United States v. Brace

Opinions of the United
1994 Decisions States Court of Appeals
for the Third Circuit
11-22-1994
United States v. Brace
Precedential or Non-Precedential:
Docket 94-3076
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UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
_______________
No. 94-3076
_______________
UNITED STATES OF AMERICA,
Appellant
v.
ROBERT BRACE;
ROBERT BRACE FARMS,
a Pennsylvania Corporation
_______________
On Appeal from the United States District Court
for the Western District of Pennsylvania
(D.C. Civil No. 90-cv-00229E)
_______________
Argued September 19, 1994
Before: BECKER and COWEN, Circuit Judges
and POLLAK*, District Judge
(Filed: November 22, 1994)
_______________
Bonnie R. Schlueter
Office of United States Attorney
633 United States Post Office & Courthouse
Pittsburgh, PA 15219
William B. Lazarus (argued)
United States Department of Justice
P.O. Box 23795
L'Enfant Plaza Station
Washington, DC 20026
COUNSEL FOR APPELLANT
UNITED STATES OF AMERICA
*Honorable Louis H. Pollak, United States District Judge for the
Eastern District of Pennsylvania, sitting by designation.
Samuel W. Braver
Henry McC. Ingram (argued)
Buchanan Ingersoll Professional Corporation
600 Grant Street
58th Floor
Pittsburgh, PA 15219
John D. Ward
Buchanan Ingersoll
30 North Third Street
Vartan Parc, 8th Floor
Harrisburg, PA 17101-2023
COUNSEL FOR APPELLEES
ROBERT BRACE;
ROBERT BRACE FARMS,
a Pennsylvania Corporation
_______________
OPINION OF THE COURT
_______________
COWEN, Circuit Judge.
The United States brought this action in the United States
District Court for the Western District of Pennsylvania against
Robert Brace, individually, and Robert Brace Farms, Inc., a
Pennsylvania corporation (collectively, "Brace" or "defendants"),
alleging violations of the requirement in Section 404 of the
Clean Water Act ("CWA"), 33 U.S.C. § 1344, that a permit be
obtained for the discharge of dredged or fill material into
waters of the United States. The United States sought
restoration of the site, a permanent injunction and civil
penalties pursuant to 33 U.S.C. § 1319(d).
The district court bifurcated the action: a trial on
liability issues and a trial on remedy issues. Shortly before
the liability trial, Brace stipulated that at the time of the
discharges, "the approximately thirty-acre site that is the
subject of this lawsuit was wetlands as defined at 33 C.F.R. §
328.3(b) and 40 C.F.R. § 232.2(r)." Pre-Trial Stipulation (Dec.
16, 1993); Appendix ("App.") at 40.
The United States, either by stipulation or at trial,
established the five elements of a prima facie case for
violations of Section 404 of the CWA: (1) defendants admitted
that they are "persons" within the meaning of the CWA; (2)
defendants admitted that the activities at the site were
conducted without a permit; (3) defendants stipulated that the
site was a wetland at the time of the discharges; (4) the
district court held that the site constituted waters of the
United States at the time of defendants' activities; and (5) the
district court held that defendant's clearing, mulching,
churning, and levelling of the formerly wooded and vegetated site
constituted a discharge of pollutants into the waters of the
United States and that defendants paid for excavation and
installation of drainage tubing in an effort to drain the site.
Brace asserted, and the district court held, that the
discharges were exempt from the permit requirement under Section
404(f)(1). The court concluded that: (1) Brace's activities on
the wetland constituted "normal farming activities" exempt under
Section 404(f)(1)(A); and (2) Brace's activities constituted
"upland soil and water conservation practices" also exempt under
that same provision of the CWA. United States v. Brace, C.A. No.
90-229 (W.D. Pa. Dec. 16, 1993), slip op. at 22-23. In addition,
the court found that Brace's conduct in "preserving and regularly
cleaning the existing drainage system on the site" was exempt
from the permit requirement as "maintenance of the drainage
system" under Section 404(f)(1)(C). Id. at 23. The court also
held that the recapture provision of Section 404(f)(2) does not
apply to this case because "[t]he land is not being converted to
a use to which it was not previously subject, nor has significant
impairment to the reach or flow of waters been proven." Id. at
22.
The district court entered judgment in defendants' favor.
We hold that the district court incorrectly applied the
requirements of the CWA permit exemption provisions. We will
reverse the order of the district court and remand the case to
determine the appropriate remedy.
I.
Brace is a farmer who owns approximately 600 acres of real
property in Erie County, Pennsylvania, including the subject
thirty-acre wetland site ("the site"). Brace Farms, Inc. is a
Pennsylvania corporation engaged principally in the farming
business. Brace's parents and other family members have always
earned their principal livelihood from farming activities. Brace
purchased a parcel of farm property from his father in 1975. A
portion of that property contains the site. The property has
been in the Brace family since the 1930's when Brace's
grandfather farmed the land. Prior to 1975, Brace's father used
the site for pasturing of cows and horses, and Brace's brother
used the site for pasturing cows until 1976.
