Opinion
NO. 2013-CA-001856-MR
02-19-2016
BENNY COLEMAN APPELLANT v. COMMONWEALTH OF KENTUCKY, ENERGY AND ENVIRONMENT CABINET; and BRC COAL COMPANY, INC. APPELLEES
BRIEF FOR APPELLANT: Otis Doan, Jr. Harlan, Kentucky ORAL ARGUMENT FOR APPELLANT: Scott Lisenbee Harlan, Kentucky BRIEF AND ORAL ARGUMENT FOR APPELLEE BRC COAL COMPANY, INC.: Susan C. Lawson Pineville, Kentucky BRIEF AND ORAL ARGUMENT FOR COMMONWEALTH OF KENTUCKY, ENERGY AND ENVIRONMENT CABINET: Jennifer Cable Smock Frankfort, Kentucky
NOT TO BE PUBLISHED APPEAL FROM FRANKLIN CIRCUIT COURT
HONORABLE THOMAS D. WINGATE, JUDGE
ACTION NO. 10-CI-00695 OPINION
AFFIRMING BEFORE: ACREE, CHIEF JUDGE; JONES, AND NICKELL, JUDGES. JONES, JUDGE: The Appellant, Benny Coleman, appeals the Franklin Circuit Court's decision affirming an order issued by Energy and Environment Cabinet ("Cabinet") that granted BRC Coal Company Inc., ("BRC") a Phase I bond release. Coleman maintains that the circuit court erred because substantial evidence did not support the Cabinet's finding that BRC properly reclaimed the permit area. Having carefully reviewed the evidence, and, mindful of our limited role in reviewing administrative decisions, we affirm.
I.
In rural Harlan County, a low splint seam of coal forms the rough boundary line between two parcels of land. The upper parcel is known as the Creech Property; the lower parcel is known as the Pace Property. The Appellant, Benny Coleman, is the majority owner of the Pace Property.
In 1991, BRC obtained a permit from the Cabinet to perform surface mining on the Creech Property. From 1998 to 2001, BRC actively mined the Creech Property. Since that time it has engaged in reclamation efforts, which it maintains have been completed according to statute. Coleman disagrees. He believes that BRC has failed to remedy the damage its mining caused to the Pace Property. As a result, in September of 2006, Coleman filed a civil suit for damages against BRC in Harlan Circuit Court claiming that BRC trespassed on and damaged the Pace Property during its mining operations.
The civil suit remains pending. However, BRC is now bankrupt. Even if Coleman were to prevail in the civil suit, the only apparent source of money for a judgment is the bond BRC posted for this increment of its mining operation. That bond and its release are the basis of this appeal.
The permit is incrementally bonded, and the bond at issue herein is Increment No. 12.
BRC began mining the property at issue sometime in 1998 and continued to do so for the next several years. It is undisputed that BRC's mining activities caused some slides and debris deposits on the Pace Property. The extent of that debris and the ensuing damage it caused is disputed. Additionally, the evidence is fairly clear that the mining caused three several-hundred-ton boulders to tumble down the mountainside. Coleman maintains that the boulders came to rest on the Pace Property. The Cabinet and BRC maintain that the boulders, while close to the boundary, lay on the Creech Property. The parties also dispute whether the boulders, if left in place, constitute a hazard.
The Cabinet issued BRC notices of noncompliance during the course of its mining operations and directed it to take various actions to reclaim the land. Generally, those actions had to be accomplished before the Cabinet would approve a release of BRC's bonds. In August of 2004, the Cabinet and BRC entered into an agreed order wherein they resolved Notice of Non-Compliance No. 211180 citing BRC with violations relating to grading and backfilling and Notice of Non-Compliance No. 211124 relating to off-permit disturbances. With respect to the Pace property, BRC agreed to post a performance bond in the amount of $5,000 to guarantee complete reclamation of the affected areas, since BRC was not able to obtain a right of entry to the property. Additionally, BRC agreed to submit a reclamation plan for all affected areas, including the Pace Property.
