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In re In re Kimber Petroleum Corp.

ELR Citation: 18 ELR 20933
Nos. Nos. A-127, A-128, 539 A.2d 1181/27 ERC 1668/110 N.J. 69, (N.J., 04/18/1988)

The court upholds the New Jersey Spill Compensation and Control Act against federal constitutional challenges but adds a good-cause exception to the provision for the assessment of treble damages. Appellants sought to challenge a Department of Environmental Protection (DEP) directive requiring them to fund the construction of an alternative water supply for a town whose groundwater was contaminated from gas stations owned or leased by appellants, or be subject to treble damages. The court rules that the broad powers of the Spill Act permit the DEP to maintain control of a site and at the same time require potentially responsible parties to pay for removal costs prior to remedial action. Such powers are implied in the powers granted to the DEP under the Spill Act and the DEP's authorizing legislation. The court then construes the treble damages provision of the Spill Act to contain a good-cause exception since the combined weight of joint and several strict liability, mandatory penalties and additional mandatory treble damages for noncompliance, the elimination of substantive defenses, and the lack of preenforcement review may be unconstitutional and also may violate the principle of fundamental fairness. Implying the exception is more consistent with the legislature's intent than invalidation of the entire Act, the court then rules that treble damages need not be assessed where there is a reasonable basis to believe that a DEP directive is invalid or inapplicable to a party. Possible good-cause defenses include challenges to the reasonableness of costs assessed by the DEP. Finally, the court holds that, subject to the good-cause defense, the DEP directive issued to the appellants threatening treble damages for noncompliance is permissible under the Spill Act.

A dissent would not imply a good-cause exception, since the statute does not provide for one and the legislature explicitly chose to impose treble damages without intentto create an exception.

[A companion case is published at 18 ELR 20951.]

Counsel for Appellants
Edwin R. Matthews
Budd, Larner, Gross, Picillo, Rosenbaum, Greenberg & Sade
150 John F. Kennedy Pkwy., CN1000, Short Hills NJ 07078-0999
(201) 379-4800

Counsel for Appellees
Ross A. Lewin, Deputy Attorney General
Dep't of Law & Public Safety, 8th Fl., Justice Complex, CN080, Trenton NJ 08625
(609) 292-8740

For affirmance as modified -- Justices CLIFFORD, HANDLER, O'HERN, GARIBALDI, and STEIN -- 5.

Dissenting -- Chief Justice WILENTZ -- 1.