Petition — Alabama Surface Mining Reclamation Commission v. Commercial Standard Insurance

93-1717

No.

IN THE SUPREME COURT OF THE UNITED STATES

OCTOBER TERM, 1983

ALABAMA SURFACE MINING RECLAMATION

COMMISSION,

Petitioner

Vv.

COMMERCIAL STANDARD INSURANCE COMPANY,

Respondent

PETITION FOR A WRIT OF CERTIORARI

TO ALABAMA SUPREME COURT

CHARLES A. GRADDICK

ATTORNEY GENERAL OF

ALABAMA

ROSA H. DAVIS

ASSISTANT ATTORNEY

GENERAL OF ALABAMA

Counsel of Record

P. 0. Box 2390

Jasper, Alabama

35502-2390

ATTORNEYS FOR

PETITIONER

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QUESTIONS PRESENTED

1. Is the Alabama Courts' decision

in this case so unusual and improper as

to unnecessarily obstruct the purpose of

federal law, to "protect the society and

the environment from the adverse effects

of surface coal mining operations"? 30

U.S.C. §1202(a).

2. Does the Alabama Courts' deci-

sion violate federal law in its restric-

tive interpretation of the statute in

question?

a. Should the failure to timely

commence one verified complaint proceed-

ing for one particular violation against

a surface coal mine operator operate to

relieve the operator and his surety from

all requirements of the Alabama Surface

Mining Act of 1975?

b. Is the Alabama Surface Mining

Commission without jurisdiction to carry

out its federally mandated responsibility

and act upon any violations of the sur-

face mining laws unless a verified com-

plaint is filed within nine months of the

cessation of mining activity?

ii

PARTIES

The caption contains the names of

all parties to the proceeding in the

court below.

iii

;

a

2

TABLE OF CONTENTS

QUESTIONS PRESENTHD.............. i

FT ee ee eee Oe eee iii

Rene Oe CORRE 6 bo oe cic t-cdcces iv

TABLE OF AUTHORITIES ............ vi

SPREE BENE 666s coc cweceveeess 1

PURE EEUEDON. 2c cea vecemeucesesece 2

FEDERAL QUESTIONS INVOLVED ...... 4

STATEMENT OF THE CASE ........... 9

REASONS FOR GRANTING THE WRIT ... 14

GN 6 oc ON cand eed ees ee deste 23

CERTIFICATE OF SERVICE .......... 24

APPENDIX A: January 27, 1984

Alabama Supreme Court Order

(Denying Petition for

GRRERGCGEED so bb bt hove sccee la

APPENDIX B: October 19, 1983

Alabama Court of Civil Appeals

ane lication f

Denyin plication for

woe vires Re cette covepreed ca

APPENDIX C: September 14, 1983

Alabama Court of Civil Appeals

(Appeals Opinion) ......... 3a

APPENDIX D: April 5, 1983

Tuscaloosa County Circuit Court

iy eer eers eure. ore 17a

APPENDIX E: March 12, 1981

Alabama Surface Mining Reclamation

Commission

(Findings and Order) ...... 24a

APPENDIX F: Texts of Statutes

GE saan. nas oeus 3la

v

Ba i

TABLE OF AUTHORITIES

CASES

American Casualty Co. v.

Commonwealth, 441 A. 2d

Re a SE nn a cc's 0c osbesee 19

National Surety Co. v.

First National Bank, 224 Ala.

3 ee Oe Sy 20

STATUTES

Alabama Surface Mining Reclamation

Act of 1975, Ala. Code §¥-16-30 et seq.

RD 5 a ee ae 17

ot rere 16

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EE cies) 0's a baw hee 16,17,18,19

2 ® * MR s+ >, » es 2a 2

8 BR A eee ree 2

Surface Mining Control and Reclamation

Act of 1977, 30 U.S.C. §1201 et seq.

DT nuh nh dabidh’ os nee 6,14,15,21

ie he iets 6 ae ee 5,14

re ae 14

vi

OPINIONS BELOW

1. The opinion of the Alabama Court

of Civil Appeals is reported as Commer-

cial Standard Insurance Company v.

Alabama Surface Mining Reclamation Com-

mission, 443 So. 2d 1245 (Ala. Civ. App.

1983), and is reproduced as Appendix C,

hereto, pp. 3a, infra.

