A.H. Smith Associates Ltd. Partnership v. Maryland Department of Environment

CATHELL, Judge. The Maryland Department of the Environment (MDE), appellee, brought a civil enforcement action against A.H. Smith Associates Limited Partnership (A.H. Smith), appellant, for alleged violations of 1) a Consent Order and 2) a wastewater discharge permit over the period of March 1991 through September 1994. The Circuit Court for Prince George’s County (Spellbring, J., presiding) found that appellant had ²³⁷ violated the Consent Order and the permit and imposed civil fines against appellant in the amount of $49,000. From that decision, appellant noted a timely appeal to this Court and now presents three issues for our consideration: 1.

Whether the Trial Court abused its discretion in construing [the] Consent Order and permit language in favor of the Appellee, and against the Appellant, thereby improperly imposing liability. 2. Whether the Trial Court erred in concluding that the Appellant violated the Consent Order and the permit. 3. Whether the Trial Court abused its discretion in awarding $1,000.00 per violation despite clear and uncontroverted mitigating factors in favor of Appellant. Finding no error on the part of the trial court, we shall affirm.

As they are intertwined, we shall answer appellant’s first two questions together. We relate first the applicable statutory scheme and relevant facts. Background The Clean Water Act, 33 U.S.C. §§ 1251 et seq., generally prohibits the discharge of pollutants into the waters of the United States from point sources unless a permit has been obtained from the U.S. Environmental Protection Agency (EPA). Under a procedure established by Congress in § 402 of the Clean Water Act, 33 U.S.C. § 1342 , EPA may delegate its authority to grant National Pollution Discharge Elimination System (NPDES) permits to a state with respect to point sources located within that state.

A violation of an NPDES permit, whether issued by EPA or state authorities, is a violation of the Clean Water Act, thereby exposing the permit holder to liability. See Environmental Protection Agency v. California, 426 U.S. 200, 205 , 96 S.Ct. 2022, 2025 , 48 L.Ed.2d 578 (1976). The State of Maryland is authorized by the EPA to administer the NPDES program for point sources located in this State. This authority is vested with MDE, appellee.

Under both the Clean Water Act and the Environment Article of the ²³⁸ Maryland Code, MDE is empowered to attach certain terms and conditions to permits. See 33 U.S.C. § 1342 ; Md.Code (1982, 1996 RepLVoL), §§ 9-324, 9-326 of the Environment Article (EN). These terms and conditions may include installing monitoring equipment, sampling discharges, recording test results, and reporting to MDE on a regular basis, as well as any other “conditions [MDE] considers necessary to prevent” unpermitted discharges. EN § 9-326(a); see also 33 U.S.C. § 1318 .

Furthermore, the issuance of a permit is contingent upon the permittee granting MDE “a right of entry on the permit site at any reasonable time to inspect and investigate for violation or potential violation of any condition of the permit.” EN § 9-326(b); see also 33 U.S.C. § 1318 (a). Once a final determination on a permit application has been made, the permittee has fifteen days within which to file a challenge to any term or condition contained in the permit. Code of Maryland Regulations (COMAR) 26.08.04.01-3(C)(2); accord Chesapeake Bay Found. v. Bethlehem Steel Corp., 608 F.Supp. 440, 443 (D.Md.1985) (“Under Maryland law, a permit holder may challenge a permit’s terns and conditions only during the 15[-]day period” after publication of the notice of final determination.); see also Adams v. United States Envtl. Protection Agency, 38 F.3d 43, 51 (1st Cir.1994) (stating that public participation in permitting processing is to alert agency to potential problems with permits and ensure that agency has opportunity to address those problems before permit becomes final).

After that time, “[t]he obligations and limitations of NPDES permits are binding ... and may not be reexamined in an enforcement proceeding.” Chesapeake Bay Found., 608 F.Supp. at 443 . Moreover, compliance with the permit becomes a matter of strict liability. Sierra Club v. Simkins Indus., Inc., 617 F.Supp. 1120, 1128 (D.Md.1985), aff'd, 847 F.2d 1109 (4th Cir.1988), and cert. denied, 491 U.S. 904 , 109 S.Ct. 3185 , 105 L.Ed.2d 694 (1989); Student Pub. Interest Research Group v. Tenneco Polymers, Inc., 602 F.Supp. 1394, 1400 (D.N.J.1985) (“Enforcement of NPDES permits is based on strict liability.”); see also Chesapeake Bay Found., 608 F.Supp. at 451-53 . ²³⁹ A.H. Smith, appellant, owns and operates a sand and gravel processing facility in Branchville.

At this facility, appellant uses water to wash, sand and gravel in preparation for its sale to contractors for use in construction projects throughout the State. As its principal water source, AH. Smith drafts water from Indian Creek and an unnamed tributary of the creek, both of which run adjacent to appellant’s property. The water is then injected into scrubbers with the sand and gravel, where it rinses away dirt and clay.

The water, together with the dirt and clay, then flows into holding ponds, where the dirt and clay settle out. From these ponds, the water is discharged through an outfall back into the unnamed tributary upstream of the intake point. The largest of appellant’s ponds is approximately thirty acres. On March 26, 1991, A.H. Smith and MDE entered into a Consent Order, CO-91-0137, which allowed for the discharge of wastewater until MDE made a final determination on the issuance of a permit.

Subsequently, on May 16, 1991, MDE issued a wastewater discharge permit, 91-DP-2865, to appellant. This permit is a joint federal NPDES and State discharge permit. Under both the Consent Order and permit, appellant was authorized “to discharge wastewater, consisting of sand and gravel wash water and stormwater runoff, to an unnamed tributary of Indian Creek.” This discharge was subject to a daily maximum effluent limitation for total suspended solids (TSS) of 60 milligrams per liter (mg/1) and a monthly average maximum of 30 mg/1. The effluent limitation on turbidity set 100 nephelometric turbidity units (NTU) as the daily maximum and 50 NTU as the monthly average limit.

