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New W. Urban Renewal Co. v. Viacom, Inc.

Citation: 33 ELR 20132
No. No. 01-707, 230 F. Supp. 2d 568/(D.N.J., 11/18/2002)

The court holds that New Jersey's discovery rule does not toll a property owner's environmental contamination claims against the seller and, therefore, the claims are barred by the six-year statute of limitations. The owner purchased the property in 1983, and after conducting an environmental investigation of the site in 1992, it filed suit against the seller in 1994. The seller then filed a motion to dismiss the owner's strict liability, negligence, fraud, and breach of contract claims. New Jersey's discovery rule delays the onset of the statute of limitations until the party bringing suit learns, or reasonably should have learned, of a state of facts giving rise to a cause of action. The court first holds, therefore, that with respect to environmental claims, tolling under the discovery rule is not dependent on whether actual sampling results have been taken, but whether there are enough indications of environmental contamination to put the plaintiff on reasonable notice of a need to investigate further. Although the owner conducted an environmental investigation in 1992, the record contained no genuine question of material fact regarding whether the owner had knowledge of environmental hazards on the property in late 1987. Under New Jersey law, therefore, the owner had six years from that point in which to pursue a cause of action but did not do so. The court, therefore, grants summary judgment to the seller on these claims.