Quality Aggregates, Inc. (Commission decision, July 24, 2009)

Plain-English summary

Quality Aggregates missed the deadline to contest a penalty assessment after MSHA separately vacated two citations included in it. The company's safety director believed MSHA would issue a revised assessment, even though MSHA's letter stated the total assessment before and after the two citations were vacated. The Commission focused on whether that belief was reasonable because Quality still had 11 days to contest when the safety director reviewed the assessment and the letter. It remanded the matter to the Chief Administrative Law Judge to determine whether good cause existed and whether the final order should be reopened.

Decision snapshot

• Governing provisions: 29 C.F.R. § 2700.1(b); 30 U.S.C. § 815(a)
• Outcome: The reopening request was remanded for a determination of good cause and entitlement to relief.
• Key point: When MSHA amends cited items, an operator's expectation of a new assessment must be evaluated against what MSHA's letter actually says and the time still available to contest.

Full text (FMSHRC public release)

Federal Mine Safety and Health Review Commission

FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION

601 NEW JERSEY AVENUE, NW

SUITE 9500

WASHINGTON, DC 20001

July 24, 2009

SECRETARY OF LABOR,

MINE SAFETY AND HEALTH

ADMINISTRATION (MSHA)

v.

QUALITY AGGREGATES, INC.

Docket No. PENN 2009-408-M

A.C. No. 36-07747-172956

BEFORE: Duffy, 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. (2006) (“Mine Act”). On March 30, 2009, the Commission received from Quality Aggregates, Inc. (“Quality”) a motion by counsel 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) of the Mine Act, 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 section 105(a) orders, the Commission has found guidance in Rule 60(b) of the Federal Rules of Civil Procedure under which, for example, a party could be entitled to relief from a final order of the Commission on the basis of mistake, inadvertence, or excusable neglect. 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).

Quality states that, following its receipt of the proposed assessment on or about January 12, 2009, its safety director, who was responsible for reviewing the document, was out of the office on vacation for a week. Following his return, the safety director was generally away from Quality’s home office on training and other work duties during the next eight days. Quality further states that on February 3, 2009, it received a letter from MSHA dated January 23, 2009 which vacated two citations that were included in the proposed assessment. Quality asserts that its safety director mistakenly believed that he would receive another assessment that would reflect the vacated citations.

The Secretary opposes reopening the proposed penalty assessment, maintaining that Quality has failed to establish the existence of “exceptional circumstances.” Specifically, the Secretary contends that for the period up to February 3, 2009, Quality’s “inadequate or unreliable internal procedures” do not justify reopening. The Secretary is silent as to the period beginning February 3, 2009.

We find that the reasons advanced by Quality for not contesting the proposed assessment between January 12 and February 3, 2009 are essentially irrelevant. As of February 3, 2009, when the safety director had focused on the proposed assessment, Quality still had 11 days within which to contest it. Thus, the issue is whether the safety director’s mistaken belief that he would receive another proposed assessment, reflecting the amended citations, was reasonable. In this regard, we note that in the letter dated January 23, 2009, MSHA clearly indicated the total amount of the assessment, both before and after the two citations were vacated.

Having reviewed Quality’s request and the Secretary’s response, in the interests of justice, we remand this matter to the Chief Administrative Law Judge for a determination of whether good cause exists for Quality’s failure to timely contest the penalty and whether relief from the final order should be granted.

If it is determined that relief from the final order is
appropriate, this case shall proceed pursuant to the Mine Act and the Commission’s Procedural Rules, 29 C.F.R.§ 2700.

______

Michael F. Duffy, Chairman

______

Mary Lu Jordan, Commissioner

______

Michael G. Young, Commissioner    

______

Robert F. Cohen, Jr., Commissioner

Distribution:

Stephen L. Korbel, Esq.

Babst, Calland, Clements, Zomnir

Two Gateway Center, 8th Floor

Pittsburgh, PA 15222

W. Christian Schumann, Esq.

Office of the Solicitor

U.S. Department of Labor

1100 Wilson Blvd., Room 2220

Arlington, VA 22209-2296

Myra James, Chief

Office of Civil Penalty Compliance, MSHA

U.S. Dept. of Labor

1100 Wilson Blvd., 25th Floor

Arlington, VA 22209-3939

Chief Administrative Law Judge Robert J. Lesnick

Federal Mine Safety & Health Review Commission

601 New Jersey Avenue, N.W., Suite 9500

Washington, D.C. 20001-2021