Constitutionality of State Procedural Reform Provision

in Superfund Legislation

A bill reauthorizing the Comprehensive Environmental Response, Compensation, and Liability 

Act o f 1980 contains a section that provides for a uniform federal commencement date for the 

running o f state statutes of limitations in toxic tort actions. By operation of this provision, 

some actions previously time-barred under existing state law would be revived.

Under current case law, the bill would not be struck down as beyond the constitutional power of 

Congress. Although the effort to dictate the content of state law is inconsistent with wellestablished provisions o f federalism, it cannot be said that this effort violates the Tenth 

Am endment as explained by the Supreme Court in Garcia v. San Antonio Metropolitan

Transit Authority, 469 U.S. 528 (1985).

The retroactive aspects of the bill may be challenged as a denial of property without due process 

of law or as a taking of property without just compensation. A due process challenge would 

present difficult questions due to the existence of two lines of Supreme Court authority in 

apparent tension, and the bill may well be held to violate the Due Process Clause. The revival 

of a tim e-barred action probably would not constitute a taking under the ad hoc regulatory 

takings inquiry established by the Supreme Court.

April 1, 1986

M e m o r a n d u m O p i n i o n f o r t h e D e p u t y A s s i s t a n t A t t o r n e y G e n e r a l ,

C iv i l D i v i s i o n

In a letter of December 19, 1985, you requested the views of this Office on 

the constitutionality of certain provisions in H.R. 2817, prescribing a uniform, 

retroactive federal commencement date for the running of statutes of limitations in state tort actions arising from exposure to toxic substances (toxic torts). 

Although the invasion of the powers of the states proposed by this bill raises 

serious concerns, we cannot say that the bill would be struck down as beyond 

the constitutional powers of Congress. We believe, however, that the retroactive aspects of the bill may be held to violate the Due Process Clause in certain 

instances, although they would likely survive a challenge under the Takings 

Clause. Finally, we think that, even if constitutional, the bill might have the 

untoward result of inducing some state courts to invalidate entire state causes 

of action for toxic torts.

H.R. 2817, the House bill reauthorizing the Comprehensive Environmental 

Response, Compensation, and Liability Act of 1980, Pub. L. No. 96-510, 94 

Stat. 2767 (codified at scattered sections of titles 26, 33,42 & 49 of the United 

States Code) (Superfund), contains a section on “State Procedural Reform,”

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which provides a uniform federal commencement date for the running of state 

statutes of limitations in toxic tort actions. The federal commencement date 

applies to “any action brought under State law” for injury resulting from 

exposure to toxic substances; this federal commencement date presumably 

applies to both statutory and common law actions. No new federal cause of 

action is created. The bill would make the new commencement date applicable 

to actions brought after December 11,1980, thereby retroactively “reviving” at 

least some actions that are time-barred under existing state statutes of limitations.

1. Tenth Amendment. The initial question is whether congressional alteration 

of state statutes of limitations, other than through creation of a preemptive 

federal cause of action, is consistent with the constitutional structure of dual 

sovereignty. We find the question troubling. Although Congress may of course 

preempt state law in areas of legitimate federal constitutional authority, any 

effort by the federal government to dictate the content of state law (as this bill 

contemplates) would do gross violence to our federal system. Nevertheless, we 

cannot say that this novel provision would be held to violate the Tenth Amendment under the standards for constitutional federalism set forth in Garcia v. 

San Antonio Metropolitan Transit Authority, 469 U.S. 528 (1985). The Supreme Court in Garcia overruled its earlier decision in National League o f

Cities v. Usery, 426 U.S. 833 (1976), which had determined that the federal 

government’s Commerce Clause powers were constrained by the Tenth Amendment “in areas of traditional governmental functions.” Id. at 852. Garcia

rejected the distinction between traditional and nontraditional governmental 

functions as untenable, see 469 U.S. at 539-49, and concluded that limitations 

on congressional power to regulate the states were to be left primarily to the 

political process. See id. at 549-55. To be sure, the Court held open the 

possibility that certain extreme cases might invite judicial scrutiny. See id. at 

556-57. But H.R. 2817 would have presented a difficult question even under 

pre-Garcia law. See FERC v. Mississippi, 456 U.S. 742, 764—71 (1982).

