Notice of Violation #N90217-S-00118 is affirmed with respect to the following areas:
(1) south side of permit area;
(2) east of bond segments A, C, 0, M, and S;
(3) east and west of the northern portion of bond segment Y; and
(4) west of the eastern portion of bond segment S. In any penalty determination, the notice of violation is supplemental to (and not separate from) notice of violation #N81024-S-00118.
FINDINGS OF FACT
1. On March 20, 1989, Jaeco, Inc. ("Jaeco"), by counsel, filed a "Petition for Review" of the issuance of notice of violation N90217-S-00118 (the "NOV") by the division of reclamation (the "Division") of the department of natural resources (the "Department").
2. The NOV was served with respect to activities at the Eel River Mine in Clay County, Indiana (the "mine") for which permit S-00118 (the "Permit") had been issued by the Department to Jaeco under IC 13-4.1 and 310 IAC 12 (these statutory and regulatory articles being collectively referred to as "Indiana SMCRA").
3. The Department is an "agency" as defined in IC 4-21.5-1-3.
4. The issuance of a notice of violation is an "agency action" as defined in IC 4-21.5-1-4.
5. The issuance of the NOV is governed by IC 4-21.5 and 310 IAC 0.6 (a rule article which applies to proceedings before the Department under IC 4-21.5-1-4). More particularly, IC 4-21.5-3-6 applies to the NOV. IC 13.4.1-11-4(b).
6. The director of the Department (the "Director") is the "ultimate authority" (as defined in IC 421.5-1-15) with respect to notices of violation under Indiana SMCRA. The Director is the ultimate authority for administrative review of the NOV.
7. The NOV stated the nature of the violation was that Jaeco failed to "keep mining activities on the permitted and bonded area."
8. The NOV cited the following rule sections as having been violated by the activities of Jaeco: 310 IAC 12-3-2(a), 310 IAC 12-4-5.
9. The NOV identified the locations of the alleged violations as follows:
A. south side of permit area;
B. east of bond segments A, C, 0, M, and S;
C. east and west of the northern portion of bond segment Y;
D. the southwest corner of the Marshall Nuckolls property;
E. east of segment H; and F. west of the eastern portion of bond segment S.
10. The actions required by the NOV for abatement were as follows:
A. Limit mining activities to the permitted and bonded area.
B. Permit and bond all areas affected by the mining activity.
11. The compliance time set in the NOV was immediately upon its receipt (February 27, 1989 at 9:00 a.m., EST).
12. In its "Petition for Review", Jaeco urged that the NOV was improper because the Division "had previously written a notice of violation (#N81024-S-00118) for the identical actions" by the company. "It is improper to have two distinct notices of violation for the same act."
13. In addition, Jaeco urged in its "Petition for Review" that the NOV and notice of violation #N81024-S-00118 both "were improperly written because an authorized representative of the Director gave Jaeco permission to mine in the area of the violation."
14. A prehearing conference was held on April 14, 1989; and the issues for this proceeding were framed during the prehearing conference. Those issues were as follows:
(1) whether the NOV (for mining off the bonded area) had been previously written in notice of violation #N81024-S-00118 for the identical actions of Jaeco; and
(2) whether the Director, through an authorized representative, gave Jaeco permission to mine in the area.
15. The issues described in Finding 14 are the sole and exclusive issues now to be determined in this proceeding.
16. A hearing was conducted in this proceeding on May 26, 1989. Following the hearing, the Division contended in its "Final Argument" filed on July 11, 1989 that Jaeco was
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precluded, under the doctrine of equitable estoppel, from asserting that the areas described in the NOV were the same as those described in notice of violation #N81024-S-00118.
17. Equitable estoppel is an affirmative defense.[FOOTNOTE i] Whether used as a sword or a shield, an affirmative defense must be disclosed before the hearing.[FOOTNOTE ii] If a prehearing conference is held, the affirmative defense must be raised during the prehearing conference. IC 4-21.53-14(c).
18. The Division did not raise the equitable estoppel argument outlined in Finding 16 in a timely fashion. The argument was not an issue identified during the prehearing conference or otherwise in advance of the hearing. Any argument for equitable estoppel which might have existed in favor of the Division has been waived and cannot be considered in this proceeding.
19. Evidence is abstruse as to whether the NOV (for mining off the bonded area) had been previously written in notice of violation #N81024-S-00118.
20. Charles W. Armbrust, an authorized representative of the Director, testified that his calculations whether mining activities were on or off the permit or the bonded area depended, in large measure, upon one or more of the 25 bond maps submitted by Jaeco.
21. A map was attached to the NOV upon which it appeared, inaccurately, that Jaeco had mined through and beyond a county road. This violation was identified in the NOV as being on the south side of the permit. (See Finding 9A.) The map also showed that the violation alleged as the area east of bond segment H (Finding (E) was on property owned by Eldon Tipton, but this area did not, in fact, include the Tipton property. A disturbance occurred to land owned by Marshall Nuckolls in 1988; and based on documentation submitted to the Division by Jaeco, Armbrust determined there had been more recent disturbances (Finding 9D), but those disturbances were unconfirmed by field examinations. As testified by Armbrust, "The lines on the map [attached to the NOV] aren't accurate to what's out there ... The maps that they've [Jaeco] submitted to us are apparently wrong".