Brace purchased the property from his father with the intent
of continuing and improving his father's established farming
operation. It was Brace's intention to integrate the various
portions of the property into an overall operation for an
effective and productive farming business. At the time Brace
purchased the property containing the site from his father, the
site was vegetated with areas of scrub brush, including red brush
and briars.
In 1977, Brace sought the advice and assistance of the
Agricultural Stabilization and Conservation Service ("ASCS") as
part of his plan to develop an integrated farming operation on
the property that includes the site. The ASCS is "an agency of
the United States Department of Agriculture which is generally
responsible for administering commodity production adjustment and
certain conservation programs of the Department." 7 C.F.R. §
12.2(a)(2) (1994). Brace's father had previously worked with the
ASCS to prepare a drainage plan relating to the site for the
purpose of farming the entire property. At the time he purchased
the property from his father, Brace obtained and utilized the
soil and conservation plans that had been prepared for his father
by the ASCS. The drainage system impacts the ability to produce
crops on all parts of Brace's property.
The existing drainage system was in poor condition and not
yet complete at the time of Brace's acquisition. Brace began
cleaning the system in 1976 in order to improve upon the existing
system and make it effective for agricultural development. In
the following years, Brace maintained and improved the drainage
system pursuant to the plan recommended by the ASCS. From 1977
to 1985 the ASCS periodically visited the site and provided
technical assistance and cost-sharing arrangements to Brace.
As of 1977, the essential portions of Brace's improvements
to the existing drainage system were intact and operating.
Brace's work in improving upon the interconnected drainage system
progressed continuously from 1977 to 1987, as time, funds and
equipment were available. If the necessary funds had been
available to him in 1977, Brace would have expedited his farming
plans and completed the project at that time. As a result of
Brace's efforts, by the end of 1979 the site was dry, with the
exception of times of excessive rainfall.
Brace cleared, mulched, churned, levelled, and drained the
formerly wooded and vegetated site from 1985 through 1987. In
1986 and 1987, Brace paid for excavation in the site and the
burying of plastic tubing or "drainage tile" in an effort to
drain the site. Throughout the 1980's, Brace used appropriate
equipment to remove unconsolidated soil, pebbles, silt, and
growth which were impeding water flow. Farmers in the area
typically engaged in such practices.
As a result of Brace's levelling, spreading, and tiling,
Brace began to grow crops on the site in 1986 and 1987. Brace
did not have a permit issued pursuant to Section 404 of the CWA
authorizing his activities.
The United States became aware of Brace's activities in
1987. During 1987 and 1988, the United States issued three
orders to Brace, directing him, inter alia, to refrain from
further disturbing the site, so that it could naturally
revegetate with indigenous plant species. After the issuance of
these orders, Brace continued to mow vegetation on the site. In
October of 1988, Brace received an administrative complaint in
connection with his farming activities on the site. Brace
requested a hearing to contest the complaint, believing that his
activities were exempt from any and all permit requirements.
Prior to the hearing, the complaint was dismissed.
In the summer of 1988, Brace approached the ASCS in order to
gain the status of "commenced conversion from wetlands" prior to
December 23, 1985 with respect to the site. The ASCS was
authorized to make such a determination under the Food Security
Act of 1985, 16 U.S.C. §§ 3801, et seq. This Act contains a
provision, referred to as the "Swampbuster," which denies certain
Department of Agriculture benefits to farmers who produce an
"agricultural commodity on converted wetland," unless such
conversion commenced before December 23, 1985. 16 U.S.C. §§
3821, 3822 (1988 & Supp. V 1993).
The ASCS granted the status to the site, finding that
Brace's on-going farming activities had commenced prior to
December of 1985, which would enable Brace to complete conversion
and produce an agricultural commodity without losing USDA
benefits. Letter from Erie County ASCS Office to Robert Brace
(9/21/88); App. at 172. However, the ASCS expressly noted that
"[t]he granting of a commencement . . . request does not remove
other legal requirements that may be required under State or
Federal water laws." USDA Form; App. at 173.
In April 1990, as a cautionary measure, Brace approached the
Army Corps of Engineers ("COE") in an effort to obtain an after-
the-fact permit to conduct his farming activities on the site,
despite his belief that the activities were exempt from the
permit requirements of the CWA. The United States Environmental
Protection Agency ("EPA") requested that the COE not review an
application from Brace for an after-the-fact permit. Brace was
advised that because the matter was then in litigation, the
government would not act on his request for a permit. Since the
time of the cease and desist orders Brace has terminated farming
activity on the site except for routinely mowing the vegetation.
II.
The district court exercised its jurisdiction pursuant to 33
U.S.C. § 1319(b) (1988) and 28 U.S.C. §§ 1331, 1345, 1355 (1988 &
Supp. V 1993). Our jurisdiction rests on 28 U.S.C. § 1291(1988).
Presently, there are three issues before us. The first
issue is whether the district court erred in determining that
Brace's discharges of dredged and fill material into the wetland
were exempt from the permit requirement pursuant to Section
404(f)(1) of the CWA, 33 U.S.C. § 1344(f)(1). The second issue
is whether the district court erred in determining that Brace's
discharges were not "recaptured" by the permit requirement under
Section 404(f)(2) of the CWA, 33 U.S.C. § 1344(f)(2). We have
plenary review over the question of whether the district court
erroneously interpreted the meaning of the applicable statutes.
