Friday, May 27, 2016

Statute of limitations applies to bar State's claim for groundwater contamination, notwithstanding exemption for state property.

State v. Atlantic Richfield Company, 2016 VT 61 (filed May 27, 2016)

ROBINSON, J. This interlocutory appeal calls upon us to decide whether the general six-year limitations has run on the State of Vermont’s claims against defendants for injury to state waters due to groundwater contamination from gasoline additives. The trial court dismissed the State’s claims on the basis of the statute of limitations, insofar as they are predicated on generalized injury to state waters as a whole. On appeal, the State argues that 12 V.S.A. § 462 exempts the State’s claims from the statute of limitations, and, alternatively, that the State’s claims arising under 10 V.S.A. § 1390, a statute that establishes a state policy that the groundwater resources of the state are held in trust for the public, are not time barred because that statute became effective less than six years before the State filed its complaint. We affirm.

Defendants moved to dismiss the complaint as time-barred under the general six year statute of limitations for civil actions. See 12 V.S.A. § 511. Defendants noted that the Legislature’s ban on MTBE in Vermont was enacted in May 2005. For this reason, defendants argued, the State was indisputably aware of the alleged injury to Vermont’s waters due to MTBE more than six years prior to its June 5, 2014 complaint.

In opposition, the State argued that: (1) its claims, which arise from injury to state lands and public trust resources, are exempt from any limitations period, see 12 V.S.A. § 462; (2) even if a limitations period did apply, the State’s cause of action based on 10 V.S.A. § 1390 accrued on June 9, 2008, when that statute became effective, and the State filed suit within six years of the Legislature’s creation of that new cause of action


(1) 12 V.S.A. § 462

12 V.S.A. § 462 provides: “Nothing contained in this chapter shall extend to lands given, granted, sequestered or appropriated to a public, pious or charitable use, or to lands belonging to the state.” The section appears in chapter 23 of Title 12, which includes the general six-year limitation for civil actions, 12 V.S.A. § 511.

The State argues that this statute relating to “lands belonging to the state” applies to groundwater held by the state in trust for the public. Second, the State contends that the statute’s bar to application of the statute of limitations extends beyond claims of adverse possession or prescriptive rights to claims based on environmental injuries.

Based on the history surrounding its enactment, our cases, the language of the statute, and policy considerations,we conclude that § 462 does not exempt the State’s claims from the statute of limitations because the State’s claims are not the kind of claims contesting property interests in land to which the statute applies.

Although we have never squarely considered the question, our decisions have consistently reinforced the understanding that § 462 was designed to prevent adverse-possession claims with respect to interests in state property, or property dedicated to a public, pious, or charitable use. Our longstanding understanding of § 462 is consistent with the language of the statute itself. Moreover, sound policy considerations reinforce our longstanding interpretation.

We conclude the trial court properly interpreted § 462 as limited to claims of adverse possession (or other claims of property interests arising by prescription). The exemption is thus inapplicable in this case


(2) 10 V.S.A. § 1390


10 V.S.A. § 1390 codifies the Legislature’s recognition that the groundwater of Vermont is a precious, finite, and invaluable resource. The following language of the statute is the basis of the State’s argument here: “The designation of the groundwater resources of the state as a public trust resource shall not be construed to allow a new right of legal action by an individual other than the State of Vermont . . .” 10 V.S.A. § 1390(5). The effective date of this statute was June 9, 2008.

We conclude that even if § 1390 did create a new cause of action that was retroactively enforceable, that would not empower the State to apply the statute to injuries discovered more than six years prior to its complaint. When the State filed its complaint on June 5, 2014, the general six-year statute of limitations precluded claims arising from injuries that were discovered more than six years before. Even if § 1390 created a new cause of action for the State, and even if the statute authorized retroactive application of this new cause of action—questions we do not decide—the six-year limitation would bar the State’s § 1390 claims to the extent that it relies on generalized harm to the groundwater’s of the state as a whole.


For the above reasons, we affirm the trial court’s determinations that 12 V.S.A. § 462 does not exempt the State’s claims from operation of the applicable statute of limitations, and its conclusion that the State’s claims under 10 V.S.A. § 1390 are not all timely as a matter of law. Affirmed.

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