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NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-0908-07T20908-07T2
IN RE REQUEST BY FORSGATE INDUSTRIAL
COMPLEX, L.P., THAT THE NEW JERSEY
DEPARTMENT OF ENVIRONMENTAL
PROTECTION REVOKE THE OCTOBER 18, 2005
NO FURTHER ACTION AND COVENANT NOT TO
SUE LETTER ISSUED TO LEGGETT & PLATT,
INC. FOR THE CREST FOAM CORPORATION
FACILITY LOCATED AT 100 CAROL PLACE,
MOONACHIE BORO, BERGEN COUNTY.
Argued November 12, 2008 - Decided
Before Judges Wefing, Parker and Yannotti.
On appeal from a final decision of the New Jersey Department of Environmental
Protection.
Michael J. Weisslitz argued the cause for appellant Forsgate Industrial Complex, L.P.
(Wilentz, Goldman & Spitzer, attorneys; Mr. Weisslitz and Marvin J. Brauth, of counsel
and on the briefs).
Franklin L. Widmann, Deputy Attorney General, argued the cause for respondent New
Jersey Department of Environmental Protection (Anne Milgram, Attorney General,
attorney; Lewis Scheindlin, Assistant Attorney General, and Mr. Widmann, on the brief).
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Frances B. Stella argued the cause for respondents Leggett & Platt, Inc., Crest-Foam
Corporation, and Crest-Foam Industries, Incorporated (WolfBlock, L.L.P., attorneys for
respondents Leggett & Platt, Inc. and Crest-Foam Corporation; and Lindabury,
McCormick, Estabrook & Cooper, P.C., attorneys for respondent Crest-Foam Industries,
Incorporated; Ms. Stella, Lindsay P. Kern, and Monica Perez, on the joint brief).
PER CURIAM
Forsgate Industrial Complex, L.P. (Forsgate) appeals from a final determination of the New Jersey Department of
Environmental Protection (NJDEP), which denied Forsgate's application for revocation of a "No Further Action" and
"Covenant Not to Sue" letter (NFA) issued to Leggett & Platt, Inc. (Leggett) with respect to certain properties in
Moonachie, New Jersey. For the reasons that follow, we affirm.
We begin by summarizing the procedural history in this dispute and the relevant facts. Prior to June 14, 1991, Crest-
Foam Corp., Crest-Foam Industries, Inc., and/or Crest-Foam Industries, Incorporated (collectively, Crest-Foam)
operated an industrial facility on properties located at 100 Carol Place, 1 State Street and 35 State Street in
Moonachie. It appears that, during the operation of this facility, Crest-Foam contaminated the soil and underlying
groundwater. In 1986, as a result of a sale or transfer of stock, the Crest-Foam site became subject to the
requirements of the Industrial Site Recovery Act (ISRA), N.J.S.A. 13:1K-6 to -35. Leggett, which is the successor in
interest to Crest-Foam, assumed responsibility for the contamination of the properties and their remediation under
the direction of the NJDEP.
On October 18, 2005, the NJDEP issued to Leggett an NFA with respect to the property at 100 Carol Place,
specifically Lot 5.02, Block 38; Lot 3, Block 39; and Lot 2.02, Block 39. The NFA provided that the NJDEP would not
bring a civil action against any person who undertook the remediation of the property and subsequent owners,
lessees or operators of the property.
The NFA further stated that, in accordance with N.J.S.A. 58:10B-13.1, nothing therein
shall benefit any person who is liable, pursuant to the Spill Compensation and Control
Act (Spill Act), [N.J.S.A.] 58:10-23.11 [to -23.24], for cleanup and removal costs and the
[NJDEP] makes no representation by the issuance of this [c]ovenant, either express or
implied, as to the Spill Act liability of any person.
The NFA also provided that it could be revoked by the NJDEP "at any time after providing notice upon its
determination that any person with the legal obligation to comply with any condition in this No Further Action
Determination has failed to do so[.]"
In December 2005, Forsgate filed a complaint in the Chancery Division naming Leggett and Crest-Foam as
defendants. Forsgate sought, among other things, to compel Leggett and Crest-Foam to remediate environmental
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contamination on its properties allegedly emanating from the former Crest-Foam site and to compensate Forsgate
for the costs it had incurred and will incur to investigate and remediate the alleged contamination of its properties.
In its amended complaint, which was filed on April 5, 2006, Forsgate asserted that it had retained Sadat Associates
(Sadat) to perform an environmental analysis of its property. Sadat had concluded that it was likely that
contamination from the Crest-Foam facility had migrated to the Forsgate properties, and it was not probable that
the Forsgate properties had been contaminated by other potential sources.
According to the amended complaint, Sadat identified two sources of groundwater contamination from the Crest-
Foam site. One source was located on the 100 Carol Place property. The other source was on the 35 State Street
property. Sadat said that groundwater could have flowed off the Crest-Foam property in any one of four directions,
"three of which would impact one or more of the Forsgate Properties."