Moody v. Sec. Pac. Business Credit, Inc., 971 F.2d 1056, 1063 (3d
Cir. 1992); Manor Care, Inc. v. Yaskin, 950 F.2d 122, 124 (3d
Cir. 1991). To the extent that the court's ruling on these
issues was also premised on findings of fact, we review any such
findings under the clearly erroneous standard. Zenith Radio
Corp. v. Hazeltime Research, Inc., 395 U.S. 100, 108, 89 S. Ct.
1562, 1568 (1969); Sheet Metal Workers Int'l Ass'n Local 19 v.
2300 Group, Inc., 949 F.2d 1274, 1278 (3d Cir. 1991).
The third issue is whether the district court erred in
determining that Brace was not subject to liability for
violations of administrative orders. Our review of questions of
law such as this is plenary. Moody, 971 F.2d at 1063; Manor
Care, 950 F.2d at 124.
III.
The Clean Water Act was enacted to "restore and maintain the
chemical, physical, and biological integrity of the Nation's
waters." 33 U.S.C. § 1251(a) (1988). Section 301(a) of the CWA
prohibits the discharge of any pollutant into navigable waters of
the United States, unless the discharge is authorized by a
permit. 33 U.S.C. §§ 1311(a), 1362(12) (1988). We recognize
that:
The Act defines the operative terms of this prohibition
broadly. The term "pollutants" includes fill material
such as "dredged spoil, . . . rock, sand, [and] cellar
dirt," 33 U.S.C. § 1362(6), and "navigable waters"
means "the waters of the United States," id. §
1362(7). In so defining the term "navigable waters,"
Congress expressed a clear intent "to repudiate limits
that had been placed on federal regulations by earlier
water pollution control statutes and to exercise its
powers under the Commerce Clause to regulate at least
some waters that would not be deemed `navigable' under
the classical understanding of the term."
United States v. Pozsgai, 999 F.2d 719, 724 (3d Cir. 1993), cert.
denied, U.S. , 114 S. Ct. 1052 (1994) (citations omitted).
The district court found that Brace's clearing, churning,
mulching, levelling, grading, and landclearing of the formerly
wooded and vegetated site was a discharge of a dredged spoil,
biological material, rock and/or sand, each of which fits the
definition of pollutant. Brace, slip op. at 18.
Section 404 of the CWA authorizes the Secretary of the Army,
through the COE, to issue permits "for the discharge of dredged
or fill material into the navigable waters at specified disposal
sites." 33 U.S.C. § 1344(a) (1988). See also 33 C.F.R. § 323.1(1993). The permit program, as we recognized in Pozsgai, "is the
central enforcement tool of the Clean Water Act . . . .
Unpermitted discharge is the archetypical Clean Water Act
violation, and subjects the discharger to strict liability." 999
F.2d at 724-25.
The COE and EPA have issued regulations defining the term
"waters of the United States" to include "wetlands," among other
bodies of water:
(a) The term waters of the United States means
(1) All waters which are currently used, or were used
in the past, or may be susceptible to use in interstate
or foreign commerce, including all waters which are
subject to the ebb and flow of the tide; . . .
(3) All other waters such as intrastate lakes, rivers,
streams (including intermittent streams), . . .
wetlands, . . . the use, degradation or destruction of
which could effect interstate or foreign commerce . . .
(5) Tributaries of waters identified in paragraphs
(a)(1) through (4) of this section . . .
(7) Wetlands adjacent to waters (other than waters
that are themselves wetlands) identified in paragraphs
(a)(1) through (6) of this section.
33 C.F.R. § 328.3(a) (1993); 40 C.F.R. § 230.3(s) (1993)
(emphasis in original). The district court found that the site
constituted waters of the United States at the time of Brace's
activities. Brace, slip op. at 17. The term "wetlands" is
defined as:
those areas that are inundated or saturated by surface
or ground water at a frequency and duration sufficient
to support, and that under normal circumstances do
support, a prevalence of vegetation typically adapted
for life in saturated soil conditions. Wetlands
generally include swamps, marshes, bogs, and similar
areas.
33 C.F.R. § 328.3(b); 40 C.F.R. § 230.3(t). The parties have
stipulated that the site constituted wetlands at the time of
Brace's activities.
Exemptions to the general requirement for a Section 404
permit are contained in Section 404(f) of the CWA. Under Section
404(f)(1), a permit is not required for: (1) the discharge of
dredged or fill material "from normal farming, silviculture, and
ranching activities such a plowing, seeding, cultivating, minor
drainage, harvesting for the production of food, fiber, and
forest products, or upland soil and water conservation
practices," 33 U.S.C. § 1344(f)(1)(A); and (2) the discharge of
dredged or fill material "for the purpose of . . . the
maintenance of drainage ditches." 33 U.S.C. § 1344(f)(1)(C).
