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Steck, Richard K. and Gerald Philbin - Order, March 29, 1993

Order, March 29, 1993

STATE OF NEW YORK : DEPARTMENT OF ENVIRONMENTAL CONSERVATION

In the Matter of the Alleged
Violation of Article 23 and 27 of the
New York State Environmental Law, and
6 NYCRR Part 360 and 420 by

ORDER

Richard K. Steck, Gerald Philbin
and Richard Steck, Gerald Philbin Development Co.

Case No. 1-3421 and 1-3601
Respondent

WHEREAS:

  1. Pursuant to a Notice of Hearing and Complaint dated February 21, 1989, an enforcement hearing was held before Administrative Law Judge ("ALJ") Frank Montecalvo on April 25, 1989, October 16-17, 1991 and March 10, 1992. The Staff of the Department of Environmental Conservation (the "Staff") appeared by Mary E. Carpentiere, Esq. and Michael Greco, Esq., Assistant Regional Attorneys. The Respondents, Richard K. Steck, Gerald Philbin and Richard Steck, Gerald Philbin Development Co., appeared by Leader & Berkon, Joseph G. Colao, Esq. of counsel, and Peter R. Newman, P.C., Peter R. Newman, Esq., of counsel.
  2. Upon review of the ALJ's Hearing Report (copy attached), I concur with and adopt the findings of fact contained in the hearing report except as noted. Those areas where I reach different conclusions are set forth below.

Staff Appeals

In their final brief, Staff appealed two rulings which the ALJ made during the course of the hearing. The following resolves those appeals.

Denial of Witness Substitution

Staff appeal the ALJ's refusal to allow a substitution of one witness for another who had left the employ of the Department. I find that it was an abuse of discretion in this case for the ALJ to deny that request. Even though the Staff might have been able to subpoena the original witness, the ALJ should not require the use of a compulsory process where an acceptable substitute exists. While the substitution of a new witness might have caused a small delay in the proceeding, it would not have legally prejudiced the Respondent's case. ALJs must not lose sight of the administrative, as contrasted to judicial, nature of the process.

Nonetheless, after examining the prefiled testimony of Mr. Roth, I conclude that even if the equivalent of his testimony were included in the record, the substantive result of this case would not be affected. Therefore, there is no need to remand this case for further testimony.

Res Judicata

Staff has appealed the ALJ's ruling which found certain of the charges barred by the doctrine of res judicata. The ALJ is correct in stating the general principle that the doctrine of res judicata operates to bar not merely matters that were actually put in issue in the prior action but those that might have been (Siegal, New York Practice, Second Edition 447). It is also correct that the doctrine applies to administrative determinations and it has been held to apply specifically in Department proceedings (In the Matter of Niagara Recycling, Inc., Interim Decision of the Commissioner, May 19, 1989).

However, application of these principles is necessarily dependent upon case-by-case analysis. The analysis that is suggested by some legal commentors is to review whether the causes of action arise out of the same transaction or series of connected transactions (see Siegal, New York Practice, Second Edition 447, quoting the Second Restatement of Judgments). I concur with the ALJ's analysis that the causes of action he precluded did arise out of transactions which were the subject of adjudication that had already been resolved on their merits.

Alleged Violations

Mining/Reclamation Violations

I concur with the ALJ's conclusion that where the obligation to reclaim is tied to the cessation of mining, the renewal of the mining permit by the Department implicitly recognizes that the mining activity has not ceased. It is not infrequent in the mining industry that operators will suspend operations because of economic conditions, only to resume at a later date. As long as the operator retains the authority to mine, then reclamation does not have to occur unless the mining plan requires that it be done concurrently with mining. This was not the case here. If the Department Staff seek reclamation because they conclude that the mining activities at a site are not going to be resumed in the foreseeable future, they should either move to revoke the existing permit or refuse to renew it.

Wood Waste Operation

The ALJ has misanalyzed the law concerning whether a permit is needed for the storage and processing of wood wastes. The provision cited by the ALJ in the Report, 6 NYCRR 360-1.2(a)(4)(vii)(c), relates only to wood chips. However, while the wood chips, by operation of this provision, are not solid wastes, the wood wastes that are used to produce the wood chips remain solid wastes.

Secondly, while it is not relevant to the determination, it is important to point out that the ALJ has also misconstrued the relationship between paragraphs (4) and (5) of that regulation. The intent of paragraph (4) is to list materials which are excluded from regulation as solid waste by operation of law (i.e., without need for any Department determination). Paragraph (5) provides for the possibility of excluding additional materials upon the issuance of a specific beneficial use determination by the Department Staff. This relationship is clarified in the Technical and Administrative Guidance Memorandum ("TAGM") issued by the Department's Division of Solid Waste on July 25, 1991.

Therefore, the only question is whether the exclusion in clause 360-1.2(a)(4)(vii)(a) encompasses the operation at Respondents' site. That provision excludes from the definition of solid waste, "...materials that are incorporated into a manufacturing process to produce a marketable product."

I conclude that the provision does not apply to materials used in recycling and recovery operations. While "manufacturing" is not defined in Part 360, the regulations specifically refer to recycling and recovery activities and the particular requirements that relate to them. For instance, 6 NYCRR Subpart 360-12 is devoted in its entirety to the regulation of recycling and recovery facilities. If, as argued by the Respondents, recycling and recovery activities are properly characterized as manufacturing processes that produce marketable products, Subpart 360-12 would serve no purpose. In fact, this inconsistency becomes even more apparent by examining 6 NYCRR 360-12(c)(3). This paragraph exempts the storage of recyclables on manufacturer's site from solid waste facility permitting. However, if Respondents' interpretation of the regulation were correct, this provision would be completely superfluous since the materials being stored, by definition, would be excluded as solid wastes.

Having concluded that the storage and processing of wood wastes at Respondents' site requires a solid waste facility permit under the existing regulations, attention needs to be focused on the transition provisions of those regulations. In a letter dated January 3, 1983, the regional permit administrator determined that the operation did not require a solid waste permit under the then existing regulations. Clearly that determination was based on the regulations as they existed and did not prevent the Department from regulating the facility when the regulations were amended.

Since the regulations adopted on December 31, 1988 required that the wood waste operation be permitted, Respondents were obligated to comply with the transition provisions of 6 NYCRR 360-1.7(a)(2)(iv) which relate to facilities that did not require permits under pre-existing regulations but do so require under the amended regulations. That provision requires, among other things, that the facility owner or operator notify the Department about the nature of its operations within sixty days of the effective date of the amended regulations. There is no evidence in the record that shows that Respondents complied with this requirement. It is Respondents' failure to meet this transition requirement that is the basis for finding that they are now operating without a permit.

Fire Incidents

The findings of fact establish that, in both instances alleged by the Department Staff, the Respondents violated the prohibition against open burning without a permit and the requirement that solid waste be confined to areas that can be effectively maintained operated and controlled. The issues raised related to the appropriate relief for these violations will be addressed below.

I also reach a different conclusion than ALJ Montecalvo on the question of the cause of the second fire. He concluded that the cause of the first fire was spontaneous combustion but that there was no evidence on which to base a similar conclusion concerning the second fire. To the contrary, I conclude that there is a sufficient evidence to conclude that the second fire had the same cause. The wood stored at site spontaneously combusted on September 13. Given that there is no evidence that site conditions changed in the next six days and that there is no evidence supporting any other plausible explanation for a fire, there is strong indirect evidence that it too was caused by spontaneous combustion. In Department enforcement proceedings, the standard of proof is preponderance of the evidence. This standard requires an inquiry into whether the existence fact (in this case, that the fire was caused by spontaneous combustion) is more probably than its non-existence (Prince, Ricardson on Evidence, Tenth Edition 97). In this case, the direct evidence combined with reasonable inferences taken from this evidence, make it far more probable than not that the second fire was also caused by spontaneous combustion.

Penalties and Other Remedies

Principles

This case raises several important issues concerning the assessment of penalties. These issues relate to the violations which occurred as a result of two fires on Respondents' property. The first issue is whether separate penalties can be assessed for violation of a statute and a regulation, where the two recite essentially the same requirement. A related issue is whether a single act that violates two regulations can give rise to multiple penalties.

