In Elkhart Foundry & Machine Co., Inc. v. City of Elkhart, __ N.E.3d ___, No. 20A03-1709-CT-2136, 2018 WL 4762756 (Ind. Ct. App. Oct. 3, 2018), the Indiana Court of Appeals held that Indiana’s Environmental Legal Action statute (ELA), Ind. Code § 13-30-9-2, is subject to a ten-year statute of limitations. The decision ends, at least for now, a debate that has raged since the General Assembly first enacted the ELA in 1997 to allow people who incur environmental remediation costs to recover those costs from those who caused or contributed to the contamination.
When first enacted, the ELA did not contain its own statute of limitations. Without a specific statute of limitations, litigants were left to scour the Indiana Code for the appropriate limitations period. Two contenders quickly emerged: the six-year statute of limitations for damage to real property, Ind. Code § 34-11-2-7, and the ten-year “catch-all” statute of limitations, Ind. Code § 34-11-1-2. Which statute of limitations applies to the ELA quickly became one of the most hotly litigated questions under the new statute, leading to conflicting results. See Peniel Group, Inc. v. Bannon, 973 N.E.2d 575, 582 (Ind. Ct. App. 2012) (applying a six-year statute of limitations); Bernstein v. Bankert, 733 F.3d 190, 220–21 (7th Cir. 2013) (applying a ten-year statute of limitations). The issue was addressed by the Indiana Supreme Court in Cooper Industries, LLC v. City of S. Bend, 899 N.E.2d 1274 (Ind. 2009). To resolve the case, the Court presumed but did not decide that the six-year statute of limitations applied to the case before it, and so no clarity was brought to the issue.
With so much confusion, the General Assembly jumped back into the fray in 2011, enacting Indiana Code § 34-11-2-11.5. That section allows the ELA plaintiff to recover “costs incurred not more than ten (10) years before the date the action is brought, even if the person or any other person also incurred costs more than ten (10) years before the date the action is brought.”
Following the enactment of the new statute, the issue was resolved, but it would not stay that way for long. In 2016, the Indiana Court of Appeals decided Schuchman/Samberg Investments, Inc. v. Hoosier Penn Oil Co., Inc., 58 N.E.3d 241 (Ind. Ct. App. 2016). That case arose prior to enactment of Indiana Code § 34-11-2-11.5, so the new statute was not before the court. The court addressed the statute nonetheless, stating “§ 34-11-2-11.5 says nothing of the time frame within which an ELA claim must be brought or the events that trigger the running of that period. Instead, it imposes a limitation on the types of damages recoverable in an ELA claim in the form of a ten-year look-back period.” Id. at 246 n.5. In other words, the court did not believe that the statute was a statute of limitations at all and the door was again opened for further litigation on the appropriate statute of limitations for an ELA action.
Thus, in Elkhart Foundry, the defendant argued that the ELA was subject to a six-year statute of limitations and that Indiana Code § 34-11-2-11.5 was simply a limit on damages recoverable. Brushing Schuchman/Samberg aside as dicta, the court rejected this argument. The court held that the General Assembly intended § 34-11-2-11.5 to function as a statute of limitations because although not phrased in terms of stating when an action must be brought, the statute still functions the same as a traditional statute of limitation. To further bolster this conclusion, the court noted that the General Assembly placed the new statute in a section titled “Limitation of Actions” and placed it alongside other statutes of limitation.
The Elkhart Foundry court held that § 34-11-2-11.5 “means that if a person wants to recover a particular cleanup cost, they must bring an ELA within ten years of incurring the cost. Stated differently, as soon as a person incurs a cleanup cost, the ten-year period starts to run with respect to that cost.” Elkhart Foundry, 2018 WL 4762756, at *3. The issue is again settled — at least for now. The appellant has filed a petition to transfer with the Indiana Supreme Court, so the Court of Appeals’ opinion may or may not be the final chapter in this saga.