DEP's Authority Under FWPA Is Clarified

It is noteworthy that Justices Albin and Zazzali dissented, reasoning that Owens-Illinois should not be read to require an insured to pay multiple deductibles before being entitled to insurance coverage. According to the dissent, the purposes of the earlier decision – maximizing coverage to respond to environmental damages and notions of simple justice – required a different result.

Coastal Area

The Department of Environmental Protection (DEP) utilizes deed restrictions in connection with a number of its land use and other regulatory programs to assure that limitations remain in place over time. The purpose for requiring the recording is to assure that subsequent purchasers will be placed on notice of the permit conditions and take the property subject to them.

Coastal permits, particularly those issued pursuant to the Coastal Area Facilities Review Act (CAFRA), frequently include such requirements. N.J.S.A. 13:19-1 et seq. Common examples of these restrictions limit future construction or provide for public access.

In Island Venture Associates v. DEP, 179 N.J. 485 (2004), the Court considered a situation where a bona fide purchaser of unimproved property conducted a diligent title search but did not receive notice that a land use restriction prohibiting the future construction of nonwater dependent uses had been imposed by DEP in a previously issued CAFRA permit. The environmental agency had also erroneously advised the landowner that the proposed construction would not require a permit.

After the property was sold, the DEP discovered its error and notified the new landowner that the property was subject to the deed restriction and probably would not qualify for a permit to construct a two-family residential unit on each of the two lots that comprised the property. That application was made and denied by the agency.

The Court grounded its ruling on the primacy of the Recording Act. N.J.S.A. 46:15-1.1 et seq. In this setting, equity required that the innocent purchaser should prevail. The DEP has corrected the problem on a prospective basis by tightening up its CAFRA deed restriction review procedures.

Toxic Torts

Proof in toxic tort cases includes expert testimony as to causation. The result turns on the admissibility and quality of the testimony.

The Court established the basic rules for the admissibility of this type of testimony more than a decade ago in its Rubanick and Landrigan rulings. In Rubanick v. Witco Chemical Corp., 125 N.J. 421, 449 (1991), the Court held that where a scientific causation theory has not reached the level of general acceptance, it may be sufficiently reliable if “based on a sound, adequately-founded scientific methodology involving data and information of the type reasonably relied on by experts in the scientific field” and the proffered expert must be sufficiently qualified in the specific field. In Landrigan v. Celotex Corp., 127 N.J. 404, 417 (1992), the Court found that in a Rule 8 hearing an epidemiologist and other experts must be able to provide the factual bases for their conclusion, explain their methodology, and demonstrate that these are scientifically reliable so the court can determine whether the opinion will assist the trier of fact to understand the evidence or resolve the disputed facts.

These rules were applied this year in Clark v. Safety-Kleen Corp., 179 N.J. 318 (2004), which involved injuries sustained by an auto mechanic who used a product that contained cresylic acid. In this case, the Court considered whether one of the plaintiff’s expert witnesses, a research chemist, a nonphysician, could testify as to the toxicological effects of cresylic acid on human skin and whether the injuries were consistent with plaintiff’s exposure to that chemical. The expert held a Ph.D. in organic chemistry, had worked with cresylic acid and had observed its effects on human tissue. He also was familiar with the chemical labeling and “Material Safety Data Sheets,” had examined the plaintiff’s medical records and reviewed the pertinent literature.

The research chemist’s testimony served as a link between the plaintiff’s testimony regarding the use of the product and the symptoms that were reported and verified in the medical records. In finding that the testimony was admissible, the Court reasoned that the expert’s:

. . . education, experience, and research broadly qualified him to address the subject of the effect of cresylic acid on human skin. The chemical properties of such a solvent is a subject uniquely within a chemist’s expertise and it is those chemical properties that essentially determine the toxicological and occupational health effects of a product. Clark, 179 N.J. at 338.

The chemist did not testify as a substitute for a medical witness, whose testimony was limited to the plaintiff’s chemical exposure. The matter was remanded for the reinstatement of the verdict for the plaintiff.

Hazardous Substances

The issue in American Trucking Ass’n v. State, 180 N.J. 377 (2004), was the constitutionality of the hazardous waste transporter fee imposed by N.J.A.C. 7:26-4a.3(g)(1). The Court considered whether an annual hazardous waste transporter fee assessed against out-of-state transporters was consistent with the Commerce Clause.

Presiding Judge Joseph Small of the Tax Court found that the state had failed to prove that the flat truck fee does not discriminate. As such, the fee was invalidated.

The Court agreed with Judge Small’s analysis:

In summary, we hold, based upon the record that has been developed, that the transporter fee mechanism lacks internal consistency; it discriminates against interstate commerce by charging a flat fee unrelated to a transporter’s level of activity in the State; and it places an undue burden on interstate commerce.