D E C banner
D E C banner

Disclaimer

The New York State Department of Environmental Conservation has added a link to a translation service developed by Microsoft Inc., entitled Bing Translator, as a convenience to visitors to the DEC website who speak languages other than English.

Additional information can be found at DEC's Language Assistance Page.

Danny Fortune & Co., Inc. - Ruling 2 - Ruling on Motion to Dismiss and Cross Motion to Amend, November 23, 1999

Ruling 2 - Ruling on Motion to Dismiss and Cross Motion to Amend, November 23, 1999

STATE OF NEW YORK DEPARTMENT OF ENVIRONMENTAL CONSERVATION

In the Matter of Alleged Violation of Article 23 of
the New York Environmental Conservation Law and Part 421 of Title 6 of the
Official Compilation of Codes, Rules and Regulations of the State of New York, by,

DANNY FORTUNE & CO., INC.,
PALUMBO BLOCK COMPANY, INC.,
FORTUNATO PALUMBO and ANTHONY PALUMBO
,

Respondents.

RULING
MOTION TO DISMISS
AND
CROSS MOTION TO AMEND

NYSDEC Case No.

R3-1999-0909-52
(November 23, 1999)

Introduction

This enforcement action was commenced by Notice of Hearing and Complaint dated September 13, 1999 alleging that the Respondents Danny Fortune & Co., Inc., Palumbo Block Company, Inc., Fortunato Palumbo and Anthony Palumbo (the "Respondents") are unlawfully mining without a permit (NYSDEC Case No. R3-19990909-52; the "Dover enforcement action") at the Dover Industrial Park site, Dover, New York. Staff allege that the Respondents excavated an area of the site pursuant to Town of Dover Planning Board approval in 1993 to construct a building referred to as "Building II". Staff assert that excavation of a two-acre area exceeded the Town approval, and further, the Respondents have not commenced building construction on the site. The Respondents own various mining interests in New York including sites in Dutchess County and Columbia County and are the owners and developers of the Dover Industrial Park.

The Respondent Danny Fortune & Co., Inc. ("DFC"), separately has applied for a modification of its Mined Land Reclamation permit pursuant to ECL Article 23 and a Solid Waste Management Facility permit pursuant to ECL Article 27 and related permits, to construct and operate a new construction and demolition debris landfill in Dover, Dutchess County, New York (NYSDEC Case No. 3-1326-00031/00003; the "Dover permit action"). The Respondent Palumbo Block Company, Inc., separately, has applied for a Mined Land Reclamation permit pursuant to ECL Article 23 for a proposed mine in Ancram, Columbia County, New York (NYSDEC Case No. 4-1020-00035/00001; the "Ancram permit action"). The Department Staff (Regions 3 and 4) and Interveners in the Dover and Ancram permit actions have raised the issue of Applicants' "record of compliance", including the present allegations.

By motion dated October 15, 1999, the Respondents seek dismissal of the complaint, or in the alternative, an order directing expedited fact finding on the allegations that the Respondents are unlawfully mining without a permit (the "motion to dismiss"). The Respondents assert that the present enforcement action is precluded on theories of double jeopardy or equitable estoppel because Staff and the Respondents have previously entered into an Order on Consent (dated November 5, 1998) addressing these charges.

By papers dated October 25, 1999 Staff filed in opposition to the Respondents' motion to dismiss and also sought leave to amend the complaint.

By papers dated October 28, 1999, the Respondents provided a reply; by papers dated October 29, 1999, Staff provided a sur-reply.

Separately, by motion dated October 20, 1999 in the Dover Permit action, Staff seek to consolidate this enforcement action with the Dover permit action, or to adjourn or suspend processing of the Dover permit action, pending a disposition in the enforcement action (the "motion to consolidate"). The Applicant Danny Fortune & Co., Inc., through its counsel in the Dover permit action, has filed papers dated November 5, 1999 in opposition to Staff's motion to consolidate.

My determination on the Respondents' motions was held in abeyance until motions for intervention were decided. Only the Town of Dover petitioned for intervention. My ruling denying that motion was issued on November 12, 1999.

The Town's Motion to Dismiss

Staff alleges in it complaint that the Respondents have mined without a permit at the future location of the Dover Industrial Park. Excavation for approved construction would be exempt from the requirement for a mining permit. See, ECL §23-2705(8). But, Staff alleges that the Respondents have excavated to a lower elevation than the approved elevation for construction of the building on the site.

