Member Article

The Comprehensive Environmental Response, Compensation and Liability Act, commonly referred to as CERCLA or Superfund, does not contain any provision for a private cause of action for personal injury or property damage relating to the release of hazardous substances. Section 309 of CERCLA, however, does contain a discovery rule that can preempt state statutes of limitations in any such actions, which applies to releases of not only hazardous substances, but also of any pollutant or contaminant. In CTS Corporation v. Waldburger, the Supreme Court was asked to determine whether that section applies not only to statutes of limitations, but also to statutes of repose. The Supreme Court reversed a Fourth Circuit judgment and held that it does not. Justice Kennedy wrote the Court’s opinion and was joined, for the most part, by Justices Scalia, Thomas, and Alito and Chief Justice Roberts. Justices Ginsburg and Breyer dissented. 

The case involved a property that had been owned and used by the defendant for an electronics plant in North Carolina. The operation of that plant resulted in the release of hazardous substances onto the land. The defendant represented to the buyer that the site was environmentally sound. The buyer eventually sold portions of the property to various individuals, and they and adjacent landowners brought suit against the defendant for property remediation and damages, some 24 years after the defendant sold the property. North Carolina has a statute of repose that precludes any defendant from being subjected to a tort suit brought more than 10 years from the last culpable act or omission of the defendant giving rise to the cause of action. A divided Court of Appeals, finding the statute ambiguous, held that an interpretation pre-emption was preferable, relying on the remedial purpose of CERCLA. 

Although acknowledging that there were similarities between statutes of limitations and statutes of repose in that both can operate to bar a suit based on timing, the Court explained that their policies and starting points differed: a statute of limitations creates a time limit for suing based on when the injury occurred or was discovered, while a statute of repose puts an outer limit on the right to bring an action, even if the period ends before the plaintiff suffered an injury. The policy behind a statute of limitations is to encourage the plaintiff to act diligently; the policy behind a statute of repose is to free the defendant from liability regardless of the plaintiff’s circumstances. 

Acknowledging that there is confusion regarding the two concepts, the Court held that, under a proper interpretation of CERCLA Section 309, statutes of repose are excluded from being preempted by it. That approach, the Court, explained was also consistent with notions of federalism. The significance of this case is that in states with statutes of repose, potential defendants will have some assurance that once that time period expires, they are protected from liability and need no longer look back over their shoulders. On the flip side, plaintiffs in states with statutes of repose will be disadvantaged compared to their counterparts in states with statutes of limitations.

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