SC Administrative Law Court Decisions

STATEMENT OF THE CASE

This matter is before the South Carolina Administrative Law Court (“ALC”) on cross motions for summary judgment[1] in a contested case. Southern Environmental Services, Inc. (“SESI” or “Respondent”) challenges Administrative Order 07-041-A issued by the South Carolina Department of Health and Environmental Control (“Department”) based on SESI’s alleged violations of S.C. Code Ann. § 48-1-10 et seq. (2008) (South Carolina Pollution Control Act); 25A S.C. Code Ann. Regs. 61-86.1 (Supp. 2007) (Asbestos Project Standards), and 40 C.F.R. § 61 (2008) (National Emission Standards for Hazardous Air Pollutants). Upon review of this matter, the court finds that SESI’s Motion for Summary Judgment should be denied on all grounds.

BACKGROUND

SESI is a contractor that specializes in asbestos abatement, with offices in Georgia and South Carolina. In 2005, SESI was hired as a subcontractor to manage a construction and abatement project at Wade Hampton High School in Greenville, South Carolina. The Department issued an asbestos abatement project license to SESI on July 22, 2005. On July 27, 2005, the Department conducted an inspection of Wade Hampton High School in response to a complaint. Department inspectors observed numerous violations. Samples taken from Wade Hampton showed greater than one percent asbestos, which requires compliance with the National Emission Standards for Hazardous Air Pollutants (“NESHAP”) and S.C. Regulation 61-86.1.

Also in 2005, SESI was hired to remove asbestos-containing surfacing from Quail Hollow Apartments in West Columbia, South Carolina. The Department issued an asbestos abatement project license on August 12, 2005. SESI subcontracted with Faircloth Interiors, LLC, to install a new ceiling. On August 18, 2005, the Department conducted an inspection of Quail Hollow, and observed numerous violations. Samples taken from Quail Hollow showed greater than one percent asbestos, which requires compliance with NESHAP and S.C. Regulation 61-86.1.

On January 9, 2006, the Department issued a Notice of Alleged Violations and Notice of Enforcement Conference to SESI. On February 24, 2006, the Department held two separate enforcement conferences regarding the alleged violations.

On April 19, 2006, the Department issued an asbestos abatement project license to SESI for the abatement of a building in Greenville, South Carolina, located on Rutherford Drive. On May 2, 2006, the Department conducted an inspection of the location, and observed numerous violations.

On July 17, 2006, the Department received a complaint about an office space in Irmo, South Carolina. The office space was shared by SESI and Faircloth Interiors, LLC, and included one main reception area, two offices, a break room, a bathroom, and a large garage behind the main building. The inspector observed asbestos debris in bags in the garage. Samples taken showed greater than one percent asbestos, which requires compliance with NESHAP and S.C. Regulation 61-86.1.

On August 29, 2006, the Department sent SESI a proposed Consent Order for the violations at Wade Hampton, Quail Hollow, and Rutherford Drive. SESI did not sign the proposed Consent Order. On February 28, 2007, the Department sent SESI another proposed Consent Order, which included the violations at the Irmo office space. SESI did not sign this second proposed Consent Order. The Department then issued an administrative order requiring SESI to comply with the provisions of Regulation 61-86.1 and pay a civil fine of $54,000. Thereafter, SESI filed its Notice of Appeal with the ALC on August 27, 2007.

DISCUSSION

1. Summary Judgment Standard of Review

Summary judgment is appropriate when “there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” Hansson v. Scalise Builders of S.C., 374 S.C. 352, 355, 650 S.E.2d 68, 70 (2007); see also Gadson v. Hembree, 364 S.C. 316, 613 S.E.2d 533 (2005); Cisson Constr. Inc. v. Reynolds & Assocs., Inc., 311 S.C. 499, 429 S.E.2d 847 (Ct. App. 1993). In determining whether summary judgment is proper, “the evidence and all reasonable inferences must be viewed in the light most favorable to the non-moving party.” Hansson, 374 S.C at 355, 650 S.E.2d at 70; see also Byers v. Westinghouse Elec. Corp., 310 S.C. 5, 425 S.E.2d 23 (1992). “Summary judgment is not appropriate where further inquiry into the facts of the case is desirable to clarify the application of the law.” Gadson, 364 S.C at 320, 613 S.E.2d at 535.

