[CITE: Chieftain Coal Co. Inc. v. DNR, DOR, 4
CADDNAR 48 (1987)]
[VOLUME 4, PAGE 48]
Cause #: 87-015R
Caption: Chieftain Coal Co.
Inc. v. DNR, DOR
Administrative Law Judge: Lucas
Attorneys: Runnells; Szostek, DAG
Date: October 16, 1987
ORDER
[NOTE: THE ORDER IN THIS
PROCEEDING WAS UPHELD ON JUDICIAL REVIEW BY THE GREENE CIRCUIT COURT IN CAUSE
NO. 28CO1-8712-CP-503. A COPY OF THE ORDER, WHICH DENIED CHIEFTAIN'S REQUEST
FOR SUMMARY JUDGMENT, FOLLOWS THE ADMINISTRATIVE "FINDINGS OF FACT."]
Cessation
Order #C70130-P-00016 is affirmed.
FINDINGS OF FACT
1.
The Department of Natural Resources (the "Department") is an agency
as the term is defined under IC 4-22-1. The Director of the Department (the
"Director") is the ultimate authority for the Department with respect
to the subject matter of this administrative action.
2.
The Director may delegate any or all powers and duties assigned to him under IC
13-4.1 to other employees of the Department in accordance with IC 13-4.1-2-2
(c).
3.
Chieftain Coal Co., Inc. ("Chieftain") holds permit number P-100016
issued by the Department. The permit is for the processing of coal rather than
the mining of coal. The permit is subject to IC 13-4.1 ("Indiana
SMCRA".)
4.
The area permitted under P-100016 had been previously mined.
5.
Chieftain ran a processing operation on the permitted area until November 1985,
when all operations ceased. There has been no processing since that time.
6.
In October 1986, the processing equipment was sold, and most of it has been
removed from the site. The equipment that remains on site is not owned by
Chieftain.
7.
During the fall of 1986, six notices of violation were issued to Chieftain by
the Department.
8.
During December 1986, II & K. Company, Inc. ("II & K"), the
owner of the land covered by the Chieftain permit, applied to the Department
for a transfer of the permit from Chieftain to II & K. Chieftain consented
to the transfer of the permit.
9.
The Permit Section of the Reclamation Division of the Department reviewed the
materials submitted by II & K requesting further information necessary to complete
evaluation of the permit transfer application.
10.
On January 30, 1987, cessation order C70130-P-00016, in six parts, (the
"Cessation Order") was written by the Department for failure to abate
the Notices of Violation referenced by finding 7.
11.
The Cessation Order ordered Chieftain to “CEASE OPERATIONS IMMEDIATELY”
as described on the pages attached, AND complete the corrective actions as
described within the time allowed." [Emphasis is as set forth in the
Cessation Order.]
12.
The corrective actions referenced in Finding 11 were described on the attached
pages of the Cessation Order with respect to each of the six enumerated
violations. In each instance, the operation required "to be ceased"
was to "cease all activities except those necessary to abate the
violation." The natures of the six violations were described as follows:
(A) failure to abate NOV #N60919P-00016 for failure to backfill
and grade open pits and spoil ridges that have exceeded the 180-day limit;
(B) failure to abate NOV #N61010P-00016 for failure to clearly
mark the perimeter of the permitted area;
(C)
Failure to abate NOV #N61010P-00016 for failure to construct a siltation
structure in all appropriate locations before beginning any surface mining
activities in the drainage to be affected;
(D) failure to abate NOV #N61010P-00016 for failure to dispose
of all noncoal wastes in a controlled manner in a
designated portion of the permitted area;
(E) failure to abate NOV #N61010P-00016 for failure to maintain
a permit which contains a valid certificate of liability insurance; and
(F) failure to abate NOV #N61114P-00016 for failure to maintain
all dams or embankments during the mining operations and to prevent short
circuiting to the extent possible.
13.
Chieftain made no effort to abate the Notices of Violation referenced in
Finding 7.
14.
Chieftain did not file for administrative review from any of the Notices of
Violation referenced in Finding 7.[FOOTNOTE 1]
15.
Chieftain made no effort to abate the Cessation Order.
16.
Pursuant to IC 13-4.1-11-5 (c), a Cessation Order is ordinarily effective for
30 days after actual notice of the order is sent to the permittee.
17.
The Cessation Order has completed the 30-day period of effectiveness provided
under IC 13-4.1-11-5 (c). The Cessation Order has run its course, and no other
has been written.
18.
II & K has not supplied all of the information requested by the Division of
Reclamation in the January letter described in Finding 9 and in subsequent
meetings between the Division of Reclamation and II & K. Submission of the
information is required by the Division before the permit transfer application
can be completed. Chieftain is not responsible for submission of that
information.