The COE and EPA have promulgated regulations which provide
that the "normal farming activities" exemption is available only
to discharge activities that are "part of an established (i.e.,
on-going) farming . . . operation," and expressly stipulate that
the exemption is not available either: (1) for "[a]ctivities
which bring an area into farming . . . use"; or (2) where
"modifications to the hydrological regime are necessary to resume
operations." 33 C.F.R. § 323.4(a)(1)(ii) (1993); 40 C.F.R. §
232.3(c)(1)(ii)(A), (B) (1993).
This provision further requires that, to be exempt from the
permit requirement, such activities "must be in accordance with
definitions in 33 C.F.R. § 323.4(a)(1)(iii)." 33 C.F.R. §
323.4(a)(1)(ii). The definitions in 33 C.F.R. § 323.4(a)(1)(iii)
provide that "the redistribution of surface materials by blading,
grading, or other means to fill in wetland areas is not plowing."
33 C.F.R. § 323.4(a)(1)(iii)(D); 40 C.F.R. § 232.3(d)(4). The
definitions also define "minor drainage" as meaning "[t]he
discharge of dredged or fill material incidental to connecting
upland drainage facilities to waters of the United States,
adequate to effect the removal of excess soil moisture from
upland croplands." 33 C.F.R. § 323.4(a)(1)(C)(1)(i); 40 C.F.R. §
232.3(d)(3)(i)(A). This latter definition is modified by 33
C.F.R. § 323.4(a)(1)(iii)(C)(2) and 40 C.F.R. § 232.3(d)(3)(ii),
which further provide that the term minor drainage "does not
include drainage associated with the immediate or gradual
conversion of a wetland to a non-wetland . . . , or conversion
from one wetland use to another."
The COE has also promulgated definitions concerning the
second exemption to the permit requirement, i.e. the exemption
for the maintenance of drainage ditches. The definitions provide
that the exemption from the permit requirement applies to
"maintenance (but not construction) of drainage ditches." 33
C.F.R. § 323.4(a)(3).
Even where Section 404(f)(1) exempts a discharge from the
permit requirement, the discharge may be "recaptured" by the
permit requirement under Section 404(f)(2):
Any discharge of dredged or fill material into the
navigable waters incidental to any activity having as
its purpose bringing an area of the navigable waters
into a use to which it was not previously subject,
where the flow or circulation of navigable waters may
be impaired or the reach of such waters be reduced,
shall be required to have a permit under this section.
33 U.S.C. § 1344(f)(2). The regulation governing the "recapture"
provision stipulates in part that "[a] conversion of a section
404 wetland to a non-wetland is a change in use of an area of
waters of the United States," 33 C.F.R. § 323.4(c), and states
as an example, that "a permit will be required for the conversion
of a cypress swamp to some other use . . . when there is a
discharge of dredged or fill material into waters of the United
Stated in conjunction with construction of . . . structures used
to effect such conversion." Id.Thus, to be exempt from the CWA permit requirement, a
defendant has the burden of demonstrating that proposed
activities both satisfy the requirements of Section 404(f)(1) and
avoid the recapture provision of Section 404(f)(2). United
States v. Akers, 785 F.2d 814, 819 (9th Cir.), cert. denied, 479
U.S. 828, 107 S. Ct. 107 (1986). See also United States v.
Cumberland Farms, 647 F. Supp. 1166, 1176 (D. Mass. 1986)
("[E]ven if [defendant] could establish that it is exempt from
the permit requirements under § 1344(f)(1), it must also
demonstrate that its activities avoid `recapture' under the
provisions of 33 U.S.C. § 1344(f)(2)."), aff'd, 826 F.2d 1151(1st Cir. 1987), cert. denied, 484 U.S. 1061, 108 S. Ct. 1016(1988). Read together, the two parts of Section 404(f) provide a
narrow exemption for agricultural activities that have little or
no adverse effect on the waters of the United States. Avoyelles
Sportsmen's League, Inc. v. Marsh, 715 F.2d 897, 926 (5th Cir.
1983). Congress intended this narrow exemption. As Senator
Muskie, one of the primary sponsors of the CWA, explained:
New subsection 404(f) provides that Federal permits
will not be required for those narrowly defined
activities that cause little or no adverse effects
either individually or cumulatively. While it is
understood that some of these activities may
necessarily result in incidental filling and minor harm
to aquatic resources, the exemptions do not apply to
discharges that convert extensive areas of water into
dry land or impede circulation or reduce the reach or
size of the water body.
3 A Legislative History of the Clean Water Act of 1977: A
Continuation of the Legislative History of the Water Pollution
Control Act, at 474 (1978).
IV.
The district court held that Brace's activities on the
thirty-acre wetland site were exempt from Section 404's permit
requirement "because they constitute: (a) normal farming
activities; (b) upland soil and water conservation practices; and
(c) maintenance of drainage ditches." Brace, slip op. at 22. We
find that the district court's determination is erroneous as a
matter of law.