2. Licensure of Department Inspectors

Regulation 61-86.1 provides in pertinent part, “No person or contractor shall engage in any asbestos project or abatement involving regulated asbestos-containing material unless licensed to do so by the Department.” S.C. Code Ann. Regs. 61-86.1 (III)(A)(1). A “person” is defined to include a “government agency.” See S.C. Code Ann. § 48-1-10 (1). An “asbestos project” is “any activity associated with abatement including inspection . . . .” S.C. Code Ann. Regs. 61-86.1 (I)(13). Regulation 61-86.1 states that it applies to “any . . . building inspector . . . involved in the inspection . . . of RACM [regulated asbestos-containing material].” Id. at (III)(A)(2) (emphasis added). A “building inspector” is defined as a “person licensed by the Department to examine a facility for the presence of ACM [asbestos-containing material], to identify and assess the condition of the material, and to collect bulk samples.” S.C. Code Ann. Regs. 61-86.1 (I)(24). SESI contends that, pursuant to the Pollution Control Act and S.C. Regulation 61-86.1, the Department’s own inspectors must be licensed prior to conducting any inspection. Furthermore, SESI argues that the Department’s failure to properly license its inspectors renders all inspections conducted by unlicensed inspectors to be void. By contrast, the Department contends that its inspectors do not need to be licensed because a Department inspector or “government project inspector” is considered an “authorized visitor” under S.C. Code Ann. Regs. 61-86.1 (I)(21), which is different from a licensed “building inspector” under (I)(24).

The cardinal rule of statutory construction is to give effect to the intent of the legislature. Hodges v. Rainey, 341 S.C. 79, 85, 533 S.E.2d 578, 581 (2000) (citing Charleston County Sch. Dist. v. State Budget and Control Bd., 313 S.C. 1, 437 S.E.2d 6 (1993)). Legislative intent is first and foremost determined by the language of the statute. State v. Pittman, 373 S.C. 527, 561, 647 S.E.2d 144, 161 (2007) (citing Whitner v. State, 328 S.C. 1, 6, 492 S.E.2d 777, 779 (1997)). If the statutory language is plain and unambiguous, then its terms should be applied as written and resort to the principles of statutory interpretation need not be had. Paschal v. State Election Comm’n, 317 S.C. 434, 454 S.E.2d 890 (1995). The literal language of a statute should be disregarded only when the result is so plainly absurd that it clearly could not have been the intent of the legislature. Kiriakides v. United Artists Commc’ns, Inc., 312 S.C. 271, 275, 440 S.E.2d 364, 366 (1994) (citing Stackhouse v. Rowland, 86 S.C. 419, 68 S.E. 561 (1910)). Further, “the Court generally gives deference to an administrative agency’s interpretation of an applicable statute or its own regulation.” Brown v. Bi-Lo, Inc., 354 S.C. 436, 440, 581 S.E.2d 836, 838 (2003) (citing Brown v. S.C. Dep’t of Health & Envtl. Control, 348 S.C. 507, 560 S.E.2d 410 (2002)).

Regulation 61-86.1 refers to “building inspector,” “government project inspector,” “Department inspector,” and “Department personnel.” “Where the same word is used more than once in a statute it is presumed to have the same meaning throughout unless a different meaning is necessary to avoid an absurd result.” Busby v. State Farm Mut. Automobile Ins. Co., 280 S.C. 330, 333, 312 S.E.2d 716, 718 (Ct. App. 1984). Conversely, where different terms are used, it follows that they have different meanings. Other sections of Regulation 61-86.1 provide support for the Department’s interpretation that Department inspectors are considered “authorized visitors” under the Regulation, rather than “building inspector[s].” Part IV of Regulation 61-86.1 refers to “Department inspectors or other authorized visitors,” which suggests that Department inspectors are one type of authorized visitor. S.C. Code Ann. Regs. 61-86.1 (IV)(C)(3)(c). Moreover, the definition of “building inspector” does not expressly apply to Department personnel. See id. at (I)(24).