19.
The Department has not formally rejected the transfer application of II &
K.
20.
There is no disputed issue of a material fact in this administrative action.
21.
The disputed issues in this administrative action are matters of law. Notably, the
parties dispute the nature and function of a Cessation Order. 22. IC
13-4.1-11-5(a) is the statutory subsection which most directly addresses the
nature and function of Cessation Order. That subsection provides:
(a)
If the. . .inspector determines that:
(1) any condition or practice exists or a violation of this
article or the commission's rules has occurred which creates an immediate
danger
[VOLUME 4, PAGE 49]
to the health or safety of the
public or is reasonably expected to cause significant, imminent environmental
harm to land, air, or water resources; or
(2) the permittee has not abated the
violation within the time set pursuant to section 4 of this chapter; he shall
order the cessation or surface coal mining and reclamation operations of the
portion thereof relevant to the condition, practice, or violation. In the order
of cessation, the [D]irector shall determine the
steps necessary to abate the violation in the most expeditious manner.
23.
IC 13-4.1-11-5 (a) requires the issuance of a Cessation Order in either of two
circumstances. Under subpart (a)(1), a Cessation Order
is issued where there is some immediate threat to the environment or to public
health and safety. Under subpart (a)(2), a Cessation
Order is issued where a notice of violation was issued, and the Notice of
Violation was not abated within the period set forth in the Notice of
Violation. In both circumstances, the Cessation Order is directed toward the
portion of the surface coal mining and reclamation operations which are
relevant to the condition, practice or violation described in the order.
Additionally, the Director is required to specify in a Cessation Order the
steps needed to abate the violation.
24.
The circumstances under which the Department seeks to issue the Cessation Order
is that contemplated by IC 13-4.1-11-5 (a)(2). The
Cessation Order references a failure by Chieftain to abate six notices of
violation. There is no allegation of an immediate threat to the environment or
to health and safety as contemplated by IC 13-4.1-11-5 (a)(1).
25.
The Department provides by rule in 310 IAC 12-6-5 (b)(1):
(b)(1)
When, on the basis of an inspection, an authorized representative of the [D]irector for good cause shown and upon written findings
finds that a notice of violation has been issued under 310 IAC 12-6-6 (a) and
the person to whom it was issued fails to abate the violation within the
abatement period fixed or subsequently extended by the authorized
representative, he or she shall immediately order a cessation of the portion of
the surface mining operations relevant to the violation. This rule subpart is
derived from IC 13-4.1-11-5 (and particularly subpart (a)(2)
of the statutory section.)
26.
The federal counterpart to IC 13-4.1-11-5 (a) and 310 IAC 12-6-5 (b)(1) is
found in the Surface Mining Control and Reclamation Act of 1977 (Public Law
95-87) at 30 U.S.C. 1271 (a)(3), second paragraph, which provides in pertinent
part: If, upon expiration of the period of time as originally fixed or
subsequently extended, for good cause shown and upon the written findings of
the Secretary or his authorized representative, the Secretary or his authorized
representative finds that the violation has not been abated, he shall
immediately order a cessation of surface coal mining and reclamation operations
or the portion thereof as relevant to the violation. . .
27.
There is no written legislative history for Indiana SMCRA.
28.
The legislative history for the federal version of SMCRA addresses Cessation
Orders briefly. The portion of the legislative history addressing Cessation
Orders (which are issued following a Notice of Violation) states in pertinent
part as follows: Where. . .a Federal Inspector determines that a permittee is violating the act or his permit but that the
violation is not causing imminent environmental h arm, then the inspector must
issue a Notice [of Violation] to the permittee
setting a time within the established time, the inspector must immediately
order a cessation of the mining operation relevant to the violation. . .
.[This] enforcement mechanism will be utilized by the inspector in the great
majority of compliance problems. It not only enables the inspector to gain
immediate control of the problem, but also provides him with essential
flexibility to appropriately deal with minor as well as major violations. [See
1977 U.S. Code Cong. And Admin. News
593, 662, quoting from H.R. 95-218, p. 130. Emphasis is added.]
29.
The language of the state statute and rule, read in light of the federal statute
and U.S.
[VOLUME 4, PAGE 50]
Congressional
History, makes clear that an inspector must issue a
notice of violation or a cessation order when a violation is observed at a site
which is subject to Indiana SMCRA. If there is an immediate threat to the
environment or to the public health and safety, a cessation order must be
issued.
30.
