[CITE: Murphy and Easton v. DNR, 5 CADDNAR 108 (1990)]
[VOLUME 5, PAGE 108]
Cause #: 89-098G
Caption: Murphy and Easton
v. DNR
Administrative Law Judge: Rider
Attorneys: Newhouse; Zlatos, DAG
Date: March 7, 1990
ORDER
Based on the findings of fact, the following order is approved and adopted by the Natural Resources Commission:
1. Permit 48524 expired on May 17, 1989.
2. Permittees are ordered to plug and abandon the well at permit 48524 by May 1, 1990 or bond will be forfeited.
3. Permittees
are assessed a civil penalty of $5,000.
FINDINGS OF FACT
1. On June 1, 1989 and again on June 7, 1989, Esther Murphy and Gladys Easton (the "Claimants") filed requests for review of a Notice of Violation (NOV) dated May 30, 1989 and an Emergency Order signed by the Director on May 25, 1989, in regard to permit 48524.
2. At the prehearing conference on July 13, 1989, Sam Murphy held himself out to be a Claimant but at the hearing the evidence showed that he was not named as a permittee on the most recent permit application, but was listed as the drilling contractor.
3. At the prehearing conference the counsel for the Claimants presented no defense to the enforcement actions in question here and indicated only a desire to "clean them up" and re-permit the well. Such an agreement was tentatively reached but never consummated due to the refusal of the Claimants to follow through.
4. The Claimants refused to follow through due to the filing of bankruptcy by the Murphys. The Claimants believed that Federal Bankruptcy Code section 362 would stay this action.
5. The Claimant's belief was incorrect as section 362 would not stay the enforcement actions at bar here.
6. IC 4-21.5, IC 13-4, IC 13-8, 310 IAC 0.6 and 310 IAC 7 apply to this proceeding.
7. The Natural Resources Commission (the "Commission") is an agency as defined in IC 4-21.5-1-3. The Commission is the ultimate authority for the Department with respect to this proceeding.
8. Upon Claimant's refusal to follow through with the settlement agreement and subsequent request for a hearing, three issues were presented:
(a) Federal Bankruptcy Code section 362 precluded the action of bar,
(b) the Department cannot prove that Claimants have contaminated groundwater, and
(c) the Department has no proof that gas is escaping into the environment.
9. Prior to the hearing, counsel for the Claimants relented as to issue a. above and the hearing was convened to consider the other questions.
10. At hearing, it became clear that issue b above need not be proven to justify either of the enforcement actions here.
11. Inspector Virgil Lowe testified that the well in question here has been leaking gas into the atmosphere since at least May 1988; and a previous NOV was issued to that problem in August 1988, review of which was not taken.
12. In regard to permit 48524, the issue date was May 17, 1988 and, since this was an old well drilled deeper permit (OWDD), the permittee had one year to properly complete the "drill deeper" and to operate the well (IC 138-5-11).
13. Evidence shows that the well is not completed or operating; and therefore permit #48524 expired on May 17, 1988.
14. Once the permit expired, the permittee is required to plug and abandon the well under 310 IAC 7-1-33.
15. It is clear from the testimony that Mr. Murphy, who purported to be a permittee and to speak for the other permittees, refused to remedy the problems at the well even though given repeated opportunities to do so by the inspector (Mr. Lowe).
16. The issuance of the NOV in question here was a last resort and was designed to force the permittees to plug and abandon the well.
17. The emergency order signed by the Director was issued to terminate a situation where the permittees had an unpermitted well (expired permit) which was improperly constructed, thereby causing waste to take place and the permittees refused to pursue remedies prescribed by law.
18. Mr. Murphy claimed he may not have received the
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various mailings of NOV, etc. Since he is not a permittee he would not be on the mailing list.
19. Evidence shows that the Division of Oil & Gas did, in all cases, mail all proper notices to permittees Gladys Easton and Esther Murphy at the address furnished with the permit application.
20. The NOV here was properly issued to plug and abandon a well with an expired permit.
21. The Emergency order was
properly issued to terminate waste of a natural resource where the driller
refused to take action on his own.