Middleton, Kontokosta Associates, Ltd. and Donald Middleton - Ruling, October 14, 1998
Ruling, October 14, 1998
STATE OF NEW YORK : DEPARTMENT OF ENVIRONMENTAL CONSERVATION
In the Matter of Alleged Violation of Articles 17 and 71 of the New York Environmental Conservation Law and Title 6 of the Official Compilation of Codes, Rules and Regulations of the State of New York by,
MIDDLETON, KONTOKOSTA ASSOCIATES, LTD.
doing business as and/or also known as MKA LTD.
DONALD J. MIDDLETON, JR., Individually
and as Vice-President of Middleton, Kontokosta Associates, Ltd.
NYSDEC Case No. R1-6039
RULING ON MOTION TO DISMISS
By motion dated July 30, 1998 Respondents seek a summary finding that the Verified Complaint herein should be dismissed pursuant to New York Civil Practice Law and Rules §3211(a)(7) for failure to state a cause of action. The motion is supported by the affidavits of the Respondent Donald J. Middleton, Jr. and Respondents' attorney John V. Soderberg, and a memorandum of law. In response to the motion, Department Staff filed a combined affidavit and memorandum of law in opposition, dated August 31, 1998. Respondents then filed a reply memorandum dated September 14, 1998, received September 17, 1998. In their reply, the Respondents requested oral argument on the motion. Oral argument was heard by telephone conference on September 29, 1998.
Respondent Middleton, Kontokosta Associates, Ltd. ("MKA, Ltd.") is a New York State corporation that provides consulting services on environmental issues. Respondent Donald J. Middleton, Jr. is the vice-president of MKA, Ltd. The Department Staff prepared and served a combined Notice of Hearing, Pre-hearing Conference, Calendar Call and Complaint dated May 7, 1998. Staff alleges that in a September 25, 1997 telephone conversation with Department staff person Brian Campbell, Mr. Middleton admitted that in July 1997 the Respondents took soil borings in the vicinity of a 3,000 gallon underground petroleum storage tank located at 519 Acorn Street, Deer Park, New York ("the site"). Further, that the borings revealed petroleum contamination around the tank and that the Respondents never reported this contamination to the Department Staff.
It is uncontroverted that the Respondents are not owners or operators of the site. Staff seeks imposition of a $25,000.00 penalty against the Respondents, jointly and severally, for violation of the reporting requirement of 6 NYCRR §613.8.
The Motion to Dismiss
The Respondents seek dismissal of the Complaint pursuant to CPLR §3211(a)(7) and any further relief that the Commissioner deems appropriate. Mr. Middleton is vice-president of Middleton, Kontokosta Associates, Ltd. He holds a Bachelor's degree and certificates from New York University for Lead-based Paint Inspector/Risk Assessor and Asbestos Inspector and Management Planner. Mr. Middleton states that neither he nor anyone on behalf of the Respondent MKA ever conducted soil borings at the site, as alleged in Staff's Complaint. However, he states that he was present at the site in July 1997 when an independent environmental consulting firm took soil samples. Mr. Middleton states he viewed dirt from the borings and based upon the color and odor it appeared that the soil was potentially contaminated. He asserts that he did not personally take any samples or cause any samples from the site to be analyzed by a laboratory. Lastly, Mr. Middleton states that the Respondents were not at the site in any contractual capacity nor were they compensated in any manner for their presence at the site. In the Respondents' memorandum of law, the Respondents assert that Mr. Middleton was at the site as a favor at the request of an (unidentified) friend.
The Respondents make several legal arguments in support of their motion to dismiss. The Respondents assert that the Code of Responsibility for Professional Engineers requires that engineers shall not reveal facts, data or information obtained in a professional capacity without prior consent of the client or employer except as authorized or required by law or the Code. However, Staff have correctly pointed out that the Respondent Donald J. Middleton, Jr. is not an engineer. The Engineer's Code does not apply to him. Since the owner or operator of the site was not his client or employer, a "professional relationship" does not appear to exist.
The Respondents assert that Staff's Complaint fails to state a cause of action because the Department's promulgation of 6 NYCRR §613.8 exceeds the legislature's statutory delegation of authority.
ECL §17-1743 provides that,
"Any person who is the owner of or in actual or constructive possession or control of more than one thousand one hundred gallons, in bulk, of any liquid, including petroleum, which if released, discharged or spilled would or would be likely to pollute the lands or waters of the state including the groundwaters thereof shall, as soon as he has knowledge of the release, discharge or spill of any part of such liquid in his possession or control onto the lands or into the waters of the state including the groundwaters thereof immediately notify the department . . . "
6 NYCRR §613.8 provides that,
"Any person with knowledge of a spill, leak or discharge of petroleum must report the incident to the department within two hours of discovery. The results of any inventory record, test or inspection which shows a facility is leaking must be reported to the department within two hours of discovery."