The Respondents deny the charges, but also assert that Staff has adjudicated the "mining without a permit" charges have been adjudicated previously by Staff and have been settled by two orders on consent. The orders on consent are dated November 5, 1998 and July 7, 1999. The Respondents assert that these two orders on consent include any mining without a permit that has occurred at the site. Consequently, the Respondents assert, the present enforcement action is barred by the constitutional guarantee against double jeopardy or in the alternative, is barred under the doctrine of equitable estoppel.

Regarding equitable estoppel, the Respondents acknowledge that this doctrine generally may not be invoked against the government to prevent it from discharging its statutory duties unless such exceptional facts exist as would require its application in order to avoid manifest injustice. Yet, the Respondents assert that it would be manifestly unjust to allow the Respondents to be subjected to this administrative enforcement proceeding. The Respondents assert that Staff observed their activities on the site for several years, and never objected to the activities now identified in the complaint, even when Staff found similar activities on the same site to be objectionable. The Respondents contend that Staff previously gave tacit, if not explicit, approval for the site excavation now at issue.

The Respondents conclude that Staff should be equitably estopped from prosecuting the violation alleged in the complaint.

In the alternative, pursuant to 6 NYCRR Section 622.13, the Respondents seek an expedited fact finding hearing on the issue of whether the Respondents were unlawfully mining without a permit.

Staff's Opposition to the Motion to Dismiss

Staff asserts that the November 5, 1998 order on consent addressed violations observed by Mined Land Reclamation Specialist Robert Martin on September 15, 1998. The November 5, 1998 order on consent addressed allegations that the Respondents were excavating in an area of the site for which they had no local approval to construct a building.

Staff asserts that the present allegations are separate and distinct with respect to both time and place from the violations addressed in the November 5, 1998 order on consent. According to Staff, the present action addresses Specialist Martin's observations in June 1999, in a different area of the site for which the Respondents did have local approval to construct Building II of the Dover Industrial Park. Staff asserts that prior to 1999,

Specialist Martin did not question the minor excavation in this area of the site because it was in an area for which the Respondents had obtained local construction approval. However, Staff asserts that by June 1999, the Respondents' excavation in this area had progressed significantly, causing Specialist Martin to question whether the extent of the Respondents' excavation was within the parameters of the local approval.

Staff alleges that the local construction approval for this area of the site authorizes excavation to an elevation of 430 feet. However, Staff alleges that the Respondents have excavated more than two acres of the site (exceeding the Building II footprint)to an elevation of 420 feet. Staff alleges the Respondents have thereby excavated material to an elevation ten feet lower than authorized, amounting to approximately 42,600 cubic yards of material.

Staff asserts that once the Respondents exceeded the local construction approval and the quantity of material removed exceeded 750 cubic yards in twelve months, the Respondents' activities violated the ECL Article 23 mining permit requirement.

Ruling 1:In evaluating a motion to dismiss, all of the factual allegations of the complaint are assumed to be true. The complaint must be construed in the light most favorable to the Department Staff. I am persuaded by my review of the motion papers that the present allegations are separate and distinct with respect to both time and place from the violations addressed in the November 5, 1998 order on consent. Therefore, the Respondents' double jeopardy and equitable estoppel theories are inapposite. The Respondents' motion to dismiss the complaint is denied.

The Respondents' Motion for Expedited Fact finding

Pursuant to 6 NYCRR Section 622.13,where a complaint includes the allegation that a respondent is unlawfully conducting an activity without a permit, the ALJ must, upon motion from staff or respondent, sever this issue from the other allegations for expedited adjudication. Upon completion of the expedited adjudication, the ALJ will submit a report to the commissioner containing findings of fact, conclusions of law and recommendations limited to the issue of whether or not the respondent is unlawfully conducting an activity which requires a permit. The commissioner may issue an order to desist upon finding that respondent is conducting such an unpermitted activity. All remaining issues, including the assessment of civil penalties, must be heard and resolved as part of the original proceeding [emphasis supplied].

Since Staff's complaint (and the amended complaint discussed below) alleges mining without a permit, the Respondent's request for an expedited fact finding hearing pursuant to 6 NYCRR Section 622.13 must be granted.

Ruling 2:The Respondent's request for an expedited fact finding hearing is granted. At the Respondents' prerogative, the hearing may be limited to expedited fact finding under 6 NYCRR Section 622.13, or may address all issues raised by the complaint. Addressing all issues at once may further the Respondents' interests more so than a bifurcated hearing pursuant to Section 622.13. I will contact the parties in the near future to discuss further scheduling.

