T & E Industries, Inc. v. Safety Light Corp.
587 A.2d 1249, 21 Envtl. L. Rep. (Envtl. Law Inst.) 20872, 123 N.J. 371 (1991)
Premium Feature
Subscribe to Lexplug to listen to the Case Podcast.
Rule of Law:
A party that creates a hazardous condition on its property through an abnormally dangerous activity is strictly liable for the resulting harm, and this liability extends to a subsequent purchaser of the land. The doctrine of caveat emptor does not bar a successor in title from bringing a strict liability claim against a predecessor responsible for the contamination.
Facts:
- From approximately 1917 to 1926, United States Radium Corporation (USRC) processed radium at an industrial site in Orange, New Jersey.
- The extraction process created radioactive by-products called 'tailings,' which USRC discarded onto unimproved portions of its own property.
- During and after its operations, USRC was aware of the significant health hazards of radium, as evidenced by employee protection measures, employee illnesses from radium ingestion, and its participation in creating a 1941 safety handbook on radioactive materials.
- In 1943, USRC sold the property to Arpin, a plastics manufacturer, without disclosing the presence or danger of the radium tailings on the site.
- The property was sold several more times, and in 1974, T & E Industries, Inc. (T & E) purchased the property, unaware of the contamination.
- In 1979, the New Jersey Department of Environmental Protection (DEP) discovered elevated gamma-radiation and radon levels on the property, stemming from the tailings left by USRC.
- As a result of the discovery and the associated health risks, T & E was forced to close its plant on the site and relocate its operations.
- The Environmental Protection Agency (EPA) later placed the property on the National Priorities List for cleanup as a Superfund site.
Procedural Posture:
- T & E Industries, Inc. sued Safety Light Corporation and other successor corporations of USRC in the state trial court on theories of nuisance, negligence, fraud, and strict liability.
- The trial court granted T & E's motion for partial summary judgment on strict liability but later reversed itself and dismissed that claim.
- The case proceeded to a jury only on the negligence claim, and the jury found the defendant negligent concerning the 1974 sale to T & E.
- The trial court then granted a judgment notwithstanding the verdict (JNOV) in favor of the defendant, ruling that the doctrine of caveat emptor barred T & E's recovery.
- T & E, the appellant, appealed to the Appellate Division of the New Jersey Superior Court.
- The Appellate Division, an intermediate appellate court, reversed the trial court's decision, holding that the defendant was strictly liable as a matter of law and that caveat emptor was not a defense.
- The Supreme Court of New Jersey granted the petition for certification filed by the defendant, Safety Light Corp.
Premium Content
Subscribe to Lexplug to view the complete brief
You're viewing a preview with Rule of Law, Facts, and Procedural Posture
Issue:
Does the doctrine of strict liability for an abnormally dangerous activity allow a current owner of contaminated property to hold a distant predecessor in title, who caused the contamination by disposing of radioactive materials, liable for damages?
Opinions:
Majority - Clifford, J.
Yes, a successor in title may hold a predecessor strictly liable for harm caused by an abnormally dangerous activity. The policy behind strict liability—that the enterprise engaging in the hazardous activity should bear the costs of the harm it causes—is not limited to disputes between neighboring landowners. The doctrine of caveat emptor does not shield a seller from liability for creating an abnormally dangerous condition on the land, particularly when the buyer is unaware of the hazard. Applying the six-factor test from the Restatement (Second) of Torts § 520, the court determined that USRC's disposal of radium tailings was an abnormally dangerous activity. Even if foreseeability of the harm is a requirement for this type of strict liability, USRC had sufficient constructive knowledge of the dangers of radium to be charged with knowledge of the dangers of its disposal.
Analysis:
This decision significantly extends the reach of common law strict liability for abnormally dangerous activities by applying it to successors in title, not just to neighboring landowners. It weakens the traditional real estate doctrine of caveat emptor in cases of latent environmental contamination, establishing that the 'polluter pays' principle can be enforced through common law tort actions. The ruling provides an important avenue of recovery for innocent purchasers of contaminated property, creating liability that runs with the activity of pollution, not just the ownership of land. This precedent strengthens the legal framework for holding original polluters financially responsible for cleanup and other damages, even decades after they have sold the property.
