Homes Oil Co. v. Maryland Department of Environment

THIEME, Judge. Appellant Homes Oil Company, Inc., appeals from the decision of the Circuit Court for Montgomery County granting summary judgment in favor of appellee, Maryland Depart ⁴⁴⁷ ment of the Environment (“MDE”), pertaining to appellant’s petition of appeal of MDE’s administrative decision. Appellant presents the following question for review, which we have re-phrased and consolidated for clarity: Did the trial court err in granting appellee’s Motion for Summary Judgment regarding appellant’s petition of appeal of MDE’s administrative decision? We answer “no” to this question and explain.

Facts Appellant owned and operated gas stations in Maryland, and was cited by appellee for oil contamination at two of its gas stations—one in Upper Marlboro and one in Hyattsville. Appellant was ordered to remedy these environmental concerns and implemented plans to do so. After successfully cleaning up the sites, appellant received notices of compliance from MDE for both sites. In 1995, appellant applied to appellee for reimbursement of costs associated with the removal and off-site treatment of contaminated soil at these sites, pursuant to the Maryland Oil Contaminated Site Environmental Cleanup Fund (“Fund”) of Title 4, subtitle 7 of the Environment Article.

The Fund was created by the General Assembly in 1993 and amended in 1996. The parties agree that the 1996 amendment does not directly affect this case, as this action is based on events occurring prior to 1996. Following is a reproduction of the relevant portions of Title 4, subtitle 7 of the Environment Article, as it read prior to the 1996 amendment: § 4-701 provides relevant definitions: (a) In general.—In this subtitle the following words have the meanings indicated. (b) Cleanup.—“Cleanup” means abatement, containment, removal, and disposal of oil and the restoration of the environment.

(c) Fund.—“Fund” means the Oil Contaminated Site Environmental Cleanup Fund. ⁴⁴⁸ (d) Oil.—“Oil” has the meaning provided in § 4-401(g) of this title. (e) Site rehabilitation.— (1) “Site rehabilitation” means cleanup actions taken in response to a release from an underground oil storage tank. (2) “Site rehabilitation” includes investigation, evaluation, planning, design, engineering, construction, or other services undertaken and expenses incurred to investigate or clean up affected soils, groundwater, or surface water. (f) Third party claim.—“Third party claim” means any civil action brought or asserted by any person against any owner or operator of any underground oil storage tank for damages to person or property which damages are the direct result of oil released from tanks covered under this subtitle.

(g) Underground oil storage tank.—“Underground oil storage tank” has the meaning provided in § 4-401 (k) of this title. § 4-702 provides legislative findings and intent: (a) Findings.—The General Assembly finds and declares that: (1) The storage of oil in underground oil storage tanks is a major cause of groundwater contamination in this State; (2) Groundwater resources are vital to the population and economy of this State; and (3) The preservation of the State’s groundwater resources is in the public interest. (b) Additional Findings.—The General Assembly further finds that where contamination of groundwater has occurred due to leaking underground oil storage tanks, remedial measures have often been delayed for long periods due to high costs of such remedial measures. These delays result in the continuation and intensification of the threat to the public health, safety, and welfare, in greater damages to the environment, and in significantly higher costs to clean up the contamination and rehabilitate the site. ⁴⁴⁹ (c) Intent.—The General Assembly intends this subtitle to provide adequate financial resources and incentives for the expeditious cleanup and rehabilitation of contaminated sites without delay. § 4-704 provides for the establishment of the fund: (a) Established.—There is an Oil Contaminated Site Environmental Cleanup Fund. (b) Uses.—The Fund shall be used to: (1) Reimburse an owner or operator of an underground oil storage tank for site rehabilitation costs incurred on or after October 1, 1993 resulting from contamination caused by releases from an underground oil storage tank; (2) Provide funds for site rehabilitation activities carried out by the Department or under the Department’s direction and control; and (3) To the extent provided in the State budget and in an amount not to exceed 3% of the revenues in the Fund during the fiscal year, provide funds for the Department’s administration of this subtitle.

