Booth v. Garvin

IN THE SUPERIOR COURT OF THE STATE OF DELAWARE
JOSEPH W. BOOTH & :
MARGARET A. BOOTH : S18A-08-001 JJC
: In and for Sussex County
Appellants, :
:
v. :
:
SECRETARY M. SHAWN GARVIN :
& DELAWARE DEPARTMENT OF :
NATURAL RESOURCES & :
ENVIRONMENTAL CONTROL, :
:
Appellees. :
Submitted: December 17, 2018
Decided: February 6, 2019
MEMORANDUM OPINION AND ORDER
Appeal from the Decision of the Environmental Appeals Board: AFFIRMED
Christopher M. Coggins, Esquire, Coggins Law, LLC, Wilmington, Delaware,
Attorney for the Appellants.
Robert F. Phillips, Deputy Attorney General, Department of Justice, New Castle,
Delaware, Attorney for the Appellees.
Clark, J.
Appellant’s Joseph W. Booth and Margaret Booth (the “Booths”) appeal an
Environmental Appeals Board (“EAB”) decision. The EAB dismissed the Booths’
appeal of (1) an oral statement made by the Secretary of the Department of Natural
Resources and Environmental Control (“DNREC”), and (2) a letter written by a
separate DNREC official. For the reasons that follow, neither constituted agency
action that could be appealed. Furthermore, if the oral statement of the Secretary
had constituted agency action, their appeal of that statement would not have been
timely. Accordingly, the Booths’ appeal in the case was properly dismissed and the
EAB’s decision must be AFFIRMED.
I. Procedural History
The procedural history in this case is complex and unusual. Namely, the
Booths filed two separate EAB appeals regarding the same substantive issues. Both
appeals involved DNREC’s January 8, 2014, notice of the Booths’ alleged liability
for environmental contamination at the Thro-Kleen Dry Cleaners Site (hereinafter
the “Site”) in Georgetown. The Booths purchased the Site and at some point
DNREC discovered hazardous substances, terachlorethene (“PCE”) and
trichloroethened (“TCE”), at the Site. Thereafter, the Booths and DNREC
negotiated potential remedial action. The give and take included DNREC urging the
Booths to participate in DNREC’s Voluntary Cleanup Program, and the Booths’
attempt to convince DNREC that they were innocent landowners.
The first alleged agency action that the Booths appealed was an oral statement
allegedly made by DNREC Secretary Shawn Garvin (the “Secretary”) on May 17,
2017. The only reference in the record regarding the content of that statement was
provided in the Booths’ letter of appeal to the EAB. There, they alleged that after
2
discussing their differences at a meeting, the Secretary stated that “he stands by
DNREC employees’ position and it is his official decision.”
The next item the Booths allege was agency action was a May 23, 2017, letter
from a DNREC program administrator, Timothy Ratsep (“Mr. Ratsep”). In that
letter, Mr. Ratsep wrote in response to a letter from the Booths’ former attorney:
DNREC has a fundamental disagreement . . . Apart from the innocent
landowner concern, it seems that there is a misunderstanding of DNREC’s
position that you, as the owners of the property and the operators of the
cleaning business . . . are strictly liable . . . DNREC again urges you to
give serious consideration to providing the information necessary to
complete an ability to pay determination relating to the potential cleanup
costs.
On June 12, 2017, while pro se, the Booths filed their first appeal to the EAB.