Staff's Motion to Amend

Pursuant to 6 NYCRR Section 622.5, a party may amend its pleading once without permission at any time before the period for responding expires or, if no responsive pleading is required, at least twenty days prior to commencement of the hearing. 6 NYCRR Section 622.5(a). Consistent with the CPLR a party may amend its pleading at any time prior to the final decision of the commissioner by permission of the ALJ or the commissioner and absent prejudice to the ability of any other party to respond. 6 NYCRR Section 622.5(b).

By motion dated October 25, 1999, Staff seeks to amend the complaint to add a second cause of action arising out of the same facts underlying the initial complaint. Staff seeks to assert a second cause of action alleging that the Respondents' mining without a permit violated the terms and conditions of the November 5, 1998 order on consent. Further, Staff contend that since both causes of action arise out of the same set of facts, both causes of action share common questions of law. Staff do not seek additional monetary penalties for the new cause of action.

The Respondents' Opposition to the Motion to Amend

The Respondents oppose Staff's motion to amend, asserting that the time anticipated for such amendments has passed. Also, the Respondents assert that they have already answered the initial complaint; and if the amendment is granted, they will be prejudiced by the delay occasioned by their filing of amended answers and possibly renewed pre-hearing motions. The Respondents conclude that this delay will be significant and will prejudice the Respondents in this enforcement action, and also in the Respondents' two pending permit actions.

Discussion

Pursuant to 6 NYCRR Section 622.5(b), consistent with the CPLR, a party may amend its pleading at any time prior to the final decision of the commissioner by permission of the ALJ or the commissioner and absent prejudice to the ability of any other party to respond. The CPLR provides for liberal amendment of pleadings so that to the extent possible, each case may be determined on its true facts. Further, a policy of liberal amendment of pleadings results in greater efficiencies in judicial trials (and in administrative hearings). See, CPLR Sections 3025 and 3025(b) [leave to amend shall be freely granted].

I am unpersuaded in this instance that any delay occasioned by granting Staff's motion to amend will result in substantial prejudice to the Respondents. To the contrary, the delay (if any) will be of no more than de minimis effect upon the Respondents interests. Since the amendment proposes only to add a second theory of liability, any amendment of pleadings should be a minimal burden to the Respondents. Moreover, in all likelihood, any amended pleadings or renewed motions will have been resolved before a hearing in this matter may be convened, even an expedited fact finding hearing.

Ruling 3:Staff's motion for leave to amend the complaint, adding a second cause of action based upon a new theory of liability, is granted.

Summary of Rulings

Ruling 1:In evaluating a motion to dismiss, all of the factual allegations of the complaint are assumed to be true. The complaint must be construed in the light most favorable to the Department Staff. I am persuaded by my review of the motion papers that the present allegations are separate and distinct with respect to both time and place from the violations addressed in the November 5, 1998 order on consent. Therefore, the Respondents' double jeopardy and equitable estoppel theories are inapposite. The Respondents' motion to dismiss the complaint is denied.

Ruling 2:The Respondent's request for an expedited fact finding hearing is granted. At the Respondents' prerogative, the hearing may be limited to expedited fact finding under 6 NYCRR Section 622.13, or may address all issues raised by the complaint since addressing all issues at once may further the Respondents' interests more so than a bifurcated hearing pursuant to Section 622.13. I will contact the parties in the near future to discuss further scheduling.

Ruling 3: Staff's motion for leave to amend the complaint, adding a second cause of action based upon a new theory of liability, is granted.

__________________/s/__________________
Administrative Law Judge

Albany, New York
November 23, 1999

To:Laura Zeisel, Esq.
169 Main Street
P.O. Box 9
New Paltz, New York 12561

Dominic R. Cordisco
Assistant Counsel
NYSDEC - OGC/DEE
50 Wolf Road [Rm 627]
Albany, New York 12233-5500

cc:Palumbo/Ancram Permit Action Distribution List
Danny Fortune & Co., Inc./Dover Permit Action
Distribution List

  • PDF Help
  • For help with PDFs on this page, please call 518-402-9003.
  • Contact for this Page
  • Office of Hearings and Mediation Services
    NYS DEC
    625 Broadway, 1st Floor
    Albany, New York 12233-1550
    518-402-9003
    Send us an email
  • This Page Covers
  • Page applies to all NYS regions