SC Administrative Law Court Decisions

I. STATEMENT OF THE CASE

The above-captioned case comes before this tribunal on Petitioner South Carolina Coastal Conservation League's ("League") request for a contested case hearing to challenge the August 25, 2000 decision of the South Carolina Department of Health and Environmental Control (DHEC), Office of Ocean and Coastal Resource Management (OCRM), to grant an extension of Respondent Palmetto Land Properties' ("PLP") permit for the construction of a marina facility on Daufuskie Island in Beaufort County, South Carolina. After several motions had been resolved and several continuances allowed, a hearing of this matter was conducted on January 22, 2002, at the Administrative Law Judge Division (ALJD or "Division") in Columbia, South Carolina. At the close of Petitioner's case-in-chief, Respondent OCRM moved to dismiss this case on the ground that Petitioner had failed to meet its burden of establishing that Respondent PLP has not exercised due diligence toward the completion of the permitted work. Respondent PLP joined in OCRM's motion and further moved to dismiss the case on the ground that the Petitioner lacked standing to bring this action. ⁽¹⁾ For the reasons set forth below, OCRM's and PLP's motion for an involuntary nonsuit against Petitioner is granted.

II. FINDINGS OF FACT

Having carefully considered all testimony, exhibits, and arguments presented at the hearing of this case, and taking into account the credibility and accuracy of the evidence, I make the following Findings of Fact by a preponderance of the evidence:

1. In 1986, the South Carolina Coastal Council (the predecessor organization to OCRM) issued Permit #85-3T-316 to the International Paper Corporation of South Carolina for the construction of an inland lock harbor marina facility on Daufuskie Island in Beaufort County, South Carolina. The marina was designed to be a "hub marina" that would provide water access and moorage on the Cooper River for extensive residential and resort development on Daufuskie Island. International Paper was also required to obtain, and did obtain, a United States Army Corps of Engineers permit and a 401 Water Quality Certification from DHEC for the construction of the marina. Zoning approval for the development was obtained from Beaufort County.

2. The OCRM permit was renewed in 1989, 1992, and 1995. The 1995 renewal was due to expire on September 25, 2000. However, pursuant to a renewal request made on July 11, 2000, by Respondent PLP, who had acquired the marina property in late 1999, OCRM extended the expiration date of the permit for three years by a letter dated August 25, 2000. The League received notice of the permit extension on September 22, 2000, and timely filed this contested case to challenge the extension on October 5, 2000. The Corps of Engineers permit and the 401 Water Quality Certification were renewed, without objection, in 1998.

III. CONCLUSIONS OF LAW

Based upon the above Findings of Fact, I conclude the following as a matter of law:

A. Motion for Involuntary Dismissal

At the close of Petitioner's case, Respondent OCRM moved for a dismissal of Petitioner's case on the ground that Petitioner failed to meet its burden of proof on the relevant issue in this case. Respondent PLP joined in this motion. The ALJD Rules do not address the procedure for dismissing a matter at the close of a petitioner's case. However, ALJD Rule 68 allows the South Carolina Rules of Civil Procedure to be applied, where practicable, in proceedings before the Division to resolve questions not addressed by the ALJD Rules. Here, Rule 41(b) of the South Carolina Rules of Civil Procedure provides guidance on how to resolve a motion for an involuntary nonsuit; it states:

After the plaintiff in an action tried by the court without a jury has completed the presentation of his evidence, the defendant, without waiving his right to offer evidence in the event the motion is not granted, may move for a dismissal on the ground that upon the facts and the law the plaintiff has shown no right to relief.

The court as trier of the facts may then determine them and render judgement against the plaintiff or may decline to render any judgement until the close of all the evidence.

Rule 41(b), SCRCP. In Johnson v. J.P. Stevens & Co., 308 S.C. 116, 417 S.E.2d 527 (1992), the South Carolina Supreme Court further elaborated upon the standard a court, as the trier of fact, should apply in considering a defendant's motion for an involuntary dismissal:

Under Rule 41 in a nonjury trial, the trial judge clearly may dismiss the action even though the plaintiff may have established a prima facie case. Rule 41(b) allows the judge as the trier of facts to weigh the evidence, determine the facts and render a judgement against the plaintiff at the close of his case if justified.