2. The opinion of the Tuscaloosa

County Circuit Court of Alabama is

reproduced as Appendix D, hereto, pp.1l7a

infra.

3. The opinion of the Alabama Sur-

face Mining Reclamation Commission is

reproduced as Appendix E, hereto, pp. 24a

infra.

JURISDICTION

The judgment of the Alabama Court of

Civil Appeals was entered September 14,

1983. See Appendix C, hereto, pp. 3a

infra.

Petitioner's timely application for

rehearing was denied in an order entered

October 19, 1983. See Appendix B, hereto

pp. 2a infra.

Petitioner's timely application for

certiorari to the Alabama Supreme Court

was denied in an order entered January

27, 1984. See Appendix A, hereto, pp. la

infra.

This petition is filed within ninety

days of that denial, as permitted by

Rule. 20.2, 28 U.S.C. §2191(c). Juris-

diction of this Court is invoked pursuant

to 28 U.S.C. §1257(3) which provides for

review of a final judgment rendered by

the highest court of a state in which a

decision could be had where the validity

of a statute of the United States is

drawn into question or any right is

specially set up or claimed under a

United States statute. See Appendix

F, hereto, pp. 39a infra.

FEDERAL QUESTIONS

The precise issues litigated at the

state court level involved interpreta-

tion of enforcement provisions of the

State act. These were the provisions

relied on by Congress to safeguard the

rights created by federal law. While

the case involves the interpretation of

state law provisions the overriding issues

center on the enforcement of federally

created rights making federal questions

manifest at every stage of the proceed-

ing herein.

The federal act was enacted to

“establish a nationwide program to pro-

tect society and the environment from

the adverse effects of surface coal

mining operations", to "assist the States

in developing and implementing a program

to achieve" those purposes; and "where-

ever necessary, exercise the full reach

of Federal constitutional powers to

insure the protection of the public

interest through effective control of

surface coal mining operations". 30 U.S.

C. §1202(a), (g)(m).

Congress specifically declared that

the protection of the environment from

the adverse effects of coal surface

mining was a feder2l problem. ‘"(S)urface

and underground coal mining operations

affect interstate commerce, contribute

to the economic well-being, security,

and general welfare of the Nation and

should be conducted in an environmentally

sound manner". Congress further found

that "the cooperative effort established

by this Act is necessary to prevent or

mitigate adverse environmental effects

"4

“i > . 7 y} ial

Sane as bike!»

of present and future surface coal mining

operations". 30 U.S.C. §1201(4), (k).

The federal act imposes mandatory

incorporation of federal standards that

protect federal rights into state law.

Enforcement of a federal right-protec-

tion from the adverse effects of surface

coal mining operations-has been entrusted

to those states with approved regulatory

programs. Congress has defined the evil,

prescribed the remedy, but allowed the

states to administer the "medicine"

through implementation of a consistent

state statutory scheme.

Where a federal act imposes manda-

tory incorporation of federal standards

into state law and compels the state to

enforce federal rights any litigation

arising under such state law must

necessarily present federal questions.

Whenever federally created rights are at

stake, federal questions must necessarily

be involved.

At issue in the present case is

whether the state can continue to enforce

crucial provisions of the state act

which directly affects the ability of the

state to protect the federal rights it

is charged with enforcing. The action

herein involves federal rights granted

by a federal statute. Litigation of

these issues necessarily involves

federal questions in that their resolu-

tion hinges on the interpretation of a

state statute that enforces federally

created remedies. The questions litigated

in the state courts below are necessarily

federal questions in that their resolu-

tion will affect federally created rights

and remedies.

ate

The state statute draws its author-

ity from the federal act and must be

construed in light of the purposes and

remedies declared in the federal act.

As such, a federal question is implicit

in any action involving an interpretation

of such a state statute or a part there-

of.

STATEMENT OF THE CASE

On January 12, 1981, Frank Evans

and Bob Cleere, Inspectors for the

Alabama Surface Mining Reclamation

Commission (hereinafter the Commission)

filed verified complaints with the

Commission alleging violations of the

Alabama Surface Mining Reclamation Act

of 1975 (hereinafter the State Act),

by Hendrix and Lee, Inc., a surface coal

mining licensee subject to regulation

by the Commission. On the same date, the

Director of the Commission issued Cita-

tions and Orders to Hendrix and Lee, Inc.

Copies were sent to the surety on Hendrix

and Lee's reclamation bonds, Commercial

Standard Insurance Company, Inc. (herein-

after Commercial Standard), the Appellant.

