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Can I Be Sued if My UST Damages My Neighbor’s Property?

Firemen are using water to extinguish the fire. Firefighter training

Underground storage tanks (USTs) can be an inconvenient hassle to discover on your property. Even when dealt with properly, they can still pose a risk to the environment, to local groundwater, etc., affecting property value. But what if a UST leak extends beyond your property and damages your neighbor’s land? Are you liable for their damages? The New Jersey Supreme Court has addressed this exact issue.

New Jersey UST Case – Ross v. Lowitz

In the case of Ross v. Lowitz, the New Jersey Supreme Court dealt with a property owner’s lawsuit against their neighbor. The defendant Lowitz bought the land knowing a UST was present and had an appropriate environmental test conducted which showed no leakage. Lowitz also secured homeowner’s insurance. Preparing to resell the property, Lowitz discovered a leak. The insurers handled the leak remediation.

The plaintiff bought the neighboring property in 2004, unaware there was a UST leak. He tried to sell the property in 2006, and shortly thereafter he learned that the defendant’s property had a leak. During the closing process in 2007, the plaintiff learned that the oil leak had reached his own property. The prospective buyers rescinded their agreement to buy as a result.

The plaintiff sued the defendant landowner as well as the insurance companies, based on claims of negligence, strict liability, nuisance, trespass and Spill Act liability, for damages related to a diminution in value of the home, damages related to remediation, and alleged loss of use of the home. During the course of the lawsuit, the insurance companies finally arranged for remediation and compensated the plaintiff for out-of-pocket losses related to remediation. Plaintiff dropped the strict liability and Spill Act claims but continued the lawsuit based on claims of negligence, nuisance and trespass for the oil remaining on the property.

A UST Owner is Liable For Private Nuisance and Trespass Only if They Acted Negligently

The New Jersey Supreme Court ultimately upheld the trial court’s decision to dismiss the plaintiff’s claims on summary judgment. The Court held that maintaining a UST was not “unreasonable” or “abnormally dangerous” conduct sufficient to trigger a strict liability nuisance or trespass claim. Thus trespass and nuisance would only apply if the landowner interfered with plaintiff’s use of his land through negligent, reckless, or intentionally bad conduct. Because the landowner acted reasonably with regard to the UST and in dealing with the leak, the plaintiff had no claim. The Court also held that the plaintiff could not sue the defendant landowner’s insurance company because he was not a party or third-party beneficiary to their insurance contract.

The moral of the story is clear: Make the best, educated decisions, and hire the right professionals. If your UST causes a problem but you did everything reasonably in your power to prevent an accident from occurring, you are much more likely to avoid significant liability.

Call in the Professionals at Lutz to Handle Your Underground Storage Tank Issues

If you are a real estate owner looking to properly remove a UST prior to sale, get help from trusted advisors with years of underground storage tank experience. For advanced, professional assistance, call Herbert Lutz & Company in New Jersey at 908-862-8888 or in Florida at 954-971-5222.

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