Secretary of Labor v. San Juan Coal Co. (Commission decision, May 4, 2018)

Plain-English summary

San Juan Coal's safety manager selected four citations for contest and sent that information to accounts payable. A clerical error caused the contest form to be mailed with payment for the uncontested citations to MSHA's St. Louis office rather than to the Arlington contest office. After learning of the error through a delinquency notice, San Juan changed its procedures so mine safety personnel would handle all penalty-contest correspondence. It had filed no other reopening motions in the prior two years, and the Secretary did not oppose relief. The Commission reopened the assessment and remanded.

Decision snapshot

• Cited authority: Section 105(a) of the Mine Act, 30 U.S.C. § 815(a)
• Outcome: The final penalty assessment was reopened and remanded for further proceedings.
• Key point: A promptly addressed clerical mailing error, coupled with corrective procedures, can establish good cause for reopening a defaulted penalty contest.

Full text (FMSHRC public release)

FEDERAL
MINE SAFETY AND HEALTH REVIEW COMMISSION

1331
PENNSYLVANIA AVE., N.W., SUITE 520N

WASHINGTON,
DC 20004-1710

SECRETARY
OF LABOR,

MINE
SAFETY AND HEALTH   

ADMINISTRATION
(MSHA)        

v.

SAN
JUAN COAL CO.

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:

:

:

:

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Docket
No. CENT 2017-325

A.C.
No. 29-02170-426933

BEFORE:  Althen,
Acting Chairman; Jordan, Young, and Cohen, Commissioners

ORDER

BY THE
COMMISSION:

This
matter arises under the Federal Mine Safety and Health Act of 1977, 30 U.S.C.   
§ 801 et seq. (2012) (“Mine Act”). On May 12 2017, the Commission received from San Juan Coal Co. (“San Juan”) a motion seeking to reopen a penalty assessment that had become a final order of the Commission pursuant to section 105(a) of the Mine Act, 30 U.S.C. § 815(a).

Under
section 105(a), an operator who wishes to contest a proposed penalty must notify the Secretary of Labor no later than 30 days after receiving the proposed penalty assessment. If the operator fails to notify the Secretary, the proposed penalty assessment is deemed a final order of the Commission. 30 U.S.C. § 815(a).

We
have held, however, that in appropriate circumstances, we possess jurisdiction to reopen uncontested assessments that have become final Commission orders under section 105(a). Jim Walter Res., Inc., 15 FMSHRC 782, 786-89 (May 1993) (“ JWR ”). In evaluating requests to reopen final orders, the Commission has found guidance in Rule 60(b) of the Federal Rules of Civil Procedure, under which the Commission may relieve a party from a final order of the Commission on the basis of mistake, inadvertence, excusable neglect, or other reason justifying relief. See 29 C.F.R. § 2700.1(b) (“the Commission and its Judges shall be guided so far as practicable by the Federal Rules of Civil Procedure”); JWR , 15 FMSHRC at 787. We have also observed that default is a harsh remedy and that, if the defaulting party can make a showing of good cause for a failure to timely respond, the case may be reopened and appropriate proceedings on the merits permitted. See Coal Prep. Servs., Inc., 17 FMSHRC 1529, 1530 (Sept. 1995).

San
Juan asserts that it received the Secretary’s proposed penalty assessment on or about January 4, 2017. It further asserts that it inadvertently sent the contest form to MSHA’s St. Louis office with a check for uncontested citations instead of to the Arlington office. San Juan’s check for partial payment of the assessment was dated January 17, 2017.

The operator claims that the safety manager
at San Juan reviewed the assessment and selected four citations that the company intended to challenge. San Juan claims the safety manager then forwarded this information to the accounts payable department. The operator asserts that the Secretary received the payment for the citations it did not intend to contest. However, the operator asserts that as a result of a clerical error the contest was mailed with the check. The operator alleges that it only learned of the problem when it received a delinquency notice on or around April 17, 2017. [1] Upon learning of the mistake, the operator changed its contest procedures so that safety personnel will now handle all correspondence related to the contest of proposed penalties at the mine. San Juan has not filed any other motions to reopen with the Commission in the last two years. The Secretary does not oppose the request to reopen, but urges the operator to take steps to ensure that future penalty contests are timely filed.

Having reviewed San Juan’s request and the Secretary’s response, we find that the operator inadvertently sent its notice of contest to the wrong address. The operator changed its office procedures to prevent the mistake from happening again. In the interest of justice, we hereby reopen this matter and remand it to the Chief Administrative Law Judge for further proceedings pursuant to the Mine Act and the Commission’s Procedural Rules, 29 C.F.R. Part 2700. Accordingly, consistent with Rule 28, the Secretary shall file a petition for assessment of penalty within 45 days of the date of this order. See 29 C.F.R. § 2700.28.

/s/ William I. Althen

William I. Althen, Acting Chairman

/s/ Mary Lu Jordan

Mary Lu Jordan, Commissioner

/s/ Michael G. Young

Michael G. Young, Commissioner

/s/ Robert F. Cohen, Jr.

Robert F. Cohen, Jr., Commissioner

Distribution:

Jere
C. Overdyke III, Esq.

Holland
& Hart LLP

P.O.
Box 68

Jackson,
WY 83001

Ali
Beydoun, Esq.

Office
of the Solicitor

U.S.
Department of Labor

201
12th St. South, Suite 401

Arlington,
VA 22202-5450

Chief
Administrative Law Judge Robert J. Lesnick

Federal
Mine Safety & Health Review Commission

1331
Pennsylvania Ave. N.W., Suite 520N

Washington,
DC 20004-1710

Melanie
Garris

Office
of Civil Penalty Compliance

Mine
Safety and Health Administration

U.S.
Department of Labor

201
12th St. South, Suite 500

Arlington,
VA 22202-5450

[1] The delinquency
notice was dated April 4, 2017. The Secretary does not challenge the operator’s assertion that it was received on April 17, 2017.