The district court's conclusion that Brace's discharges on
the thirty-acre site constituted "normal farming activities"
which are exempt from Section 404's permit requirement cannot be
reconciled with the statute, the applicable regulations, and case
law governing the "normal farming activities" exemption. As we
described above, Section 404(f) of the CWA provides exemptions to
the general permit requirement, including the discharge of
dredged or fill material without a permit in connection with
"normal farming . . . activities such as plowing, seeding,
cultivating, minor drainage, harvesting . . . or upland soil and
water conservation practices." 33 U.S.C. § 1344(f)(1)(A). In
determining that Brace's activities fell within this provision,
the district court relied on facts that are irrelevant to the
inquiry required by the applicable law. The district court
appears to have based its conclusion on a casual observation that
what Brace did was "normal" activity for a farmer in Erie County,
rather than on the application of the regulatory construction
accorded the statutory term "normal farming activities" by the
agencies charged with the implementation of the statute.1
The applicable regulation provides that, to constitute
"normal farming activity" within the meaning of the statute, the
activity:
must be part of an established (i.e., on-going) farming
. . . operation and must be in accordance with the
definitions in § 323.4(a)(1)(iii) . . . . Activities
which bring an area into farming . . . use are not part
of an established operation. An operation ceases to be
established when the area on which it was conducted has
been converted to another use or has lain idle so long
that modifications to the hydrological regime are
necessary to resume operations.
33 C.F.R. § 323.4(a)(1)(ii). Brace's activities between 1985 and
1987 meet neither prong of this provision: they were neither
part of an "established (i.e., on-going) farming operation," nor
were they conducted "in accordance with the definitions in §
323.4(a)(1)(iii)."
A.
1
. See 33 U.S.C. §§ 1251(d) and 1344 for the implementation
authority of the EPA and COE.
Brace points out that in determining whether farming
activities are established and continuing, the conduct must be
analyzed by a contextual review of the total activities.
Cumberland Farms, 647 F. Supp. at 1175. He argues that the
district court correctly undertook a contextual analysis in its
determination that the site was an integral part of an
established and on-going farm operation, and Brace's activities
between 1985 and 1987 did not bring a new area into the
operation. Brace, slip op. at 12. The district court based its
conclusion on: (1) its determination that the site is an integral
part of the drainage system previously installed in adjoining
crop producing fields; (2) its finding that the installation of a
drainage system at the site "is normal farming activity in order
to make land suitable for farming," because "[e]xtensive
underground drainage systems are typical and necessary aspects of
farming in Erie County," id. at 3; and (3) the ASCS determination
that Brace had "commenced conversion" of the site from wetland to
cropland prior to December 23, 1985.
The district court's reasoning and conclusion are improper.
The district court misinterpreted the meaning of the "established
farming operation" requirement. The district court believed it
was appropriate to examine the relationship of the site in
question to the rest of the land owned by the same property-owner
in determining whether land was being brought into farming use.
Brace maintains that it is arbitrary to delineate artificially a
portion of the farm and without rational justification sever it
from his overall operations. We cannot agree with this
interpretation of the statute's requirement.
The regulations provide that, "[a]ctivities which bring an
area into farming . . . use are not part of an established
operation." 33 C.F.R. § 323.4(a)(1)(ii); 40 C.F.R. §
232.3(c)(1)(ii)(B) (emphasis added). The regulations do not
specify the precise area to which we should look in determining
whether there is an established farming operation. There are no
minimum limits placed on the "area" being brought into farming
use. Thus, we read the regulations to provide that an exemption
is available only to activities that are part of an "established
farming operation" at the site. A proper "contextual review of
its total activities" only requires us to analyze whether such
activities are "established and continuing" on the thirty-acre
wetland site itself. See Cumberland Farms, 647 F. Supp. at 1175(referring to "the site," rather than the property owner's total
land holdings).2 Our reading of the regulation recognizes the
statute's legislative history and is in accord with the strict
construction of the permit exemptions afforded by other Courts of
Appeals. See, e.g., Akers, 785 F.2d at 819, 823; United States
v. Huebner, 752 F.2d 1235, 1240-41 (7th Cir.), cert. denied, 474
U.S. 817, 106 S. Ct. 62 (1985); Marsh, 715 F.2d at 925 n.44.
2
. We recognize that the designation of the use of some very
small sites will be effectively inseparable from the use of the
surrounding land for established farming operations. Thus, we
would not require that every square foot be used for farming in
order for a site to meet the established operation exemption. In
this case, however, it is clearly reasonable to require that all
or substantially all of the thirty-acre site be part of an
established operation.
Brace himself testified that: (1) for the nine-year period
prior to the discharges onto the site, from 1977 to 1986, his
activities at the site included no pasturing or growing of any
crops, but consisted entirely of efforts to drain the wetland;
(2) the site was fully covered in 1983 with indigenous plants,
but that all plants had been stripped from the site in 1987,
subsequent to the discharge activities; and (3) the purpose of
his 1985-1987 discharges was to drain the wetland and make it
suitable for row cropping. The district court found that "[a]s a
result of Defendants' levelling, spreading and tiling, Defendants
began to grow crops on the site in 1986 and 1987." Brace, slip
op. at 9 (emphasis added). These facts do not justify the
district court's determination that Brace's activities on the
site were exempt from the permit requirements as "normal farming
activities." Indeed, the factual findings of the district court
can only lead to the opposite conclusion. Brace converted a
thirty-acre site that was not suitable for farming into a site
that is suitable for farming, and thus "brought an area into
farming use."