If a notice of violation is issued, and if the violation is not abated or
appealed in a timely fashion, an inspector must issue a cessation order with
respect to that Notice of Violation. This result follows the unambiguous
language of IC 13-4.1-11-5 (a) (2) and 310 IAC 12-6-5 (b)(1).
The same result is supported by 30 U.S.C. 1271 (a)(3)
and its legislative history.
31.
"Cessation Order" is the particular phraseology used in Indiana
SMCRA, but is very similar or identical to what is generically called a
"Cease and Desist Order."
32.
A "Cease and Desist Order is an order of an administrative agency
prohibiting an individual from continuing a course of conduct which violates a
statute or a rule." [People
v. Fremont Energy Corp., Wyo., 651 P. 2d 802, 805 (1982).] A
Cessation Order may be similarly defined.
33.
A course of conduct which violates a statute or a rule may consist of
malfeasance or (where there is an affirmative duty to act) of nonfeasance.
34.
Chieftain had an affirmative duty to act with respect to the permitted area as
specified in the six unchallenged notices of violation. Chieftain did not act.
35.
The Cessation Order is properly directed to the nonfeasance by Chieftain. That
nonfeasance is a course of conduct which violates a statute (IC 13-4.1) and a
rule (310 IAC 12.)
36.
Issuance of the Cessation Order is mandated by IC 13-4.1-11-5 (a) (2) and 310
IAC 12-6-5 (b) (1). Even if the Cessation Order were not so mandated, a
rational basis exists for its issuance resulting from the wrongful nonfeasance
by Chieftain.
37.
The proposed transfer of permit number P-100016 from Chieftain to II & K is
irrelevant. Chieftain is responsible for compliance with all statutory,
regulatory and permitting requirements before a transfer is completed. 38.
Cessation Order #C70130-P-00016 should be affirmed.
FOOTNOTE
1.
There is no direct evidence in the record concerning whether Chieftain sought
administrative review from the six notices of violation. Counsel for the
Department, however, states in the Brief of Respondent that Chieftain did not
seek administrative review. Counsel for Chieftain does not subsequently refute
his statement. Generally, if a notice of violation is not challenged, the
notice of violation is presumed to have been properly issued during an action
which challenges the resulting cessation order. [Jaeco, Inc. v. Department, 3 Caddnar 52
(January 16, 1986)] an exception is recognized where there is an ambiguity as
to the action required for abatement in the notice of violation and where an
operator makes a colorable effort at compliance with the required abatement
action. [Otto Rone
v. Department, 3 Caddnar 3 (September 24, 1985)]
The evidence in the instant administrative action does not disclose either that
an ambiguity existed of that Chieftain made any effort to abate any of the six
Notices of Violation.
_______________________________________________________________
[NOTE: CADDNAR citation does not apply to the court entry below.]
ON AUGUST 11, 1988, THE
GREENE CIRCUIT COURT MADE THE FOLLOWING ENTRY: (PREAMBLE OMITTED)
FINDINGS
1.
Plaintiff Chieftain Coal Company, Inc. (Chieftain) applied for and was granted surface
coal mining permit P-00016 [permit] by Defendant Indiana Department of Natural
Resources [hereinafter DNR] for its Keller Pit #1 in Vigo County.
2.
All surface coal mine operators in Indiana must mine and reclaim in accordance
with the Indiana statutes, found at IC 13-4.1 et seq., and Administrative
rules, found at 310 IAC 12 et seq.
3.
IC 13-4.1, Secs. 11-4 through 11-6, contain the
provisions dictating the enforcement mechanisms for violations of the
environmental performance standards found at IC 13-4.1-8-1 et seq., and 310 IAC 12-5 et seq.
4.
The use of these enforcement mechanisms by DNR is mandatory; in IC 13-4.1, Secs. 11-4 through 11-6, the word "shall" is
used. Under Sec. 11-4, the permittee is charged with
violating a statutory or regulatory performance standard by a Notice of
Violation. A specific action to be taken to abate the violation and a time
limit for compliance are contained in the Notice.
5.
IC 13-4.1-11-5 (a) requires the state to issue a Cessation Order when it is
determined that a permittee has not abated a
violation within the time set in the Notice of Violation.[FOOTNOTE 1]
6.
During the fall of 1986, DNR's field compliance inspectors issued six Notices of
Violation to Chieftain for six separate violations of various sections of 310
IAC 12 and Permit P-00016. Chieftain did not file for administrative review on
any of these violations and has stipulated that it made no effort to abate the
Notices of Violations.
7. A
DNR compliance inspector then issued, pursuant to the requirements of IC
13-4.1-11-5 (a), a six-part Cessation Order to Chieftain on January 30, 1987,
which encompassed the six Notices of Violation.