Furthermore, a building inspector’s responsibilities involve performing building inspections to identify the presence, location, and estimated quantity of ACM that may be disturbed by a particular activity. See S.C. Code Ann. Regs. 61-86.1 (IV)(B)(1). A building inspector must comply with sampling procedures, prepare a detailed report based on his findings, including a description of non-suspect materials, and provide an assessment of all materials suspected to contain asbestos, including an evaluation of the materials’ current condition, estimated quantities, and potential for disturbance. Id. at (IV)(B)(3). The evidence shows that the duties of Department inspectors are distinct from those of building inspectors. (See R. Renee Baecker Aff.; Mark Farleigh Dep. 44:4-12). Department inspectors inspect a project involving known or alleged asbestos material to ensure compliance with applicable laws and regulations. Department inspectors are trained in accordance with Department and EPA policy and regulations. (See R. Renee Baecker Aff.) The court agrees with the Department’s interpretation that a building inspector is separate and distinct from a Department inspector, and that Department inspectors are not required to be licensed as building inspectors to conduct compliance inspections and cite violations of the asbestos regulations.

3. Quail Hollow Apartments

SESI contends that it is entitled to summary judgment regarding the part of the Department’s administrative order related to the Quail Hollow Apartments because SESI had already completed its work at Quail Hollow at the time of the alleged violations, and another contractor was responsible for the violations. The Department claims that SESI’s president, Thomas F. Wasson, admitted during his deposition that the other contractor, Faircloth Interiors, was in fact a subcontractor of SESI.[2] It is the well-established law of agency that a principal is liable for the actions of his agent. Cook v. Canal Ins. Co., 245 S.C. 238, 140 S.E.2d 166 (1965). Similarly, a contractor may be held responsible for the actions of its subcontractor. See Universal Const. Co. v. Occupational Safety and Health Review Comm'n, 182 F.3d 726 (10th Cir. 1999) (“[A]n employer who controls or creates a worksite safety hazard may be liable under the Occupational Safety and Health Act even if the employees threatened by the hazard are solely employees of another employer.”); but see Bozung v. Condo. Builders, Inc., 711 P.2d 1090 (Wash. Ct. App. 1985) (holding that contractor was not liable for regulatory violation of the subcontractor, where the subcontractor was the only active contractor on site at the time). SESI argues that because SESI had completed abatement work and received clearance from a third-party air monitor, SESI was not responsible for the work of Faircloth Interiors. The court finds that a genuine issue of material fact exists as to whether Faircloth Interiors was an agent of SESI at the time of the violation. Accordingly, summary judgment on this ground is inappropriate.

4. Rutherford Drive

The Department also reported violations regarding a project conducted by SESI on Rutherford Drive, an abandoned property in Greenville County. The Department conducted an inspection and found that the shower in the decontamination unit did not have a connected water source, as required by S.C. Regs. 61-86.1 (V)(D)(1)(a)(12), which states that “[p]rior to beginning removal, each owner/operator engaged in a renovation project subject to this Section shall . . . [c]onstruct a decontamination enclosure system [that shall consist of] a shower room containing hot and cold or warm running water controllable at the tap . . . .” (emphasis added). SESI challenges the alleged violation based on the fact that SESI had access to only one water source at that site. SESI admits its violation of S.C. Regs. 61-86.1 (V)(D)(1)(a)(12) in its argument for summary judgment, stating “[a]t the time, there was only one water source, which was a hose pipe. . . . SESI was limited as to what it could do regarding water sources because there was only one.” (SESI Mem. in Support of Summ. J., at 17; see also Paul Wojoski Dep. 29-31). The regulation clearly indicates that the responsibility to comply with the regulation lies with the Respondent. SESI’s explanation that it was running a single hose back and forth between the asbestos-contaminated contained work area and the shower room, where persons are to clean themselves of asbestos containing material, does not meet the regulatory requirement that the decontamination enclosure system must have “hot and cold or warm running water controllable at the tap.” S.C. Regs. 61-86.1 (V)(D)(1)(a)(12). Therefore, the court denies Respondent’s motion on this ground.

5. Search and Seizure

SESI argues that the Department’s search of its Irmo, South Carolina office in July of 2006 was in violation of the Fourth Amendment. The Pollution Control Act authorizes the Department to

[e]nter at all times in or upon any property, public or private, for the purpose of inspecting and investigating conditions relating to pollution or the possible pollution of the environment of the State. Its authorized agents may examine and copy any records or memoranda pertaining to the operation of a disposal system or source that may be necessary to determine that the operation thereof is in compliance with the performance as specified in the application for a permit to construct; provided, however, that if such entry or inspection is denied or not consented to, and no emergency exists, the Department is empowered to and shall obtain from the magistrate from the jurisdiction in which such property, premise or place is located, a warrant to enter and inspect any such property, premise or place prior to entry and inspection.