Courts have analyzed the question of when two offenses, arising out of the same transaction, may be subject to distinct sanctions in the criminal context. It has been held that,

"... where the same act or transaction constitutes a violation of two distinct statutory provisions, the test to be applied to determine whether there are two offenses or only one is whether each provision requires proof of an additional fact which the other does not." Blockburger v. United States, 284 U.S. 299, 304 (1932).

The criminal cases that have addressed this issue have analyzed it in the context of the constitutional prohibition against placing a person in double jeopardy. This principle is therefore not directly applicable or legally binding in the administrative arena. However, it is also the case that allowing the assessment of separate penalties where the elements of the offenses are identical would undermine the prerogatives of the Legislature to establish the level of maximum penalties for particular wrongdoing. If this were not the case, the Department could at least double the legislatively established maximums by merely putting statutory language in regulation. Therefore, application of the principle articulated in Blockburger makes sense in the administrative context as well. In the case of a regulation that reiterates a statutory prohibition, separate penalties cannot be supported since the proof would be identical.

Whether separate penalties can be sustained for the violation of two regulatory provisions requires analysis of what the elements of proof are for each one. A similar issue was addressed in a recent administrative decision, In the Matter of Linda Wilton and Costello Marine, Inc., Order of the Commissioner, February 1, 1991). In that decision, I held that a single act that would require a permit under three independent bases constitutes three distinct violations. Similarly here, the fires that occurred on the Respondents' property violated two distinct requirements. These requirements are not identical. Not all violations of former 6 NYCRR 360.8(a)(16) relate to open burning and likewise not all violations of the open burning prohibition (former 6 NYCRR 360.8(a)(15)) arise out of situations where solid waste has been placed in areas that cannot be effectively maintained, operated and controlled. Hence the elements of proof are different and separate penalties may be imposed.

The final issue relates to the level of Respondents' culpability for each of the two fire incidents and how those levels should be factored into the penalty considerations. I have recently held that penalties should not be imposed where there is no culpability on the part of the violator, mindful that culpability can result from both negligent and intentional conduct and it can be caused either by actions or failures to act (In the Matter of the Town of LeRay, Order of the Commissioner, March 24, 1989). In those situations where the Respondent demonstrates that the violation was reasonably beyond its control, remedial action may still be ordered but no assessment of penalties would be appropriate.

I find that there are important features that distinguish this case from the LeRay case. Significantly, in the LeRay case the facility was operating legally under a duly issued consent order. However, in this case, Respondent's wood waste operation lacked any authorization nor were there any regulatory controls on it. Significantly, it was the wood wastes that ignited resulting in the two fire incidents detailed in the Report.

The permit process would have been the forum to address the potential problem of fire hazards but the Respondents failure to proceed through the permit process denied the Department any opportunity to do so. Additionally, unlike the LeRay case, the Respondents in this action submitted no evidence showing that their operating procedures were safe vis-a-vis fire hazards. Therefore, I find that Respondents bear a significant degree of culpability for both fires that occurred at their site.

Application of Principles

Applying these principles to this case, I reach the following conclusions. In the case of the wood waste operation, the Respondents were in violation from March 1, 1989 (60 days after the effective date of the amended regulations) until September 28, 1990, the end of the period covered by the Staff's complaint. The maximum penalty for this violation would therefore be $577,500 (representing $2,500 for the initial violation and $1,000 for each of the 575 days that the violation continued). Given the fact that no adverse environmental impact was shown and that the operation was a continuation of a previously legal activity, a reduced penalty of $150,000 is justified despite the extended length of time during which the illegal operation took place. Given the failure of the Respondents to properly comply with the transition provisions, the wood wastes must be removed. I find no basis to delay the removal, as recommended by the ALJ.

With respect to the allegations arising out of the two fire incidents at Respondents property, I conclude that there is support for finding two distinct violations for each incident. There was a significant degree of culpability on the part of Respondents with respect to both incidents, warranting the assessment of maximum penalties.

NOW THEREFORE, having considered this matter, it is ORDERED that:

  1. The Respondents are found to have operated an unpermitted solid waste management facility in violation of 6 NYCRR 360-1.7(a)(1) from March 1, 1989 to September 28, 1990. For that violation they are jointly and severally assessed a civil penalty of ONE HUNDRED AND FIFTY THOUSAND DOLLARS ($150,000), such penalty being due and payable sixty (60) days after the service of a conformed copy of this Decision and Order on Respondents.
  2. The Respondents are found to have caused an unpermitted open burning on September 13-14 1988 at the Site, in violation of then effective 6 NYCRR 360.8(a)(15) and failed to have adequately confined wastes to an area where they could be effectively controlled, in violation of then effective 6 NYCRR 360.8(a)(16). For those violations they are jointly and severally assessed an additional civil penalty of FIVE THOUSAND DOLLARS ($5,000), such penalty being due and payable sixty (60) days after the service of a conformed copy of this Decision and Order on Respondents.
  3. The Respondents are found to have caused an unpermitted open burning of September 19, 1988 at the Site, in violation of then effective 6 NYCRR 360.8(a)(15) and failed to have adequately confined wastes to an area where they could be effectively controlled, in violation of then effective 6 NYCRR 360.8(a)(16). For those violations they are jointly and severally assessed an additional civil penalty of FIVE THOUSAND DOLLARS ($5,000), such penalty being due and payable sixty (60) days after the service of a conformed copy of this Decision and Order on Respondents.
  4. All remaining charges of the Second Amended Complaint are dismissed.
  5. Respondents are to immediately cease operating the Site as a solid waste management facility and must remove all solid waste from the Site within one hundred and eighty (180) days after the service of a conformed copy of this Decision and Order on Respondents. Respondents must obtain prior approval from the Department for the manner and disposition of the wastes.
  6. Respondents shall post a performance bond in an amount to be set by and in a form acceptable to the Department. The amount of the bond shall reflect the cost of performing the work required in Paragraph V. of this Order. The bond must be posted within sixty (60) days after the service of a conformed copy of this Decision and Order on Respondents.
  7. The provision and terms of this Decision and Order shall bind the Respondents, their officers, directors, agents, servants, employees, successors and assigns and persons, firms and corporations acting for or on behalf of the Respondents.
  8. All communications between Respondents and the Department concerning this Decision and Order must be made to the Director, New York State Department of Environmental Conservation, Region 1 Headquarters, Building 40, SUNY Campus, Stony Brook, N.Y. 11794.

NEW YORK STATE DEPARTMENT OF
ENVIRONMENTAL CONSERVATION
THOMAS C. JORLING, COMMISSIONER
/s/

Albany, New York
March 29, 1993

TO: Richard K. Steck (Certified Mail)
Old Northport Road
Kings Park, New York
Gerald Philbin (Certified Mail)
Old Northport Road
Kings Park, New York

Richard Steck (Certified Mail)
Gerald Philbin Development Co.
Old Northport Road
Kings Park, New York

Leader & Berkon (Certified Mail)
555 Madison Avenue
New York, New York 10022 ATTN: Joseph G. Colao, Esq.

Peter R. Newman, PC (Certified Mail)
700 Veterans Memorial Highway
Hauppauge, New York 11788 ATTN: Peter R. Newman, Esq.

Mary E. Carpentiere, Esq. (Interagency Mail)
Assistant Regional Attorney
Region 1
NYS Department of
Environmental Conservation
Building 40, SUNY Campus
Stony Brook, New York 11794

STATE OF NEW YORK
DEPARTMENT OF ENVIRONMENTAL CONSERVATION
50 Wolf Road
Albany, New York 12233-1550

In the Matter of the Alleged
Violation of Articles 23 and 27 of the
New York State Environmental Conservation Law and
6 NYCRR Parts 360 and 420 by
RICHARD K. STECK,
GERALD PHILBIN and
RICHARD STECK, GERALD PHILBIN DEVELOPMENT CO.

Respondents

Files 1-3421, 1-3601

HEARING REPORT

-by-

/s/
Frank Montecalvo
Administrative Law Judge

PROCEEDINGS

This matter concerns a mine Site where Respondents are alleged to have violated their mining permit, operated a solid waste management facility without a permit, caused or permitted open burning without a permit, and caused or permitted solid waste to be confined to an area which could not be effectively maintained.