The amended complaint further stated that Sadat had also found that,
[t]hese groundwater flow patterns, coupled with the high concentration of
contamination within 20 feet of the property line at 100 Carol Place, make it highly
likely that contamination from the Crest Foam Facility has migrated onto neighboring
properties owned by Forsgate Properties. Likewise, groundwater flow from 35 State
Street [is] such that it is highly likely that contamination from that location migrated
onto neighboring properties owned by Forsgate.
Forsgate asserted that, based upon Sadat's findings, it had and will incur "significant costs" to investigate the
contamination and, if contamination is found, remediation will be required.
Forsgate sought an injunction requiring Leggett and Crest-Foam to perform an investigation of the nature and
extent of the contamination and the remediation of the contamination. Forsgate demanded the award of costs and
expenses of investigation and remediation, compensatory damages, as well as attorneys' fees and costs. Forsgate
additionally demanded injunctive relief and damages pursuant to the Spill Act, and asserted claims based on strict
liability, public nuisance, trespass, and negligence.
Leggett and Crest-Foam thereafter filed a motion for summary judgment. On September 8, 2006, the trial court filed
a written opinion in which it noted that the Superior Court and the NJDEP have concurrent jurisdiction to entertain
Forsgate's claims. The court found that it was "appropriate to allow the [NJDEP] to consider [Forsgate's] claims, at
least in the first instance, given [its] extensive history with the property, its technical expertise, and to attempt to
ensure [that] uniform standards [are] applied equally to all similarly situated New Jersey properties." The court
entered an order memorializing its decision and Forsgate appealed.
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On December 12, 2006, Forsgate submitted a letter to the NJDEP asking the department to revoke the NFA that it
had issued to Leggett, reopen the ISRA case against Leggett, and compel Leggett to investigate and remediate the
off-site contamination of the Forsgate properties. In support of its request, Forsgate submitted a site investigation
report prepared by Ransom Environmental (Ransom), which stated that the NFA "may have been improperly
granted [to Leggett] and should be reopened by [the] NJDEP." Ransom said that Leggett "should be required to
fully investigate and remediate the off-site impacts of groundwater contamination emanating from the Crest-Foam
site."
In January 2007, Crest-Foam Corp. submitted a response to Forsgate's letter and provided the NJDEP with a report
prepared by Haley & Aldrich (H&A), its environmental consultant. In the report, H&A concluded that the Crest-Foam
site was not the source of the contaminants found in monitoring wells on neighboring properties. In April 2007,
Forsgate replied to the H&A report and furnished the NJDEP with a supplemental report from Ransom.
On May 30, 2007, Forsgate filed a complaint in the Law Division asserting essentially the same claims against
Leggett and Crest-Foam that it had asserted in the previously dismissed Chancery Division action. On July 20, 2007,
the trial court dismissed the complaint without prejudice in view of the pending appeal from the order dismissing
the Chancery Division action.
On September 7, 2007, Maurice Migliarino, Section Chief of the NJDEP's Bureau of Industrial Site Remediation,
advised the parties that the NJDEP would not revoke the October 18, 2005 NFA it had issued to Leggett. Migliarino
stated that the NJDEP had determined there was insufficient information to determine that the low levels of volatile
organic compounds (VOC) detected in monitoring wells on Forsgate's properties are from an off-site source.
Migliarino additionally stated that the NJDEP agreed
that at times during the history of the Crest Foam investigation ground water
contamination did have an impact in areas near and on the Forsgate Industrial Partners
properties. However, once the source area was remediated on the Crest Foam property,
concentrations of VOC contaminants dropped to below the New Jersey Ground Water
Quality Standards or to non-detect in and surrounding the former Crest Foam source
areas.
Also, based upon the ground water contour map submitted by Ransom Environmental
in [the] December 2006 Site Investigation Report, ground water flow appears to be
from the northwest to the southeast, since Forsgate['s] . . . monitoring well MW-10 has
the highest water level elevation of all the Forsgate . . . monitoring wells. Therefore, the
Crest Foam facility is hydraulically downgradient of all the Forsgate monitoring wells.
In addition, Forsgate['s] . . . monitor well MW-3 was installed very near Crest Foam well
MW-9. MW-9 had been impacted from the former source on the Crest Foam facility,
however, all post-remediation ground water monitoring results indicated that all VOC
contaminants were below the New Jersey Ground Water Quality Standards.
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On October 11, 2007, we affirmed the order dismissing Forsgate's Chancery Division complaint without prejudice.
Forsgate Industrial Complex, L.P. v. Leggett & Platt, Inc., No. A-1307-06T5 (October 11, 2007). By letter dated
October 22, 2007, Forsgate asked the NJDEP to reconsider its determination. Thereafter, Forsgate filed a notice of
appeal from the NJDEP's September 7, 2007 determination.
While this appeal was pending, a Deputy Attorney General (DAG) wrote to counsel for Forsgate, Leggett and Crest-
Foam and advised that the NJDEP would conduct a meeting to further consider its decision regarding the NFA,
subject to certain conditions. The DAG wrote that prior to the meeting, the parties would be permitted to furnish
the NJDEP with written submissions. The DAG also stated that, at the meeting, oral presentations would be
permitted but they would "be in the nature of an oral discussion or argument, as opposed to direct or cross-
examination of witnesses." Thereafter, the Bureau Chief of the Bureau of Industrial Site Remediation would render a
written decision.
