NATIONAL COAL OPERATORS' ASSN. v. KLEPPE
Legal provision: 30 U.S.C. 801
Argument of John L. Kilcullen
Chief Justice Warren E. Burger: We will hear arguments first this morning in 73-2066, the National Independent Coal Operators’ Association against the Secretary of the Interior and the consolidated case, the Secretary of Interior against Delta Mining Company.
Mr. Kilcullen, you may proceed whenever you are ready.
Mr. John L. Kilcullen: Mr. Chief Justice, members of the Court, these consolidated cases present a single legal issue as to whether the Bureau of Mines of the Department of Interior in assessing civil penalties for alleged violations of the Federal Coal Mine Health and Safety Act followed strictly the procedural requirements spelled out by Congress in the Act.
The Act directs that the operator of a coal mine in which a violation occurs shall be assessed to civil penalty by the Secretary of the Interior in an amount not less than $10,000 for each violation.
The penalty provisions of the statute are mandatory, i.e., the Secretary must assess penalty in each instance where he finds a violation.
In this respect, the Act differs from other occupational safety Acts such as OSHA which give the administrative agency discretion to assess penalties where a fault is found.
Here, the statute requires in each case that a penalty be assessed regardless of fault.
Because of the mandatory nature of the penalty provisions of this statute, Congress wrote into the Act certain procedural safeguards which must be followed by the Secretary in assessing these penalties.
The Act expressly provides that a penalty shall be assessed by the Secretary only after a mine operator charged with the violation has had an opportunity for a public hearing and the Secretary has determined by decision incorporating findings of fact that a violation occurred and the amount of the penalty which is warranted.
The statute also requires that hearings be subject to the provisions of the Administrative Procedure Act.
In determining the amount of the penalty, the Secretary must consider six criteria spelled out in the statute: the operator’s prior record of violations, the size of his business, whether he was negligent, the gravity of the violation, his good faith effort to achieve compliance, and whether the penalty would affect his ability to continue in business.
These cases are before the Court because the Secretary has not applied these procedural safeguards.
Instead, he has adapted a summary type of procedure under which he has authorized the Bureau of Mines to issue a proposed order, a proposed assessment, in advance of any hearing or any finding or determination that a violation occurred.
Unless the mine operator request formal adjudication within a certain number of days after he receives such a proposed order, the order becomes final by its terms.
The Bureau of Mines’ Assessment Officer who issues these assessment orders is not a qualified administrative law judge nor does he have authority to hold hearings or adjudicate disputed issues.
On deposition, he admitted that he made no effort to determine whether a violation had in fact occurred, and he also admitted that in fixing the amount of the penalty he had simply followed a preset penalty schedule which gave no consideration to the six statutory criteria.
In the National Independent Coal Operators’ case, the District Court found that the Assessment Officer gave no meaningful consideration to the six statutory criteria for determining penalties and that he made no independent determination as to whether the charged violation had occurred.
In the Delta Mining Group of cases, the District Courts refused enforcement of these penalty assessment orders on the same ground, that they were not based on a genuine determination as to the occurrence of a violation or consideration of the statutory criteria for determining the penalty amount.
Now, the Government has argued that the statutory language requires only that the mine operator be given an opportunity for a hearing, and if he does not request a hearing there is no need for a decision incorporating findings of fact.
In other words, the procedural requirements of the Act are satisfied simply by advising the operator that he can request a hearing.
The balance of the Section which calls for determination, the Government says, becomes inoperative once he had been given this opportunity for a hearing.
The District Courts in the cases below rejected this argument and held that in all cases, before an assessment order can become final, it must be supported by a decision incorporating the Secretary’s findings of fact that a violation did occur in the amount of the penalty which is warranted, and held that the procedures leading to the orders sought to be enforced by the Secretary did not comply with the requirements of the Act.
Justice William H. Rehnquist: Mr. Kilcullen, isn’t your version of what Congress provided here rather elaborate by the standards of normal administrative law?