2. Retroactivity and Due Process. The proposal to apply the new statute of 

limitations retroactively to revive previously barred actions raises serious 

constitutional questions, the chief of which is whether revival of time-barred 

actions is an unconstitutional deprivation of the property of defendants without 

due process of law.

The principal decision suggesting that revival of actions might violate the 

Constitution is William Danzer & Co. v. G ulf & Ship Island R.R. Co., 268 U.S. 

633 (1925). Following the First World War, a statute was passed providing that 

the period of wartime federal control of railroads was not to be counted in 

determining whether actions under the Interstate Commerce Act were brought 

within that Act’s statute of limitations. The reparations suit by the plaintiff 

shippers in Danzer was brought subsequent to this new statute, but the time 

limit on the action under the old statute of limitations had expired before the 

post war enactment. If the wartime period was excluded from the computation, 

the action would have been timely. The Supreme Court held that it would

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violate the Fifth Amendment to apply the new limitations provision to revive 

an action that was already fully barred. Prior decisions had established “that the 

lapse of time not only barred the remedy but also destroyed the liability of 

defendant to plaintiff. On the expiration of the two-year [limitations] period, it 

was as if liability had never existed.” 268 U.S. at 636 (emphasis added) 

(citations omitted). In such cases, where the limitations provision “constitute[s] 

a part of the definition of a cause of action created by the same or another 

provision, and operate[s] as a limitation on liability,” id. at 637, retroactive 

application of a change in the statute to revive liability “would . . . deprive 

defendant of its property without due process of law in contravention of the 

Fifth Amendment.” Id.

Danzer distinguished the Court’s earlier opinion in Campbell v. Holt, 115 

U.S. 620 (1885), which had rejected the argument that the retroactive removal 

of a time-bar to a Texas contract action violated the Fourteenth Amendment. 

The Campbell Court, while suggesting that there would be constitutional 

problems with revival of an action to recover title to property that had vested 

with the passage of time, see 115 U.S. at 623, found no such bar to revival of an 

expired contract action, holding: “We certainly do not understand that a right to 

defeat a just debt by the statute of limitations is a vested right, so as to be 

beyond legislative power in a proper case.” Id. at 628. See also id. at 629 (“[w]e 

are unable to see how a man can be said to have property in the bar of the 

statute as a defence to his promise to pay”) (emphasis in original). The Danzer

Court found this case inapplicable since it “rests on the conception that the 

obligation of the debtor to pay was not destroyed by lapse of time, and that the 

statute of limitations related to the remedy only . . . .” 268 U.S. at 637. By 

contrast, the Danzer Court concluded, the time limitation in the Interstate 

Commerce Act went to the existence of liability, freedom from which was held 

to be a vested property right that could not be infringed under the Fifth 

Amendment. See id.

In Chase Securities Corp. v. Donaldson, 325 U.S. 304 (1945), the Court 

upheld the constitutionality of retroactive application of a change in the statute 

of limitations for actions under Minnesota’s Blue Sky laws. Danzer was 

discussed and distinguished in a footnote:

In the Danzer case it was held that where a statute in creating a 

liability also put a period to its existence, a retroactive extension 

of the period after its expiration amounted to a taking of property without due process of law.... But the situation here 

plainly does not parallel that in the Danzer case .... At the time 

this action was commenced the Blue Sky Law of Minnesota had 

imposed on appellant a duty; it had not explicitly created a 

liability. The liability was implied by the state’s common law; 

the period of limitation was found only in the general statute of 

limitations enacted many years earlier. The state court concluded that the challenged statute did not confer on appellees a

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new right or subject appellant to a new liability. It considered 

that the effect of the legislation was merely to reinstate a lapsed 

remedy, that appellant had acquired no vested right to immunity 

from a remedy for its wrong in selling unregistered securities, 

and that reinstatement of the remedy by the state legislature did 

not infringe any federal right under the Fourteenth Amendment, 

as expounded by this Court in Campbell v. Holt.