S.C. Code Ann. § 48-1-50(24) (2008).

The undisputed facts show that in July of 2006, a Department inspector visited SESI’s office location during regular business hours. Upon arrival, the Department inspector identified himself to the receptionist, Heidi Meetze, who was the only person in the office at that time. (Wojoski Dep. 57:16-58:13.) The inspector explained to the receptionist that he was investigating a complaint of asbestos waste. (Id. at 64:8-21.) The inspector received the receptionist’s consent to proceed with his investigation. (Id.) Testimony supports that the receptionist regularly greeted customers for both entities. (Ralph Shuler Dep. 54-55:9.) The office had a single front door, with the names and numbers of two businesses, Faircloth Interiors and SESI. (Wojoski Dep. 38:14-18.) Visitors enter a single reception area upon entering through the front door. (Shuler Dep. 54:2-20.) This reception area had no demarcations indicating it was strictly used by only one of these two co-tenants. (Id. at 51:20-24.)

The Fourth Amendment operates to protect privacy interests by prohibiting certain non-consensual searches without a warrant. Consent to search may be given by an individual possessing apparent authority to grant access. See State v. Pressley, 288 S.C. 128, 341 S.E.2d 626 (1986) (“A third party may grant consent to search the premises if they possess ‘common authority’ over or ‘sufficient relationship’ to the premises or effects sought to be inspected.”); United States v. Matlock, 415 U.S. 164, 94 S.Ct. 988 (1974) (“[T]he consent of one who possesses common authority over premises or effects is valid as against the absent, nonconsenting person with whom that authority is shared.”); see also State v. Laux, 344 S.C. 374, 544 S.E.2d 276 (2001) (“The test of whether a third party has sufficient status to consent to a search is whether the third party possesses common authority over or has some other sufficient relationship to the premises or effects searched.”); Illinois v. Rodriguez, 497 U.S. 177, 110 S.Ct. 2793 (1990) (“[D]etermination of consent to enter must ‘be judged against an objective standard: would the facts available to the officer at the moment . . . “warrant a man of reasonable caution in the belief”’ that the consenting party had authority over the premises?”); State v. Williams, 655 N.E.2d 764 (Ohio Ct. App. 1995) (finding Rodriguez applicable to situations in which an officer would have had valid consent to search if the facts were as he reasonably believed them to be).

SESI argues that searches “may be unreasonable if they are not authorized by law or are unnecessary for the furtherance of government interests.” (SESI Mem. in Support of Summ. J., at 21 (emphasis added).) However, neither of these factors renders the search at issue unconstitutional, because (1) the S.C. Pollution Control Act, § 48-1-50 (24), clearly authorizes the Department to search the office with consent; and (2) the Department’s investigation was for “the furtherance of government and the [public’s] interests.” 79 C.J.S. Searches § 128, cited in (SESI Mem. in Support of Summ. J., at 21).

Moreover, the expectation of privacy is lowered for a commercial entity engaged in such a highly regulated field. “An expectation of privacy in commercial premises, however, is different from, and indeed less than, a similar expectation in an individual’s home, [and] this expectation is particularly attenuated in commercial property employed in ‘closely regulated’ industries.” New York v. Burger, 482 U.S. 691, 700, 107 S.Ct. 2636, 2643 (1987). “[W]here the privacy interests of the owner are weakened and the government interests in regulating particular businesses are concomitantly heightened, a warrantless inspection of commercial premises may well be reasonable within the meaning of the Fourth Amendment.” Id. at 702, 107 S.Ct. at 2643-44. Asbestos abatement is a highly regulated field, as demonstrated by the extensive nature of the Asbestos Regulations, due to the great potential for harm to public health and the environment. The court finds that the Department’s search and seizure of evidence from SESI’s Irmo location was valid and denies SESI’s motion on this ground.

CONCLUSION

The court finds that the Department’s citations of violations are not rendered invalid because its inspectors were not licensed building inspectors, that SESI is not entitled to summary judgment regarding the specific citations at Quail Hollow and Rutherford Drive, and that the search and seizure was lawful and the evidence obtained admissible. Based upon the foregoing, it is

ORDERED that the Respondent’s motion for summary judgment is denied and the matter shall proceed to a contested case hearing on the merits.

IT IS SO ORDERED.

__________________________________

PAIGE J. GOSSETT

Administrative Law Judge

October 22, 2008

Columbia, South Carolina