchell Tech. Ctr., 223 N.J. Super. 166 (App.Div.1988), certif. den. 111 N.J. 605 (1988) (transfer of research facility auxiliary to industrial establishment triggers ECRA).*fn3

Chemos proposed to close its ECRA-covered "small business" industrial establishment. N.J.A.C. 7:26B-1.10(d). See N.J.S.A. 13:1K-8f. The facility had long been involved in the manufacturing of coatings for metal, wood and plastic. The substances used in its manufacture of enamels, lacquers and paints were stored in drums, and its hazardous substance inventory included: Acetone, Toluene, Amyl Acetate, Methyl Ethyl Ketone, Methanol, Ethyl Acetate, Nitrocellulose, Xylene, Ethanol, Dibutyl

Phthalate, N-Butanol, Butyl Acetate, Butyl Alcohol, Dioctyl Phthalate, mineral spirits, and Sodium Hydroxide, all of which it asserted had been or would be removed from the site as part of its closure plan.*fn4

In order to evaluate Chemos' ECRA appeal, a brief review of the applicable regulations is in order. Under DEP regulations ECRA applies upon "triggering" events. One such "trigger" is the cessation of operations. N.J.A.C. 7:26B-1.5(b)15. Another is the termination of a lease. N.J.A.C. 7:26B-1.5(b)13. Both of these "triggers" applied to Chemos. An industry proposing to close its operation must give written notice to DEP no more than 5 days subsequent to public release of the closure decision, N.J.A.C. 7:26B-1.6(a)3, along with a general information statement (GIS). This GIS must be followed by a Site Evaluation Submission Statement (SES) within 45 days. N.J.A.C. 7:26B-3.2(c). The SES requires inter alia a detailed sampling plan for soil, surface water, groundwater and air. N.J.A.C. 7:26B-3.2(c)11. The only way that the operator of the industrial establishment may avoid the sampling plan requirement is to "propose [exemption] to the Department . . . by providing full documentation of the justification . . . [other than economic]." N.J.A.C. 7:26B-3.2(d). After a sampling plan is approved, DEP must be able to observe the taking of samples and may take its own samples. N.J.A.C. 7:26B-4.2. Sampling results must be accompanied by a proposed negative declaration (or cleanup plan), and if not satisfied, DEP may require further sampling. N.J.A.C. 7:26B-4.3. DEP notifies the applicant when required information has been satisfactorily submitted and the filings are complete. N.J.A.C. 7:26B-3.2(f).*fn5

There is no applicable statutory or regulatory time-frame for DEP's approval of a cleanup plan. Under the statute, however,

an applicant may seek a "negative declaration" (that no hazardous substances remain) and within 45 days of the submission of this proposed negative declaration, DEP must approve the negative declaration or inform the industrial establishment that a cleanup plan is to be submitted.*fn6 N.J.S.A. 13:1K-10b; N.J.A.C. 7:26B-5.2. Under its regulations DEP "shall" not approve the negative declaration until notice and sampling plan requirements are met. N.J.A.C. 7:26B-5.1(b). Following submission of a negative declaration, if the Department so determines, the owner or operator must submit a cleanup plan within the time DEP specifies. N.J.S.A. 13:1K-10b; N.J.A.C. 7:26B-5.2(d)2.

In preparation for seeking DEP approval of a negative declaration, on or about August 3, 1988, Chemos filed its GIS and notified DEP's Division of Hazardous Waste Management that it had ceased doing business as of that date at the site (which was owned by Alken Realty Co., Inc. (Alken), its landlord). DEP immediately advised Chemos that it had not given sufficient lead time (60 days) prior to closing, which might affect the validity of its action under ECRA, and that it would not review whether the site as closed complied with ECRA until Chemos' SES was submitted. Chemos filed its SES on September 16, 1988. The SES indicated that a sampling plan "is currently in preparation and will be submitted subsequent to this document." DEP sent a deficiency notice, noting the absence of a sampling plan. In answer to DEP's deficiency notice of October 13, 1988, Chemos filed an SES supplement on March 2, 1989, providing results of fuel oil tank integrity test but no sampling plan. Its SES supplement said, "Since the ...

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