Mustang Fuels Corporation

Plain-English summary

Mustang Fuels was cited after MSHA alleged that a dozer operated too close to a high-voltage cable at a surface mine. The Commission vacated a default order that had assessed a $450 civil penalty because the company had not answered the penalty proposal or a show-cause order. Mustang, a small company proceeding without counsel, said it believed another contractor was responsible and that a former business associate had promised to handle the citations. The Commission found that the record could support relief from default and remanded the case so the judge could determine whether Mustang was entitled to that relief.

Decision snapshot

• Cited standards: 30 C.F.R. § 77.807-1; 30 U.S.C. §§ 814(a) and 817(a)
• Outcome: The $450 default order was vacated and the case was remanded for further proceedings.
• Key point: A small unrepresented operator may obtain relief from default when it makes a colorable showing of inadvertence, mistake, or excusable neglect.

Full text (FMSHRC public release)

FEDERAL MINE SAFETY & HEALTH REVIEW COMMISSION
WASHINGTON, D.C.
July 18, 1991

SECRETARY OF LABOR,
MINE SAFETY AND HEALTH
ADMINISTRATION (MSHA)

v. Docket No. KENT 91-100

MUSTANG FUELS CORPORATION

BEFORE: Backley, Acting Chairman; Doyle, Holen and Nelson, Commissioners

ORDER

BY THE COMMISSION:

In this civil penalty proceeding arising under the Federal Mine
Safety and Health Act of 1977, 30 U.S.C. 801, et seq. (1988), (the "Mine
Act"), Commission Chief Administrative Law Judge Paul Merlin issued an
order of default on June 17, 1991, finding Mustang Fuels Corporation
("Mustang") in default for failure to respond to his April 23, 1991,
order to show cause. The judge assessed a civil penalty of $450.00.
For the reasons that follow, we vacate the default order and remand
the case for further proceedings.

On June 25, 1991, the Commission received an undated letter from
Mustang that contains a statement of the reasons why Mustang disagrees
with the civil penalty proposed by the Secretary of Labor in this case.
The judge's jurisdiction over the case terminated when his decision was
issued on June 17, 1991. 29 C.F.R. 2700.65(c). Under the circumstances
presented, we deem Mustang's letter to be a timely petition for
discretionary review of the judge's default order. E.g., Middle States
Resources, Inc., 10 FMSHRC 1130 (September 1988). The petition is granted.

The record discloses that on June 19, 1990, an inspector of the
Department of Labor's Mine Safety and Health Administration ("MSHA")

Page 2

issued Mustang a citation pursuant to section 104(a) of the Mine Act,
alleging a violation of 30 C.F.R. 77.807.1, and an imminent danger
withdrawal order pursuant to section 107(a) of the Mine Act, alleging
that sufficient clearance from a high-voltage cable was not provided
in an area in which a dozer was being operated. Mustang filed a "Blue
Card" request for a hearing before this Commission. When no answer to
MSHA's Proposal for Assessment of Civil Penalty was filed, Judge Merlin
issued an order directing Mustang to file an answer within 30 days or
show good cause for its failure to do so. When no response was received,
Judge Merlin issued an order finding Mustang in default for failure to
answer the Secretary's civil penalty proposal and the show cause order,
and assessing the $450 civil penalty proposed by the Secretary.

Page 3

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On June 25, 1991, the Commission received a letter from Donna
Johnson, the secretary and treasurer of Mustang, in which Ms. Johnson
alleges that John Kerr, the president of Delta Fuels Corporation
("Delta"), hired Mustang as the "underground miner" for the mine,
and hired another company as its "surface mine contractor." Johnson
explains that surface mining operations were being conducted by the
other contractor when the subject citation and order were issued on
June 19, 1990, but that Mustang "never ran any coal at any time" out
of the mine' and had no control over the surface mine contractor. It
appears that both the citation and the order of withdrawal were issued
for conditions present on the surface. She further states that Mr. Kerr
assured Mustang that the "citations would be taken care of," and that,
subsequently, Kerr left the country.

Ms. Johnson also attached to her letter a separate undated letter
addressed to MSHA from Mustang stating that the mine "has been and will
be permanently aban[doned]. This was effective on August 1, 1990." The
subject citation and order were issued at the mine on June 19, 1990, and
terminated on July 5, 1990.

Mustang appears to be a small company proceeding without benefit
of counsel. In conformance with the standards set forth in Fed. R. Civ.
P. 60(b)(1), the Commission has previously afforded such a party relief
from default upon a colorable showing of inadvertence, mistake, or
excusable neglect. E.g., A.H. Stone Company, 11 FMSHRC 2146, 2147
(November 1989). Here Mustang asserts that it failed to respond to
the judge's order because it relied upon Kerr's alleged representation
that the citation "would be taken care of," and that it believed that
it was not the party responsible for any violative conduct. On the basis
of the present record, we are unable to evaluate the merits of Mustang's
assertions, but, in the interest of justice, we will permit Mustang to
present its position to the judge, who shall determine whether relief
from the default order is warranted.

Accordingly, we grant Mustang's petition for discretionary review,
vacate the judge's default order, and remand this matter for proceedings
consistent with this order.

Richard V. Backley, Acting Chairman

Joyce A. Doyle, Commissioner

Arlene Holden, Commission

L. Clair Nelson, Commissioner