Opinion
No. CV 02-0512243 S
June 11, 2003
MEMORANDUM OF DECISION
The plaintiffs, five individuals seeking to obtain Connecticut marine pilots licenses, challenged the constitutionality of Regulation of Connecticut State Agencies § 15-15a-15, pursuant to which the Commissioner of the Department of Transportation (DOT) declared a moratorium on the issuance of new marine pilot licenses and declined to issue licenses to these individuals. After the Commissioner's declaratory judgment ruling, pursuant to Connecticut General Statutes § 4-175, finding the regulation and statute constitutional, this appeal ensued.
"Sec. 15-15a-15. Deferment of issuing of licenses: The Commissioner, who is empowered to determine the number of pilots sufficient to meet the demands of commerce in the waters of Connecticut, may place the names of those qualified applicants which he deems to be above the number of pilots sufficient to meet the demands of commerce on file for review and licensing in the order and dates on which the applications were made."
For the Commissioner's statutory authority, see Connecticut General Statutes, Sec. 15-13. Pilots; qualifications; license fee; bond; suspension or revocation of license; inactive status; limited licenses; regulations. "(a) The Commissioner of Transportation shall license as many residents of this state and any other state as said commissioner deems necessary and finds qualified to act as pilots for one year in any of the ports and waters of this state including the Connecticut waters of Long Island Sound."
Intervenor status was granted at the administrative hearing to certain professional marine pilots who are licensed to perform pilotage work in Connecticut waters, the Connecticut Marine Pilots Association, the Pilot Commission and the Board of Commissioners of Pilots of the State of New York. The intervenors now join the Defendant Department in this appeal. Because the court concludes that there is substantial evidence to support the DOT's findings of fact and conclusions of law as set forth in detail below, the court finds the issues in favor of the DOT. The court further concludes that plaintiffs' due process and equal protection claims must also fail. The court therefore dismisses the appeal.
1. BACKGROUND
The findings of fact set forth in the declaratory judgment ruling provide the framework of this dispute. Under Connecticut law, every vessel under register, entering or departing from any port or crossing the Connecticut waters of Long Island Sound is required to take on a licensed pilot. Conn. General Statutes § 15-15 (a). Responsibility and authority for licensing pilots operating vessels in Connecticut waters is vested in the DOT, which is authorized to license such pilots as are deemed necessary. To assist the DOT in its oversight and licensing of state marine pilots, the legislature created the Connecticut Pilot Commission which advises the DOT on matters relating to the licensure of pilots, the safe conduct of vessels and the protection of the ports and waters of the state, including the waters of Long Island Sound. Among other advisory responsibilities, the Pilot Commission is to advise the DOT on the "appropriate number of state-licensed pilots necessary for the safe, efficient and proper operations in the ports and waters of the state, including the waters of Long Island Sound." General Statutes § 15-13c.
Sec. 15-13c. Connecticut Pilot Commission. Members. Appointments.
(a) There is created within the Department of Transportation, for administrative purposes only, the Connecticut Pilot Commission to advise the Commissioner of Transportation on matters relating to the licensure of pilots, the safe conduct of vessels and the protection of the ports and waters of the state, including the waters of Long Island Sound.
Since 1992, the Pilot Commission has monitored the number of pilots and vessel calls and, based on the available evidence, had recommended a moratorium on the number of licensed pilots and continues to do so through the present time. The Pilot Commission recommended that the existing ranks of state licensed pilots be reduced from thirty to ten, modified to encompass a gradual reduction over a number of years. The DOT has imposed such a moratorium for these years and has not licensed any additional pilots, deciding to allow the number of active licensed pilots to fall by attrition. In 1992 there were approximately forty Connecticut and Long Island Sound licensed pilots, and in November 2001, there were approximately twenty pilots.