Pursuant to a duly served Notice of Hearing (copy attached hereto as Appendix A-1) with Complaint attached, dated February 21, 1989, the New York State Department of Environmental Conservation (the "Department" or "DEC") Region 1 Staff (the "Department Staff" or "Staff") initiated a civil administrative enforcement proceeding, conducted in accordance with the State Administrative Procedure Act ("SAPA") and Title 6 of the Official Compilation of Codes, Rules and Regulations of the State of New York ("6 NYCRR") Part 622, against RICHARD K. STECK, GERALD PHILBIN and RICHARD STECK, GERALD PHILBIN DEVELOPMENT CO., Old Northport Road, Kings Park, NY 11754, (the "Respondents"), in the matter of the alleged violation of Articles 23 and 27 of the New York State Environmental Conservation Law ("ECL") and 6 NYCRR Parts 360 and 420.

Respondents filed an undated Answer to the Complaint.

At the time the original Complaint was served, another enforcement matter (File 1-1251) was pending which involved the same Respondents, the same Site, and activities during the same alleged time period.

In accordance with the Notice of Hearing, an adjudicatory hearing was convened before Administrative Law Judge ("ALJ") Frank Montecalvo on April 25, 1989 at the Department's Region One Headquarters in Stony Brook, NY. Michael A. Greco, Esq., Assistant Region 1 Attorney, appeared on behalf of the Department Staff. With the agreement of Mr. Greco, the matter was immediately adjourned at the request of Respondent's attorney, Peter R. Newman, Esq., to allow time for Respondent to make certain motions and Staff to reply.

Respondents moved to dismiss the Complaint, essentially claiming that the matter had already been tried. Staff (then and thereafter represented by Mary E. Carpentiere, Esq., Assistant Regional Attorney) cross-moved to amend the Complaint. In Rulings dated September 5, 1989 (copy attached hereto as Appendix B, portions summarized below), the ALJ granted Staff's cross-motion to amend (directing clarification of ambiguities), temporarily denied Respondents' motion to dismiss, and adjourned the proceeding until after the Commissioner rendered a Decision on File 1-1251, when Respondents' motion would be reconsidered. On October 24, 1989, Staff served an Amended Complaint, which Respondent Answered on November 9, 1989.

On October 2, 1989, the Commissioner dismissed the charges in the File 1-1251 matter, "without prejudice" to their reinstitution, on the basis of improper service of the hearing notice. By Ruling dated November 20, 1989, based on the "without prejudice" dismissal of the prior charges, the ALJ denied Respondents' motion to dismiss; and thereupon proceeded to schedule a date certain for the evidentiary hearing herein. Before that date was reached, however, Staff requested, and was granted, further adjournments due to Respondents' court challenge of the Commissioner's "without prejudice" dismissal. Following a March 27, 1990 agreement settling the court challenge, wherein the Commissioner agreed to issue a decision on the merits of File 1-1251, the ALJ adjourned this matter until the decision was issued and the ALJ could consider its res judicata effect herein. On October 25, 1990, the Commissioner issued a Decision and Order on the merits of case 1-1251.

By Ruling and Orders dated February 1, 1991 (copy attached hereto as Appendix C, portions summarized below), the ALJ determined that res judicata barred consideration of portions of the Amended Complaint, ordered Staff to pre-file its proof in accordance with specified ground rules, and permitted Respondents to make motions with regard thereto.

Staff's pre-filed proof was received March 7, 1991.

On April 1, 1991, Respondents (now represented by the firm Leader & Berkon (Joseph G. Colao, Esq., of counsel) as co-counsel with Mr. Newman) moved to dismiss the remaining portions of the Amended Complaint on the grounds of res judicata. Staff opposed the motion and requested reconsideration of the ALJ's previous determination or a referral to the Commissioner for redetermination. Following exchanges of written arguments between the parties, the ALJ issued Rulings and Orders dated July 25, 1991 (copy attached hereto as Appendix D, portions summarized below) disposing of Respondents' motion and Staff's request.

The ALJ determined that additional charges stated in the Amended Complaint were also res judicata barred, that other charges were not barred, and that Staff would be permitted to amend certain portions of the Amended Complaint to give Respondents notice of distinct post-October 1986 transactions (i.e., after the period covered by the prior proceeding) which Staff had intended to be covered by "continuing violation" descriptions in the Amended Complaint. Staff was also permitted to supplement its pre-filed proof with regard to one authorized amendment and was ordered to list the portions of the pre-filed proof it intended to move into evidence on the non-barred charges and amended charges. Respondents were permitted to amend their Answer to respond to Staff's amendments, and were ordered to pre-file their direct proof after receiving Staff's evidence list. The ALJ also scheduled a date certain for the hearing to resume.

On August 23, 1991, Staff served its Second Amended Complaint, supplemental pre-filed testimony, and exhibits list. The Second Amended Complaint (copy attached hereto as Appendix A-2) is the complaint upon which the evidentiary hearing was based and from which "The Charges" (below) are summarized. On October 2, 1991, (following a denied request that they be permitted to move to dismiss the new complaint) Respondents served their Answer to the Second Amended Complaint (from which "The Answer," below, is summarized) and pre-filed evidence.

The hearing resumed as scheduled on October 16, 1991.

Testimony was taken on October 16-17, 1991, and March 10, 1992, and concluded on the last mentioned date. On October 16, in light of the charges excluded by the ALJ, Staff indicated that it was seeking "a great deal less" monetary penalty than the amount requested in its original complaint. To give Respondents notice of the penalty amount and manner of calculation, the ALJ requested that Staff place that information on the record the following day. This was done and is reflected in "The Relief Requested" section below. During December 1991 and January 1992, the parties exchanged briefs and reply briefs in response to the ALJ's request to be briefed on the law pertaining to the issue of when the owner of a mining operation is required to bring the facility within final reclamation grades. On February 26, 1992, Department Staff requested permission to substitute the prefiled testimony of Mr. Paul Roth with that of another witness due to Mr. Roth's imminent departure from employment with the Department. Following Staff's submission of additional material, Staff's request was denied by Ruling dated March 4, 1992 (copy attached hereto as Appendix E, portions summarized below).

Staff presented as its witnesses: Robert Galli, DEC Mined Land Reclamation Specialist; David Raymond, DEC Water Program Specialist, and former Principal Engineering Technician; Robert Becherer, DEC Regional Hazardous Substances Engineer; and Pappachan Daniel, DEC Environmental Engineer I. Respondents called as their witness Respondent Gerald Philbin.

Respondents moved to dismiss the complaint at the end of Staff's case, claiming that Staff failed to show (1) that Respondents did anything to cause either of the two fires complained of, (2) that Respondents failed to confine or maintain solid waste on the occasion of either fire, (3) that Respondents accepted any material that they did not have the authority to accept, and (4) that reclamation grades have been exceeded and that the reclamation period has commenced or ended. The motion was denied for lack of opportunity to closely review the evidence.

The record was held open pending receipt of the hearing transcript and exchange of closing briefs and replies. The record closed on July 13, 1992, upon receipt of the parties' Reply briefs.

