Presented by the Environmental & Toxic Tort Litigation Practice Group

Legal Updates for Environmental Law - November 2018

Liability Under the Spill Act Does Not Require ‘Smoking Gun’ Evidence of a Discharge

by Kevin T. Bright, Esq.

In the unpublished decision in Morris Plains Holding VF, LLC v. Milano French Cleaners, Inc., N.J. Super. App. Div., Docket No.: A-0604-16T1 (April 20, 2018), the New Jersey Appellate Division affirmed a trial court’s decision which held that liability under the New Jersey Spill Compensation and Control Act, N.J.S.A. 58:10-23.11, et seq., did not require direct evidence of a discharge and that circumstantial evidence was sufficient.

Morris Plains Holdings VF sued the defendant, Vito Meghnagi, for contribution under the Spill Act. This claim related to remediation expenses the plaintiff incurred in remediating tetrachloroethylene (PCE) contamination at a shopping mall it owned, which leased space to the defendant’s dry-cleaning business. PCE is a hazardous substance commonly used by dry-cleaning businesses. The defendant’s dry-cleaning business operated at the site for 25 years.

After a four-day, non-jury trial, the trial judge found the defendant to be a responsible party under the Spill Act. On appeal, the defendant argued that the trial judge acted erroneously by finding liability without sufficient and direct evidence that the defendant actually committed a discharge. In rejecting this argument, the Appellate Division found that the trial court had a sufficient basis upon which to rely in establishing the defendant’s liability. This evidence consisted of: (1) the defendant’s dry-cleaning business was the only such business ever on the property and it operated there for 25 years; (2) the business used approximately 15 gallons of PCE annually; (3) the machinery used sat on a concrete floor without drains; (4) there was evidence of spills in that area; and (4) contamination was found in the soil directly beneath the dry-cleaning machine.

On these bases, the plaintiff’s expert offered an opinion that the source of the contamination was related to the defendant’s use and release of PCE on the property. The plaintiff’s expert also concluded that there was no “credible mechanism” through which soil contamination could have migrated either horizontally or vertically to a place directly beneath the dry-cleaning business. In response, the defendant offered what the Appellate Division referred to as “little more than unfounded speculation about other potential causes of the contamination and his own self-serving denials.”

The Appellate Division upheld the trial court’s finding that sufficient evidence of a discharge occurred. Although the standard of review in such cases requires affirmation of the trial court’s decision, unless the appellate court finds the decision to be “so manifestly unsupported by or inconsistent with the competent, relevant and reasonably credible evidence as to offend the interest of justice,” D’Agostino v. Maldonado, 216 N.J. 168, 182 (2013), the Appellate Division held in this case that the trial court’s findings were “fully supported by the credible evidence.”

Morris Plains Holding VF, LLC v. Milano French Cleaners, Inc. makes clear that evidence of a discharge can be based upon the circumstances present and that “smoking gun” evidence of a discharge need not be present. Evidence of a discharge can be premised upon indirect evidence, such as the location of the contamination relative to the alleged source, the type of contamination and the lack of other, credible sources.



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