Even if Brace's father's pre-1975 use of the site for
pasturing could be considered to have been a prior, "established
farming operation" on the site, Brace's drainage activities
demonstrate that the court erred as a matter of law in finding
the exemption from the permit requirement available for his
subsequent activities. Under the regulations, a farming
operation is not "ongoing" where "modifications to the
hydrological regime are necessary to resume operations." 33
C.F.R. § 323.4(a)(1)(ii); 40 C.F.R. § 232.3(c)(1)(ii)(B). Here,
Brace admitted that "modifications to the hydrological regime,"
i.e., drainage of the site through excavating and burying four
miles of plastic tubing for drainage, were necessary to grow
crops on the site.
Our determination is consistent with the holdings of
numerous other courts that have found the "normal farming"
exemption inapplicable because modifications were required to
resume farming. See, e.g., Akers, 785 F.2d at 819-20
("[Defendant] argued below that unless he were allowed to
complete the work he had started, the effect of which is to drain
the wetland, he would be unable to engage in the farming
activities he had planned. By his own admission, his activities
require substantial hydrological alteration to [the site], and
run afoul of the regulations."); Bayou Marcus Livestock & Agric.
Co. v. EPA, No. 88-30275, 20 Envtl. L. Rev. (Envtl. L. Inst.)
20445, 20446 (N.D. Fla. Nov. 3, 1989) ("Before plaintiffs could
have effectively harvested the timber and begun farming, it was
necessary to dredge, fill, construct roads and dig ditches . . .
. [I]f an ongoing operation had been previously functioning,
such changes in the landscape would have been unnecessary.");
United States v. Larkins, 657 F. Supp. 76, 85-86 n.23 (W.D. Ky.
1987) ("Activities cease to be established when the property on
which they were once conducted `. . . has lain idle so long that
modifications to the hydrological regime are necessary to resume
operations.' Reducing the reach of the [site] required
modifications of the site's hydrological regime. Consequently,
even if the wetland had a history of farm use, that use was no
longer established at the time [of defendant's activities]."
(emphasis by court) (citations omitted)), aff'd, 852 F.2d 189(6th Cir. 1988), cert. denied, 489 U.S. 1016, 109 S. Ct. 1131(1989).
Brace suggests that this line of cases is distinguishable
from his circumstances because of, inter alia, the larger size of
the farms and wetlands at issue in those cases, and the fact that
one site was a habitat for an endangered species. We cannot
agree. There is no provision in Section 404(f)(1) of the CWA or
its implementing regulations under which either the size of a
wetland or the effect of discharge activities on wildlife are
factors relevant to determining whether particular discharge
activities are exempt from the permit requirement. Although
wetland protection in Section 404 serves the important function
of protecting wildlife habitats, in addition to several other
functions including flood and erosion control and water
purification, see 33 C.F.R. § 320.4(b)(2), neither the statute
nor the regulations condition the permit requirement on the
existence of adverse impacts on wildlife or on the particular
size of a wetland. Indeed, we have upheld determinations of both
civil and criminal liability for the discharge of fill material
onto a 14-acre wetland site, a substantially smaller site than
Brace's, where there was no claim of adverse impact on wildlife.
United States v. Pozsgai, 999 F.2d 719 (3d Cir. 1993), cert.
denied, U.S. , 114 S. Ct. 1052 (1994) (civil), and United
States v. Pozsgai, 897 F.2d 524 (3d Cir.), cert. denied, 498 U.S.
812, 111 S. Ct. 48 (1990) (criminal).
In addition to the district court's erroneous interpretation
of the "established farming operation" requirement, the district
court erred as a matter of law in finding that Brace's
installation of a drainage system at the site "is a normal
farming activity in order to make land suitable for farming,"
because "[e]xtensive underground drainage systems are typical and
necessary aspects of farming in Erie County." Brace, slip op. at
3. Brace argues that the court correctly considered the area-
specific context in its fact finding inquiry. However, this
factual determination is a legal conclusion, and is not merely a
matter for factual findings. The question is not whether farmers
in a particular county install extensive drainage systems.
Rather, the proper question is whether the activities performed
by Brace at this particular site, and at a time when the CWA
applied, were within the meaning of the statutory term "normal
farming activities" as defined by the regulations. Regardless of
how "typical" or "necessary" such drainage systems may be in Erie
County, Section 404 of the CWA requires a permit for "activities
which bring an area into farming . . . use," as opposed to
activities that are part of an "established farming operation."
Brace did not have an "established farming operation" on the site
prior to his discharges, and brought the site into farming use by
discharging pollutants into waters of the United States.
Moreover, the district court erred in relying upon a
determination from the ASCS in September of 1988 that Brace had
"commenced conversion" of his property from wetland to cropland
prior to December 23, 1985, as evidence of an "established
farming operation" at the site. The USDA Swampbuster Commenced
and Third-Party Determinations form signed by Brace expressly
states that "[t]he granting of a commencement . . . does not
remove other legal requirements that may be required under State
or Federal water laws." USDA Form; App. at 173. The purpose of
the "commenced conversion" determination is solely to prevent the
loss of USDA benefits. The ASCS determination is not a
dispositive factor in our analysis.