The Charges:

Pertaining to a 23 acre Site (commonly known as Northeast Mines) on Old Northport Road, Kings Park, Smithtown, Suffolk County, NY, Staff alleged Respondents committed the following violations:

  1. Violation of ECL 23-2713(4) and 6 NYCRR 422(a) on January 11, 1989 and September 28, 1990 by placement of shredded wood and construction and demolition debris in excess of the final reclamation grades specified in Respondents' mined land-use plan, with the exceedance of reclamation grades continuing to the date of the Second Amended Complaint [see Second Amended Complaint Paragraphs 19-20, only post-October 1986 period under consideration].
  2. Violation of ECL 27-0707, and 6 NYCRR 360.2(b) (eff. through 12/30/88) or 360-1.7(a)(1)(ii) (eff. 12/31/88), by operation of a solid waste management facility without a permit through receiving, storing, shredding and landfilling solid waste, consisting of vegetation including trees, stumps, tree limbs and branches, wood chips, shredded wood, and other wood wastes. The violation is a continuing violation to the date of the Second Amended Complaint. Increases in material received, stored, shredded and landfilled were noted on 1/11/89 and 9/28/90. [See Second Amended Complaint Paragraph 29, only post-October 1986 period under consideration]
  3. Violation of ECL 27-0707 and 6 NYCRR 360.8(a)(15) (eff. 3/9/82 through 12/30/88), on or about September 13, 1988, by causing or permitting to be caused, non-permitted open burning. [See Second Amended Complaint Paragraph 30].
  4. Violation of ECL 27-0707 and 6 NYCRR 360.8(a)(16) (eff. 3/9/82 through 12/30/88), on or about September 13, 1988, by causing or permitting to be caused, solid waste to be confined to an area which could not be effectively maintained, operated and controlled. [See Second Amended Complaint Paragraph 31].
  5. VIOLATION of ECL 27-0707 and 6 NYCRR 360.8(a)(15) (eff. 3 9 82 through 12 30 88), on about September 19, 1988, by causing or permitting to be caused, non-permitted open burning. [See Second Amended Complaint Paragraph 32].>
  6. Violation of ECL 27-0707 and 6 NYCRR 360.8(a)(16) (eff. 3/9/82 through 12/30/88), on or about September 19, 1988, by causing or permitting to be caused, solid waste to be confined to an area which could not be effectively maintained, operated and controlled. [See Second Amended Complaint Paragraph 33].

All other charges referred to in the Second Amended Complaint (See Appendix A-2 herein, Paragraphs 17, 18, 19, 20, 21, 22, 28 and 29) were found res judicata barred from consideration (see Summary of Major Rulings, below).

The Relief Requested:

In its Second Amended Complaint, Staff requested that the Commissioner order Respondents, jointly and severally, to:

  1. Pay an administrative penalty of One Million Four Hundred Thousand ($1,400,000) Dollars.
  2. Cease operation of the site as a solid waste management facility immediately.
  3. Remove all solid waste, wood chips and shredded wood from the site within 180 days.
  4. Submit an amended mined land reclamation plan to the Department staff for review and comments.
  5. Conduct reclamation of the site in conformity with approved reclamation plan.
  6. Post a performance bond in the amount of One Million ($1,000,000) Dollars within sixty (60) days of the Commissioner's Order.
  7. Conduct such other remedial activities as the Commissioner finds to be just and reasonable.

At the opening of the evidentiary hearing, Staff indicated that it was seeking "a great deal less" than the amount stated in number 1 above, due to the limitation of the charges which would be heard. At the request of the ALJ, Staff gave the following breakdown (with reference to the applicable paragraphs ("") of the Second Amended Complaint) of what it was seeking, citing the dollar amounts as being the maximum penalty under the statute or regulation:

19-20: a) Violations of January 11, 1989

i) Mining Statute $ 1,000

ii) Mining Regulation 1,000

b) Violations of September 28, 1990

i) Mining Statute 1,000

ii) Mining Regulation 1,000

29: a) Violations of January 11, 1989

i) Solid Waste Statute 2,500

ii) Solid Waste Regulation 2,500

b) Violations of September 28, 1990

i) Solid Waste Statute 2,500

ii) Solid Waste Regulation 2,500

30: Violations of September 13, 1988

i) Solid Waste Statute 2,500

ii) Solid Waste Regulation 2,500

31: Violations of September 13, 1988

i) Solid Waste Statute 2,500

ii) Solid Waste Regulation 2,500

32: Violations of September 19, 1988

i) Solid Waste Statute 2,500

ii) Solid Waste Regulation 2,500

33: Violations of September 19, 1988

i) Solid Waste Statute 2,500

ii) Solid Waste Regulation + 2,500

Total $ 34,000

Staff also indicated that they might also claim another $1,000 per day maximum penalty ($365,000/yr) from January 1, 1989 if the Department's testimony shows a continuing operation or through Respondents' admissions of operating an exempt recycling operation.

The Answer:

While admitting to certain allegations in the Second Amended Complaint, Respondents essentially denied all charges by denying the key paragraphs therein which alleged the violating conduct. Respondents allege the following affirmative defenses:

  1. The action is barred by laches.
  2. The action is barred by collateral estoppel.
  3. There is no corporate entity owned or operated by the principals known as "Richard Steck, Gerald Philbin Development Co."
  4. Claims based on acts committed prior to July 1984 are barred by the doctrine of release, and the Department is estopped from complaining of same.
  5. The action was not brought within a reasonable time per SAPA 301.
  6. The action was not brought in good faith.
  7. The action is barred by Res judicata.
  8. Paragraphs 19 and 20 of the second amended complaint do not comply with the ALJ's July 25, 1991 ruling and are thus barred.

Summary of Major Rulings:

Only the most important portions of the listed rulings are summarized. The complete texts of the rulings are in the appendices.

Rulings, September 5, 1989 (Appendix B)

Respondents sought dismissal of the complaint claiming that the matters asserted had already been litigated in a prior proceeding, and are now barred by res judicata. Staff argued that the violations alleged were distinct from those in the prior proceeding, and that no final decision had been made therein, therefore res judicata should not apply.

The res judicata principle is intended to put an end to matters that have been decided. It forbids relitigation of a matter as an unjustifiable duplication - an unwarranted burden on opposing parties as well as on the courts . Res judicata bars relitigation of not only those matters which were actually put in issue in the prior action, but also those which could have been, the guideline being whether or not the current proceeding involves the same transaction or series of connected transactions (i.e., factual groupings) as the prior. See Siegel, Handbook on New York Practice, 1978 ed., pp. 585 et seq. It is important to focus on the acts alleged to be wrongful to see if they are the same. See Reilly v. Reid, 45 NY2d 24, 29-30 (1978).

Some of the acts underlying the complaint herein were the same as those in issue in the prior proceeding. To avoid relitigation, the hearing was held in abeyance until a final Commissioner's Decision on the prior matter was issued, at which time the res judicata effect thereof would be reconsidered.

Ruling and Orders, February 1, 1991 (Appendix C)

The Amended Complaint in Paragraphs 28 and 29 alleged that Respondents violated part 360 by having "initiated construction of a solid waste management facility" on or before August 19, 1986, and operated a solid waste management facility on or before and continuing after August 19, 1986, by receiving and doing various things to trees and wood wastes without a permit. The complaint in the previous matter alleged numerous violations of part 360 involving improper management of solid wastes and/or improper operation of the solid waste facility at Respondents' site on specific dates spanning April 6, 1984 through September 16, 1986, overlaping the time period alleged herein. The ALJ's Report in the prior proceeding clearly addressed Respondents' handling of wood wastes. Respondents' handling of wood wastes was thus either actually litigated or could have been litigated in the earlier proceeding. Under the res judicata principle, such handling of wood wastes should not be asserted now to support new charges. The charges of constructing and operating a solid waste management facility without a permit (Paragraphs 28 and 29 of the Amended Complaint) clearly could have been asserted in the prior action, and therefore were found barred by res judicata.

Other charges in the Amended Complaint also appeared to be barred, but it was not possible to make a determination without first knowing the specific facts Staff was relying on. Pre-filing of proof and opportunity for motions thereon were required to enable such a determination.

Rulings and Orders, July 25, 1991 (Appendix D)

Respondent moved for dismissal of the remaining charges, again arguing that they were res judicata. Staff opposed the motion, and requested reconsideration of the prior ruling (barring Paragraphs 28 and 29) arguing that res judicata generally didn't apply to administrative proceedings, and didn't apply here because a different party (i.e., Staff division) was pressing charges, and because the elements of proof varied materially from those in the prior proceeding.

Res judicata clearly applies to administrative proceedings. In New York, res judicata gives conclusive effect to the quasi-judicial determinations of an administrative agency when rendered through procedures substantially similar to those used in a court of law. Ryan v. New York Telephone Co., 62 NY2d 494, 499 (1984). Here, the prior proceeding employed court-like procedures and resulted in such a quasi-judicial determination. Thus, the determination must be given conclusive effect. There was no different "party" pressing the mining charges because a staff subdivision does not have a right to enforce the law on its own separate from the Department's right. Although an exception to the transactional approach is recognized where the requisite elements of proof vary materially (Reilly v. Reid, 45 NY2d 24, 30 (1978) citing Smith v Kirkpatrick, 305 NY 66, 72) the exception does not apply when essentially the same relief is being sought in the two actions. O'Brien v City of Syracuse, 54 NY2d 353, 357-358 and fn 1 on 358 (1981), partially overrulling Smith. Here, essentially the same relief was being sought in both actions: monetary penalties, closure and remediation -- thus, the exception does not apply. If it did apply, a material variation in the elements of proof was not demonstrated.