In their letter of appeal, they referenced only the Secretary’s May 17, 2017, oral
statement. DNREC then moved to dismiss the EAB appeal since it was not filed
within twenty days of the alleged agency action as required by statute. 1 The Booths
then amended their appeal as follows:
To date, we have never received an official written position on the
Innocent Landowner Defense from Secretary Garvin. He stated
verbally in the May 17th meeting [that] “he stands by DNREC
employees’ position and it is his official decision.” We interpret the
written position from Mr. Ratsep dated May 23, 2017, as Secretary
Garvin’s official decision . . . [A]ny person may appeal to the
Environmental Appeals Board within 20 days after receipt of the
Secretary’s decision or publication of the decision. 2
By agreement of the parties, no EAB hearing followed for some time. In the
interim, on October 31, 2017, the Secretary issued a written order finding, inter alia,
1
See 7 Del. C. § 6008(a) (providing that “[a]ny person whose interest is substantially affected by
any action of the Secretary may appeal to the Environmental Appeals Board within 20 days after
receipt of the Secretary's decision or publication of the decision”).
2
Pl.’s Ex. N, at 2 (emphasis in original removed).
3
that the Booths were not innocent landowners and were liable pursuant to 7 Del. C.
§ 9105(a)(1) for releases of hazardous substances on the Site. The Booths timely
appealed that order to the EAB.
Nine months later, on July 2, 2018, the EAB issued its decision regarding the
first appeal. In its decision, the EAB granted DNREC’s motion to dismiss the
Booth’s appeal of the Secretary’s oral statement and Mr. Ratsep’s letter because the
appeal was untimely. Nevertheless, the EAB’s order recognized that all substantive
arguments regarding the Site survived to be later addressed in the remaining appeal
of the Secretary’s October 2017 written order. The Booths then timely appealed the
dismissal of their first EAB appeal to this Court.
With the appeal of the first EAB matter pending in this Court, the EAB
scheduled a November 27, 2018, hearing regarding the Secretary’s October 2017
written order. The planned scope of that EAB hearing included all substantive issues
regarding the Site and any defenses to liability. For reasons that are difficult to
understand, the Booths appeared at that hearing but then abruptly withdrew their
second appeal. Counsel for the Booths indicated at oral argument in Superior Court
that the Booths did not believe they would receive a fair hearing because DNREC
and the EAB were structurally intertwined.3 The Booths did not explain why those
assumed circumstances would be any different were the EAB to consider their first
appeal.
II. Arguments of the Parties
The Booths alternatively argue that the Secretary’s oral statement on May 17,
2017, or Mr. Ratsep’s letter dated May 23, 2017, constituted agency action by the
Secretary that triggered their right to appeal. They argue primarily that Mr. Ratsep’s
3
Oral Argument Tr., 2-5, Dec.14, 2018.
4
letter triggered the accrual of the appeal deadline. They initially argued in their
briefing that the Court should reverse the EAB’s decision and remand the case for a
hearing so they could defend the case on its merits.
At oral argument, the Booths explained that they withdrew their EAB appeal
of the Secretary’s written order because the EAB and DNREC were inextricably
intertwined. This, they allege, makes the EAB an unfair venue to hear the appeal.
For that reason, the Booths then sought to argue the substantive merits of their case
in this Court.
DNREC counters that the issue before the Court is procedural only.
Specifically, it argues that neither the Secretary’s oral statement nor Mr. Ratsep’s
letter constituted agency action that triggered the right (or need) to appeal.
Moreover, DREC argues that even if the Secretary’s oral statement could have been
appealed to the EAB, the issue narrows to one of untimeliness. Finally, DNREC
emphasizes that the Booths withdrew the only appeal that could have provided their
requested relief.
III. Standard of Review
The Court’s standard of review of an EAB decision is limited to a substantial
evidence review and a review for legal error. 4 Since the issues before the Court are
(1) the timeliness of an appeal, and (2) whether upon uncontroverted facts the oral
statement and Mr. Ratsep’s letter constituted agency actions, the Court’s standard of
review in this case is de novo.5
4
Bullock v. K-Mart Corp., 1995 WL 339025, at *2 (Del. Super. May 5, 1995) (citing Motors v.
Freemen, 164 A.2d 686, 688 (Del. 1960)).
5
See Hofecker v. Lexus of Wilmington, 2012 WL 341714, at *1 (Del. Feb. 1, 2012) (explaining
that errors of law are reviewed de novo).
