New Jersey’s Supreme Court ruled this week that the State cannot be held liable for pollution discharges that occurred prior to the adoption of the New Jersey Spill Compensation and Control Act (Spill Act).

The case involves a Superfund Site in Laurence Harbor. The State had granted approval in the 1960s for construction of a seawall and beach restoration, partially on State land, using metal slag. In 2007, contamination was discovered along the seawall, and ultimately the U.S. Environmental Protection Agency (USEPA) identified the Laurence Harbor site as a Superfund Site.  USEPA demanded NL Industries, the company which had provided the slag, clean up the site.  NL subsequently filed a contribution claim in state court seeking New Jersey’s share of cleanup costs.  The trial court decided in favor of NL, since the State is included in the Spill Act’s definition of a “person” subject to the Act, and the appellate court agreed.

In its decision, the Supreme Court concluded that “the Spill Act contains no clear expression of a legislative intent to waive the State’s sovereign immunity retroactively to cover periods of State activity prior to the Spill Act’s enactment.”  Thus, barring any future amendment to the Spill Act to address this issue, the State of New Jersey may face liability only for discharges occurring after the Spill Act’s 1977 effective date.