(c) Exemptions from subtitle.—The provisions of this subtitle do not apply to an underground storage tank that is: (1) Exempt from the requirements of § 4-409(b)(3) of this title; (2) Owned by a state, county, or municipal corporation; or (3) Owned by a local education agency. § 4-705 is the reimbursement provision of the fund [1] : (a) Application.—The owner or operator of an underground oil storage tank may apply to the Fund for reimbursement, on or after October 1, 1993, for usual, customary, and reasonable costs incurred on or after October 1, 1993 in performing site rehabilitation. ⁴⁵⁰ (b) Deductibles; limitation.—Any reimbursement from the Fund is subject to: (1) For owners or operators of six tanks or fewer, a deductible of $15,000; (2) For owners or operators of more than 6 but not more than 15 tanks, a deductible of $20,000; (3) For owners or operators of more than 15 but not more than 30 tanks, a deductible of $30,000; (4) For owners or operators of more than 30 tanks, a deductible of $40,000; and (5) A limit of $125,000 per occurrence. (c) Eligibility.—To be eligible for reimbursement from the Fund, an owner or operator shall: (1) Certify that the discharge is not the result of a willful or deliberate act; (2) Submit a corrective action plan, schedule, and cost estimate to the Department that shall include provisions for the environmentally sound treatment or disposal of contaminated soils that meet all federal and State requirements and standards; and (3) Certify that the discharge is from a tank registered under § 4-411.1 of this title. (d) False certification.—if the owner or operator knowingly submits a false certification under subsection (c) of this section, that owner or operator is not eligible for reimbursement under this subtitle. (e) Only cost-effective and reasonable expenses are eligi ble.—Only expenses that are cost-effective, reasonable, and consistent with a corrective action plan approved by the Department may be eligible for reimbursement from the Fund.

(f) Cost of replacing or retrofitting tanks not eligible.—The cost for replacement or retrofitting of underground oil storage tanks and associated piping is not eligible for reimbursement, and the Department may not incur these costs or expend moneys from the Fund for these purposes. ⁴⁵¹ In 1994, MDE adopted in Title 26, Subtitle 10, Chapter 14 of the Code of Maryland Regulations (“COMAR”) regulations to assist in the Fund’s implementation. 2 MDE established a method to prioritize applicants to the Fund based upon environmental risk and the total amount of an applicant’s underground storage tanks within Maryland. The most relevant provision of COMAR to the dispute in this case is 26.10.14.05, which includes a schedule of eligible reimbursement costs: A. The Department shall reimburse an applicant only for the following site rehabilitation costs if they are cost effective, reasonable, and consistent with an approved application: (1) Soil handling, including excavation, transportation, and proper disposal—up to $20 per ton up to 100 tons per site; (2) Soil treatment—up to: (a) $30,000 per installation, (b) $10,000 per year for operation and monitoring; (3) Ground water pumping and treatment, and soil treatment—up to: (a) $45,000 per installation, (b) $17,500 per year for operation and monitoring; (4) Ground water pumping and treatment, and soil treatment—up to: (a) $55,000 per installation, (b) $17,500 per year for operation and monitoring; (5) Well bailing or monitoring, or both,—up to $12,500 per year for operation; (6) Subsurface investigation—up to $8,000. ⁴⁵² B. The Department may approve other site rehabilitation costs for reimbursement if it determines the costs are for effective and necessary site rehabilitation activities. COMAR, Title 26, Subtitle 10, Chapter 14 Appellant claims that it “excavated and treated 2,131 tons of contaminated soil from the Upper Marlboro site ... at a cost of over $105,000” and that it “excavated and treated 3,517 tons of contaminated soil from the Hyattsville site ... at a cost of over $175,000.” Interpreting its own regulations, MDE determined that the costs in question were for “soil handling” and “soil treatment,” and reimbursed appellant $32,263.08 for the Upper Marlboro site and $36,410.01 for the Hyattsville site. These amounts were established primarily as a result of the maximum allowable reimbursement limits for “soil handling” and “soil treatment” under § .05A of COMAR 26.10.14.

Appellant, dissatisfied with the amount of the reimbursement provided by appellee, requested that MDE reconsider its determination and provide it with additional reimbursement under § .05B of COMAR 26.10.14 for “other site rehabilitation costs for reimbursement” that appellant claimed were “for effective and necessary site rehabilitation activities.” MDE rejected appellant’s request, stating in a letter to appellant that it believed “that additional reimbursement would be beyond the cost allowed in the current regulations” and that “[t]he Department has reimbursed you under COMAR 26.10.14.05A(1) and A(2) for soil removal and treatment. CO-MAR 26.10.14B applies to rehabilitation costs not listed under Regulation .05A....” Appellant subsequently filed a notice of appeal with MDE. In response, MDE stated that “it would be inappropriate to allocate additional funds. Under COMAR 26.10.14.04D, this decision is final regarding reimbursement matters.” Appellant then filed a petition in the Circuit Court for Montgomery County requesting judicial review of MDE’s reimbursement decision pursuant to applicable provisions of the Administrative Procedure Act (“APA”), or, in the alternative, a writ of mandamus ordering MDE to pay additional ⁴⁵³ reimbursements.