On January 27, 1981, the Commission

held administrative hearings, addressing

the violations against Hendrix and Lee.

At the hearing, no one appeared on be-

half of Hendrix and Lee, Inc. However,

Commercial Standard was represented by

counsel. Based upon the failure of any

representative of Hendrix and Lee, Inc.

to appear, the hearing examiner found

that the allegations as to violations of

the State Act were admitted. Counsel

for Commercial Standard was not allowed

to participate in the hearing other than

to the extent of objecting on the record

that the hearing violated the due process

rights of Commercial Standard, and that

the Commission had no jurisdiction in the

matter due to the fact that the complaints

were not filed within the time required

by §9-16-41(a) Ala. Code (1975), (here-

inafter cited by section number).

10

On March 12, 1981, the Director

issued an order which required Hendrix

and Lee, Inc. or any other interested

party to file a reclamation timetable

within sixty days of the date of the

Commission's order outlining the steps

to complete reclamation of the affected

areas by May 15, 1982. Commercial

Standard, as surety, was granted an

additional thirty days to file such a

timetable. It was further ordered that

the failure to file a reclamation time-

table within the time limits allowed

would result in the surety bonds being

declared forfeited and being due and pay-

able to the State. Neither Commercial

Standard nor Hendrix and Lee, Inc. sub-

mitted a timetable.

Commercial Standard filed a consoli-

dated appeal of the Commission's orders

11

to the Circuit Court of Jefferson County,

Alabama. The case was transferred to the

Tuscaloosa County Circuit Court which

entered an order affirming the orders of

the Comm.ssion.

Commercial Standard appealed to the

Court of Civil Appeals which on Septem-

ber 14, 1983 reversed and remanded the

decision of the Circuit Court holding

that the surety was due to be discharged

from its obligation on the bonds in the

instances complained of and that the

orders of the Commission were void and to

no effect on the basis that the verified

complaints on which the actions were

based were not filed within ninety days

of the event or events giving rise to the

violations complained of as required by

the Act.

The Commission's application for

12

rehearing was overruled without opinion

on October 19, 1983. The petition for

writ of certiorari to the Court of Civil

Appeals was denied without opinion by

the Supreme Court of Alabama on January

27, 1984.

13

REASONS FOR GRANTING THE WRIT

The mandate of federal law, the Sur-

face Mining Control and Reclamation Act

of 1977, 30 U.S.C. §1201 et seq. (herein-

after the federal act), is to insure that

all lands surface mined within the United

States be reclaimed. 30 U.S.C. §1202(e).

The federal act initiated a scheme

whereby the states would enforce the

federally mandated surface mining laws

through state procedure. 30 U.S.C. §1253.

The federal act established the

right of the people to be free from the

adverse effects of surface coal mining

operations, 30 U.S.C. §1202 (a). How-

ever protection of these rights was en-

trusted to the states. "(T)he primary

governmental responsibility for

developing, authorizing, issuing, and

14

enforcing regulations for surface mining

and reclamation operations subject to

this Act should rest with the States”.

30 U.S.C. §1201(£). The purpose of the

Alabama act is to safeguard these federal

rights by establishing and enforcing a

regulatory scheme that is uniquely suited

to the surface coal mining industry of

the state. While the instant case in-

volves a challenge to state regulatory

statutes, in actuality it is federally

created rights that are endangered. The

decision as it now stands, frustrates

the will of Congress by eviscerating the

state remedy that was implemented to

carry out the purposes of the federal act.

It was argued in Petitioner's appli-

cation for writ of certiorari to the Ala-

bama Supreme Court that the Alabama Court

of Civil Appeals erred in the result that

15

was reached. That result obstructs the

purpose and design of the federal act by

placing a very restrictive interpretation

on the State statute which implements the

federal law.

The State law contains a provision

that complaints brought by the Commission

must be filed within ninety days from the

event or events giving rise to the com-

plaint. Ala. Code §9-16-5l(a). Further,

there is a requirement that grading and

contouring of surface coal mined lands

be accomplished by the operator within

six months from the date of completion

of mining operations. Ala. Code §9-16-

39(g). The Court of Civil Appeals

determined that since the Commission had

not filed one particular complaint with-

in ninety days from that six month period

that the surety company is automatically

16

discharged. Commercial Standard, supra.