5
IV. Analysis
One section in the Delaware Code controls the disposition of both aspects of
this appeal. First, it provides in relevant part:
(a) Any person whose interest is substantially affected by any action of
the Secretary may appeal to the Environmental Appeals Board within
20 days after receipt of the Secretary’s decision or publication of the
decision.6
In the next two subsections of that section, the statute defines two types of
DNREC actions that are appealable to the EAB – those from (1) case decisions, and
(2) those challenging regulations. Specifically, those subsections provide:
(b) Whenever a final decision of the Secretary concerning any case
decision, including . . . any . . . enforcement action is appealed, the
Board shall hold a public hearing . . .
(c) Appeals of regulations shall be on the record before the Secretary
. . . The board my affirm, reverse or remand any appeal of regulations
promulgated by the Secretary. 7
DNREC primarily argues that even if the Secretary’s oral statement
constituted agency action, the Booths did not file their appeal to the EAB within
twenty days of May 17, 2017. The Booths counter that Mr. Ratsep’s May 23, 2017,
letter memorialized the Secretary’s earlier oral decision and they filed their appeal
within twenty days of receiving Mr. Ratsep’s letter.
At the outset, if the Secretary’s oral statement constituted appealable agency
action, DNREC correctly argues that the Booths did not file their appeal within the
6
7 Del. C. § 6008(a) (emphasis added).
7
7 Del. C. § 6008(b) – (c) (emphasis added).
6
twenty days required by statute. Appeal periods within agency enabling statutes are
jurisdictional.8 The Court has no discretion to waive such requirements.9
Furthermore, there is no reasonable reading of Mr. Ratsep’s May 23, 2017,
letter that permits it to be considered an action of the Secretary. A common thread
in the issues raised in this appeal is a misunderstanding regarding the multi-faceted
nature of DNREC’s responsibilities. DNREC investigates possible violations,
enforces compliance with environmental laws and regulations, and adjudicates
environmental violations.10 It is well settled that legislatures can permissibly charge
the same agency with investigating, enforcing, and adjudicating violations. 11 The
General Assembly provided for such multi-faceted responsibilities in DNREC’s
enabling statute. Mr. Ratsep’s letter urges the Booths to accept a settlement and
explains DNREC’s litigation posture. Such correspondence does not fall within the
scope of DNREC’S adjudicatory function. Rather, it advances DNREC’s
compliance related function by urging a pre-hearing resolution. Accordingly, it did
not constitute appealable action of the Secretary.
8
See e.g. Johnson v. Delhaize, 138 A.3d 1149, 2016 WL 2839857, at *2 (Del. May 5, 2016)
(holding that the Superior Court did not have jurisdiction over plaintiff’s appeal when plaintiff
filed her notice of appeal one year after the IAB order’s issuance, because the “timely filing of an
appeal is mandatory and jurisdictional”); and Lively v. Dover Wipes Co., 2003 WL 21213415, at
*1 (Del. Super. May 16, 2003) (explaining that an appeal from the UIAB must be filed within 10
days and that appellant jurisdiction cannot be “invoked or properly exercised unless an appeal is
perfected within the time period fixed by law”).
9
See Draper King v. Malave, 743 A.2d 672, 673 (Del. 1999) (explaining that “[w]hen a party fails
to perfect an appeal within the period mandated by statute, a jurisdictional defect is created that
may not be excused in the absence of unusual circumstances that are attributable to court personnel
and are not attributable to the appellant or appellant’s attorney”).
10
See Withrow v. Larkin, 421 U.S. 35, 51-55 (1975) (recognizing the dual nature of an agency’s
investigative and adjudicative powers).
11
Id. at 57 (explaining at the federal level that the “combination of investigative and adjudicative
functions” does not automatically create an unconstitutional risk of bias when agencies perform
these functions).