22. Jeff Major, President of Jaeco, conceded in testimony that the NOV and notice of violation #N81024-S-00118 described different geographical areas. He testified, however, that Jaeco had been given permission by the Division, or by the design of the (inaccurate) map described in Finding 21, to mine within the area on the south side of the permit (Finding 9A) and within the area east of bond segment H (Finding (E). He disputed the allegation that Jaeco had disturbed the Marshall Nuckolls property (Finding (D)) or that Jaeco had disturbed the areas east and west of the northern portion of bond segment Y (Finding 9C) in a manner which violated Indiana SMCRA. With respect to other areas described in the NOV as having been wrongfully mined, Major argued those apparent violations resulted from misinterpretations of "the original bond map that was pretty much forced on me [by the Division] on October 28. I bonded under protest."
23. Charles Armbrust testified that "as far as I know" the disturbed areas which were the subject of the NOV had already been disturbed in October 1988. "They weren't cited [in notice of violation #N81024-S-00118] because...on 10-24 we had a 100-foot tape and a compass. We didn't, we couldn't, in fact, do the whole permit area ... That's why we decided to require them [Jaeco] to survey it. So they would find those areas that we didn't.
24. Jeff Major also testified that disturbance of the areas at issue in the NOV did not take place after October 1988. Except for limited exploratory drilling, he testified Jaeco was not operating in these areas.
25. The preponderance of the evidence indicates that the NOV and notice of violation #81024-S-00118 were both issued for mining off the bonded or permitted areas of the permit but were for different geographical areas.
26. The preponderance of the evidence indicates that Jaeco conducted surface coal mining operations without being properly permitted or without being properly bonded under 310 IAC 12-3-2(a), 310 IAC 12-3-3, and 310 12-4-5 for the following areas cited in the NOV:
(A) on the south side of the permit area (Finding 9A);
(B) east of bond segments A, C, 0, M, and S (Finding 9B);
(C)east
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and west of the northern portion of bond segment Y (Finding C); and
(D) west of the eastern portion of bond segment S (Finding 9F).
27. Specifically with respect to the south side of the permit area (Finding 9C), the apparent incongruity between the location of the road, as depicted on the map, and the location of the road, in fact, results from inaccuracies in a map or maps submitted to the Division by Jaeco. A company which engages in surface coal mining, under Indiana SMCRA is responsible for properly permitting and bonding disturbed areas, including providing for the submission of accurate maps and documentation; and to excuse Jaeco from mining south of the permit because the company provided an inaccurate map to the Division would be an unwarranted windfall.
28. The Division has not sustained the burden of going forward and the burden of persuasion with respect to the following areas cited in the NOV:
(A) the southwest corner of the Marshall Nuckolls property; and
(B) east of bond segment H.
29. Even so, whether the NOV and notice of violation #N81024-S-00118 result from the same action requires a consideration of the nature of a notice of violation.
30. A "notice of violation" under Indiana SMCRA is a written document which contains a detailed description of each violation, which fixes a reasonable time not in excess of ninety (90) days for abatement of the violation, and which provides an opportunity 'or review under IC 4-21.5. IC 134.1-11-4.
31." 'Violation' ... embraces not only acts of omission, but of commission, in failing to do the things which are provided shall be done, and in doing things which it is declared shall not be done..." Princeton Coal, etc., Co. v. Lawrence (1911), 176 Ind. 469, 478, 95 N.E. 423,426. A similar interpretation was applied in Chieftain Coal Co., Inc. v. DNR, 4 CADDNAR 48,50.
32. The activities by Jaeco which constituted the subject of the NOV and notice of violation #N81024-S-00118 were essentially the same and occurred at the same time. Those activities were mining outside the area which had been permitted and bonded.
33. The Division was precluded by the absence of precise permit and bond segment boundaries from including the areas described in the NOV (Finding 9) in notice of violation #N81024-S-00118. If Jaeco had provided the Division with accurate maps and documentation, this absence of precision would not have occurred.
34. The issuance of notice of violation #N81024-S-00118 cannot properly serve as a bar to the issuance of the NOV within the facts of this proceeding because to do so would benefit Jaeco for its own inaccuracies and inadequacies.
35. On the other hand, the NOV and notice of violation #N81024-S00118 apply to the same action-- a failure by Jaeco in October 1988 to have properly bonded and permitted all areas where surface coal mining activities were conducted. The areas described in the NOV which are described in Finding 26 are supplemental to (and tend to aggravate the seriousness of) the violation by Jaeco. The actions are not, however, different violations.
36. The areas described in Finding 26 should be considered as supplemental to notice of violation #N81024-S-00118, and not as a separate violation, in any penalty determination (including the assessment of points) which might be derived from issuance of the NOV.
37. The preponderance of the evidence does not support the contention that the Director, through an authorized representative, gave Jaeco permission to mine the areas described in Finding 26.
FOOTNOTES
i. The administrative adjudication act (IC 4-21.5) does not identify what are affirmative defenses. Where not inconsistent with IC 4-21.5 and 310 IAC 0.6, a provision of the Indiana Rules of Trial Procedure may be applied. 310 IAC 0.6-1-10. Trial Rule 8(c) lists estoppel as an affirmative defense. A similar result was reached by the Department in Kuss v. DNR, 5 CADDNAR 51,54.
ii. Use of an affirmative defense, such as estoppel, to prosecute an action (i.e., as a "sword") is uncommon but not unprecedented. Watson Rural Water v. Ind. Cities Water (1989), Ind. App., 540 N.E.2d 131.