Bath Petroleum Storage, Inc. and EIL Petroleum, Inc. - Commissioner Ruling, February 17, 1999
Commissioner Ruling, February 17, 1999
STATE OF NEW YORK : DEPARTMENT OF ENVIRONMENTAL CONSERVATION
50 Wolf Road
Albany, New York 12233-1010
In the Matter
- of -
Alleged Violations of the Environmental Conservation Law by
EIL Petroleum, Inc.,
Bath Petroleum Storage, Inc.
DEC No. R8-1088-97-01
RULING OF THE DEPUTY COMMISSIONER
February 17, 1999
Ruling of the Deputy Commissioner
Staff moved the Commissioner on December 24, 1998 for leave to file an expedited appeal from part of a Ruling of Administrative Law Judge (ALJ) Daniel P. O'Connell dated December 21, 1998. Leave to appeal was granted by the Chief Administrative Law Judge's letter dated December 30th, which accepted Staff's motion papers as presenting Staff's argument in favor of the appeal, and allowed Respondents until January 11, 1999 to answer. Respondents replied immediately by its Virginia counsel to the Chief Judge with a letter and a brief dated December 30. Counsel complained bitterly that leave to appeal should not have been granted prior to Respondents being given an opportunity to reply. Next, Respondents availed themselves of the opportunity to address Staff's motion on the merits by filing a brief dated January 11, 1999, which was timely received. Also, a notice substituting a new local counsel on behalf of Respondents has been received. The matter is now ripe for decision. The Commissioner has designated the Deputy Commissioner for Air and Waste Management to be the decision-maker in this proceeding.
The Staff's appeal is taken from that part of the December 21 Ruling which established a briefing schedule on the question whether the Department has "subject matter jurisdiction". The ALJ reasoned that "subject matter jurisdiction" is a threshold question that should be decided prior to further proceedings in this case. Therefore he ruled that the parties should brief this question. By way of background, this is an enforcement case in which Staff complains that Respondent has violated provisions of the Environmental Conservation Law (ECL), including Articles 17 and 23, which contain titles relating to control of water pollution and to underground storage of gas. Respondent has answered Staff's amended administrative complaint and has asserted a number of affirmative defenses. Respondents' third affirmative defense is that the Department's claims are preempted by applicable federal statutes administered by EPA and FERC. The ALJ understood Respondents' preemption claim as being an assertion that the Department lacked "subject matter jurisdiction" and ordered briefs to be filed on that question beginning January 19, 1999. Staff appealed. The briefing schedule was suspended pending resolution of this appeal.
The letter from Respondents' Virginia counsel dated December 30th said he was "absolutely outraged" that leave to appeal was granted without Respondents first being given an opportunity to respond. Counsel's letter adds that "the grounds cited by the staff are absolutely ludicrous and do not begin to comply with the requirements of the regulations". Counsel adds further that: "There is a continuing issue of fundamental fairness to the respondents in this case and their dealings with the DEC. Your decision to grant this frivolous appeal without even hearing a response does not begin to alleviate those fears."
In response, contrary to the claim of Respondents' counsel's letter, the Chief ALJ did not "grant" this appeal. The Chief ALJ's letter, in accordance with our Department's rules of procedure, only granted leave to appeal, and gave Respondents an opportunity to answer. The determination whether to grant leave is discretionary. No response to a motion for leave to file an expedited appeal is allowed unless requested. However if leave to file an expedited appeal is granted "the parties must be so notified and provided with an opportunity to file a response to the appeal" (6 NYCRR §622.10(d)(5)). In this case, Respondent was in fact granted ample time to reply (until January 11, 1999), and Respondents, in a brief signed by both local counsel and Virginia counsel, in fact replied. Accordingly, it is abundantly clear that the requirements of our regulations were followed to the letter, and Virginia counsel's contrary statements are absolutely without foundation.
With respect to the merits of Staff's appeal, my review of the file in this case, including Staff Counsel's brief, shows that Staff's appeal is hardly "frivolous", and the grounds cited by Staff are not "ludicrous". In fact I conclude that the pleadings and related papers in the record to date show that the ALJ believed that the doctrine of "subject matter jurisdiction" is equivalent to "preemption". Staff's brief explains that the ALJ was incorrect in that regard, and I concur with Staff. There is no basis for briefing the issue of subject matter jurisdiction in this case. The Department clearly has subject matter jurisdiction. The question of preemption is and continues to be a bone of contention between Staff and Respondent in this and related cases. Factual development of the record should be of assistance in resolving that issue. Accordingly, I find that briefing of the preemption question should not take place at this time, but should be addressed after the record is closed and a final briefing schedule is established. I further agree that briefing the preemption issue at this time could prejudice the Staff. Moreover, the Commissioner has the discretion to review any ruling of an ALJ on an expedited basis on his own initiative under §622.10(d)(4), whether or not there is undue prejudice within the meaning of § 622.10(d)(2)(ii). In response to Respondents' arguments that Staff is not prejudiced, I hereby exercise my discretion to review the ALJ's Ruling in addition to concluding that Staff would indeed be prejudiced. I have considered the points proffered in Respondents' January 11 brief favoring immediate briefing on preemption/jurisdiction. I reject those arguments because, as stated above, factual development of the record will provide an opportunity to elucidate a decision on the preemption question.
Finally, Respondents' Virginia counsel's claims of unfairness on the part of the Department need to be addressed. The Department Staff initiated this proceeding to enforce alleged violations of the Environmental Conservation Law. Respondents are entitled to a fair and impartial hearing with respect to Staff's allegations, and this hearing is the mechanism that our law and regulations offer to give Respondents their opportunity to be heard. The ALJ will continue to assure that this hearing is conducted fairly and in accordance with our rules. Respondents' Virginia counsel is respectfully reminded that he is expected to adhere to our rules and to do so in a respectful and professional manner. Respondents' counsel's needlessly litigious posture and persistent unprofessional assertions, such as "absolutely outrageous" and "ludicrous", in his papers in this appeal and in related dealings with this Department are unhelpful and irrelevant. Respondents' counsel is hereby admonished to eschew needless rhetoric and to stick to the facts and the applicable law and rules in this and related dealings with the Department.
Based on the foregoing, I hereby grant Staff's appeal. The briefing schedule at page 6 of the ALJ's December 21 Ruling is vacated. This matter is remanded to ALJ O'Connell for further proceedings, consistent with this Ruling.
For the New York State Department
of Environmental Conservation
By: Carl Johnson
for Air and Waste Management
Dated: Albany, New York
February 17, 1999