Legislature Passes Bill to Limit Liability of Fuel Oil Dealers

On June 21, 2018, the New Jersey Senate passed S2662 unanimously with a vote of 40-0.  The Assembly substituted S2662 for A4113, which was identical, and passed S2662 earlier this week.  The bill, which was sponsored by Senators Sweeney and Bateman would supplement the New Jersey Spill Compensation and Control Act and limit the liability for persons who deliver heating oil to unregulated tanks for discharges from those tanks under certain circumstances.  Specifically, the bill notes, “[n]otwithstanding the provisions of Section 8 of P.L. 1976, c.141 (C.58:10-23.11g), any other law, or common law, a person who delivers home heating oil to an unregulated heating oil tank shall not be liable for cleanup and removal costs or for direct or indirect damages due to the discharge of heating oil from that heating oil tank unless the person knew or should have known that the delivery of heating oil would result in the discharge of a hazardous substance from that tank.”

The Legislature’s action is in response to the Supreme Court of New Jersey’s opinion in Morristown Associates, wherein the court noted, “any defendant who is shown to have delivered fuel into a leaking UST system, released a hazardous substance into the ground and could meet the statutory definition of a discharger.”  220 N.J. 360 (2015).  This opinion has been used in countless cases to pursue fuel delivery companies for the costs associated with leaking residential USTs.  If signed into law by the Governor, the law would take effect immediately.  While the law would convert the liability standard against fuel oiler dealers from strict liability to a negligence standard under the Spill Act, many cases will still likely be brought against fuel oil delivery companies under the new liability standard and additional steps will need to be taken by fuel oil delivery companies to avoid liability under this new standard.

If you have any questions about S2662 or regarding environmental laws or regulations, please do not hesitate to contact Jacob S. Grouser at jgrouser@hoaglandlongo.com or call 732.545.4717.