If Congress clearly provided it, certainly that is the way it ought to be, but if there is ambiguity, is there not some question as to whether this is a rather unusually elaborate proceeding?
Mr. John L. Kilcullen: I do not think so, Your Honor.
I think that it simply follows the standard procedure for adjudicating penalties, any penalty, to be asserted against the citizen.
There must be some adjudicative process and this is simply what the Congress provided here that there must be a determination.
Justice William H. Rehnquist: Well, he has an opportunity for an adjudication if he wants one.
Mr. John L. Kilcullen: But the statute says that the Secretary must apply these criteria in making a determination and unless he has done so, the operator’s failure to request a hearing does not validate or does not cure a Secretary’s failure to comply with the statute.
He has to find that there has been a violation, and having found that there is a violation, he must then decide what the amount of the penalty must be and in doing so, he has to take into account the six criteria.
The procedure that has been followed here eliminates that.
It simply involves issuing a proposed order and advising the operator that if he does not request a hearing a proposed order becomes final.
Justice Thurgood Marshall: But if he requests a hearing without law, the procedure goes in, right?
Mr. John L. Kilcullen: Yes, sir, that initiates the hearing procedure and then the --
Justice Thurgood Marshall: Well, why did he not do that?
Mr. John L. Kilcullen: Your question is why did not the operators request a hearing?
Justice Thurgood Marshall: Yes, sir.
Mr. John L. Kilcullen: I cannot answer that question other than to say that the operators undoubtedly felt that these orders were not in accordance with the statutory procedure, that the orders were not valid orders.
Justice Thurgood Marshall: It would not cost him anything to send a note, would it?
Mr. John L. Kilcullen: Well, in every one of these cases -- Your Honor, in every one of these cases --
Justice Thurgood Marshall: All he had to do was to send a note and say “we want a hearing.”
Mr. John L. Kilcullen: In every one of these cases, the operator protested, filed a protest with the Assessment Officer and sent in material to establish that the circumstances of the violation were set to the penalty -- it sets should not be --
Justice Thurgood Marshall: Just like a lawyer’s fight, he just wants to try this out.
Mr. John L. Kilcullen: Sorry.
Justice Thurgood Marshall: It is a lawyer’s fight; he just wants to try the statute out, when all you have to do was send in one little piece of paper saying “I request a hearing.”
Mr. John L. Kilcullen: Well, I do not know whether you are correct in saying it is a lawyer’s fight.
I believe that the mine operator is entitled to the due process that is set out on the statute, Your Honor, and his failure to request a hearing does not entitle the Secretary to disregard the statute.
He cannot avoid his responsibility to adjudicate.
He has got to make a determination.
He cannot assume that a violation occurred, which he does -- which the Assessment Officer does.
He cannot assume the existence of a violation.
He must find, under the statute, he must find that there was in fact a violation, and if he finds that, as I say, he then has to determine the amount that is to be assessed.
Unknown Speaker: Mr. Kilcullen, are the operators really claiming that they do not know what these alleged violations consist of or are they really arguing mitigation here?
Mr. John L. Kilcullen: Mitigation, Your Honor?
No, I think they are not given adequate notice as to what the nature of the charge is.
The District Court so found in the National Independent case that all they get is a pro-form of printed form with some blanks still there which says “you have been assessed” or “we propose to assess a penalty of so much money” without any explanation of why or how the penalty was determined.
Unknown Speaker: Is that not the reason for requesting a hearing then?
Mr. John L. Kilcullen: Well, the Secretary originally set up a procedure whereby, in each case, the matter would be sent to the Office of Hearings and Appeals, and then the Bureau of Mines had to file a petition for an assessment within which they would spell out the circumstances, all of the factual background, and so on.
In that circumstance, the matter would then go to an Administrative Law Judge who would take testimony and make findings and then further appeal from that to the Board of Mine Operations Appeals.