Id. at 118, 417 S.E.2d at 529; see also James F. Flanagan, South Carolina Civil Procedure 348 (2d ed. 1996). ⁽²⁾

In moving to dismiss Petitioner's case, Respondents contend that the sole issue in the present case is whether PLP has shown due diligence toward completion of the Daufuskie marina so as to justify an extension of its permit, that Petitioner had the burden of proof on this issue, and that Petitioner did not present sufficient evidence in its case-in-chief to meet that burden. In response, Petitioner argues that it has met its burden of showing a lack of due diligence on the part of PLP. With the standard for an involuntary nonsuit under Rule 41(b) in mind, and after careful consideration of all of the testimony and documentary evidence presented in Petitioner's case-in-chief, I find that this case must be dismissed, as Petitioner failed to demonstrate that PLP has not exercised due diligence toward the completion of the permitted marina.

B. Issue of Case

Put generally, the basic question at issue in this case is whether OCRM properly granted PLP's request for an extension of the time limits specified under its permit. The extension of a construction permit issued by OCRM is governed by S.C. Code Ann. § 48-39-150(F) (Supp. 2001). This Section provides:

Work authorized by permits issued under this chapter must be completed within five years after the date of issuance. The time limit may be extended for good cause showing that due diligence toward completion of the work has been made as evidenced by significant work progress. An extension only may be granted if the permitted project meets the policies and regulations in force when the extension is requested or the permittee agrees to accept additional conditions which would bring the project into compliance. The time periods required by this subsection must be tolled during the pendency of an administrative or a judicial appeal of the permit issuance.

Id. Under the plain terms of this section, Petitioner may challenge the extension of the time for completion of the marina either: (1) on the ground that good cause for the extension has not been shown by the permittee, as evidenced by a lack of due diligence toward completion of the work, or (2) on the ground that the permitted project does not meet the policies and regulations in force when the request for an extension was made. Id.; see also Order Den. Mot. to Dismiss of Jan. 16, 2001, at 3-7.

However, the second prong of Section 48-39-150(F) is not as broad as it might first appear. It is not a sweeping invitation to challenge the original permit; rather, it is a limited provision for challenges based solely on changes in the law. This provision clearly contemplates that environmental permitting policies and regulations are subject to change over time. Accordingly, if such statutory and regulatory changes have occurred between the time of a permit's original issuance and the time at which a request is made for an extension of time under the permit, the extension of time can only be granted if the permitted project complies with the current state of the law. But, if no relevant changes have occurred in policy or law since the issuance of a permit, there would be no basis for an administrative challenge to the extension of time under the permit on the ground that the permit does not comply with current policies and regulations.

Section 48-39-150(F) is designed to ensure that extensions of time to complete permitted projects are not granted unless the permittee is working toward such completion with due diligence and the project complies with any changes in environmental law made since its initial approval. It is not designed to give parties an opportunity to re-litigate the merits of the issuance of the original permit. In the case at hand, Petitioner is entitled to challenge OCRM's extension of PLP's permit on the grounds that PLP has not shown due diligence in its efforts to construct the marina and that changes in relevant law since the last extension of the permit have made the construction of the marina incompatible with current regulatory standards. Petitioner is not entitled to use this extension-of-time proceeding to re-litigate the decision to issue the original permit. See, e.g., Associated Enterprises, Inc. v. Toltec Watershed Improvement Dist., 578 P.2d 1359, 1361-62 (Wyo. 1978) ("In a proceeding requesting an extension of time for commencing and completing a reservoir, the appellants did not and could not raise . . . issues which relate to the propriety of granting the original reservoir permit," because it would violate the statutory permitting scheme to allow the appellants to, "in a proceeding contemplated by the extension-of-time statute, litigate claimed rights conceived by the original reservoir permit approval-or-rejection statute.") (emphasis added) (citations omitted). ⁽³⁾

At the hearing of this matter, Petitioner further limited the issues in contention by restricting its focus to the "due diligence" prong of Section 48-39-150(F). (Hr'g Tr. at 5.) Specifically, Petitioner stated that "it is our contention that there has not been due diligence toward completion of the work and that there has not been significant work progress" with regard to the permitted marina project. Id. Accordingly, the sole issue remaining in this case is whether OCRM granted the extension of PLP's permit "for good cause showing that due diligence toward completion of the work has been made as evidenced by significant work progress." § 48-39-150(F).