7
The Booths emphasized in their appeal that the EAB’s decision assumed that
the Secretary’s oral statement constituted agency action.12 DNREC challenges this
assumption. The Court reviews EAB decisions de novo for legal error. A reference
by the EAB in its decision that assumes an oral statement to be action of the
Secretary is not controlling if it was incorrect as a matter of law.
Although, Chapter 60 of Title 7 of the Delaware Code does not expressly
define action of the Secretary, Section 6008 of Title 7 can only be reasonably read
to provide for appeals of (1) case decisions or (2) regulations.13 In order to trigger
an appeal right to the EAB, the Secretary must act through written order by deciding
a case, or promulgating a final regulation.14 With regard to appealing a case
decision, only “a final decision of the Secretary” is appealable. 15 Neither the
Secretary’s oral statement allegedly stating his future position nor a letter from a
senior staff member relaying DNREC’s settlement position constituted final
decisions of the Secretary. There was nothing to enforce before the Secretary issued
his October 2017 written order. It follows that there was nothing to appeal before
the Secretary issued that written order.
DNREC does not fall within the case decision provisions of Delaware’s
Administrative Procedures Act (“APA”).16 Nevertheless, the APA provides a
12
See Booth, EAB Appeal No. 2017-08 (holding that the Booth’s appeal from the verbal statements
by Secretary Garvin on May 17, 2017, was untimely, because the board received a notice of appeal
26 days after the Secretary’s oral statements).
13
7 Del. C. § 6008(b) – (c).
14
Id.
15
7 Del. C. § 6008(b).
16
See 29 Del. C. § 10161 (listing “affected” agencies and providing that all agencies not listed are
subject only to subchapters I and II of the APA as well as §§ 10141, 10144 and 10145 of Title 29);
See also 29 Del. C. § 10142 (providing the court’s authority to review case decisions of enumerated
agencies); and Fatir v. Phelps, 2018 WL 3039223, at *1 (Del. Super. Jun. 19, 2018) (recognizing
the inclusion of only certain agencies within 29 Del. C. § 10142’s scope).
8
persuasive definition for what constitutes action of the Secretary in the case decision
context. There, it provides:
“[a]gency action” means either an agency’s regulation or case decision,
which could be a basis for the imposition of injunctive orders, penal or
civil sanctions of any kind or the grant or denial of relief or of a license,
right or benefit by any agency or court, or both.17
Black’s Law Dictionary is likewise helpful. It defines an “action” in the case
decision context “to be any judicial proceeding, which, if conducted to a
determination, will result in a judgment or decree.”18 Under either definition,
neither challenged matter in this case constituted “action by the Secretary” that
generated a right to appeal.
Appealable action, and by corollary enforceable action in the case decision
context, occurs only through written orders and does not include litigation related
correspondence from agents of the Secretary.19 In the context of alleged hazardous
substance releases, DNREC must investigate alleged violations, adjudicate such
violations, and enforce remedial measures.20 In performing some of these functions,
the agency must negotiate with alleged violators to reach settlements. 21 In order to
negotiate settlements, it must state positions. The Booths incorrectly advocate a
17
29 Del. C. § 10102(2).
18
Black’s Law Dictionary (10th ed. 2014).
19
See O’Neil v. Town of Middletown, 2006 WL 205071, at *9 (Del. Ch. Jan. 18, 2006) (recognizing
that “only agency conduct that may be fairly characterized as ‘regulations’ or ‘case decisions’”
trigger judicial review).
20
See e.g. 7 Del. C. § 6016 (stating that “the Secretary may make or cause to be made any
investigation or study which is, in his or her opinion, necessary for the purpose of enforcing this
chapter” and the Secretary may designate an investigative officer to “subpoena witnesses and the
production of documents and compel their testimony”); 7 Del. C. § 6005 (outlining the different
civil and administrative penalties that the Secretary may impose pursuant to his or her adjudicatory
authority); 7 Del. C. 6018 (outlining the Secretary’s cease and desist power).