Now, after this procedure was in effect for a year, the Secretary decided he was going to take a shortcut and he then adapted this new summary procedure under which the Assessment Office would send out these proposed penalties.
The important point I think is that the Assessment Officer made no adjudication, no attempt to adjudicate.
He admitted that he made no attempt to find whether a violation had occurred.
He simply took the notice of violation that had been issued by the Mine Inspector and on the basis of that he issued the penalties.
Now the penalties were in large amounts in many cases, running $5,000-$10,000.
Justice William H. Rehnquist: But the Mine Inspector did make an effort to find out whether a violation had occurred, did he not?
Mr. John L. Kilcullen: Well, he found a situation which he considered to be a violation but that does not prove the existence of a violation.
There has to be some actual proof in many of these instances, and these cases are now being heard by Administrative Law Judges.
When the evidence is heard, it is found that there was not in fact a violation.
The Mine Inspector misread the situation.
Justice William H. Rehnquist: And that sort of a hearing was opened to any of your clients on request.
Mr. John L. Kilcullen: They could go to a hearing, right.
The question is whether the order which became final without a hearing was a valid order because it was not based upon a determination as to the existence of a violation or the application of these statutory criteria.
Justice William H. Rehnquist: Well, you say it was not based upon a determination of the existence of a violation.
Why, at that stage of the administrative proceeding, is not the Adjudicative Officer entitled to take the representations of the Mine Safety Inspector?
Mr. John L. Kilcullen: There is not Adjudicative Officer in this procedure, Your Honor.
The Secretary dispensed with an Adjudicative Officer.
All he has is an Assessment Officer who --
Justice William H. Rehnquist: Call it then that why is the Assessment Officer then entitled to take their finding of the Mine Safety Inspector?
Mr. John L. Kilcullen: Why is he not entitled to take it?
Because it is a unproved violation and it has to be established by adequate evidence.
Justice William H. Rehnquist: Would you say it has to be proved twice then in a course of an administrative hearing, first, at the preliminary stage and then, if a hearing is requested, again?
Mr. John L. Kilcullen: No, sir, I do not understand.
I think perhaps I am not getting across.
The Assessment Officer, it is a ministerial Act with him.
All he does is just -- in fact his clerical staff just filled in the blanks on these forms, these pre-credit forms.
He made no effort to adjudicate or make any determination of any of these questions.
He just sent out an order, and he said “unless you pay this order or request a hearing, it becomes a final order of the Secretary.”
Now we contend, Your Honor, that the Secretary cannot disregard the statute.
His failure to comply with the statutory requirements cannot be waived by the person who is charged with the violation.
Justice Byron R. White: You mean even if the mine operator had, in writing, expressly purported to dispense with a need for a hearing or with findings?
Mr. John L. Kilcullen: He could pay the penalty and settle the case and not at that level if he wished, but if he did not wish to pay this penalty he filed, in these cases, as we have indicated, he filed a protest.
He said “I think this is erroneous; it is wrong.”
Now, at that stage, he should have -- if the Secretary wanted to make this penalty a final penalty, he should have gone through the adjudicative process.
Justice Byron R. White: Did you rest on any constitutional argument below?
Did you make a constitutional argument?
Mr. John L. Kilcullen: We did, in fact, make the constitutional argument, there was --
Justice Byron R. White: That was rejected too, I take it.
Mr. John L. Kilcullen: No, the District Court held in our favor in each case and the Third Circuit held in our favor in the one case.
Now, the Court of Appeals for the District of Columbia --
Justice Byron R. White: Now did they reject the constitutional argument?
Mr. John L. Kilcullen: They did not consider the constitutional argument.
They read the statute.
They said “we aer going to go back and try to find out what the Congress meant in the statute,” and we feel they misread completely the statute.
Justice Byron R. White: Well, are you pressing a constitutional claim here?
Mr. John L. Kilcullen: Well, it is the question of due process of law I think is a proper question here.
Justice Byron R. White: So your answer is yes?
Mr. John L. Kilcullen: Yes, sir.