Ultimately, the circuit court did not rule on the motion regarding the mandamus petition but remanded the case to MDE for the issuance of a written decision outlining MDE’s specific findings of facts and conclusions of law upon which it had based its denial of additional reimbursements. MDE then appealed the circuit court’s decision to remand the case. In an unreported opinion, Judge Rosalyn B. Bell wrote for this Court, holding that appellant did not have the right to judicial review under the APA, and that its petition for mandamus failed to state a claim upon which relief could be granted. Regarding the right to judicial review under the APA, we stated that “we hold that § 4—412(b) grants APA judicial review only for MDE decisions issued pursuant to Subtitle Four, Title Four of the Environment Article.” Pertaining to appellant’s petition for mandamus, we allowed for the filing of an amended petition for mandamus, as we stated: [Appellant’s] allegations are much too sparse and conclusory to support a claim that MDE officials acted arbitrarily and capriciously.

Thus, Homes cannot be allowed to proceed on that pleading; if it wants review of MDE’s reimbursement decision, it will have to re-file a pleading which contains more specific allegations entitling it to relief. Maryland Department of the Environment v. Homes Oil Company, Inc., No. 541, September Term, 1997, 122 Md.App. 789 (filed July 24, 1998) (per curiam). Appellant subsequently filed an amended complaint in mandamus. MDE responded by filing a motion for summary judgment on the ground that its reimbursement decisions were consistent with the reasonable interpretation of its own regulations.

MDE’s motion for summary judgment was granted by the circuit court. Appellant then moved to alter or amend the judgment; appellant’s motion was denied. This appeal followed. It is appellant’s contention that the circuit court erred in granting appellee’s motion for summary judgment when material facts were in dispute.

Pursuant to Md. Rule 2-501 (e), ⁴⁵⁴ “[t]he court shall enter judgment in favor of or against the moving party if the motion and response show that there is no genuine dispute as to any material fact and that the party in whose favor judgment is entered is entitled to judgment as a matter of law.” Md.Rule 2-501(e). See, e.g., Murphy v. Merzbacher, 346 Md. 525, 531 , 697 A.2d 861 (1997); Bowen v. Smith, 342 Md. 449, 454 , 677 A.2d 81 (1996); Rosenblatt v. Exxon Company, U.S.A., 335 Md. 58, 68 , 642 A.2d 180 (1994); McGraw v. Loyola Ford, Inc., 124 Md.App. 560, 572 , 723 A.2d 502 , cert. denied, 353 Md. 473 , 727 A.2d 382 (1999). In order for there to be disputed facts sufficient to render summary judgment inappropriate, “there must be evidence on which the jury could reasonably find for the plaintiff.” Seaboard Sur. Co. v. Richard F. Kline, Inc., 91 Md.App. 236, 244 , 603 A.2d 1357 (1992).

This Court has held that “[cjonclusory denials or bald allegations will not defeat a motion for summary judgment.” Barber v. Eastern Karting Co., 108 Md.App. 659, 672 , 673 A.2d 744 , cert. denied, 343 Md. 334 , 681 A.2d 69 (1996); see Seaboard Sur. Co., 91 Md.App. at 243 , 603 A.2d 1357 . Moreover, “a mere scintilla of evidence in support of the non-moving party’s claim is insufficient to avoid the grant of summary judgment.” Barber, 108 Md.App. at 672 , 673 A.2d 744 (citing Beatty v. Trailmaster Products, Inc., 330 Md. 726, 738 , 625 A.2d 1005 (1993)). Appellant contends that an actual controversy does exist on two issues: 1) whether MDE’s handling of appellant’s reimbursement applications to the Fund was arbitrary and capricious, because MDE limited reimbursement to the amounts specified in Section A of COMAR 26.10.14.05, and refused to reimburse appellant under Section B of that statute for other remediation costs;, and 2) whether COMAR 26.10.14.05 is invalid because it provides incentive for applicants to delay clean-up of oil contaminated sites, contrary to the legislative intent.