The plaintiffs challenged the authority of the DOT to regulate the issuance of licenses in their administrative petitions for declaratory judgment ruling requesting (1) that they be issued Connecticut Marine Pilots Licenses and; (2) that the moratorium or freeze pursuant to the regulations be held unconstitutional and void, and for other relief. They presented facts and arguments before the DOT challenging the regulation as an undue burden on interstate commerce contrary to Article I, Section 8, Constitution of the United States.
The DOT's declaratory judgment ruling of November 21, 2001, a five-page decision, made the following findings of fact and conclusions of law:
19. The States of Connecticut and New York have, after study and careful deliberation, jointly imposed a moratorium on the issuance of any new State pilot licenses because there are now and have been in the past, more State licensed maritime pilots in the system than actual vessel traffic can warrant or support. Affidavit of Robert H. Pouch, dated June 13, 2001, Paragraph 1.
20. There is currently not a need for any additional pilots beyond the number currently licensed by the Commissioner of Transportation.
21. The existing limitation on the issuance of pilots licenses is not unconstitutional and does not constitute an unreasonable and undue burden on interstate commerce or intrastate commerce.
In this appeal, for the first time the plaintiffs challenge the declaratory judgment ruling as a denial of due process and equal protection under the 14th Amendment to the United States Constitution.
2. DISCUSSION
A. Standard for Review
Under the Uniform Administrative Procedure Act ("UAPA"), General Statutes § 4-166 et seq., judicial review of an agency decision is restricted. See MacDermid Inc. v. Department of Environmental Protection, 257 Conn. 128, 136-37, 778 A.2d 7 (2001). Section 4-183 (j) of the General Statutes provides as follows:
The court shall not substitute its judgment for that of the agency as to the weight of the evidence on questions of fact. The court shall affirm the decision of the agency unless the court finds that substantial rights of the person appealing have been prejudiced because the administrative findings, inferences, conclusions, or decisions are:
1) In violation of constitutional or statutory provisions;
2) in excess of the statutory authority of the agency;
3) made upon unlawful procedure;
4) affected by other error of law;
5) clearly erroneous in view of the reliable, probative, and substantial evidence on the whole record; or
6) arbitrary or capricious or characterized by abuse of discretion or clearly unwarranted exercise of discretion.
Stated differently, "[j]udicial review of an administrative agency decision requires a court to determine whether there is substantial evidence in the administrative record to support the agency's findings of basic fact and whether the conclusions drawn from those facts are reasonable." (Internal quotation marks omitted, emphasis added.) Schallenkamp v. DelPonte, 229 Conn. 31, 40, 639 A.2d 1018 (1994). "It is fundamental that a plaintiff has the burden of proving that the [agency], on the facts before [it], acted contrary to law and in abuse of [its] discretion . . ." (Internal quotation marks omitted.) Murphy v. Commissioner of Motor Vehicles, 254 Conn. 333, 343, 757 A.2d 561 (2000).
Because this is an appeal from a declaratory judgment decision of the Commissioner, the question pursuant to General Statutes § 4-183 becomes whether, given the facts, which are not in material part contested, the actions of the DOT are arbitrary, capricious and contrary to the laws of the State of Connecticut. As argued below, do the regulations and the actions of the DOT place an undue burden on interstate commerce contrary to Article I, Section 8, Constitution of the United States? Further, may the court consider whether the due process clause and the equal protection clause of the 14th Amendment have also been violated, even though these constitutional claims were not raised in the administrative proceeding and are raised for the first time in the briefing for this appeal?
Additional facts which are referred to in the plaintiff's brief and which were not a part of the record will be discussed later on in this opinion. The facts concerning the licensure of Captains Eulitt and Heath during the term of the moratorium are not part of the record and were not permitted to be added as additional evidence outside the record during the course of this appeal. (See ruling of Schuman, J.)