With regard to paragraphs 17, 18, 19, 20, 21 and 22 of the Amended Complaint, Respondents pointed out sufficient similarities between the proof herein and what was proven or put in the record in the prior proceeding to demonstrate that the charges in these paragraphs stemmed from the same "transactions" or "series of transactions" litigated in the prior proceeding. Staff made no attempt refute this demonstration. Thus consideration of paragraphs 17, 18, 19, 20, 21 and 22 of the Amended Complaint was barred by res judicata. No such demonstration was found with regard to the charges embodied in paragraphs 30, 31, 32 and 33 of the Amended Complaint, thus, those paragraphs were not barred.

Because res judicata does not bar subsequent claims arising from separate transactions or which describe acts occurring after termination of the prior lawsuit, O'Brien, supra, 358 (including fn), and because paragraphs 19-20 and 29 of the Amended Complaint alleged continuing violations to the "present" or "to date" (i.e., encompassing times after the October 22, 1986 date of the complaint already litigated), Staff was granted leave to amend its complaint a second time to specifically put Respondents on notice of any post-October 22, 1986 acts or separate transactions Staff had intended to include within the "continuing" language. Staff was also permitted to supplement its pre-filed proof with regard to any amendment of Paragraph 29 (which would allege post-October 1986 transactions) which proof had not previously been filed due to the earlier barring of the charge.

Ruling, March 4, 1992 (Appendix E)

On February 26, 1992, Staff requested dates for submission of pre-filed testimony by, and cross-examination of, a witness to substitute for Mr. Paul Roth. Mr. Roth had already pre-filed his testimony, but, contrary to previous understanding, would "not be available" to testify at the hearing [then scheduled for March 3] due to his departure from DEC employment. Staff based its request on Mr. Roth being an expert witness, and caselaw indicating that a person cannot be compelled to give expert opinion against his or her will. As requested during the conference calls that followed, Staff submitted case law and identified those portions of Mr. Roth's pre-filed testimony it contended were expert opinions, to support its request.

Staff did not demonstrate that it was unable to produce Mr. Roth at trial -- only that under the law it was unable to compel him to give expert testimony. Mr. Roth, however, was not adverse to providing "expert" testimony, per se. Rather, he did not wish to inconvenience his new employer by being called away as a witness. Regardless, Staff's submissions made clear that Mr. Roth was almost exclusively a fact witness, not an expert witness, thus the caselaw relied upon by Staff was largely inapplicable. Staff's request to substitute a witness for Mr. Roth was denied. As stated in the Ruling, "If Mr. Roth refuses to testify to something that truly requires expertise to say, such refusal will be addressed in an appropriate fashion when and if it occurs."

[It should be noted that when the hearing resumed on March 10, 1992, Staff indicated it had not subpoenaed Mr. Roth; and it later rested its case without requesting an opportunity to subpoena Mr. Roth.]

Motions Renewed in Closing Arguments:

Staff requested that the ALJ and the Commissioner reconsider and/or reverse the ALJ's denial to Staff of the opportunity to substitute another witness for Mr. Roth.

Staff requested reversal of the ALJ's rulings which effectively dismissed the charges contained in Paragraphs 17, 18, 21, 22, 23 and 28.

FINDINGS OF FACT ("FF")

Respondents:

  1. At all times relevant herein, Respondent Richard Steck, Gerald Philbin Development Company was and is a partnership duly organized and existing under and by virtue of the laws of the State of New York.
  2. At all times relevant herein, Respondent Richard K. Steck and Respondent Gerald Philbin, were and still are partners of the aforesaid Respondent partnership.

The Site and its setting:

  1. This case involves an approximately 23 acre site, commonly known as Northeast Mines, located on Old Northport Road, Kings Park, Smithtown, Suffolk County, NY (hereinafter, the "Site").
  2. At all relevant times herein, Respondents Steck and Philbin have been and continue to be operators of the Site.
  3. The Site is located in an area zoned heavy industrial. Twelve hundred feet east of the Site is a landfill that was run by the Town of Smithtown. In between are mining, concrete casting, tire shredding and trucking operations, the Town Highway Department, and a garbage dump. Respondents also own, since 1984 or 1985, a 30 acre parcel immediately adjoining the Site on the east, used since purchase for storage of material (processed material, woodchips, mulch, topsoil) and equipment. Five homes are within 500 feet of the Site's northern boundary. Southwest of the Site is another Town of Smithtown landfill known as Cell #5, which is currently receiving garbage. Directly south of the Site is another landfill known as Cell #6.

Relevant activities concerning the Site:

  1. On March 25, 1982, the Department issued Respondents permit no. 02823, bearing an expiration date of January 27, 1983, which authorized the mining of sand and gravel from 5 of the Site's 23 acres, in compliance with an approved mined land-use plan.
  2. On June 11, 1982, the Department issued Respondents an amended permit no. 02823, bearing an expiration date of January 27, 1983, which authorized continued mining of sand and gravel from 22 [sic, 21] of the Site's 24 [sic, 23] acres, in compliance with an approved mined land-use plan.
  3. On October 19, 1982, Respondents applied (No. 10-82-0936) for approvals to construct and to operate a solid waste management facility (transfer station) at the Site. The applications indicated that "Demolition will be brought in and sorted items of value will be separated and held for resale. The balance will be trucked to a dump site" and that "putrifiable wastes" would not be accepted.
  4. On January 3, 1983, in response to Application No. 10-82-0936, by letter of said date signed by then Regional Permit Administrator Daniel J. Larkin, the Department issued Respondents a "Conditional No Permit Necessary" determination for their project at the Site which "will involve the manual separation of wood and other recyclables from demolition debris" conditioned upon (1) "[a]ll materials not recycled be sent to an approved site for disposal", (2) "[o]nly non-putrescibles will be accepted at the transfer station" and (3) "[a]ll local and Town ordinances shall be adhered to."
  5. On January 27, 1983, the Department issued Respondents permit no. 102823, bearing an expiration date of January 27, 1984, which authorized continued mining of sand and gravel from 22 [sic, 21] of the Site's 24 [sic, 23] acres, in compliance with an approved mined land-use plan.
  6. On January 27, 1984, the Department issued Respondents permit no. 102823, bearing an expiration date of January 27, 1985, which authorized continued mining of sand and gravel from 21 of the Site's 23 acres, in compliance with an approved mined land-use plan.
  7. On January 27, 1985, the Department issued Respondents permit no. 102823, bearing an expiration date of January 27, 1986, which authorized mining, in compliance with an approved mined land-use plan.
  8. Beginning about the time of Hurricane Gloria (September 1985), and continuing to date, Respondents began to use the Site to convert trees and various wood materials into woodchips and, since 1988, mulch.
  9. The trees and wood materials, usually from landscapers and carting companies, would be delivered to the Site by truck. Respondents would generally accept only those materials they could incorporate into a product. Drivers of accepted deliveries would be issued a yardage ticket for same.
  10. The trees and wood materials would be unloaded and piled on the Site for an indeterminate length of time prior to being processed by various machines into wood chips and mulch.
  11. Respondents would make the wood chips from whole trees and stumps, limbs, branches, old lumber, and "treated" wood, but not railroad ties. Wood with formica, metal or glass on it would be considered "contaminated" and not accepted at the Site. The chips would be 85% tree materials. "Treated" wood would be kept separate. Treated wood that was processed would not be sold, but would be used on-Site to cover unprocessed tree materials. The treated wood that was used in such a manner would eventually decompose and become mixed with the sand on Site to produce a topsoil product which would be sold.

    (The record is not clear on what constitutes "treated" wood since attorney and witness may have used the term differently.)