These limits were to be monitored once per week utilizing a grab sample. 1 Both the Consent Order and permit authorized MDE to enter upon A.H. Smith’s property at reasonable times to obtain samples. The Consent Order, but not the permit, specified that a stipulated penalty of $1,000 would be imposed for each violation. ²⁴⁰ On March 26, April 4, April 10, April 28, May 7, and May 14, 1991, an MDE field inspector visited appellant’s facility, obtained grab samples, and determined that appellant’s discharges were not in compliance with the effluent limitations for both TSS and turbidity as set forth in the Consent Order. The inspector also found that on April 4, April 16, and April 29, 1991, appellant had discharged wastewater from a point other than the agreed-upon discharge point. MDE determined further that, during the month of April 1991, appellant had exceeded the monthly average limitation for both TSS and turbidity.

Following issuance of the permit, MDE personnel found violations of the effluent limitations for either TSS, turbidity, or both on May 29, June 5, June 13, June 18, June 26, July 16, July 23, July 30, August 6, September 4, September 10, September 26, October 1, October 31, November 14, November 27, and December 18, 1991, June 1, June 9, July 29, September 9, and December 22, 1992, February 18, December 2, and December 14, 1993, and March 22, May 11, May 17, June 29, July 27, and September 28, 1994. MDE also determined that, in May, June, and July 1991, appellant’s discharges had exceéded the permissible monthly average concentration for TSS, and that appellant had exceeded the allowable monthly average concentration for turbidity in May and June 1991. Furthermore, MDE found that, on September 9, 1992, February 5, 1994, and May 11,1994, appellant had discharged wastewater from a point other than the location authorized in the permit. MDE instituted this civil enforcement proceeding in the Circuit Court for Prince George’s County, pursuant to its authority under Maryland Code (1982, 1996 Repl.Vol.), § 9-342(a) of the Environment Article.

MDE’s Second Amended Complaint for Injunction and Civil Penalty sought a total civil penalty of $297,000 for all of the alleged violations and an injunction requiring A.H. Smith to cease violations of the permit. Specifically, count 1 of the complaint sought the imposition of $17,000 in penalties for violations of the Consent Order. The second count sought penalties of $227,500 for ²⁴¹ discharges in excess of the daily maximum effluent limitations for both TSS and turbidity as contained in the permit; similarly, count 3 sought penalties in the amount of $22,500 for violations of the permit-based monthly average effluent limitations, and count 4 sought $30,000 in penalties for discharges from locations other than that specified in the permit. In addition, as stated, MDE sought an injunction requiring A.H. Smith to cease all discharges in violation of the permit.

The circuit court found that appellant had indeed discharged wastewater in violation of both the Consent Order and permit. The court imposed fines against A.H. Smith totalling $49,000, but declined to issue an injunction. Appellant noted this appeal therefrom. We shall relate additional facts in our discussion of the questions presented.

Did the circuit court properly determine that A.H. Smith had violated the terms of the Consent Order and wastewater discharge permit? Both the Consent Order and permit base certain violations upon exceedances of the effluent limitation daily máximums. The “daily maximum” is defined in both the Consent Order and permit as follows: The “daily maximum” effluent limitation by concentration means the highest allowable reading of any daily determination of concentration. “Daily determination of concentration” is also defined in both the Consent Order and permit: “Daily determination of concentration” means one analysis performed on any given sample representing 24-hours flow, with one number in mg/1 as an outcome. As stated, violations of the permit and Consent Order were determined by MDE based upon the results obtained from taking grab samples.

These samples were gathered by placing a one-quarter liter bottle under the outfall for no more than fifteen minutes and allowing the bottle to fill—i.e., a one- ²⁴² quarter liter sample was literally grabbed from out of the outflow. On appeal, A.H. Smith contends that “the trial court abused its discretion by improperly interpreting the Consent Order and permit language in favor of the State and against the appellant, in determining that the Appellant had, in fact[,] violated the statute at issue[.]” More specifically, appellant states, “In this case, the dispute is whether the State’s sampling methods complied with the language of the Consent Order[ ] and Discharge Permit[ ] and[,] consequently, provided sufficient evidence for the Trial Court to find a violation of Maryland Code, Environment Article, § 9-342.” Stated otherwise, appellant alleges that a grab sample is not “any given sample representing 24-hours flow” and, thus, is insufficient to be the basis for a finding that appellant exceeded the effluent limitations in the Consent Order and permit. The circuit court rejected this argument. The court found “that [MDE’s] lab reports do in fact qualify, and I received them as evidence.” In other words, the court found that a grab sample was representative of the flow within that twenty-four hour period and was, thus, sufficient to support a finding that a violation had occurred.

We agree. Under appellant’s theory, MDE would be required to obtain an unspecified number of samples over a twenty-four hour period and then average the results obtained. This argument is unpersuasive. Principally, this is not what is called for under the applicable terms of the Consent Order and permit.

Both the Consent Order and permit imposed sampling requirements, as MDE was entitled to do, of once per week by grab sample. This is precisely how violations were established. Neither the Consent Order nor the permit contemplated the taking of samples more than once per week—let alone more than once within each twenty-four-hour period—or by a method other than a grab sample. Appellant’s position would require appellee to maintain personnel on appellant’s site twenty-four hours a day or sample by a means other than ²⁴³ that specified in the consent order and permit.

That clearly is not what was