Justice Byron R. White: You did not ask for a post-assessment hearing either, I take it.
Could you not have had a de novo hearing before a jury?
Mr. John L. Kilcullen: Well, that is a question.
The statute is ambiguous on that point and, in fact, in the District Court --
Justice Byron R. White: Let us assume you could have.
You did not find out whether you could any way, whether you could have had that hearing or not.
Mr. John L. Kilcullen: This would come up in a situation where the Secretary goes into the District Court for enforcement as he did in the Delta Mining cases, and the operator then says “I think this order of the Secretary is invalid.
It was improperly issued, and I want to have a full de novo trial on these issues.”
Justice Byron R. White: It was available to you, was it not?
Mr. John L. Kilcullen: No, the Government said in the Delta Mining case, in the pre-trial conference, the Government contended that this de novo trial provision of the statute does not give the operator the right to adjudicate the fact of the violation.
In fact, in the appendix on page --
Justice Byron R. White: Because its failure to exhaust?
Mr. John L. Kilcullen: Well, they did not spell it out in those forms.
They said the way that the statute reads, excuse me Your Honor, I will just read the—
Chief Justice Warren E. Burger: Mr. Kilcullen, if you are reading from the record, where we will find it.?
Mr. John L. Kilcullen: I have it right here, I believe.
It is in the appendix.
Here it is in the appendix.
I am sorry.
It is on Page 6 of the Government’s brief, the addendum on page 6.
It says the Court, that is the District Court, shall have jurisdiction to enter a judgment enforcing modified and enforcing as so modified or setting aside in whole or in part the order and decision of the Secretary or may remand the proceedings to the Secretary for such further action as it may direct.
The Court shall consider and determine, de novo, all relevant issues except issues of fact which were or could have been litigated in review proceedings before a Court of Appeals, under Section 106 of this Act.
Chief Justice Warren E. Burger: Mr. Kilcullen, I think you are getting into Mr. Blackwell’s time now.
Mr. John L. Kilcullen: Yes, sir.
Well, I will just finish up and I point the Government argued in the pre-trial conference that these issues could have been litigated in an appeal proceeding under Section 106 and, therefore, the operator was not entitled to a de novo consideration in the Trial Court.
Chief Justice Warren E. Burger: Very well.
Argument of Fred Blackwell
Mr. Fred Blackwell: Mr. Chief Justice and may it please the Court.
I want to emphasize that there is no consideration of health or safety of the minors attaching to the issues in this case.
The Coal Mine Inspector issues a notice to obey the condition which he considers unsafe.
That Inspector’s order must be obeyed within the time he allows for the correction, otherwise, the affected part of the mine is closed down.
So, there is absolutely no connection between this case and the safety actions which are taken in the day-to-day operations in the mine.
The penalty assessment process comes many months after the condition has been corrected.
I would also like to emphasize that we are not asking this Court to give us any due process protection beyond that already spelled out in the statute.
We merely ask that the Secretary be required to honor the expressed penalty assessment procedures that are already there.
We contend that the penalty orders in these cases are invalid for a number of reasons, the major one of which is that the Secretary did not comply with Section 109 (a) (1) and (a) (3) of the Act.
The first sentence in each of these provisions requires that a violation must occur before a penalty can be assessed, violation must occur before a penalty can be assessed.
However, the testimony of the Secretary’s Assessment Officer, Mr. Everich Turner (ph), shows that no proper finding of violation has been made in these cases.
The Turner testimony, Appendix Page 93, shows that the Assessment Officer looked solely to the charge in the Inspector’s unsworn statement and assume on the basis of that that a violation had occurred.
No written finding of violation was put in the Assessment Order and in the Delta and G. M. W. cases no written finding that a violation had occurred was issued until long after the final penalty orders had been issued.
In one instance, the finding of violation called almost one year and eight months after the penalty order was issued.
The findings were never presented to the operators prior to the Secretary’s enforcement action and we saw the findings for the first time when we received the complaint as exhibits attached to the complaint.
