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Forsgate Industrial Complex, L.P. v. Leggett & Platt

October 11, 2007


On appeal from the Superior Court of New Jersey, Chancery Division, Bergen County, Docket No. C-458-05.

Per curiam.


Argued September 26, 2007

Before Judges Wefing and Parker.

In this Spill Act*fn1 case, plaintiff Forsgate Industrial Complex, L.P. (Forsgate) appeals from an order entered on September 22, 2006 dismissing the complaint and counterclaim without prejudice. We affirm.

This action arises out of the cleanup of an industrial site now owned by defendant Leggett & Platt, Inc. (Leggett). Leggett's predecessor in interest, Crest-Foam Corp. (Crest-Foam), began a cleanup of the property in 1986. On October 18, 2005, the Department of Environmental Protection (DEP) issued a no further action (NFA) letter indicating that the cleanup was complete. The NFA letter indicated that it did not affect the rights of any third parties under the Spill Act.

Plaintiff initiated this action in December 2005, claiming that a plume of contaminated groundwater "is highly likely" to have migrated onto plaintiff's property, from defendant's property. Plaintiff sought (1) a declaratory judgment "that groundwater and surface contamination from the Crest[-]Foam [f]acility has migrated to and contaminated one or more of the Forsgate Properties;" and (2) injunctive relief compelling Crest-Foam to clean up their property. Defendants counterclaimed, seeking among other things, a declaratory judgment "that groundwater and surface contamination was contaminated . . . during ownership . . . by Forsgate" and seeking to have Forsgate declared "a responsible party pursuant to the New Jersey Spill Act." Defendants moved for summary judgment or, alternatively, to transfer the matter from Chancery to the Law Division.

In his written opinion, Judge Peter Doyne indicated that both the court and the DEP have concurrent jurisdiction under the Spill Act and that "the DEP may order remediation off-site where necessary, where contaminants have migrated in a manner contrary to established environmental standards." Although the parties consented to transfer the action from General Equity to the Law Division, Civil Part, Judge Doyne stated that "[t]he nature and scope of remediation is peculiarly within the DEP's expertise . . . at least in the first instance." Consequently, rather than transfer the complaint and counterclaim to the Law Division, he dismissed both to allow the parties to proceed before the DEP.

In this appeal, plaintiff argues that the trial court erred in dismissing the complaint because the Spill Act confers "the unconditional right to bring a private cause of action in the New Jersey Superior Court."

The Spill Act does, indeed, allow a private right of action to recover cleanup costs from responsible parties. Bahrle v. Exxon, 279 N.J. Super. 5, 36 (App. Div. 1995). The Spill Act, however, also provides the DEP with discretion to direct responsible parties to clean up the property or to undertake the cleanup itself. Metex Corp. v. Federal Ins. Co., 290 N.J. Super. 95, 113 (App. Div. 1996). Thus, the Superior Court and the DEP have concurrent jurisdiction. The Superior Court may defer to the DEP when the DEP's expertise is needed to resolve the issues and when consistent statutory application is necessary. Daalman v. Elizabethtown Gas Co., 77 N.J. 267, 269-73 (1978); Boss v. Rockland Elec. Co., 95 N.J. 33, 42 (1983); Muise v. GPU, Inc., 332 N.J. Super. 140, 160 (App. Div. 2000).

Under the Spill Act, N.J.S.A. 58:10-23.11f(a)(2)(a), plaintiff has "a right of contribution against all dischargers and persons in any way responsible for a discharged hazardous substance." The statute imposes strict liability for entities discharging hazardous substances. N.J.S.A. 58:10-23.11g(c)(1). The DEP maintains discretion to compel responsible parties "to clean up and remove or arrange for the cleanup and removal of the discharge or may direct the discharger to clean up and remove" the contaminating material. N.J.S.A. 58:10-23.11f(a)(1).

Plaintiff maintains that the trial court misapplied the test for allowing the DEP to either undertake the cleanup or designate a responsible party to do so. We disagree.

In Muise, supra, 332 N.J. Super. at 160, we articulated a four-prong test for determining when the court should defer to an agency's primary jurisdiction. The four factors to be considered are (1) whether a matter is within the judge's conventional experience; (2) whether a matter is within the agency's discretion or requires its expertise; (3) whether inconsistent rulings might disrupt the statutory scheme; and (4) whether a prior application has been made to the agency. Ibid. When there are issues both in and outside an agency's special expertise, the appropriate course for the court is to refer the matter to the agency for fact finding and then to apply the agency's findings or conclusions to the court's determination of issues outside the agency's expertise. Id. at 161.

Here, we are satisfied that the matter is properly within the DEP's jurisdiction because of its special expertise. The issues are not ordinarily within a judge's experience and the DEP has already been involved with the matter by virtue of its supervision of the cleanup and issuance of the NFA letter. We are satisfied that ...

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