By contrast, MDE asserts that the motion for summary judgment was properly granted because there was no dispute as to any facts, as its reimbursement decisions were consistent with the reasonable interpretation of its own regu ⁴⁵⁵ lations. We agree with MDE, and find no merit in appellant’s argument. Writ of Mandamus The method of review in this case is by means of a writ of mandamus. Therefore, we shall first address the threshold question of whether this Court has the authority to issue the extraordinary writ of mandamus under the circumstances of this case. “The common law writ of mandamus is an original action and not an appeal.” Philip Morris Inc., et al. v. The Honorable Edward J. Angeletti, 358 Md. 689, 707 , 752 A.2d 200 (2000).

See Board of License Commissioners for Anne Arundel County v. Corridor Wine, Inc., t/a Corridor Wine & Spirits, et al., 361 Md. 403, 411 , 761 A.2d 916 (2000), slip opinion at 8. A writ of mandamus “is a summary remedy, for the want of a specific one, where there would otherwise be a failure of justice. It is based upon reasons of justice and public policy, to preserve peace, order and good government.” Id. at 708, 752 A.2d 200 (citations omitted). “[T]he authority to issue mandamus rests within the sound discretion of the court, but that discretion must ‘be exercised under the rules long recognized and established at common law.’ ” Id. (citation omitted). “We have acknowledged that the power to issue an extraordinary writ of mandamus is one which ought to be exercised with great caution.” Doering v. Fader, 316 Md. 351, 361 , 558 A.2d 733 (1989).

Although the Maryland Constitution only provides circuit courts with statutory authority to grant mandamus, the Court of Appeals has stated that “we have jurisdiction to issue to an inferior court peremptory writs in aid of our appellate jurisdiction.” Philip Morris, 358 Md. at 710-11 , 752 A.2d 200 . In support of this conclusion, the Court stated: Whether we have, as the highest court of this State, an inherent superintending or supervisory power over the courts below us in the judicial hierarchy, and whether any such power is implicit in Article IV, § 18 of the Maryland Constitution, are questions we reserve for another day. We need not and do not address them today because we hold ⁴⁵⁶ that under the circumstances of this case we have the power to issue a writ of mandamus or a writ of prohibition in aid of our appellate jurisdiction. Id. at 710, 752 A.2d 200 .

The Philip Moms Court explained that mandamus is in aid to appellate jurisdiction when the use of it is necessary to enable the Court to exercise appellate jurisdiction. Id. at 711 , 752 A.2d 200 . The Court explained that mandamus aided the appellate process “by making possible the review of a potentially unreviewable question.” Id. For similar reasons, it is within the purview of this Court to issue writs of mandamus.

See Bozeman v. Disability Review Bd. of the Prince George’s County Police Pension Plan, 126 Md.App. 1 , 727 A.2d 384 (1999). In Maryland common law mandamus has been described as a prerogative writ grantable where the public justice of the State is concerned. It is a writ to prevent disorder, from a failure of justice, where the law has established no specific remedy, and where in justice and good government there' ought to be one.... In re Writ of Prohibition, 312 Md. 280, 307 , 539 A.2d 664 (1988) (citation omitted) (inner quotation marks omitted).

A writ of mandamus will only be issued in extraordinary cases where that “action is necessary to protect its jurisdiction or accomplish substantial justice.” Philip Morris, 358 Md. at 718 , 752 A.2d 200 . The Court ultimately granted mandamus in Philip Morris , stating: We simply hold that, given the irreparable harm that might otherwise be suffered by the legal system and by Petitioners, we may issue a writ of mandamus in aid of our appellate jurisdiction in the present matter. It is appropriately within this Court’s prerogative to review the order of the Circuit Court granting class certification in this case so extraordinary because of the immense amount of time and expense that both the parties and the judicial system of this State will incur should the litigation proceed as a class action, as well as the astronomical number of persons in ⁴⁵⁷ Maryland whose lives will be affected by our decision either way. Id. at 722 , 752 A.2d 200 .

In Goodwich, the Court of Appeals stated that “judicial review is properly sought through a writ of mandamus ‘where there [is] no statutory provision for hearing or review and where public officials [are] alleged to have abused the discretionary powers reposed in them.’ ” Id. at 146, 680 A.2d 1040 (quoting State Department of Health v. Walker, 238 Md. 512, 522-23 , 209 A.2d 555 (1965)). 3 “Thus, prior to granting a writ of mandamus to review discretionary acts, there must be both a lack of an available procedure for obtaining review and an allegation that the action complained of is illegal, arbitrary, capricious or unreasonable.” Goodwich, 343 Md. at 146 , 680 A.2d 1040 . In Prince George’s County v. Carusillo, 52 Md.App. 44, 50 , 447 A.2d 90 (1982), we stated, “the writ will lie if no statutory provision for a hearing or review exists and public officials are alleged to have abused their discretion.” (Emphasis added.) Regarding the first point of this two-step analysis, the Court of Appeals has stated that “[i]t is well settled in this State that a writ of mandamus will not be granted where the petitioner has a specific and adequate legal remedy to meet the justice of the particular case and where the law affords [another] adequate remedy.” Brack v. Wells, 184 Md. 86, 90-91 , 40 A.2d 319 (1944); see also Gisriel v. Ocean City Elections Board, 345 Md. 477, 497 , 693 A.2d 757 (1997). Our earlier unreported opinion in this case stated that there was no method of review available to appellant other than mandamus. We will not now disturb that determination.