  12. Respondents would make mulch from their woodchips. Brush, yardwaste, shrubbery, grass and leaves would also be thrown into the machines to make the mulch.
  13. Intermediate products of Respondents' process (such as shredded wood) and the chips and mulch would be stored in piles on and adjacent to the Site for an indeterminate period until they would either be used and/or sold.
  14. Respondents would usually be open for business 5 or 6 days a week springtime through fall, less time during the winter.
  15. On January 27, 1986, the Department issued Respondents permit no. 102823, bearing an expiration date of January 27, 1987, which authorized continued mining of sand and gravel from 22 [sic, 21] of the Site's 24 [sic, 23] acres, in compliance with an approved mined land-use plan.
  16. During late May, 1986, the Site contained materials piled to elevations higher than the elevations specified as final reclamation grades in Respondents' Mined Land Use Plan. The specified final reclamation grade elevation was to be roughly the same as the elevation of Old Northport Road (the "road") immediately adjacent thereto. What appeared to be either a berm and/or stockpiles of earth materials was on the Site, adjacent to the road, rising from road level to approximately 8 feet above same. Piles of wood materials were either behind or on top of the earth materials, and reached elevations above the road, perhaps as much as or slightly more than twice as high as the earth materials.

    The 8 foot elevation is an approximation based on Mr. Galli's estimate. Such elevation was not measured either directly or indirectly by this witness, nor was it documented in any of the witness' inspection reports. The estimate appears to be an after-the-fact estimate based on the witness' memory. Such estimate, however, appears consistent with the photos in evidence which display the earth materials near a chainlink fence and passing cars. The number is considered to be an "order of magnitude" approximation. The other portions of the finding related to elevation of materials are based on appearances in the photographs of the Site.

  17. On August 19, 1986, no mining operations were observed. Wood waste was being taken in and shredded on-Site.
  18. On January 27, 1987, the Department issued Respondents renewal permit no. 102823, bearing an expiration date of January 27, 1988, which authorized continued mining and reclamation of 21 of the Site's 23 acres, forbade deviation or departure from the approved mined land-use plan without the Department's approval, and required the maintenance of a reclamation bond or other surety of a Department-determined amount during the mining operation until the Department approved of the reclamation of the mined area.
  19. On January 14, 1988, Respondents, enclosing a $50 fee, requested that the Department renew Mining Permit #02823.

    No action was taken on this request because then Regional Attorney Joan Scherb advised Mr. Galli that outstanding alleged solid waste violations had to be resolved first.

  20. Beginning in the afternoon or evening of September 13, 1988, and extending into the early morning hours of September 14, 1988, a fire occurred on the Site. Mr. Anderson, Town of Smithtown Fire Marshall, reportedly observed steam on the Site at about 4 PM on September 13. Later that evening, fire occurred in a pile of wood materials approximately 200 feet long and 20 feet high. Although some flames were occasionally visible, much smoke was seen coming from within the pile, the fire appearing to observers to be underground. Both the local fire authorities and Respondents' employees were engaged for several hours in putting out the fire. Respondents' bucket loader was seen digging out burning material. The smell of decomposing organic matter was noted from the pile later on September 14.
  21. Spontaneous combustion, due to the great size of the wood pile, was the likely cause of the September 13-14, 1988 fire.

    Respondents claim that vandals started the fire, argue that they claimed this on the occasion of the fire, and contend that they showed local officials a broken fence to prove their point. No one from Staff offered a theory of what caused the September 13-14, 1988 fire.

    The record contains sufficient data from which a layperson may infer that spontaneous combustion caused this fire. Almost everyone learns about spontaneous combustion in school. Decomposing matter generates heat. If you create a large enough pile of decomposing matter, you will trap the heat and cause the temperature within the pile to build up to the point where it will ignite. It's also common knowledge that wood decomposes, and wood burns. Here large piles of wood materials were on Site. The fire marshall saw steam on the Site earlier in the day before the fire was apparent. When the fire was noted, it appeared to be coming from within the mass of material. The pile smelled like decomposing organic matter. These observations support the spontaneous combustion inference. No theory was offered as to how vandals could cause a fire to develop witin the mass of material.

  22. Another fire occurred on the Site on September 19, 1988. Smoldering was observed on Site the following day. People were seen covering with sand the area where the fire reportedly had been.
  23. The cause of the September 19, 1988 fire is unknown.

    Staff's witness indicated the cause of this fire wasn't clear to him.

  24. On January 4, 1989, Respondents, enclosing a $50 fee, requested that the Department renew Mining Permit #02823. Again, no action was taken on the request because of outstanding alleged violations.
  25. On January 4 and 11, 1989, Mr. Galli visited the Site. Shredded wood, estimated to be 20 feet above the grade of the road, virtually covered the Site property.

    No measurement of height was made. Since the wood materials may have been piled to such a height as early as 1986 (FF 21), no significant increase in height since that date can be found.

  26. On February 21, 1989, the initial Notice of Hearing and Complaint herein was issued (see Proceedings).
  27. On December 20, 1989, Respondents, enclosing a $50 check to the Department, requested that the Department renew Mining Permit #02823. On May 29, 1990, Robert Thurber, Sr. Environmental Analyst with the Department, returned Respondents' check advising that the permit could not be renewed until an enforcement action against the company was resolved.
  28. Shredded wood was present on the Site on September 28, 1990.

    In driving past the Site on September 28, 1990, Mr. Galli believed he saw an "even higher elevation of shredded wood above street grade" than he saw on January 11, 1989. While sufficient to substantiate the presence of the shredded wood on Site at that time, Mr. Galli's belief regarding the height of the wood was not substantiated, nor was it documented in any inspection report. Therefore, no significant height increase is found.

  29. Piles of wood materials referred to above (FFs 15 and 18) have been on Site virtually constantly from 1986 through September 28, 1990.
  30. On January 3, 1991, Respondents, enclosing a $50 check to the Department, requested that the Department renew Mining Permit #102823.

CONCLUSIONS OF LAW ("CL")

I. Alleged Violation of ECL 23-2713(4) and 6 NYCRR 422 (unauthorized deviation from approved mined land-use plan) on January 11, 1989 and September 28, 1990, continuing to the date of the Second Amended Complaint, by placement of shredded wood and construction and demolition debris in excess of the final reclamation grades specified in the mined land-use plan (only post-October 1986 period under consideration):

1. Staff did not prove that Respondents deviated or departed from the approved mined land-use plan in the manner alleged after October 1986.

ECL 23-2713(4) and 6 NYCRR 422.1(a) prohibit unauthorized deviation or departure from the mined land-use plan (applicant's proposal for mining and reclaiming the affected land).

The mined land-use plan prescribes how mining and reclamation are to take place. Any "deviation" or "departure" therefrom must be with respect to mining or reclamation operations. Assuming arguendo that the piles of wood material on Site grew in height after 1986 as alleged, no relationship between these piles and the mining or reclamation operations was established. Neither the statute, regulation, nor mined land-use plan herein prohibit the Site from being simultaneously used for activities unrelated to mining or reclamation. The wood-material piles on-Site are associated with activities wholly unrelated to the mining or reclamation (see below).

Additionally, it was not established that the time is due for performance of the reclamation. The reclamation plan herein specifies no due dates. Although section 6 NYCRR 422.3(e) requires that reclamation be completed within 2 years after mining ceases, it was neither alleged, nor proven, that mining has ceased. "Mining" under Part 422 includes extraction of minerals and other activities related to preparing them for use. Respondents clearly have had their mining permit renewed several times and have applied for renewal through 1991. The renewal applications were not acted upon. Under these circumstances it is not clear that mining has ceased. Thus, it has not been established that reclamation is due.

II. Alleged Violation of ECL 27-0707, and 6 NYCRR 360.2(b) (eff. through 12/30/88) or 360-1.7(a)(1)(ii) (eff. 12/31/88), by operation of a solid waste management facility without a permit through receiving, storing, shredding and landfilling solid waste, consisting of vegetation including trees, stumps, tree limbs and branches, wood chips, shredded wood, and other wood wastes. The violation is a continuing violation to the date of the Second Amended Complaint. Increases in material received, stored, shredded and landfilled were noted on 1/11/89 and 9/28/90 (only post-October 1986 period under consideration):

2. The trees, stumps, tree limbs and branches, lumber and other wood materials that Respondents routinely received at the Site were solid waste, at least since December 31, 1988.