Moreover, to the extent that the ASCS determination has any
relevance to our analysis of "normal farming activities," it
undermines such a conclusion. The very title of the
determination -- "commenced conversion" -- indicates that Brace's
discharge activities were not part of an ongoing farming
operation, but rather, were directed at converting the wetland to
the farming operation of growing crops. Even if the ASCS
determination had stated that a conversion had been completed by
December 23, 1985, the CWA permit requirement would not have been
affected. Brace's activities were unpermitted and unauthorized
when they occurred, and the "commenced conversion" determination
provides no basis for an after-the-fact legitimization of those
activities.
B.
As we explained above, the regulation governing the "normal
farming activities" exemption has a second prong, under which
drainage activities, in addition to being a part of an
"established farming operation" as defined by the regulation,
must be "in accordance with definitions in § 323.4(a)(1)(iii)."
33 C.F.R. § 323.4(a)(1)(ii). Brace's activities failed to meet
the requirements of this second prong in addition to not being a
part of an ongoing, established farming operation. Brace's
undisputed activities: (1) excavating soil and discharging in
connection with burying approximately four miles of plastic
tubing for drainage; (2) levelling and clearing the formerly
wooded and vegetated site; and (3) spreading dredged material,
are all excluded from the activities allowed under 33 C.F.R. §
323.4(a)(1)(iii).
Brace's installation of four miles of tubing which drains
the site is barred by the provision's express prohibition of
both: (1) "the construction of any . . . structure which drains
or otherwise significantly modifies . . . a wetland or aquatic
area constituting waters of the United States"; and (2) "drainage
associated with the immediate or gradual conversion of a wetland
to a non-wetland . . ., or conversion from one wetland use to
another." 33 C.F.R. § 323.4(a)(1)(iii)(C)(2). See also 40
C.F.R. § 232.3(d)(3)(D)(ii). Brace's clearing of all vegetation
from the wetland site, and his spreading of dredged materials
onto the site, are barred by the provision's express prohibition
of both: (1) "the redistribution of soil, rock, sand, or other
surficial materials in a manner which changes any area of the
waters of the United States to dryland"; and (2) "the
redistribution of surface materials by blading, grading, or other
means to fill in wetland areas." 33 C.F.R. §
323.4(a)(1)(iii)(D). See also 40 C.F.R. § 232.3(d)(4).
Accordingly, by definition, Brace's discharge activities cannot
constitute "normal farming activities" under the applicable
regulation.
We are unpersuaded by Brace's assertion that we need not
reach the definitions of 33 C.F.R. § 323.4(a)(1)(iii) because
there was no conversion from one wetland use to another. Brace
bases his argument on the district court's determination that
Brace simply maintained and improved his drainage system, and
continued, piece by piece, to farm land which, in one form or
another, had always been used for crops or pasture. Brace
asserts that spreading materials that he dredged from ditches on
the site onto other portions of the site was an ordinary and
normal maintenance procedure employed by local farmers. Under
the CWA, a permit is not required for the discharge of dredged or
fill material for the purpose of maintaining drainage ditches.
33 U.S.C. § 1344(f)(1)(C). Thus, Brace argues and the district
court agreed that Brace's activities constituted maintenance of
drainage ditches, an activity clearly exempt from the permit
requirements of the CWA.
The exemption from the permit requirements under Section
404(f)(1)(C) for "maintenance of drainage ditches" applies to
"any discharge of dredged or fill material that may result from .
. . the maintenance (but not construction) of drainage ditches."
33 C.F.R. § 323.4(a)(3) (emphasis added). We find the district
court erred as a matter of law in finding that Brace was simply
maintaining rather than constructing the drainage ditches.
Likewise, the conclusion of the district court that the
activities of Brace do not require a permit because they
constitute maintenance of drainage ditches, Brace, slip op. at
22, is not supported by the evidence. Brace caused the
excavation of the site and the burying of several miles of
plastic tubing to facilitate drainage. It is not realistic to
describe what Brace was doing as "continuing maintenance."
Brace's construction of a drainage system absent a permit was
expressly prohibited by the regulation absent a permit. See
Huebner, 752 F.2d at 1242 (defendants' cleaning and deepening
existing ditches, excavating a new ditch, and discharging dredged
materials required a permit when it brought an area of navigable
waters into a use to which it was not previously subject).
Moreover, any activity that could be described as
maintenance of drainage ditches was accomplished, if at all, by
dredging ditches at the site. Brace's subsequent levelling at
the site and spreading of the dredged material were separate,
independent activities that are not subject to an exemption from
the permit requirement. This subsequent spreading of dredged
materials onto other portions of the site served no purpose
beyond converting the thirty-acre wetland site to an upland site
that could accommodate the growing of crops; it did not "result"
from the maintenance of drainage ditches. There is no statutory
or regulatory provision under which the spreading of the dredged
materials is permissible absent a permit. The district court
erred as a matter of law in holding Brace's activities
permissible.
V.
