Action Item: On August 6, 2015, the Supreme Court of New Jersey in Ross v. Lowitz, et al., No. A-101-13 (N.J. Aug. 6, 2015), held that property owners could not prove claims for private nuisance and trespass against the current and former owners of an adjoining residential property whose underground storage tank leaked home heating oil that migrated to the claimants' property without evidence of negligence, recklessness, intentional conduct, or conduct of an abnormally dangerous activity. This ruling reaffirms the longstanding principle in New Jersey that strict liability may not be imposed for private nuisance and trespass absent intentional conduct or an abnormally dangerous activity.
In a 4-3 decision, the Supreme Court of New Jersey in Ross v. Lowitz, et al., No. A-101-13 (N.J. Aug. 6, 2015), held that a landowner failed to establish claims for private nuisance and trespass against the current and former owners of a neighboring property whose underground storage tank (UST) leaked home heating oil that migrated offsite in the absence of sufficient proof of negligence, recklessness, intentional conduct, or conduct of an abnormally dangerous activity. In so holding, the Supreme Court reinforced the traditional boundaries used to define private nuisance and trespass under New Jersey law, while insulating landowners from strict liability in those circumstances. Simply put, a party is not absolutely liable simply because his or her UST leaked a substance onto another's property.
The Facts
The facts in Ross are fairly straightforward. Susan Ellman (Ellman) owned residential property in Red Bank, New Jersey that contained a UST storing home heating oil. Ellman was not aware of any release from her UST while she owned the property. Karen Lowitz (Lowitz) purchased the property from Ellman in 1999, and before the closing hired an environmental consultant to test the UST. The consultant did not detect any leaks at that time. Lowitz owned the property until 2003, at which time she entered into a contract to sell the property to Calvin Haley (Haley). Lowitz again retained an environmental consultant to inspect the UST, but this time the consultant discovered a leak. Lowitz promptly notified her homeowners' insurers, State Farm Fire and Casualty (State Farm) and New Jersey Manufacturers Insurance Company (NJM), and the insurers paid for the remediation of contamination on Lowitz's property.
Thereafter, in 2004, plaintiff John Ross purchased a neighboring property. Ross claims that he did not know the UST on Lowitz's property had leaked when he purchased his property. When Ross attempted to sell his property in 2006, he learned that oil from Lowitz's UST had migrated to his property. Ross and his wife demanded that State Farm and NJM clean up contamination on their property and reimburse them for any costs associated with the remediation. The plaintiffs contend that State Farm and NJM failed to initiate remediation promptly and were not responsive to their requests for payment of expenses. Pursuant to a consent order entered by the trial court, environmental consultants hired by State Farm and NJM excavated the plaintiffs' property to remove contamination in 2009. The site received regulatory closure in 2010.
Procedural History
The plaintiffs filed this action against Ellman, Lowitz, and others1 asserting causes of action for negligence, strict liability, private nuisance, and trespass, as well as a claim under the New Jersey Spill Compensation and Control Act, N.J.S.A. 58:10-23.11 to 23.24, commonly referred to as the Spill Act.2 The plaintiffs argued that Ellman and Lowitz should be liable for private nuisance and trespass based on the continued presence of oil that migrated from the UST to the plaintiffs' property. The plaintiffs also contended for the first time on appeal that the insurers' delays in remediating their property property gives rise to private nuisance and trespass claims against Ellman and Lowitz.
The trial court granted summary judgment for Ellman and Lowitz on the plaintiffs' private nuisance and trespass claims because the plaintiffs did not offer any evidence that Ellman and Lowitz acted negligently in maintaining the UST. The trial court also concluded that the maintenance of the UST did not constitute an abnormally dangerous activity to which strict liability applies. The Superior Court Appellate Division affirmed.
The Supreme Court's Ruling
The Supreme Court in Ross affirmed the judgment of the Appellate Division and held that the trial court properly granted summary judgment dismissing the plaintiffs' private nuisance and trespass claims against Ellman and Lowitz. In sum, the Supreme Court held that "no claim for private nuisance or trespass may be premised on this record, which is devoid of proof of negligence, recklessness, intentional conduct, or the conduct of an abnormally dangerous activity by defendant residential property owners," and "decline[d] to expand the private nuisance and trespass causes of action recognized by New Jersey law to impose strict liability in the setting of this case."
With respect to the private nuisance claim, the Supreme Court in Ross looked to sections 822, 824, and 839 of the Restatement (Second) of Torts (1979).3 Under section 822 of the Restatement, a party is liable for private nuisance if his conduct interferes with the private use and enjoyment of another's property and the invasion arose from conduct that is "intentional and unreasonable," or "unintentional and otherwise actionable under the rules controlling liability for negligent or reckless conduct, or for abnormally dangerous conditions or activities." The Supreme Court explained that an intentional but reasonable interference with another's property, or an accidental invasion of property, does not trigger liability for private nuisance. The Supreme Court further cautioned that in the absence of fault, strict liability may be imposed for private nuisance only if a party engaged in an abnormally dangerous activity.
Section 824 of the Restatement provides that a party is liable for private (or public) nuisance based on either an affirmative act or a failure to act when a duty to prevent or abate an interference or invasion with property existed. The Ross Court, however, noted that section 824 does not give rise to a strict liability claim beyond the abnormally dangerous activity setting in section 822 of the Restatement.