The Respondents assert that the specific statutory language of ECL §17-1743, limits regulatory authority, essentially, to an owner or operator. Therefore, the Respondents conclude that the Department has overreached its authority in its promulgation of 6 NYCRR §613.8 because that regulation expands the regulated population from owners and operators to all persons.
Lastly, the Respondents assert that the Respondent Middleton only observed that soil borings were removed from the earth and he has no knowledge that any laboratory testing was done. Respondents assert that on these facts, they could not have had actual knowledge of soil contamination indicating a spill, leak or discharge. Further, the Respondents assert that neither the allegedly discharged liquid nor the soil borings were in the possession or control of either Respondent, as required by ECL §17-1743. Absent knowledge that laboratory testing occurred or possession or control of the liquid, the Respondents assert that the Complaint must be dismissed because no violation of 6 NYCRR §613.8 (or ECL §17-1743) is possible.
- Validity of 6 NYCRR §613.8
Principles of statutory construction also apply to regulatory provisions. Meaning must be given to the words of a rule in the context of their particular setting. When a regulation is not inconsistent with the statute and does not exceed it, the interpretation given it by the agency is controlling and must not be disturbed in the absence of weighty reasons and unless it is arbitrary, capricious, irrational or unreasonable. Equally important, a rule must be interpreted and enforced in a reasonable manner in accordance with its manifest intent and purpose, regardless of how broad it may be. See generally, NY Jur 2d, Administrative Law, §§184, 185.
The Respondents assert that the issue is whether the Department exceeded its statutory authority in promulgating 6 NYCRR §613.8, citing Con Edison v NYSDEC, 71 NY2d 186 (1988) and Boreali v Axelrod, et al., 71 NY2d 1 (1988). However, I find that it is not necessary to reach this issue. The term "all persons", as it occurs in 6 NYCRR §613.8, must be interpreted in the context of the entire regulatory section, 6 NYCRR Part 613 and ECL Article 17, the statutory provisions from which the rule derives its authority. ECL §17-1743 addresses a narrow class of people ("owners or operators"). Although §613.8 begins with the phrase "any person", the second sentence of §613.8 refers to "inventory record, test or inspection". These are records that would be in control or possession of an owner or operator of a regulated facility. As the Respondents have shown, the language of ECL Article 17 refers repeatedly to "owners or operators" as the class of people to be regulated. Taking these factors into consideration, it is reasonable to construe 6 NYCRR §613.8 as consistent with the specific statutory language of ECL §17-1743. The phrase "any person" must be limited to any regulated person under the regulatory framework; that is, any "owner or operator".
Since the parties are in agreement that the Respondents are neither owners nor operators of the site, the facts do not support a cause of action against these Respondents.
- Dismissal Prior to Creation of Factual Record
The Commissioner has recently issued a determination in an expedited appeal from an Administrative Law Judge's ("ALJ's") ruling. Commissioner's Determination on Appeal, City of Hudson IDA, et al., NYSDEC Case No. R4-1960-97-03 (September 17, 1998). In that enforcement matter, all parties filed leave for expedited appeal of the ALJ's denial of a motion to dismiss and other rulings. Regarding the motion to dismiss, the Commissioner determined that the Respondents' appeal did not meet the standard of 6 NYCRR 622.6(e)(i), preventing undue prejudice or significant inefficiency. Instead, the Commissioner found that prior to commencement of an evidentiary hearing that would result in a fully developed record, a Commissioner's determination granting a motion to dismiss could be inadvertently prejudicial to either Staff or a Respondent. Commissioner's Determination on Appeal, City of Hudson IDA, et al., NYSDEC Case No. R4-1960-97-03 (September 17, 1998). However, in this instance, I find that the Respondents have demonstrated that they will be subjected to prejudice and inefficiency if this matter continues. Since the Complaint fails to state a cause of action, the Respondents should not be burdened with the time and cost of defending against this action.
Pursuant to 6 NYCRR §622.10(b)(1)(i), an ALJ has the power to rule upon motions and requests, including those that decide the ultimate merits of the proceeding. Accordingly, this Complaint is dismissed. The parties may appeal this ruling pursuant to 6 NYCRR §§622.6(e) and 622.10(d).
Kevin J. Casutto
Administrative Law Judge
Albany, New York
October 14, 1994
To: John V. Soderberg, Esq.
Andrew J. Simons, Esq.
Farrell, Fritz, LLC
Attorneys for Respondents
Uniondale, New York 11556-0120
Assistant Regional Attorney
NYSDEC Region 1
S.U.N.Y. Campus - Building 40
Stony Brook, New York 11790-2356