Such wood materials were brought to the Site by carters and landscapers. There is no dispute that the materials had been rejected as useless, worthless or in excess to their owners, thus they met the basic definition of "solid waste" found in 6 NYCRR 360-1.2 (a)(1) [effective December 31, 1988].

3. Such wood materials are not excluded from the "solid waste" classification under 6 NYCRR 360-1.2 (a)(4) [eff. December 31, 1988].

Respondents contend that the materials are excluded from the "solid waste" classification under 6 NYCRR 360-1.2 (a)(4) because they are "incorporated into a manufacturing process to produce a marketable product" (6 NYCRR 360-1.2(a)(4)(vii)(a)), and/or because that product is woodchips and mulch (6 NYCRR 360-1.2(a)(4)(vii)(c)). In this regard, the regulatory provisions have been taken out of context, ignoring both the language of other provisions under paragraph (a), as well as the provisions' overall purpose. Both language and purpose indicate that a prior departmental determination of beneficial use is required before such materials are excluded from the "solid waste" classification.

Title 6 NYCRR 360-1.2(a)(4)(vii) excludes from the "solid waste" classification "materials that the department has determined are being beneficially used, including the following ..." (underline and italics supplied). What follows is a list of regulatory provisions, including the two cited by Respondents, which specifies those uses the Department considers to be beneficial. The provisions immediately prior to subparagraph (vii) list materials excluded from the "solid waste" classification without the "that the department has determined" qualifier. The provision immediately following the list, 360-1.2(a)(5), specifies how one may petition the Department for a determination of beneficial use. Reading these provisions together makes clear that a prior Departmental determination of beneficial use is required to qualify for the exclusion from the "solid waste" classification under subparagraph (vii). If such determination was not required for the listed materials, they would have been simply listed without the prefacing qualifying ("that the department has determined") language. In addition, the "are being" language refers to actual materials, not classifications of materials.

(Please note that the requirement of a prior Departmental determination of beneficial use does not appear in 6 NYCRR 360.1 (f) Exemptions which was in effect before December 31, 1988).

That a prior Departmental determination of beneficial use is required becomes clear when one considers its purpose - revealed in subparagraph (5). Subparagraph (5) requires that the petition for a beneficial use determination demonstrate, inter alia, that the intended use will not adversely affect the environment. For example, if someone is turning waste wood into wood chips or mulch for sale to gardeners for landscaping use, the woodchips or mulch may or may not be environmentally benign - such would depend upon the prior use (or contamination) of the source material. The same would hold true for any other example of someone incorporating what would otherwise be regulated as "solid waste" into a marketable product. Through these regulations, the Department is ensuring itself of the opportunity to stop harmful "beneficial uses" from being alternate, unregulated methods of solid waste disposal. Respondents' treatment of these regulatory provisions would thwart Departmental oversight. Treating "incorporat[ion] into a manufacturing process to produce a marketable product" automatically as a "beneficial use" would create a loophole large enough, in the case of tainted mulch, to turn peoples' gardens into landfills.

Respondents have not submitted a Departmental determination that the wood materials are being beneficially used, thus such materials are not excluded from the "solid waste" classification under 6 NYCRR 360-1.2 (a)(4).

In addition, this record does not contain sufficient information to make an "after-the-fact" determination of beneficial use, if one were permissible at this time, since it does not contain all the information required in sub-paragraph (5).

4. Respondents have been operating a solid waste management facility at the Site, by their receipt, handling and maintenance of the wood materials on the Site in the manner described in the Findings of Fact (FFs 13-19, 34), on a continuing basis through September 28, 1990, at least since the new Part 360 regulations went into effect (December 31, 1988).

5. Respondents operated the solid waste management facility, in the manner described above, without a permit, in violation of 6 NYCRR 360-1.7(a)(1)(ii) and ECL 27-0707, since December 31, 1988, through September 28, 1990.

The 1983 "Conditional No Permit Necessary" determination was plainly not Departmental permission (or authorization) for Respondents to go ahead with their Proposed Project. Rather, it was a determination that no permission was needed (i.e., "No Permit Necessary") provided that Respondents conducted their activities in the manner described. The letter can only be considered as binding on the Department (if not legally, then equitably) in the context of the regulations as they existed at the time the letter was written. As noted above in discussion (under CL 3), significant changes were made in Part 360 effective December 31, 1988 - i.e., the requirement of a determination of beneficial use was imposed at that time. The letter did not assess Respondents' activities against this new requirement, thus it cannot estop the Department from applying it.

Respondents offered no effective Part 360 permit which expressly authorized their wood waste handling activities.

Possible violation of 6 NYCRR 360.2(b) during the post-October 1986 to December 31, 1988 period is not considered herein for two reasons. First, the Second Amended Complaint identified nothing about Respondent's conduct during such period to distinguish it from the wood-handling activities already considered by the tribunal in case 1-1251. Second, Staff indicated on the Record it was seeking penalties for a continuing violation only from January 1, 1989.

III. Violation of ECL 27-0707 and 6 NYCRR 360.8(a)(15) (eff. 3/9/82 through 12/30/88), on or about September 13, 1988, by causing or permitting to be caused, non-permitted open burning:

6. Respondents caused, or permitted to be caused, open burning at the Site, on the occasion of September 13-14, 1988, by maintaining wastes on Site in a pile so as to cause spontaneous combustion thereof, and therefore violated ECL 27-0707 and 6 NYCRR 360.8(a)(15) which prohibits open burning without a permit.

No authorization for such burning was presented.

IV. Violation of ECL 27-0707 and 6 NYCRR 360.8(a)(16) (eff. 3/9/82 through 12/30/88), on or about September 13, 1988, by causing or permitting to be caused, solid waste to be confined to an area which could not be effectively maintained, operated and controlled:

7. Respondents caused, or permitted to be caused, solid waste to be confined to an area which could not be effectively maintained, operated and controlled, on the occasion of September 13-14, 1988, by maintaining wastes on Site in a pile so as to cause spontaneous combustion thereof; and therefore violated ECL 27-0707 and 6 NYCRR 360.8(a)(16) which requires confinement of solid waste to an area which can be effectively maintained, operated and controlled.

Respondents' arguments that they maintained the Site in a manner which permitted the fire to be brought under control does not obviate the fact that the wastes were maintained in a manner that caused spontaneous combustion (i.e., the wastes were not under control).

V. Violation of ECL 27-0707 and 6 NYCRR 360.8(a)(15) (eff. 3/9/82 through 12/30/88), on or about September 19, 1988, by causing or permitting to be caused, non-permitted open burning:

8. Pursuant to the guidance provided by the Commissioner's 3/24/89 Order in Matter of Town of LeRay, File No. R6-0739-88-06, the fact of an unpermitted open fire on the Site on September 19, 1988 is sufficient to establish a violation of 6 NYCRR 360.8(a)(15). However, since there is no evidence that the fire was caused by either an intentional or negligent act or failure to act on Respondents' part, no penalty would be appropriate (id., 6).

VI. Violation of ECL 27-0707 and 6 NYCRR 360.8(a)(16) (eff. 3/9/82 through 12/30/88), on or about September 19, 1988, by causing or permitting to be caused, solid waste to be confined to an area which could not be effectively maintained, operated and controlled:

9. What Respondents did, or failed to do, to cause or permit to be caused solid waste to be confined to an area which could not be effectively maintained, operated and controlled on September 19, 1988 was not established, thus no violation of ECL 27-0707 and 6 NYCRR 360.8(a)(15) on said occasion was established.

Affirmative defenses:

10. Except for the claims of laches, untimeliness, and lack of good faith, Respondents' affirmative defenses have already been effectively addressed by the prior rulings, Findings of Fact, and Conclusions of Law herein. Respondents did not make sufficient showing on any of its other alleged affirmative defenses to permit a conclusion thereon.

Authorized relief:

11. Respondents' operation of a solid waste management facility without a permit from December 31, 1988 through September 28, 1990 (CL 4, above) would permit the Commissioner to assess a maximum penalty of $2,500 for the violation, plus up to $1,000 for each day that the violation continued (approximately $600,000).