B. Claims Made at the DOT Hearing
At the hearing before the DOT, the plaintiffs produced evidence and argued that the moratorium did not promote safety and ensure the free flow of interstate commence because the present system fosters a pilot rotation "monopoly" by pilots holding licenses issued by states other than the State of Connecticut. Plaintiffs' central claim is that the creation of moratorium is unconstitutional because it places an impermissible burden on interstate and intrastate commence by, among other things, increasing the costs of products shipped, made and sold inside and outside Connecticut, and that it negatively impacts the competitive position of Connecticut ports and terminals. In addition, the plaintiffs claim that the moratorium obstructs interstate commerce, will negatively impact national transportation efficiency and economy to the extent that the police power of the State of Connecticut is outweighed by the interests of the nation in an adequate, economical and efficient transportation system. Because of all of these reasons, plaintiffs claim the moratorium unreasonably burdens the free flow of interstate and intrastate commence.
Record, Item 2.
1. Substantial Evidence
"The substantial evidence rule governs judicial review of administrative fact-finding under UAPA. General Statutes § 4-183 (j) (5) and (6). Substantial evidence exists if the administrative record affords a substantial basis of fact from which the fact in issue can be reasonably inferred . . . This substantial evidence standard is highly deferential and permits less judicial scrutiny than a clearly erroneous or weight of the evidence standard of review . . . The burden is on the [plaintiff] to demonstrate that the [agency's] factual conclusions were not supported by the weight of substantial evidence on the whole record." (Citations omitted; internal quotation marks omitted.) MacDermid, Inc. v. Dept. of Environmental Protection, 257 Conn. 128, 136-37, 778 A.2d 7 (2001). So the court must look to the details of the record of the agency proceedings.
In support of their application for declaratory judgment ruling, the plaintiffs did not present that type of statistical or comparative data from other regions that would be expected to support such allegations and the claimed negative impact on interstate commerce. The record includes on the crucial facts a self-serving affidavit from Charles B. Jonas, an individual who holds a Connecticut State marine pilot's license and who is a vice president of Interport Pilots Agency, Inc., a pilot service which provides pilots to the waters of New York Harbor, Delaware Bay and River, Chesapeake and Delaware Canal to Baltimore and Long Island Sound.
Affidavit dated August 9, 2001, Record, Item 10.
Captain Jonas provides no facts about the number of vessels plying the Long Island Sound and Connecticut waters or the per pilot trips annually, but simply asserts his belief that the moratorium must be lifted because there are not enough licensed pilots to handle the work. He further claims that due to the reduction in the number of pilots and the increase in their average age, a time will come when the possibility exists that hastily trained pilots will be required. The crux of his claims, however, appears to relate to a claim that by virtue of the moratorium and Connecticut's agreement with the State of New York to have a rotation of this limited pool of licensed maritime pilots, ship owners, charterers, terminator operators and agents will not have the ability to choose a pilot based on performance. To support his anti-competitive claims, he asserts that members of the Connecticut State Marine Pilots, one of the intervenors, entered into a voluntary rotation agreement with two other groups of pilots called Northeast Pilots and Sandy Hook Pilots. As the Connecticut pilots continue to age and their number is reduced, the group he labels "the Block Island cabal" will have a monopolistic stranglehold upon the traffic in the waters of Connecticut and Long Island Sound.
Contrasting the material submitted for the plaintiffs, the intervenors supplied information about the facts considered by the Pilots Commission upon which its yearly recommendations to the DOT was based, as well as those recommendations themselves. There were also statements from other marine pilots contesting some of the assertions made in the Jonas affidavit. In short, a detailed review of the record indicates substantial evidence supporting the findings of fact made by the DOT. And finally, in this appeal, the plaintiffs do not point to specific matters, which they claim demonstrate the errors made below. Nonetheless, the court has reviewed the record, the factual findings and conclusions of law of the agency in detail.
See in particular the affidavit of Donald J. Sheetz, September 7, 2001 and all attachments.
