Jump to Navigation
Jump to Content

Exxon Corp. v. Hunt

ELR Citation: 18 ELR 20412
Nos. No. A-158, 534 A.2d 1/26 ERC 1953/109 N.J. 110, (N.J., 12/02/1987) On remand

The court holds that the nonpreempted provisions of the New Jersey Spill Compensation and Control Act are severable from the preempted provisions, and the corporations assessed taxes under the preempted provisions of the Act are not entitled to a refund if the state legislature reimburses the Spill Fund for the expenditures found to be preempted. The United States Supreme Court held that the Spill Act was preempted in part by §114(c) of the Comprehensive Environmental, Response, Compensation, and Liability Act, later repealed by the Superfund Amendments and Reauthorization Act of 1986 (SARA). The Court then remanded the case to the New Jersey courts to determine whether the non-preempted portions of the Act should remain in effect. The court first holds that the non-preempted provisions of the Spill Act are severable. The Act's overall structure, its comprehensive purpose to facilitate cleanup of hazardous substances, and the state legislature's continuing commitment to provide adequate resources for the Spill Fund demonstrate that the legislature would have intended the non-preempted provisions of the Act to stand during the limited period of preemption.

The court holds that the United States Supreme Court's decision applies retroactively to the date that EPA promulgated the National Contingency Plan (NCP) and the National Priorities List (NPL). The court rejects the state's argument that the decision should be given only prospective effect, since the decision did not establish a new principle of law. Prior to issuance of the NCP in July 1982 and the NPL in September 1983, there were no EPA guidelines to determine which response actions would be eligible for Superfund reimbursement and for which funding by the Spill Fund was thus preempted. The court holds that the period of preemption ended on October 27, 1986, the effective date of SARA. The court holds that plaintiffs are entitled to a pro rata refund of the taxes they paid under the preempted provisions of the Spill Act only if the legislature fails to reimburse the Spill Fund for the expenditures found to be preempted. This is the remedy that is most consistent with Congress' intent in repealing §114(c) to encourage state participation in hazardous waste cleanup.

[Previous decisions in this litigation are published at 12 ELR 20734, 14 ELR 20923, and 16 ELR 20396. The United States Supreme Court's decision is analyzed at 16 ELR 10286.]

Counsel for Plaintiffs-Appellants
John J. Carlin Jr.
Farrell, Curtis, Carlin & Davidson
43 Maple Ave., P.O. Box 145, Morristown NJ 07960
(201) 267-8130

Counsel for Defendants-Appellees
Mary R. Hamill, Deputy Attorney General
Dep't of Law & Public Safety
8th Floor, Justice Complex, CN080, Trenton NJ 08625
(609) 292-8740

For modification and remandment -- Justices STEIN, CLIFFORD, HANDLER, and POLLOCK and Judges PRESSLER and KING -- 6.

Opposed -- None.