This reasoning completely obliter-

ates the Commission's opportunity to

file additional complaints for other

violations of law for which the surety

would be responsible.

The failure to file a timely com-

plaint does not excuse performance of

the reclamation obligation and does not

work a discharge of the surety under its

bond. The verified complaint procedure

is a mechanism for enforcing specific

provisions of the State Act against re-

calcitrant operators. It is a mechanism

to insure that the requirements of the

State Act are complied with. The veri-

fied complaint applies to "operators"

under the State Act only. Ala. Code

§9-16-51. Ala. Code §9-16-31 defines an

“operator” as "the person, firm, cor-

17

poration, partnership or other entity

conducting coal surface mining". Ala.

Code §9-16-51 has no application to a

surety on an operator's bond. The pro-

cedure was never intended to provide

either an operator or a surety with an

excuse for nonperformance of their res-

pective obligations under the State Act.

If a verified complaint is untimely

filed, the result is that no proceedings

may be had upon the specific violations

alleged in the complaint. It does not

mean that the operator is discharged

from his reclamation responsibilities

under the State Act. The obligations to

reclaim are separate and apart from the

potential liabiiity of the operator for

violating specific provisions of the

State Act and the obligation to reclaim

is not dependent upon a verified complaint

18

being initiated to compel reclamation.

The ninety day rule for filing a

verified complaint of Ala. Code §9-16-51

(a) has no application to the validity of

the suretyship contract. The contract of

suretyship is conditioned, both in ex-

press terms of the contract and the lan-

guage of the Act, upon performance of the

reclamation obligations imposed by the

State Act. §9-16-44(a).

The result reached by the Alabama

Court is directly opposite to the only

other decision that has considered the

issues. In American Casualty Co. v.

Commonwealth, 441 A. 2d 1383 (Pa. 1982)

the Pennsylvania Commonwealth Court was

asked to construe a statute requiring

that bond forfeiture actions be commenced

within five years of the cessation of

mining. The court found that reclamation

19

was a part of the mining process and that

an action on the bond would lie if

brought within five years following the

completion of reclamation. American

Casualty, supra at 1387.

The effect of the restrictive

opinion of the Alabama Court of ©:ivil

Appeals is to obstruct the intent and

purpose of the federal act. The restric-

tive opinion is also contrary to the

surety law. The rule has developed that

a contract of suretyship is to be

liberally construed in favor of the

obligee and against the commercial

surety. National Surety Co. v. First

National Bank, 224 Ala. 423, 140 So.

544 (1932).

As was argued by Petitioner in its

brief to the Supreme Court of Alabama

"discharging of a surety on its bonds

20

because a verified complaint was not

timely filed against an operator stands

the Reclamation Act on its head and

places the monetary gain of a commercial

insurer above the protection of the

environment and natural resources of the

citizens of this State".

Allowing the state court decision

herein to stand will result in the very

evil that the federal act was enacted to

guard against, namely "destroying or

diminishing the utility of land...by

impairing netwel beauty, by damaging the

property of citizens, by creating hazards

dangerous to life and property, by de-

grading the quality of life in local

communities, and by counteracting govern-

mental programs and efforts to conserve

soil, water and other natural resources".

30 U.S.C. §1201(c).

21

The Alabama Courts' opinion is

contrary to applicable law, inconsistent

with opinions of other state courts and

obstructs the intent of the federal act.

22

CONCLUSION

This Court should grant certiorari

in this case as it involves important

federal questions which materially

affect the well-being of the people of

the United States.

Respectfully submitted,

Alabama Attorney General

fire L bla

Assistant Alabama Attorney

General

23

i, aa

CERTIFICATE OF SERVICE

I, Rosa H. Davis , a member

of the Bar of the Supreme Court of the

United States, do hereby certify that on

this the Qs7’day of April, 1984, I did

serve copies of this petition and the

accompanying appendix on Respondent, by

placing in the United States Mail, first

class, postage prepaid, three copies

properly addressed to the counsel of

record for Respondent, as follows:

Honorable Thomas L. Stewart

Gorham, Waldrep, Stewart &

Kendrick

1507 City Federal Building

Birmingham, Alabama 35203

sa . avis

Assistant Alabama Attorney

General

24

Address of Counsel:

Assistant Alabama Attorney General

250 Administrative Building

64 N. Union Street

Montgomery, Alabama 36130

25