Secretary of Labor v. Mid-Valley Gravel Company (Commission decision, December 17, 2015)

Plain-English summary

Mid-Valley Gravel asked to reopen a final penalty assessment, claiming that it never received the proposed assessment. The Secretary produced delivery records showing that the company's corporate secretary, who was also designated to handle health and safety matters, signed for it. A later delinquency notice reached the same address, and Mid-Valley did not respond to the Secretary's evidence. The Commission found that the missed contest reflected an inadequate internal processing system and denied reopening.

Decision snapshot

• Cited authority: 29 C.F.R. § 2700.1(b); 30 U.S.C. § 815(a)
• Outcome: Mid-Valley's motion to reopen the final penalty assessment was denied.
• Key point: A bare nonreceipt claim does not show good cause when signed delivery records identify the responsible company officer and the operator does not answer that evidence.

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.

MID-VALLEY
GRAVEL COMPANY,

:

:

:

:

:

:

:

Docket
No. WEST 2015-137-M

A.C.
No. 35-03498-359104

BEFORE:  Jordan,
Chairman; Cohen, and Nakamura, Commissioners[1]

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 November 12, 2014, the Commission received from Mid-Valley Gravel Company (“Mid-Valley”) 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) 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 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).

Records
of the Department of Labor’s Mine Safety and Health Administration (“MSHA”) indicate that the proposed assessment was delivered on August 18, 2014, and became a final order of the Commission on September 17, 2014.  Mid-Valley asserts that it did not receive the proposed assessment. The Secretary opposes the request to reopen.

The
Secretary submitted to the Commission records indicating that the proposed assessment was properly delivered to the operator and signed for by the operator’s corporate secretary, the person designated by the operator as being in charge of health and safety matters. The Secretary also submitted a copy of the delinquency notice, which the operator acknowledged receiving, and which was mailed to the operator at the same address as the allegedly-unreceived proposed assessment. The operator has not responded to the Secretary’s submissions.

The Commission
has made it clear that where a failure to contest a proposed assessment results from an inadequate or unreliable internal processing system, the operator has not established grounds for reopening the assessment. Shelter Creek Capital, LLC, 34 FMSHRC 3053, 3054 (Dec. 2012); Oak Grove Res., LLC, 33 FMSHRC 103, 104 (Feb. 2011); Double Bonus Coal Co., 32 FMSHRC 1155, 1156 (Sept. 2010); Highland Mining Co., 31 FMSHRC 1313, 1315 (Nov. 2009); Pinnacle Mining Co., 30 FMSHRC 1066, 1067 (Dec. 2008); Pinnacle Mining Co., 30 FMSHRC 1061, 1062 (Dec. 2008). Here, the operator’s failure to timely contest the proposed assessment represents an inadequate internal processing system, and fails to establish good cause for reopening a final order.

Accordingly,
we deny Mid-Valley’s motion.

/s/ Mary Lu Jordan

Mary Lu Jordan, Chairman

/s/ Robert F. Cohen, Jr.

Robert F. Cohen Jr., Commissioner

/s/ Patrick K. Nakamura

Patrick K. Nakamura, Commissioner

Distribution:

Jennifer
Middlestetter

Mid-Valley
Gravel Company

PO
Box 1089

Philomath
OR 97370

W.
Christian Schumann, Esq.

Office
of the Solicitor

U.S.
Department of Labor

201
12th St. South, Suite 500

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] This case has
been delegated to a panel of three Commissioners pursuant to section 113(c) of the Mine Act for the limited purpose of assessing the merits of the motion to reopen. 30 U.S.C. § 823(c).