On Sept. 26, the New Jersey Supreme Court issued a watershed decision in NJDEP v. Dimant,2012 N.J. LEXIS 956 (2012), clarifying the nexus standard under the Spill Compensation and Control Act (Spill Act), N.J.S.A. 58:10-23.11 et seq. Underscoring and expanding upon prior jurisprudence, the court specifically held that the Spill Act requires a reasonable nexus or connection between the alleged discharger, the hazardous substance discharged and the resulting damage at issue. In so holding, the court drew important legal distinctions between finding that a party discharged a hazardous substance and determining that a party is liable for cleanup and removal costs under the Spill Act.
The Dimant decision is important and instructive because it mandates that New Jersey Department of Environmental Protection (DEP) (or others suing under the Spill Act) must connect a discharge to the damages sought, i.e. to the specific contaminated natural resource or site at which cleanup and related costs were incurred. As discussed below, the Supreme Court rejected DEP’s arguments for adoption of the more lenient federal standard for nexus, which requires only “some connection” between a release of a hazardous substance and the costs incurred. Indeed, the court distinguished the Spill Act from the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), 42 U.S.C.A. §§ 9601 et seq., and determined that the New Jersey statute requires that a “reasonable nexus or connection must be demonstrated by a preponderance of the evidence.” Dimant, 2012 LEXIS 956, at *53. Under the Spill Act, the discharge must be connected to the specific environmental damage “in some real, not hypothetical, way… it is not enough … to ‘ask the trier of fact to supply the link’.” Id., quoting N.J. Tpke. Auth. v. PPG Indus., 197 F.3d 96, 105 n.9 (3d Cir. 1999).
