The Statute of Limitations: Does CERCLA Preempt Jolly?

by Raphael Metzger, Esq.

The client has what appears to be a very strong toxic tort case.  He worked for years with solvents, some of which contained high concentrations of benzene, and developed acute myelogenous leukemia -- the type of leukemia which is clearly caused by benzene exposure.

There is only one problem.  The client first came to your office more than a year after he was diagnosed with leukemia and more than a year after he suspected his leukemia was caused by exposure to solvents he used at work.  However, the client was unaware that benzene was in the solvents and first suspected that benzene caused his leukemia when an oncologist told him last week that benzene was the only solvent that caused the type of leukemia he had and that benzene was probably in some of the solvents he used in his employment.

The leading case in California regarding the commencement of the running of the statute of limitations when the plaintiff suffers a latent toxic injury is Jolly v. Eli Lilly & Co. (1988) 44 Cal.3d 1103, 245 Cal.Rptr. 658.

The Jolly Court held that in delayed discovery cases, "a suspicion of wrongdoing, coupled with a knowledge of the harm and its cause, will commence the limitations period," i.e., "the limitations period begins when the plaintiff suspects, or should suspect that she has been wronged."  Id. at pp. 1112 and 1114. (emphasis added).

However, the Jolly Court did not explain what "knowledge of the cause" of injury will suffice to begin the running of the statute.

Did the client's belief that his leukemia was caused by occupational exposures trigger the statute?  Was the statute triggered by his belief that the solvents he worked with caused his leukemia?  Did the statute begin to run when he first learned that benzene was the culprit?  Or does it begin to run when the products containing benzene are identified?

These questions were not resolved by Jolly. Nor are these questions answered by any appellate decisions interpreting Jolly. Indeed, a recent appellate case indicates that the answers to these questions may not depend on an interpretation of Jolly at all.

Although the California Supreme Court has never disapproved Jolly, the rule it created may no longer be good law in some toxic tort cases.  This is so, because the Jolly rule may be preempted by federal law which mandates a more liberal accrual rule than Jolly in certain personal injury and property damage cases involving hazardous substances.  This conclusion logically follows from a recent construction defect case, Angeles Chemical Co. v. Spencer & Jones (1996) 44 Cal.App.4th 112.

The preemptive statute is 42 U.S.C. § 9658, which was adopted by Congress as part of the Superfund Amendments and Reauthorization Act of 1986 ("SARA"), which amended the federal Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA").

"The [A]ct commissioned a study 'to determine the adequacy of existing common law and statutory remedies in providing legal redress for harm to man and the environment caused by the release of hazardous substances into the environment.'"  Angeles Chemical Co., Inc., supra, 44 Cal.App.4th at 122, quoting, Pub.L. No. 96-510 (Dec. 11, 1980).

"The study group was expressly charged with examining, among other things, 'barriers to recovery posed by existing statutes of limitations'. It was also directed to address "the need for revisions in existing statutory or common law" and "whether such revisions should take the 'form of Federal statutes.'"  Id., §§ 9651(e)(4)(A), 9651(e)(4)(B).)

The study group submitted its report to the President and the Congress in July 1982. The report stated in part as follows: "Commencement of the running of the statute of limitations can be a barrier to recovery under both common law and statutory remedies. This issue does not arise specifically from the applicable period of limitations which depends on the cause of action; the question is when the statute begins to run -- the time when the action accrues.  The plaintiff's ability to recover will often depend on whether a liberal discovery rule is applicable. [¶] Exposure to certain hazardous wastes may result in cancer, neurological damage, and in mutagenic and teratogenic changes. Most of these types of injuries have long latency periods, sometimes 20 years or longer. With long latency periods, a rule which starts the running of the statute from the time of exposure will defeat most actions before the plaintiff knows of his injury."  Id., 44 Cal.App.4th at 122-123.

In response to the study group's report, Congress passed the Superfund Amendments and Reauthorization Act (Pub.L. No. 99-499 (Oct. 17, 1986) 100 Stat. 1613). Title II, section 203(a) of that act became section 309 of CERCLA. It states in pertinent part:

In the case of any action brought under State law for personal injury, or property damages, which are caused or contributed to by exposure to any hazardous substance, or pollutant or contaminant, released into the environment from a facility, if the applicable limitations period for such action (as specified in the State statute of limitations or under common law) provides a commencement date which is earlier than the federally required commencement date, such period shall commence at the federally required commencement date in lieu of the date specified in such State statute.

Angeles Chemical Co., Inc., supra, 44 Cal.App.4th at 122; quoting, 42 U.S.C. § 9658(a)(1).

CERCLA defines "federally required commencement date" as the "date the plaintiff knew (or reasonably should have known) that the personal injury or property damages ... were caused or contributed to by the hazardous substance or pollutant or contaminant concerned."  Angeles Chemical Co., Inc., supra, 44 Cal.App.4th at 122; quoting, 42 U.S.C. § 9658(b)(4)(A).

The statute "creates a federally mandated discovery rule for the accrual of state law claims involving releases of hazardous substances that cause or contribute to personal injury or property damage."  Angeles Chemical Co., Inc., supra, 44 Cal.App.4th at 123.

“Practically speaking, CERCLA essentially preempts state statutes of limitations if those state law claims are based upon exposure to hazardous substances released into the environment and the applicable limitations period provides for an earlier commencement date than federal law."  Id.

"[U]nder the CERCLA preemptive statute ... plaintiffs' cause of action accrues when the plaintiffs knew or reasonably should have known that their damages were caused or contributed to by the contaminant at issue."  Hawks v. City of Coffeyville, 1994 U.S. Dist. LEXIS 15163 (D. Kans. Sept. 8, 1994).

While there are similarities between the Jolly rule and 42 U.S.C. § 9658, the Jolly rule appears to operate somewhat more niggardly.

Under the preemptive statute, California's statute of limitations cannot begin to run until the "date the plaintiff knew (or reasonably should have known) that the personal injury or property damages ... were caused or contributed to by the hazardous substance or pollutant or contaminant concerned."  Angeles Chemical Co., Inc., supra, 44 Cal.App.4th at 122; quoting, 42 U.S.C. § 9658(b)(4)(A).  (emphasis added).

Whereas Jolly does not necessarily require the plaintiff to have knowledge of the particular injury-causing hazardous substance for the statute to run, the CERCLA preemptive rule apparently requires such knowledge.

Applying the preemptive CERCLA rule to the client's case, it would appear that Jolly is preempted and the statute of limitations began to run only when the client's oncologist suggested to him that it was benzene in the solvents he worked with that caused his leukemia.  Whereas the case may be time-barred under Jolly, it would apparently not be time-barred under the CERCLA preemptive statute.

Raphael Metzger is the principal of the Metzger Law Group, a Professional Law Corporation.  His practice is concentrated on occupational cancer, lung disease, organ failure and other toxic injury cases.  The firm’s offices are located in Long Beach, California.