8.
Chieftain filed for an administrative review of the Cessation Order pursuant to
IC 13-4.1-11-8. The parties filed stipulations and briefs in lieu of an
administrative hearing.
9.
On November 24, 1987, the Director of DNR issued the "Final Order of the
Director of the Department of Natural Resources" as the final
administrative action in the administrative review of the Cessation Order. The
Director adopted the October 16, 1987, "Report, Proposed Findings of Fact
and Recommended Order of the Administrative Law Judge," upholding the
issuance of the Cessation Order.
10.
Chieftain sought Judicial Review of the Director's Final Order in this action.
CONCLUSIONS
1.
Surface coal mining is an extensively regulated industry on both the federal
and state level. Surface mining operations present potentially severe
degradation to the environment if reclamation is not performed properly and
quickly.[FOOTNOTE 2]
2. All
persons[FOOTNOTE 3] engaging in surface coal
mining operations[FOOTNOTE 4] in
Indiana must comply with the provisions of the Indiana Surface Coal Mining and
Reclamation Law, IND. CODE 13-4.1 et seq.
And its implementing regulations found at 310 IAC 12 et seq. Included[FOOTNOTE 5] in
these provisions are extensive performance standards for the mining and
reclamation of the permitted area. These performance standards are primarily to
protect society and the environment from the adverse impacts of surface coal
mining operations.[FOOTNOTE 6] Under IC 13-4.1, Secs. 11-4 and 11-5, DNR is mandated to issue a Notice of
Violation if a violation of IC 13-4.1 et
seq. Or 310 IAC 12 et seq. Occurs and is mandated to issue a Cessation
Order if the violation is not corrected within the time frame set forth in the
Notice of Violation. Under IC 13-4.1-11-5 (a) (2). DNR
must determine the steps necessary to abate the violation in the most
expeditious manner.
[3. Editor Notation: A review of the records on
microfilm did not reveal omitted information.]
4.
Notices of Violation and Cessation Orders are the statutory enforcement
mechanisms used to formal charge a permittee with
violation(s). Under IC 13-4.1-11-8 a permittee may
seek administrative review of a Notice of Violation or Cessation Order,
including temporary relief, from complying with the required abatement actions.
Chieftain did not seek administrative review or temporary relief from the
Notice of Violation. Chieftain made no effort to abate the violations.
5.
The purpose for issuing a Notice of Violation and/or a Cessation Order are to charge an operation with violating the law and to
require the abatement of the violation in the most expeditious manner. The
clear intent of this process is to protect the environment.
6. A
permittee knows when it applies for and receives a
permit that it will have to follow the above performance standards. It would be
against public policy to allow a permittee to escape its
responsibilities to meet these performance standards and to inflict
environmental harm and costs upon the general public merely by abandoning the
site.
7. A
Cessation Order is a document charging operators with failing to abate
violations of the law for which they have already been charged. See Finding 6, supra. Although a Cessation Order
requires that a permittee cease all operations until
a violation is corrected, it is not rendered null because a permittee
has abandoned the site. A permittee may not abandon
its responsibilities under the law.
8.
An examination by the court of the record in this cause, including the record
of the administrative proceedings, Chieftain's Motion for Summary Judgment,
DNR's Brief against Summary Judgment and the oral argument of the party's
counsels lead this Court to conclude that the Cessation Order in question was
properly issued.
9.
Based upon the record in front of the Court, Chieftain's Motion for Summary
Judgment must be denied.
FOOTNOTES
1.
IC 13-4.1-11-5 (a) states: "If the Director or inspector determines that:
. . .(2) the permittee has not abated the violation
within the time set pursuant to section 4; he shall order the cessation of
surface coal mining and reclamation operations of the portion thereof relevant
to the condition, practice, or violation. In the order of cessation, the
director shall determine the steps necessary to abate the violation in the most
expeditious manner."
2. IC 13-4.1-1-2 lists the purposes of Indiana's Surface Coal Mining and
Reclamation statute. Protection of the environment and the public interest is
cited in the three separate purposes: Sec. 2.(2)- "Establish a statewide
program to protect society and the environment from the adverse effects of
surface coal mining operations"; Sec. 2(3) "Assure that surface coal
mining operations are so conducted as to protect the environment"; and
Sec. 2(10) "Whenever necessary, exercise the full reach of state
constitutional powers to insure the protection of the public interest through effective
control of surface coal mining operations."
3. See IC 13-4.1-1-3(9).
4. See IC 13-4.1-1-3(12).
5. See IC 13-4.1-8-1, et seq. and 310
IAC 12-5, et seq.
6. See IC 13-4.1-1-2(2).