C. Burden of Proof

Having determined the narrow issue at hand in this case, it remains to be seen which party has the burden of proof on that issue. Generally, in administrative proceedings, the burden of proof rests upon the party who asserts the affirmative of an issue. Leventis v. S.C. Dep't of Health and Envtl. Control, 340 S.C. 118, 132-33, 530 S.E.2d 643, 651 (Ct. App. 2000); 2 Am. Jur. 2d Administrative Law § 360 (1994); see also Alex Sanders & John S. Nichols, Trial Handbook for South Carolina Lawyers § 9.3, at 366-69 (2d ed. 2001) (stating that the burden of proof in civil matters is generally upon the party asserting the affirmative of an issue). Here, Petitioner contends that OCRM's decision to extend PLP's permit was made in contravention of the terms of Section 48-39-150(F); therefore, Petitioner asserts the affirmative on the issue in the present case. Accordingly, Petitioner must prove, by a preponderance of the evidence, ⁽⁴⁾ that OCRM's grant of a renewal of the permit violated Section 48-39-150(F). In particular, Petitioner has the burden of demonstrating that PLP has not exercised due diligence toward the completion of the marina as evidenced by significant work progress.

In the case at hand, I find that Petitioner has not met its burden of proof. At the hearing of this case, Petitioner, as well as Respondent PLP, was preoccupied with collateral matters that had been resolved by earlier Orders from this tribunal and that have no bearing on the issue of PLP's diligence in completing the marina. Petitioner presented three witnesses at the hearing, two members of the Coastal Conservation League who are writers residing on Daufuskie Island and the director of the Beaufort Office of the Coastal Conservation League. The testimony of the two Daufuskie residents focused almost entirely upon their aesthetic and recreational interest in, and concern for, the island and emphasized the League's standing to bring this case. However, in an Order dated November 5, 2001, this tribunal had specifically held that the League, as an organization, had standing to pursue this contested case. (Order Den. Mot. to Dismiss of Nov. 5, 2001, at 2.) The testimony of the League's third witness, the director of its Beaufort office, pertained exclusively to the process by which the League had brought this case and emphasized the efforts the League had made to bring its challenge in a timely manner. However, in an Order dated January 16, 2001, this tribunal had specifically held that the League had timely filed its request for a contested case hearing in this matter. (Order Den. Mot. to Dismiss of Jan. 16, 2001, at 1-3.) The bulk of the testimony offered by Petitioner at the hearing was not relevant to the issue presented by this case.

Further, the one exchange during the questioning of Petitioner's witnesses that was relevant to the issue of PLP's due diligence toward the completion of the marina did not suggest a lack of such diligence by PLP. On re-direct examination by Petitioner's counsel, Roger Pinckney, a resident of Daufuskie Island, testified that he was not aware of anything that Respondent PLP had ever built on the island. (Hr'g Tr. at 59.) However, on re-cross examination by counsel for PLP, Pinckney stated that he was aware of various activities, from road building to landscaping, that had recently occurred on PLP's property. (Hr'g Tr. at 59-60.) Thus, while this testimony was pertinent to the issue of PLP's work progress, it was the only testimony of its sort offered at the hearing, and it clearly does not establish a lack of significant work progress by Respondent PLP.

Beyond the three witnesses who testified at the hearing, Petitioner introduced two depositions into evidence as part of its case-in-chief. While these depositions do contain a significant amount of testimony regarding PLP's activities on Daufuskie Island, they do not establish, by a preponderance of the evidence, that PLP has failed to exercise due diligence toward the completion of the marina project. One of these depositions is that of Charles Cauthen, a member of Respondent Plantation Land Properties, LLC. In his deposition, Mr. Cauthen did, to a limited extent, discuss PLP's efforts to construct the Daufuskie marina. However, this discussion was focused more on PLP's future plans and timetable with regard to the construction of the marina rather than on PLP's due diligence toward completion of marina for the relevant time period, i.e., the period after the previous renewal and before the current one (1995 to 2000). See, e.g., Pet. Ex. 6 at 13-15 (discussing a PLP planning meeting held in fall 2001); Pet. Ex. 6 at 18 (discussing whether any construction had occurred since the challenge to the permit renewal was brought). Further, that portion of the examination that related to past construction efforts rather than future construction plans consisted of general questions concerning construction on the entire Webb Tract ⁽⁵⁾ for the past seventeen years, and not of specific questions pertaining to construction efforts on the marina property between 1995 and 2000. (Pet. Ex. 6 at 15-17.)