Id. at 312 n.8. Thus, the footnote in Chase Securities appears to retain the 

“right/remedy” distinction enunciated by Danzer: retroactive application of 

new statutes of limitations is unconstitutional when it would revive liability, 

rather than merely revive a remedy for liability that was never extinguished, 

and in state causes of action one must look to state law to determine which is 

the case.1

The Court’s most recent discussion of Danzer is consistent with this analysis. In International Union o f Electrical, Radio & Machine Workers, AFL-CIO,

Local 790 v. Robbins & Myers, Inc., 429 U.S. 229 (1976), the Court upheld the 

retroactive application of a new statute of limitations for filing charges with the 

Equal Employment Opportunity Commission (EEOC), thus preserving a suit 

under Title VII of the Civil Rights Act of 1964 that would otherwise have been 

barred for failure to file with the EEOC in timely fashion. After concluding that 

the new limitations period applied to the suit in question, the Court rejected the 

defendant’s constitutional challenge to its application:

Respondent contends, finally, that Congress was without constitutional power to revive, by enactment, an action which, when 

filed, is already barred by the running of a limitations period.

This contention rests on an unwarrantably broad reading of our 

opinion in [Danzer], Danzer was given a narrow reading in the 

later case of Chase Securities Corp. v. Donaldson, 325 U.S.

304, 312 n.8 (1945). The latter case states the applicable constitutional test in this language:

‘The Fourteenth Amendment does not make an act 

of state legislation void merely because it has some 

retrospective operation. What it does forbid is taking of life, liberty or property without due process of 

law .... Assuming that statutes of limitation, like

1 “Property interests . . . are not created by the Constitution. Rather, they are created and their dimensions 

are defined by existing rules or understandings that stem from an independent source such as state law.” 

Board o f Regents v. Roth, 408 U.S. 564,577 (1972). The Court in Campbell does not appear to have consulted 

state law in this fashion. Rather, it seems to have held generally that limitations on contract actions go to the 

remedy, see 115 U.S. at 629, while the dissent took the contrary position, again as a general matter. See id. at 

630-31 (Bradley, J., dissenting). A possible reconciliation is found in the comment in Chase Securities that 

Campbell “adopted as a working hypothesis, as a matter of constitutional law, the view that statutes of 

limitation go to matters o f remedy, not to destruction of fundamental rights.” 325 U.S. at 314 (emphasis 

added). If a defendant proves that state law establishes that statutes of limitations protect “fundamental 

rights,” this presumption, we assume, can be overcome.

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other types of legislation, could be so manipulated 

that their retroactive effects would offend the Constitution, certainly it cannot be said that lifting the 

bar of a statute of limitation so as to restore a remedy lost through mere lapse of time is per se an 

offense against the Fourteenth Amendment.” Id. at 

315-316.

Applying that test to this litigation, we think that Congress 

might constitutionally provide for retroactive application of the 

extended limitations period which it enacted.

429 U.S. at 243-44 (omission in original).

A plausible interpretation if this passage is that Congress did not intend the 

limitations provisions in Title VII to condition the liability of defendants, and 

Robbins & Myers is thus a “remedy” case akin to Campbell and Chase Securities, rather than a “liability” case like Danzer? In view of its endorsement of 

Chase Securities, the Court evidently meant to give Danzer a “narrow reading” 

by limiting it to situations in which the statute of limitations is an essential part 

of the cause of action.