As we discussed above, Brace has the burden of proving both
that he qualifies under Section 404(f)(1) for the normal farming
activities exemption, and that the permit requirement was not
"recaptured" under Section 404(f)(2) of the CWA, 33 U.S.C. §
1344(f)(2). The "recapture" provision stipulates that:
Any discharge of dredged or fill material into the
navigable waters incidental to any activity having as
its purpose bringing an area of the navigable waters
into a use to which it was not previously subject,
where the flow or circulation of navigable waters may
be impaired or the reach of such waters be reduced,
shall be required to have a permit under this section.
33 U.S.C. § 1344(f)(2). The applicable regulation provides that
"[a] conversion of a section 404 wetland to a non-wetland is a
change in use of an area of the waters of the United States." 33
C.F.R. § 323.4(c).
Initially, the district court incorrectly stated that the
application of the recapture provision required the United States
to establish the two elements:
First, it must be established that Brace's activities
were conducted in order to bring the property into a
use to which it was not previously subject. Second, if
this element is established, it must then be
established that Brace's activities will impair the
flow or circulation of navigable waters or will reduce
the reach of such waters.
Brace, slip op. at 21. The court's articulation of the legal
standard implies that the burden of demonstrating "recapture" is
on the United States. This legal standard is erroneous.
Since we have held that Brace's drainage activities on the
thirty-acre wetland site are not exempt from the CWA permit
requirement under the "normal farming activities" or maintenance
of drainage ditches exemptions, we need not reach the application
of the recapture provision. We note, however, that the district
court's conclusion that the recapture provision does not apply
because "[t]he land is not being converted to a use to which it
was not previously subject, nor has significant impairment to the
reach or flow of waters been proven," Brace, slip op. at 22, is
incorrect as a matter of law. The evidence establishes that
Brace's activities drained the site to convert it from a wetland
to a new, non-wetland use: the district court found that the
site was inundated with water at various times in the past; the
parties stipulated, and the court found, that the site
constituted a wetland at the time of the discharges; Brace
admitted that the purpose of installing the four miles of plastic
tubing at the site in 1986 and 1987, and of clearing the
vegetation from the site between 1985 and 1987, was to drain the
site and make the ground ready for growing crops; and the court
found that as a result of Brace's levelling, spreading and
tiling, he began to grow crops on the site in 1986 and 1987.
Thus, Brace's activities fall squarely within the statutory
definition of "recapture."
VI.
The last issue that we must address is that of Brace's
penalty for violations of the permit requirements of Section 404
of the CWA and for his violations of the EPA administrative
orders. Clearly, under the CWA Section 309(d), Brace is subject
to a civil penalty for his violation of the CWA permit
requirements. 33 U.S.C. § 1319(d) (1988).3 Upon remand the
district court must determine the appropriate amount of the
penalty, based on the statutory factors delineated in Section
309(d).
The more difficult issue is whether Brace is also subject to
civil penalties for his noncompliance with the EPA administrative
orders. The district court found both that: (1) the EPA's
administrative order had required Brace "to cease and desist all
activities on the site," Brace, slip op. at 14; and (2)
3
. Section 1319(d) provides in pertinent part:
Any person who violates section 1311, 1312, 1316, 1317,
1318, 1328, or 1345 of this title, or any permit
condition or limitation implementing any of such
sections in a permit issued under section . . . 1344 of
this title by a State, . . . and any person who
violates any order issued by the Administrator under
subsection (a) of this section, shall be subject to a
civil penalty not to exceed $25,000 per day for each
violation. In determining the amount of a civil
penalty the court shall consider the seriousness of the
violation or violations, the economic benefit (if any)
resulting from the violation, any history of such
violations, any good-faith efforts to comply with the
applicable requirements, the economic impact of the
penalty on the violator, and such other matters as
justice may require.
"Defendants failed to totally comply with Administrative Orders
issued to them." Brace, slip op. at 14. However, the district
court did not attach liability for violating the orders, based on
its findings that "Defendants have not disturbed the soil on the
site in any significant way since being served with the cease and
desist orders, and in the view of this Court acted only out of
sincere conviction, although undoubtedly misguided." Id.Section 309(d) provides that "any person who violates any
order issued by the Administrator under subsection (a) of this
section, shall be subject to a civil penalty." 33 U.S.C. §
1319(d). Section 309(d) does not afford the district court
discretion to grant an exemption from liability for violating the
EPA administrative orders. See, e.g., Atlantic States Legal
Foundation v. Tyson Foods, 897 F.2d 1128, 1142 (11th Cir. 1990)
(the language of Section 309(d) "makes clear that once a
violation has been established, some form of penalty is
required.") However, the record is not sufficiently clear for us
to determine whether civil penalties are mandatory under the
circumstances of this case. We remand this issue to the district
court for further review of Brace's non-compliance with the EPA
administrative orders. Thereafter, the district court must
determine what, if any, civil penalties should be assessed
against Brace for his violations of the EPA administrative
orders.
VII. CONCLUSION
For the foregoing reasons, the order entered December 17,
1993, granting judgment in favor of the defendants, Robert Brace
and Robert Brace Farms, Inc., will be reversed. This matter will
be remanded to the district court to enter judgment in favor of
the United States and to assess upon further proceedings
appropriate penalties for defendants' violations of the permit
requirements, and to assess what, if any, penalties are
appropriate for violations of the EPA administrative orders.