Leggett and Crest-Foam agreed to proceed in accordance with the procedures outlined by the DAG. However, in a
letter dated March 10, 2008, Forsgate's counsel stated that the proposed procedures did not afford his client due
process because it did not provide for cross-examination of witnesses and adjudication by an impartial decision
maker.
Forsgate's attorney additionally stated that if the NJDEP was "truly satisfied" that Leggett and Crest-Foam had
properly completed all off-site remediation, NJDEP should provide a letter stating that in any future ISRA "or similar
proceeding," Forsgate would not have any responsibility for contaminants of the type found on the Crest-Foam site.
The NJDEP thereafter decided not to proceed with the meeting.
In this appeal, Forsgate argues that the NJDEP's determination of September 7, 2007 should be reversed because it
should have been afforded an opportunity to present its Spill Act claims in an adversarial proceeding with the right
to present evidence, cross-examine witnesses and have its case adjudicated by an independent fact-finder. Forsgate
contends that the procedures employed here by the NJDEP denied it of its constitutional right to due process. We
disagree.
"[T]he federal and state constitutions prohibit a State from depriving a person of property without due process of
law." In re Freshwater Wetlands Statewide Gen. Permits, 185 N.J. 452, 466 (2006) (citing U.S. Const. amend. XIV, §1;
N.J. Const. art. I, P.1). However, "[t]he process due in any particular case depends on the property interest at stake
and the nature of the deprivation threatened by the State's action." Ibid. In determining what process is due, the
New Jersey courts have in some cases applied the analysis set forth in Mathews v. Eldridge, 424 U.S. 319, 96 S. Ct.
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893, 47 L. Ed.2d 18 (1976). In re Freshwater Wetlands, supra, 185 N.J. at 467.
When applying the Mathews analysis, we consider the following factors: (1) "the private interest that will be affected
by the official action;" (2) the "risk of an erroneous deprivation of such interest through the procedures used" and
"the probable value" of any "additional or substitute procedural safeguards;" and (3) the government's interest
involved including "the fiscal and administrative burdens that the additional or substitute procedural requirement
would entail." Ibid. (quoting Mathews, supra, 424 U.S. at 335, 96 S. Ct. at 903, 47 L. Ed. 2d at 33).
We assume for purposes of our decision that Forsgate has a sufficient property interest that entitles it to be heard
on the issue of whether the NJDEP should revoke the NFA given to Leggett. However, the NJDEP's decision not to
revoke the NFA does not preclude Forsgate from pursuing any legal or equitable remedies it may have with regard
to the alleged contamination of its properties, including relief that may be available under the Spill Act. The NJDEP
therefore was not required to afford Forsgate an opportunity for an evidentiary hearing before determining
whether to revoke the NFA issued to Leggett. Accordingly, we conclude that the NJDEP did not act arbitrarily,
capriciously or contrary to law in resolving the dispute on the basis of the expert reports submitted by the parties.
Moreover, the NJDEP's decision is based on substantial credible evidence, specifically the Ransom and H&A reports.
We therefore affirm the NJDEP's decision not to revoke the NFA. With the conclusion of this matter, Forsgate may
now move to reinstate its Law Division action. We add the following comments.
At oral argument, the parties recognized that the factual findings made by the NJDEP in its September 7, 2007
determination will not be binding in the Law Division action. "The doctrines of collateral estoppel, issue preclusion,
res judicata, and the like" serve important policy goals, including "'finality and repose[.]'" First Union Nat'l Bank v.
Penn Salem Marina, Inc., 190 N.J. 342, 352 (2007) (quoting Hackensack v. Winner, 82 N.J. 1, 32 (1980)). The doctrines
are based on the principle that "[i]f an issue between the parties was fairly litigated and determined, it should not be
relitigated." Ibid. However, the doctrines are not applicable in the Law Division action.
In this matter, the principal question before the NJDEP was whether the agency should revoke the NFA
issued to Leggett as a result of its remediation of the Crest-Foam site. As stated previously, in its final determination,
the NJDEP found that there was insufficient evidence to show that the low levels of VOC detected in the wells on
Forsgate's properties came from an off-site source.
It is clear, however, that the NFA was primarily a matter between the NJDEP and Leggett. As we stated
previously, the NJDEP's issuance of the NFA, and its refusal to revoke that letter, does not preclude any person from
pursuing legal or equitable remedies related to any alleged contamination emanating from properties identified in
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the NFA. The NJDEP's factual findings therefore are not binding upon any party in Forsgate's Law Division action.
Affirmed.
According to N.J.A.C. 7:26E-1.8, an NFA is essentially a determination by the NJDEP that there are no "discharged
contaminants" on the site or any other site to which a contaminant may have migrated.
(continued)
(continued)
13
A-0908-07T2
January 20, 2009
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