On this understanding of the law, H.R. 2817 presents serious problems. If, 

under the law of a particular state, statutes of limitations are seen as conditioning liability with respect to any of the actions affected by the bill, then as to 

those actions retroactive application of the new commencement date would be 

an unconstitutional deprivation of property without due process. Many states 

have such rules. See generally 51 Am. Jur. 2d Limitation o f Actions §44 

(1970); 16A Am. Jur. 2d Constitutional Law §§ 665-66 (1979). The consequence of this understanding of the law is the unfortunate spectacle of a statute 

fully constitutional in some states, partly constitutional in others, and wholly 

unconstitutional in still others (those that guarantee the vesting of limitation 

defenses).

There is, however, good reason to doubt whether this is an accurate statement of the law. The Supreme Court has recently addressed the constitutional 

power of Congress to create liability retroactively, holding broadly that the 

legislature has considerable leeway to impose liability for conduct that was 

legal when performed. In Usery v. Turner Elkhom Mining Co., 428 U.S. 1 

(1976), the Court considered and rejected a constitutional challenge to a 

congressional program for compensating victims of black lung disease. In 

particular, the Court upheld the retroactive imposition of liability on mine 

owners for black lung disease contracted by mine workers who had left employment before enactment of the compensation scheme. (The mine owners did 

not object to compensating current employees for disease contracted in the

2 But c f United States Trust Co. o f New York v. New Jersey. 43] U.S. J, 20 n .]7 (1977) (the remedy/ 

obligation distinction in Contract C lause jurisprudence is “now largely an outdated formalism," though it 

“approxim ates] the result o f a more particularized inquiry into the legitimate expectations o f the contracting 

parties”).

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past.) The Court pronounced it “well established that legislative Acts adjusting 

the burdens and benefits of economic life come to the Court with a presumption 

of constitutionality, and that the burden is on one complaining of a due process 

violation to establish that the legislature has acted in an arbitrary and irrational 

way.” 428 U.S. at 15. The Court noted that the statute “has some retrospective 

effect,” id. at 16, but countered that “our cases are clear that legislation 

readjusting rights and burdens is not unlawful solely because it upsets otherwise settled expectations. This is true even though the effect of the legislation 

is to impose a new duty or liability based on past acts.” Id. (citations omitted). 

The Court suggested that retrospective legislation might be subject to more 

heightened scrutiny than purely prospective acts and even intimated that it 

would not uphold the black lung statute if its rationale was deterrence of 

undesirable conduct. Id. at 16-17. But it found “that the imposition of liability 

for the effects of disabilities bred in the past is justified as a rational measure to 

spread the costs of the employees’ disabilities to those who have profited from 

the fruits of their labor — the operators and the coal consumers.” Id. at 18.

The Court recently reaffirmed Turner Elkhom in Pension Benefit Guaranty

Corp. v. R.A. Gray & Co., 467 U.S. 717 (1984), which upheld the retroactive 

imposition of liability on employers who withdrew from certain pension plans 

within five months prior to enactment of a statute imposing additional costs on 

withdrawal from those plans. Relying on Turner Elkhom, the Court emphasized that

the strong deference accorded legislation in the field of national 

economic policy is no less applicable when that legislation is 

applied retroactively. Provided that the retroactive application 

of a statute is supported by a legitimate legislative purpose 

furthered by rational means, judgments about the wisdom of 

such legislation remain within the exclusive province of the 

legislative and executive branches ....

467 U.S. at 729. The heightened burden that retroactive legislation must face 

“is met simply by showing that the retroactive application of the legislation is 

itself justified by a rational legislative purpose.” Id. See also United States

Trust Co. o f New York v. New Jersey, 431 U.S. 1, 17 n.13 (1977) (“[t]he Due 

Process Clause of the Fourteenth Amendment generally does not prohibit 

retrospective civil legislation, unless the consequences are particularly ‘harsh 

and oppressive’” (dictum) (quoting Welch v. Henry, 305 U.S. 134, 147 (1938)).