ECL 71-2703 authorizes the Commissioner to assess a civil penalty not to exceed $2,500 for each violation of ECL Article 27 title 7 or implementing rule or regulation, and an additional penalty of not more than $1,000 per day that the violation continues. Violation of the statute and regulation are not considered separate violations here because the regulation implements the statute and the identical conduct violated both.

12. Respondents' operation of a solid waste management facility without a permit from December 31, 1988 through September 28, 1990 (CL 4, above) would also permit the Commissioner to Order that Respondents immediately cease operating the Site as a solid waste management facility, and remove all solid waste, wood chips and shredded wood from the Site within 180 days, as requested by Staff.

ECL 71-2703 authorizes the Commissioner to enjoin the continuance of the violation. Continued receipt of solid waste, wood processing operations, and maintenance of the piles (i.e., storage) of processed and unprocessed wood materials on the Site would be a continuance of the violation that the commissioner may enjoin.

[Respondents apparently landfilled "C & D" material on the Site pursuant to a permit that expired in 1986. Respondents are under a Commissioner's Order in case 1-1251 to properly close that facility. Those matters were not part of this proceeding. The Order referred to above would not pertain to materials that were legally landfilled pursuant to any such permit.]

13. Respondents' open burning, and failure to confine wastes to an area where they could be effectively controlled on or about September 13-14, 1988, would permit the Commissioner to assess a maximum penalty of $2,500 for that violation.

ECL 71-2703 authorizes the Commissioner to assess a civil penalty not to exceed $2,500 for each violation of ECL Article 27 title 7 or implementing rule or regulation. Violation of the two regulations and the statute they implement are not considered separate violations here because the identical conduct violated all three and only one regulatory purpose is perceived (i.e., control of wastes to prevent combustion).

RECOMMENDATIONS

  1. The Commissioner should affirm the ALJ's ruling rejecting Staff's request to substitute a witness for Mr. Roth for the reasons stated in the the ALJ's Ruling dated March 4, 1992 (attached hereto as Appendix E, and summarized above). In this regard it appears that there may have been a reluctance on the part of Staff to serve a subpoena on an unwilling recipient, perhaps because of a desire not to inconvenience the person, or perhaps for tactical reasons. While as a matter of common courtesy inconvenience should be avoided where possible, sometimes it is not possible without causing greater inconvenience to others. The subpoena authority exists to compel persons to come to court who, for whatever reason, don't want to. If Mr. Roth's testimony was crucial to Staff's case, he should have been subpoenaed.
  2. The Commissioner should affirm the ALJ's ruling which effectively dismissed the charges contained in Paragraphs 17, 18, 21, 22, 23 and 28 for the reasons stated in the the ALJ's Rulings dated September 5, 1989, February 1, 1991, and July 25, 1991 (attached hereto as Appendices B, C and D, and summarized above).
  3. The Commissioner should find that Respondents operated a solid waste management facility without a permit, and thus violated ECL 27-0707 and 6 NYCRR 360-1.7(a)(1)(ii), from December 31, 1988 through September 28, 1990, by their receipt, processing and storage of various wood wastes on the Site during that period of time.
  4. The Commissioner should find that Respondents caused open burning on the Site, in violation of 6 NYCRR 360.8(a)(15), and failed to adequately confine wastes to an area where they could be effectively controlled, in violation of 6 NYCRR 360.8(a)(16), and both in violation of ECL 27-0707, by maintaining wastes on Site in a pile so as to cause spontaneous combustion thereof on September 13-14, 1988.
  5. The Commissioner should find that Respondents violated 6 NYCRR 360.8(a)(15) and ECL 27-0707 on September 19, 1988, to be consistent with the Town of LeRay determination, because an unpermitted open fire occurred at the Site on that date.
  6. The Commissioner should dismiss the remaining charges.
  7. The Commissioner should assess a penalty of $ 50,000 for the violation of ECL 27-0707 and 6 NYCRR 360-1.7(a)(1)(ii) (operation of a solid waste management facility without a permit).

    As noted above, the law authorizes a much greater penalty. An aggravating factor is that Respondents have a record of past violations at this Site (see Case 1-1251). Evidence of an economic benefit to Respondents is scant, although it may be inferred that Respondents derived an income by providing a location where others could dispose of their wood materials. Since the wood materials virtually cover the 23 acre Site and also are found on adjoining property, the income was probably significant. Nevertheless, virtually no evidence was submitted on what, if any, environmental harm was caused by the presence of the wood materials on the Site. The regulations' recognition that wood chips used for mulch, landscaping or erosion control purposes is generally considered a beneficial use that exempts the wood chips from the "solid waste" definition indicates no adverse environmental impact should be expected.

  8. The Commissioner should Order that Respondents immediately cease operating the Site as a solid waste management facility, and remove all solid waste, wood chips and shredded wood from the Site within 180 days.
  9. The Commissioner should permit Respondents the opportunity to petition the Department for a determination of beneficial use under 360-1.2(a)(5) within 60 days of receipt of the Commissioner's Order, and/or submit a complete application for the appropriate Part 360 permit for their waste handling activities within 180 days of receipt of the Commissioner's Order, and stay implementation of the Order recommended at 8 above pending final determination on any such petition and/or complete application that is timely filed. Whether or not the stay should continue thereafter will depend upon the nature of the final determination. In addition, the Commissioner should suspend all or part of the penalty recommended at 7 above on condition of compliance with 8 above, or if the Department either permits the Respondents' waste handling activities or otherwise determines that the wastes are not "solid waste" because they are being beneficially reused.

    An opportunity to apply for the appropriate approvals and/or permit, and suspension of all or part of the penalty, is recommended because it appears that prior to filing the original Complaint herein, the Department previously treated Respondents' wood processing activities as legitimate, and the new regulations could be construed in Respondents' favor.

    Review of the Hearing Report and Decision/Order in Case 1-1251 makes clear that Respondents' wood handling activities were known to the Department in 1986 (Hearing Report p. 5), but no violations were charged (Case 1-1251 Decision and Order, 11). It appears that as long as the wood chipper was operable, the activity was treated as legitimate (Case 1-1251 Hearing Report, Conclusion 14). It was only when the original complaint was filed herein (February 1989) that these activities (going back to 1986) were alleged to be illegal. As indicated in earlier rulings, those matters are now res judicata.

    McKinney's Statutes indicates that penal provisions should be strictly construed against the State and in favor of the accused (see Statutes 271), while remedial statutes or those promoting the public good should be liberally construed (Statutes, 321, 341). Part 360 can be applied both as a penal provision (subject to a "strict" construction against the Department) as when penalties are sought; as well as one that promotes the public good (entitled to a liberal construction) as when activities are regulated to prevent adverse environmental impacts. The construction given to 6 NYCRR 360-1.2(a)(4)(vii) in CL 3 above is a liberal construction, made to ensure that the Department has an opportunity to regulate Respondents' activities to protect the public good. If strictly construed against the Department, however, that provision can be read, as argued by Respondents, to exclude wastes that are "incorporated into a manufacturing process to produce a marketable product," and/or turned into woodchips and mulch, from the definition of "solid waste," making the handling thereof not solid waste management (and not subject to Departmental control).

    Since a construction in Respondents' favor is possible, it would be inappropriate to assess a penalty, or force Respondents' to discontinue their activities, without first giving them a reasonable opportunity to bring their activities and Site into full compliance with the regulations. In this fashion, Respondents could avoid the penal application of the regulation, and the public good would be promoted.

  10. The Commissioner should assess the maximum penalty of $2,500 for the September 13-14, 1988 violation of ECL 27-0707 and 6 NYCRR 360.8(a)(15) and (16).

    This was not a minor fire, since the local fire authorities were called in and several hours were required before the fire was brought under control. Respondents also brought about the situation (FF 26, CL 6).

  11. The Commissioner should not assess a penalty for the September 19, 1988 violation of 6 NYCRR 360.8(a)(15) and ECL 27-0707 under the rationale articulated in Town of LeRay.

Appendices:

A-1. Notice of Hearing

A-2. Second Amended Complaint

B. ALJ Rulings, September 5, 1989

C. ALJ Ruling and Orders, February 1, 1991

D. ALJ Rulings and Orders, July 25, 1991

E. ALJ Ruling, March 4, 1992

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