The deposition of Richard Chinnis, OCRM's director of regulatory programs, suffers from similar weaknesses. While there was explicit discussion of "work progress" made under the permit in the deposition (Pet. Ex. 7 at 19, 20, 27), the primary focus of those discussions was on the criteria used by OCRM in determining whether to grant a permit extension, not on whether PLP had exercised due diligence toward completion of the marina as evidenced by significant work progress. (Pet. Ex. 7 at 27-29.) Other discussions in the deposition related to work done by PLP concerned work done on the entire Webb Tract since the mid-1980s rather than specific efforts toward construction of the marina made by PLP in the period relevant to the current renewal request. (Pet. Ex. 7 at 56.) Finally, it should be noted that, rather than indicating a lack of due diligence and work progress, the thrust of Mr. Chinnis's deposition testimony was that PLP had evidenced work progress toward the construction of the permitted marina so as to warrant an extension of its permit. (Pet. Ex. 7 at 19, 20, 27-28, 56.) Neither of the two depositions moved into evidence by Petitioner establish that PLP failed to exercise due diligence toward the completion of the marina project.

Neither through the testimony presented at the hearing of this case nor through the depositions or other exhibits entered into evidence in this matter has Petitioner proven, by a preponderance of the evidence, that Respondent PLP has failed to exercise due diligence toward the completion of the Daufuskie marina as evidenced by significant work progress. Accordingly, Petitioner's challenge to OCRM's decision to extend PLP's permit must fail. This tribunal is mindful that Petitioner faced a difficult task in demonstrating a lack of due diligence on the part of PLP. It is often easier to prove something's existence rather than its nonexistence. Nevertheless, direct testimony regarding specific actions either taken or not taken, plans either made or not made, and construction either undertaken or not undertaken by PLP during the relevant time period would have gone a long way toward helping Petitioner satisfy its burden. Petitioner's case was difficult, but not impossible, to prove. As the South Carolina Supreme Court has noted, "[i]t is hard to prove a negative, but plaintiffs sometimes have cases that are hard to prove." Carolina & N.W. Ry. v. Ford, 105 S.C. 80, 85, 89 S.E. 809, 810 (1916). Here, Petitioner faced a similar burden-a burden which it did not carry.

IV. ORDER

IT IS THEREFORE ORDERED that Respondents' Motion for an Involuntary Nonsuit against Petitioner pursuant to Rule 41(b), SCRCP, is GRANTED, and this case is DISMISSED with prejudice.

AND IT IS SO ORDERED.

______________________________

JOHN D. GEATHERS

Administrative Law Judge

Post Office Box 11667

Columbia, South Carolina 29211-1667

April 18, 2002

Columbia, South Carolina

1. Respondent PLP had previously filed a pre-hearing motion to dismiss this matter for Petitioner's lack of standing on September 21, 2001. By an Order dated November 5, 2001, this tribunal denied PLP's motion to dismiss, finding that, by sworn affidavits submitted in response to PLP's motion, the League had alleged a threat of individualized injury to the aesthetic and recreational interests of at least two of its members sufficient to satisfy the organizational standing requirements of Sea Pines Ass'n for the Prot. of Wildlife, Inc. v. S.C. Dep't of Natural Res., 345 S.C. 594, 550 S.E.2d 287 (2001). (Order Den. Mot. to Dismiss of Nov. 5, 2001, at 2.) As the testimony presented by Petitioner at the hearing only served to further establish its standing to bring this matter, PLP's renewed motion to dismiss this case for Petitioner's lack of standing is therefore denied.

2. Federal courts apply a similar standard in ruling on motions to dismiss made under the federal equivalent of Rule 41(b), SCRCP, which is now found at Fed. R. Civ. P. 52(c):

In rendering that judgement, the court is not as limited in its evaluation of the nonmovant's case as it would be on a motion for directed verdict. The trial judge is not to draw any special inferences in the nonmovant's favor nor concern itself with whether the nonmovant has made out a prima facie case. Instead, the court's task is to weigh the evidence, resolve any conflicts in it, and decide for itself where the preponderance lies.

9A Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 2573.1 (1995) (footnotes omitted).

3. This narrowing of the scope of Petitioner's challenge pursuant to Section 48-39-150(F) was previously set forth in an Order of this tribunal dated November 5, 2001. (Order Den. Mot. to Dismiss of Nov. 5, 2001, at 2-4.)

4. The preponderance of the evidence is "[t]he greater weight of the evidence" or "superior evidentiary weight that, though not sufficient to free the mind wholly from all reasonable doubt, is still sufficient to incline a fair and impartial mind to one side of the issue rather than the other." Black's Law Dictionary 1201 (7th ed. 1999).

5. The Webb Tract is a larger tract on Daufuskie Island of which the marina property is a part.