If Congress created a new cause of action for toxic torts and imposed 

retroactive liability, the statute would surely survive constitutional attack under 

Gray and Turner Elkhom. Indeed, the parallels between such hypothetical 

legislation and the black lung statute upheld in Turner Elkhom are striking, 

even to the likely cost-spreading rationale. But if this is true, it is difficult to see 

why Congress should be able to impose retroactive liability directly by creating 

a new cause of action, but not indirectly by extending backwards a statute of 

limitations (or new commencement date). An argument can thus be made that

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Danzer is no longer good law. Nonetheless, Turner Elkhom and Gray make no 

reference to Danzer or the other statute of limitations cases, nor do the latter 

cases refer generally to the former, even though Turner Elkhom had been 

decided when Robbins & M yers, the most recent of the statute of limitations 

cases, was decided.

3. Takings Clause. An additional constitutional question may be raised under 

the Takings Clause of the Fifth Amendment. If liability is imposed retroactively on those who deal with toxic wastes in order to spread costs among the 

general public, defendants may argue that their property (i.e., their freedom 

from liability by virtue of a state statute of limitations) is being taken for a 

public purpose without just compensation. However, the bill would likely 

survive a Takings Clause challenge under the “ad hoc, factual inquir[y],” Penn

Central Transportation Co. v. New York City, 438 U.S. 104, 124 (1978), used 

by the Supreme Court in regulatory takings cases. See, e.g., Connolly v. 

Pension Benefit Guaranty Corp., 475 U.S. 211,223-28 (1986); Ruckelshaus v. 

Monsanto Co., 467 U.S. 986, 1004-08 (1984); PruneYard Shopping Center v. 

Robins, 447 U.S. 74, 82-83 (1980). This inquiry looks to such factors as “the 

character of the governmental action, its economic impact, and its interference 

with reasonable investment backed expectations.” PruneYard Shopping Center, 447 U.S. at 83. Because the government action contemplated by H.R. 2817 

does not physically appropriate property for the government’s own use, see

Connolly, 475 U.S. at 224-25, and is likely to have little, if any, impact on 

“investment backed expectations,” the revival of time-barred actions probably 

does not meet the standards for a regulatory taking.

4. Other Issues. Quite apart from the question whether Congress has the 

power to create retroactive liability through extension of state statutes of 

limitations, the bill raises a number of other issues. Because H.R. 2817 is not 

creating a new cause of action, but is merely engrafting a provision onto 

existing state actions, it is necessary to consider the effects this might have 

under state law. As was noted above, a number of states guarantee the vesting 

of limitations defenses. Accordingly, it is conceivable that some state courts 

may hold that state causes of action for toxic torts are not severable from the 

statute of limitations under state law and that the effect of the federal law 

purporting to alter the state statute of limitations is to invalidate the state cause 

of action in toto.3

Present case law would not compel state courts to take jurisdiction over these 

actions instead of invalidating the state compensation scheme. The Supreme 

Court held in Testa v. Katt, 330 U.S. 386 (1947), that state courts may not

3 This raises the interesting question o f whether such abrogation o f liability without provision of a 

reasonable substitute would violate the due process rights o f toxic tort victims. W e know of no definitive 

precedent on this point, though a recent dictum o f the C ourt suggests that it would not. See Duke Power Co. v. 

Carolina Environmental Study Group, 438 U.S. 59, 88 & n.32 (1978). See also Silver v. Silver, 280 U.S. ! 17, 

122 (1929) (dictum). But see New York Central R.R. Co. v. White, 243 U.S. 188,201 (1917) (“it perhaps may 

be doubted w hether the State could abolish all rights of action [for personal injuries between employers and 

em ployees] on the one hand, or all defenses on the other, without setting up something adequate in their 

stead” ) (dictum).

38
decline to take jurisdiction over a federal cause of action on the ground that it is 

contrary to state policy. Here, however, no federal cause of action is at issue, 

and neither H.R. 2817 nor any existing federal statute requires a state to 

recognize a state cause of action for toxic torts or precludes a state from 

repealing any such existing cause of action.

C h a r l e s J. C o o p e r

Assistant Attorney General

Office o f Legal Counsel

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