Therefore, appellant has met the first criteria, but, in order for mandamus to be appropriate under the facts of this case, appellant must also demonstrate ⁴⁵⁸ that the second criteria has been met, namely, that MDE acted arbitrarily or capriciously. 4 We find that MDE did not act arbitrarily or capriciously in making its determination, and, therefore, we decline to grant mandamus. Subsequently, we affirm the circuit court’s decision granting summary judgment in favor of MDE. In Goodwich , our Court of Appeals opined: Our mandamus jurisprudence is illustrated both by those cases in which we have granted the writ, as well as those in which we have refused to issue it. For example, in Maryland-National Capital Park and Planning Commission v. Rosenberg, 269 Md. 520 , 307 A.2d 704 (1973), we held that mandamus relief was appropriate because there was no statutory provision for judicial review and because the Planning Commission acted arbitrarily and capriciously in refusing to approve a plan for the subdivision of a piece of property.

Id. at 529-31, 307 A.2d at 708-10 . In [State Dept. of Health v.] Walker, supra, [ 238 Md. 512 , 209 A.2d 555 (1965)] mandamus was granted in the absence of provision for hearing or review and where the issuance of sewage disposal permits was arbitrarily denied. 238 Md. at 522-23 , 209 A.2d at 561 . In Heaps [v. Cobb], supra, [ 185 Md. 372 , 45 A.2d 73 (1945)] again we found mandamus relief warranted in the absence of provision for judicial review and where the Board of Trustees of the Employees’ Retirement System arbitrarily denied a pension claim by a member’s widow. 185 Md. at 379-86 , 45 A.2d at 76-79 . In Bovey [v. Executive Director], supra, [ 292 Md. 640 , 441 A.2d 333 (1982)] the petitioners sought a writ of mandamus to compel the Director of the HCAO to inquire of potential arbitration panelists whether they had an economic relation ⁴⁵⁹ ship with the health care providers whose cases they would be deciding.

We denied relief on the basis that the Director was free to exercise discretion in assuring the impartiality of panelists; therefore, mandamus would not lie to compel him to follow a specific procedure. 292 Md. at 649 , 441 A.2d at 338 . We also stated that judicial review existed to correct any such errors on the Director’s part. Id. In Stark v. State Board of Registration, 179 Md. 276 , 19 A.2d 716 (1941), we refused to grant mandamus relief to a petitioner who sought to compel the Board of Registration for Professional Engineers and Land Surveyors to issue a license to him, because the record contained no evidence that the Board failed to act or acted arbitrarily and, more importantly, because he failed to exhaust his statutory right of review.

Id. at 283-85 , 19 A.2d at 719-20 . Goodwich, 343 Md. at 147-48 , 680 A.2d 1040 . In Heft v. Md. Racing Comm’n, 323 Md. 257, 274 , 592 A.2d 1110 (1991), the Court of Appeals stated: Under our decisions, this is an administrative exercise of judgment which is not controllable by mandamus. Bovey v. Exec.

Dir., Health Claims, 292 Md. 640, 649 , 441 A.2d 333, 338 (1982) (“the Director is to bring his sound judgment” in applying certain statutory criteria, and, therefore, “[mjandamus simply does not lie”); Brack v. Bar Association, 185 Md. 468, 474 , 45 A.2d 102, 105 (1945) (mandamus “will not be issued if the ... duty .... [be] of a nature to require the exercise of judgment”); Brack v. Wells, 184 Md. 86, 90 , 40 A.2d 319, 321 (1944) (“When an act depends upon ... judgment, the writ of mandamus will not lie”); Fooks v. Purnell, 101 Md. 321, 323 , 61 A. 582 (1905) (“when a matter is confided to the ... judgment of a tribunal or official, no writ of mandamus would lie ... to reverse a decision made in