2. Burden on Interstate Commerce
The court concludes that the agency properly determined that the moratorium did not place an impermissible burden on interstate commerce. "Although the criteria for determining the validity of state statutes affecting interstate commerce have been variously stated, the general rule that emerges can be phrased as follows: where the statute regulates evenhandedly to effectuate a legitimate local public interest, and its effects on interstate commerce are only incidental, it will be upheld unless the burden imposed on such commerce is clearly excessive in relation to the putative local benefits." Blue Sky Bar, Inc. v. Stratford, 203 Conn. 14, 30, 523 A.2d 467 (1987), quoting Huron Portland Cement Co. v. Detroit, 362 U.S. 440, 443 [ 80 S.Ct. 813, 4 L.Ed.2d 852 (1960)]; see also Pike v. Bruce Church, Inc., 397 U.S. 137, 142, 90 S.Ct. 844, 25 L.Ed.2d 174 (1970); Edgar v. Mite Corporation, 457 U.S. 624, 102 S.Ct. 2629, 73 L.Ed.2d 269 (1982).
It is not for this court to substitute its own judgment as to the claimed anti-competitive effects of the present rotation system in place or to opine about any putative present or future burdens placed by the system on interstate or intrastate commerce. It is the court's duty to examine basic findings of fact and the conclusions drawn and determine only whether they are reasonable. See Schallenkamp v. DelPonte, 229 Conn. 31, 40, 639 A.2d 1018 (1994). The court concludes that facts found amply support the reasonable conclusions of law made by the agency.
C. Equal Protection Claims
But as noted, plaintiffs' appeal does not point to those specific factual findings made below that are claimed to be erroneous nor does it challenge the determination of the DOT that the statutory scheme and regulations do not place an unreasonable burden on interstate or intrastate commerce. In this appeal for the first time, the plaintiffs claim that they were denied equal protection under the law.
As a preliminary matter, the defendants argue that the court should not consider those claims not raised in the proceedings before the agency. And the law does state that on appeal the court is to consider whether the agency's decision is supported by the facts before it, of necessity requiring that the court consider what was before the agency in the first instance. Schallenkamp v. DelPonte, 229 Conn. 31, 40, 639 A.2d 1018 (1994). And when there are claims that constitutional provisions have been violated, the court should afford deference to the construction of a statute applied by the administrative agency empowered by law to carry out the statute's purposes.
Nonetheless, cases that present pure questions of law, however, invoke a broader standard of review than is ordinarily involved in deciding whether, in light of the evidence, the agency has acted unreasonably, arbitrarily, illegally or in abuse of its discretion. And that is the claim made by the plaintiffs in this case. Furthermore, "when a state agency's determination of a question of law has not previously been subject to judicial scrutiny . . . the agency is not entitled to special deference." (Internal quotation marks omitted.) Connecticut Light Power Co. v. Texas-Ohio Power, Inc., 243 Conn. 635, 642, 708 A.2d 202 (1998); MacDermid, Inc. v. Dept. of Environmental Protection, 257 Conn. 128, 137, 778 A.2d 7 (2001).
The regulations and statute in question regulating the licensing of maritime pilots have not previously been the subject of judicial scrutiny. Therefore, this court may make an independent evaluation of the constitutional claims. For those reasons, despite the DOT's claim that the plaintiffs have waived this claim because of their failure to argue it at the agency hearing, the court will address the equal protection claims.
Plaintiffs argue that they had a property interest in the marine pilot's licenses and that they were not treated equally with others in their class. They further admit that the statutory scheme they are challenging is subject to review to determine if there is any rational basis for the legislature's statutory scheme and the actions taken pursuant to it by regulation.
"In the case of economic regulation, the test to determine constitutionality is well established in our cases. The equal protection and the due process provisions of both constitutions have the same meaning and the same limitations." Miller v. Heffernan, 173 Conn. 506, 516-17, 378 A.2d 572 (1977); Horton v. Meskill, 172 Conn. 615, 639, 376 A.2d 359 (1977). "[A]n act regulating economic activity must bear a reasonable relationship to a proper legislative purpose in a manner that is neither arbitrary nor discriminatory. The court's function . . . is to decide whether the purpose of the legislation is a legitimate one and whether the particular enactment is designed to accomplish that purpose in a fair and reasonable way. If an enactment meets this test, it satisfies the constitutional requirements of due process and equal protection." Pierce v. Albanese, 144 Conn. 241, 249, 129 A.2d 606, appeal dismissed, 355 U.S. 15, 78 S.Ct. 36, 2 L.Ed.2d 21 (1957).