Section 839 of the Restatement provides a basis for private nuisance liability if a party failed to abate an artificial condition, provided that the "nuisance is otherwise actionable." In other words, a party cannot establish a claim under section 839 in the absence of a showing of fault or conduct of an abnormally dangerous activity that would support a private nuisance claim under section 822.
The Supreme Court in Ross again was guided by the Restatement as to trespass. Section 158 of the Restatement provides that a party is liable in trespass for an intentional entry onto another's property that causes harm. Section 165 gives rise to liability for trespass if a party "recklessly or negligently, or as a result of an abnormally dangerous activity enters" onto another's land, and the entry causes harm." A continuing trespass claim arises under section 161 with the "continued presence on another's land of a structure, chattel, or other thing which the actor has tortiously placed there." As the Supreme Court stated, a party is not liable for an unintentional, non-negligent entry onto another's property, and strict liability may not be imposed for trespass absent an abnormally dangerous activity.
Against this backdrop, the Supreme Court in Ross concluded that Ellman and Lowitz were not liable for private nuisance or trespass because the plaintiffs failed to allege, much less prove, that any negligent, reckless, or intentional and unreasonable conduct by Ellman or Lowitz caused harm. In particular, Ellman was not aware of any leak in the UST while she owned the property; the environmental consultant hired by Lowitz before purchasing the property in 1999 did not discover any problems with the tank; and Lowitz promptly notified her insurers of the leak when it was later detected.
Moreover, the Supreme Court concluded that the plaintiffs failed to establish a claim for private nuisance or trespass against Ellman or Lowitz under section 824 of Restatement based on alleged delays in the insurers' remediation of the plaintiffs' property because the plaintiffs failed to demonstrate any fault or conduct of an abnormally dangerous activity. The Supreme Court stated that "[i]n the absence of an abnormally dangerous activity, [Ellman and Lowitz] cannot be held strictly liable for damages allegedly sustained by [the] plaintiffs as a consequence of the delay before their property was excavated and remediated."
Lastly, the Supreme Court in Ross held that the plaintiffs failed to establish a private nuisance claim under section 839 of the Restatement because the plaintiffs did not provide any evidence that Ellman or Lowitz acted negligently, recklessly, or intentionally. The Supreme Court added that Lowitz took the most practicable step possible after learning of the leaking UST: promptly contacting her insurers to commence an investigation and remediation of contamination. Accordingly, the Supreme Court affirmed the trial court's grant of summary judgment dismissing the plaintiffs' private nuisance and trespass claims.
Implications
Boiled down to its essence, Ross is significant because the Supreme Court declined to expand private nuisance and trespass in New Jersey beyond their historical parameters to impose strict liability on landowners whose UST accidentally leaked, thereby remaning faithful to well-established principles of nuisance and trespass. In short, as the Supreme Court in Ross articulated, "[strict] liability without fault should not be imposed, whether that activity be classified as a nuisance or a trespass, absent intentional or hazardous activity requiring a higher standard of care or, as a result of some compelling policy reason."
A residential landowner whose property contains a UST for home heating oil should mitigate the risk of liability for private nuisance and trespass by acting diligently and reasonably in maintaining and monitoring the UST, not causing a release or migration of fuel from the tank by any intentional or negligent act, and taking immediate steps to address any known leaks, including notifying insurers and even neighboring property owners. The risk of strict liability for private nuisance and trespass is further minimized because the use of a UST for home heating oil generally does not constitute an abnormally dangerous activity.
The applicability of Ross beyond the residential landowner setting is unclear. For example, would the Supreme Court have ruled differently if the owner of the property containing the leaking UST was not an individual homeowner, or was a less sympathetic defendant like a service station, oil refinery, or chemical plant located in a residential zone? Even if a court holds such landowners to a higher degree of care in monitoring for tank leaks or finds a more compelling public policy exists in those circumstances to warrant liability, a plaintiff still must come forward with sufficient proof of negligent, reckless, or intentional and unreasonable conduct to prove claims for private nuisance and trespass. As the Supreme Court in Ross succinctly stated, "the outcome should logically depend on whether the offending landowner somehow has made a negligent or unreasonable use of his land when compared with the rights of the party injured on the adjoining lands."
Footnotes
1 The plaintiffs also asserted claims against Haley and High Point Preferred Insurance Company, the insurer who provided homeowner's insurance to Ellman, but those claims were dismissed and were not subject to the appeal. In addition, the plaintiffs brought claims for breach of the implied covenant of good faith and fair dealing against State Farm and NJM, arguing that the plaintiffs were third-party beneficiaries of the insurance contracts between State Farm/NJM and Lowitz. The Supreme Court in Ross affirmed the grant of summary judgment dismissing the plaintiffs' claims against State Farm and NJM because the plaintiffs failed to provide any evidence that the parties to the insurance contracts intended to make the plaintiffs third-party beneficiaries. The Supreme Court also reasoned that the migration of oil from Lowitz's property to the plaintiffs' property did not confer third-party beneficiary status on the plaintiffs.
2 The plaintiffs decided not to pursue their strict liability or Spill Act claims once remediation of their property was completed.
3 The plaintiffs themselves did not rely upon section 839 of the Restatement before the trial court or on appeal. Rather that section was central to Justice LaVecchia's dissenting opinion.
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