21
See 7 Del. C. § 6019 (stating that “[n]othing in this chapter shall prevent the Department from
making efforts to obtain voluntary compliance by way of warning, notice or other educational
means; this section does not, however, require that such voluntary methods be used before
proceeding by way of compulsory enforcement”).
9
holding that would include all litigation related statements made by the Secretary or
his or her agents as appealable actions. Such an approach would subject the agency
to incalculable interlocutory appeals to the EAB. In the case decision context,
respondents can only appeal a final decision that is transmitted in the form of a
written order.
At oral argument, the Booths emphasized many substantive issues in support
of their appeal. By statute, the Superior Court’s review of decisions of the EAB is
limited to a review of evidence of record that the parties presented to the EAB. 22
Consistent with statutory limitations, the doctrine of exhaustion of administrative
remedies also limits the Court’s review. 23 That doctrine “requires that where a
remedy before an administrative agency is provided, relief must be sought by
exhausting this remedy before the courts will either review any action by the agency
or provide an independent remedy.”24 Here, because the issues before the Court are
procedural and no evidence was adduced at the hearing regarding substantive issues,
the Court may not consider such issues.
In addition to the merits, the Booths argue finally that they could not receive
a fair hearing before the EAB. In part, they assert that a conflict of interest between
DNREC and the EAB because deputy attorney generals represent both DNREC and
the EAB.
The Superior Court correctly analyzed a similar conflict of interest claim in
Kopicko v. Delaware Dept. of Services for Children.25 In that decision, later
affirmed by the Delaware Supreme Court, the court found no presumption of bias
22
7 Del. C. §6009(b); See also Bullock, 1995 WL 339025, at *2 (recognizing that the Court’s
appellate review of a Board’s decision is limited to determining whether the Board’s decision was
supported by substantial evidence and whether it as an error of law).
23
Levinson v. Delaware Compensation Rating Bureau, Inc., 616 A.2d 1182, 1187 (Del. 1992).
24
Id.25
Kopicko v. Delaware Dpt. Of Services for Children, 2003 WL 21976409, at *1 (Del. Super.
Aug. 15, 2003), aff’d, 846 A.2d 238 (Del. 2004) (TABLE).
10
where an agency exercises both adjudicative and investigative duties. 26
Furthermore, state employed attorneys from the same department that separately
represent different agencies do not presumptively generate a conflict of interest. 27
There is a presumption of honesty and integrity that must be overcome by a party
asserting such a conflict.28 When, as here, the General Assembly created a separate
appeals body by statute, there is no organic conflict of interest simply because
different attorneys from the Department of Justice represent the agency and the
board that hears appeals from that agency.
As the United States Supreme Court observed in Withrow v. Larkin,
“[w]ithout a showing to the contrary, state administrators ‘are assumed to be
[people] of conscience and intellectual discipline, capable of judging a particular
controversy fairly on the basis of its own circumstances.’”29 Moreover, here, as with
any other matter, the Court must confine its decision to the evidence of record below.
Since the Booths did not fairly raise this issue below and developed no evidence
before the EAB to overcome this presumption, the Court is unable to address it
further.
V. Conclusion
The Court cannot make a finding regarding the Booth’s liability in this matter
or regarding the merit of their substantive defenses. While the Court recognizes the
strong preference to decide cases on their merits, and recognizes that the Booths
withdrew a second appeal that could have fully addressed their issues, the Court
must decide only the procedural issues before it. Here, the EAB did not commit
26
Id. at *5.
27
Id.
28
Id.
29
Withrow, 421 U.S. at 55 (citation omitted).
11
legal error when dismissing the Booth’s first appeal. Accordingly, the EAB’s
decision in this matter must be AFFIRMED.
IT IS SO ORDERED.
/s/Jeffrey J Clark
Judge
12