"The constitutional issue is whether legislative classifications or discriminations bear a rational relationship to a legitimate state end and [are] based on reasons related to the pursuit of that goal." Gentile v. Altermatt, 169 Conn. 267, 295, 363 A.2d 1, appeal dismissed, 423 U.S. 1041, 96 S.Ct. 763, 46 L.Ed.2d 631 (1976). And it should be noted that "the judiciary may not sit as a super-legislature to judge the wisdom or desirability of legislative policy determinations made in areas that neither affect fundamental rights nor proceed along suspect lines . . . in the local economic sphere, it is only the invidious discrimination, the wholly arbitrary act, which cannot stand consistently with the Fourteenth Amendment." New Orleans v. Dukes, 427 U.S. 297, 303-04, 96 S.Ct. 2513, 49 L.Ed.2d 511 (1976); Blue Sky Bar, Inc. v. Stratford, 203 Conn. 14, 26-27 (1987).
All the facts and arguments presented by plaintiffs before the hearing officer essentially are that a free market system for not only the issuance of marine pilots' licenses but for the activity of such pilots on the waters of the State of Connecticut is better designed to protect the public interest than the regulatory scheme adopted and implemented by the state. No evidence was presented by the plaintiffs to show how they were treated any differently from anyone else nor to demonstrate why the classification made by the legislature is irrational and not related to the ends of protecting the public.
While the plaintiffs argue that Paul Eulitt and Toni Heath are two pilots who were licensed during the existence of the moratorium, there is no evidence before the court as to why they were licensed or how their status is either the same or different from that of the plaintiffs. Because the motion to enlarge the record to include any facts about these individuals was previously denied, the court cannot take these alleged facts referenced in the plaintiffs' brief into consideration. The court concludes that there is no evidence in the record before it concerning other pilots similarly situated to the plaintiffs who were dissimilarly treated. On the substantial evidence test alone, then, this appeal must fail.
Although there are no Connecticut cases interpreting Reg. § 15.15a-15 and its authorizing statute, in the arena of liquor licenses, the Connecticut Supreme Court has held that the legislature properly gave authority to the Liquor Control Commission to deny permits where "it had reasonable cause to believe that the number of [liquor] permit premises in the particular locality is such that granting of an additional permit would be detrimental to the public interest." See Connecticut General Statues § 30-46; Campisi v. Liquor Control Commission, 175 Conn. 295, 297 (1978), and Biz v. Liquor Control Commission, 133 Conn. 556, 563 (1947). The regulatory scheme pursuant to which the present moratorium has been adopted on a yearly basis by the DOT is not distinguishable from the methods that are constitutionally permissible to limit the number of new liquor licenses. In each instance, the commission in question found that it had reasonable cause to believe that increasing the number of licenses was detrimental to the public interest.
While the court can appreciate that a different method of licensing pilots and permitting them to operate in the waters of the State of Connecticut and Long Island Sound is practicable and could also be viewed as rationally related to the public interest, that is never the court's function in such an equal protection and due process analysis. As noted the court may "not sit as a super-legislature to judge the wisdom or desirability of legislative policy determinations made in areas that neither affect fundamental rights nor proceed along suspect lines . . ." New Orleans v. Dukes, supra. The record in this administrative action fails to support the plaintiffs' claims. Plaintiffs have been unable to demonstrate why the present regulation and statute is not rationally related to the public interest.
For all the foregoing stated reasons, the court dismisses the plaintiffs' appeal.
BY THE COURT
Barbara M. Quinn, Judge