In 2006, BRC sought a Phase I bond release on Increment 12. The Phase I bond release inspection occurred on June 29, 2006, and was conducted by Inspector Hoskins and Supervisor Hembree. As noted by the circuit court, "they observed appropriate seeding and mulching, proper functioning of sediment ponds, and suitable vegetation." As such, Inspector Hembree determined that Increment 12 was eligible for a Phase 1 bond release. The Cabinet granted BRC's application on September 27, 2006. Coleman sought relief at the administrative level where he claimed that he was denied the right to participate in the pre-release inspection and disputed that the disputed property had been properly reclaimed by BRC. He filed a petition for temporary relief at the administrative level on October 5, 2006. After a hearing, Hearing Officer Steve Blanton recommended temporary relief be given to Coleman. Thereafter, a final hearing was scheduled before another hearing officer, Hon. Matthew Mooney. The hearing lasted nine days.
While the hearing officer did not agree with Coleman on every point, he did recommend denying the Phase 1 bond release to BRC. In sum, the hearing officer concluded that BRC had not completed its reclamation plan because: 1) the slide areas have not been removed and the slides have not been reclaimed; 2) the large rocks in PVK hollow have not been removed and placed in the backfill; and 3) boulder #1 and boulder #3 are on the Pace property, are not stable, and have not been removed and placed in the backfill.
The hearing officer's report is eighty-nine pages in length. --------
The Cabinet filed exceptions. On January 12, 2010, the Secretary entered an order, the effect of which was to reject the hearing officer's conclusions and recommendation. The order explicitly affirmed the Cabinet's prior determination to "issue Minor Revision No. 7 to BRC's Permit NO. 848-0144." Coleman appealed to the Franklin Circuit, which affirmed the Cabinet. This appeal followed.
II.
This appeal arises out of an administrative proceeding. Only the hearing officer and/or administrative agency head is empowered to make findings of fact. See Board of Trustees, Kentucky Retirement Systems v. Grant, 257 S.W.3d 591 at 595 (Ky. App. 2008). Further, KRS 13B.150 clearly provides that when reviewing an administrative agency's decision, "the court shall not substitute its judgment for that of the agency as to the weight of the evidence on questions of fact." Thus, the judicial standard of review of an agency's decision is largely deferential, and as long as there is substantial evidence in the record to support the agency's decision, the court must defer to the agency, even if there is conflicting evidence. 500 Associates, Inc. v. Natural Resources and Environmental Protection Cabinet, 204 S.W.3d 121, 131-132 (Ky. App. 2006). Agencies are entitled to great deference in interpreting their own statutes and regulations, at least where those interpretations do not contravene the law. Hagan v. Farris, 807 S.W.2d 488, 490 (Ky. 1991).
If the agency's decision is supported by substantial evidence, the reviewing court is limited to determining whether the agency applied the correct rule of law. Burch v. Taylor Drug Store, Inc., 965 S.W.2d 830, 834 (Ky. App. 1998). Evidence is substantial if, when taken alone or in light of all the evidence, it has sufficient probative value to induce conviction in the minds of reasonable men. Kentucky Racing Comm'n v. Fuller, 481 S.W.2d 298, 308 (Ky. 972). Indeed, an administrative agency's interpretation of its own regulations is entitled to substantial deference. Commonwealth v. Family Home Health Care, Inc., 98 S.W.3d 524, 527 (Ky. App. 2003).
Having thoroughly reviewed the very voluminous record and the opinions below, we must affirm the circuit court. While we are sympathetic to Coleman's position, we cannot agree that the circuit court committed reversible error. The issues below were hotly disputed with respect to BRC's reclamation efforts. Without going into the testimony in detail, suffice it to say that as detailed in the hearing officer's lengthy findings, the opinions varied. The Secretary was not obligated to accept the hearing officer's recommendations and was free to reject his determinations as to the credibility of the witnesses. In the end, like the circuit court, we must conclude that substantial evidence supported the Secretary's decision.
For the foregoing reasons, we AFFIRM the September 30, 2013, Opinion and Order of the Franklin Circuit Court.
ALL CONCUR. BRIEF FOR APPELLANT: Otis Doan, Jr.
Harlan, Kentucky ORAL ARGUMENT
FOR APPELLANT: Scott Lisenbee
Harlan, Kentucky BRIEF AND ORAL ARGUMENT
FOR APPELLEE BRC COAL
COMPANY, INC.: Susan C. Lawson
Pineville, Kentucky BRIEF AND ORAL ARGUMENT
FOR COMMONWEALTH OF
KENTUCKY, ENERGY AND
ENVIRONMENT CABINET: Jennifer Cable Smock
Frankfort, Kentucky