Moreover, these findings, when they did come, although it is an adjudicatory function to find such a violation, the findings were made by Mr. Everich Turner who is the Secretary’s Assessment Officer.
He is not a Hearing Officer.
He is not a Juridical Officer.
This penalty process was not under the jurisdiction of a Juridical Officer at any time during the process.
Chief Justice Warren E. Burger: But was that not in part because it is the Government’s position that there was no occasion absent a request for hearing?
Mr. Fred Blackwell: That is the Government -- the Government’s position is that there is a distinction in the penalty assessment procedure in a hearing and a non-hearing situation, that the statute simply does not contain such a distinction.
In fact, when the Secretary first implemented the Coal Act in 1970 his construction of the statute was the same as our construction here today.
The penalty assessment function was placed under the jurisdiction of a hearing officer from the very beginning.
If he had maintained that procedure which was in conformity with the statute, we would not have this problem today.
Now, the fact that the hearing has not been held cannot, by any stretch of the imagination, justify a government agency dispensing a sanction a monetary penalty issuing the order “you pay this,” and then months later say “by the way, you were guilty of something.
You were guilty of a violation of a standard.”
Justice Thurgood Marshall: Mr. Blackwell, If you would have had the hearing, how long would have it taken?
Mr. Fred Blackwell: The hearing in these cases could have taken, well, the estimate -- pardon?
Justice Thurgood Marshall: About a year?
Mr. Fred Blackwell: No, not a year, sir.
Justice Thurgood Marshall: But pretty close.
Mr. Fred Blackwell: Pardon?
Justice Thurgood Marshall: Pretty close to a year.
Mr. Fred Blackwell: To a year?
Justice Thurgood Marshall: Yes.
Mr. Fred Blackwell: The hearing in the Delta and G. M. W. -- no, I cannot agree with that at all, Your Honor.
Justice Thurgood Marshall: Then how long?
Mr. Fred Blackwell: Three to five or seven days I would say, at the outside.
Justice Thurgood Marshall: And when would it be decided?
Mr. Fred Blackwell: When would it have been decided? Well, if the Hearing Examiner is not too --
Justice Thurgood Marshall: Do you meant to tell me that if you ask or a hearing you get one within three days?
Mr. Fred Blackwell: I thought-- excuse me.
Justice Thurgood Marshall: I have never seen a government agency doing that in history.
Mr. Fred Blackwell: Excuse me, I misunderstood you.
I thought you asked how long the hearing would take if it were held.
Justice Thurgood Marshall: No, that is what I meant; when would it be finished?
Mr. Fred Blackwell: Well, the administrative hearing, if it had been asked, could have been concluded I say within a year after these assessments.
Justice Thurgood Marshall: At the same time we have here.
You complained about it into the year.
Am I right?
Mr. Fred Blackwell: No, I am not complaining about a year.
I am pointing out that one of the findings of violations of a standard in a mine, on which the penalties were based, was not made until a year and eight months after the penalty assessment was issued.
Verdict first, trial afterwards, Alice in Wonderland, I just cannot square this with American jurisprudence by any stretch of the imagination.
Chief Justice Warren E. Burger: How would you compare this, Mr. Blackwell, with the traffic violation where the traffic violation is asserted in the notice and where you can get a trial if you want, if you do not ask for a trial the penalty is automatic?
Mr. Fred Blackwell: Mr. Chief Justice, yes, that is correct.
I think it is a grave error to inject the traffic ticket violation into this case.
Number one, there are no $10,000-traffic tickets in this country and these penalties can be up to $10,000, but more basically all of these traffic ticket procedures are established under a city ordinance, under a state code, and I believe I have seen maybe some by court order.
Those procedures then, how they work, must be measured by the originating authority in the ordinance.
Here, we have a different set of procedures with its own source of statutory authority.
We must measure these procedures by its statutory source and the traffic ticket by its statutory source.
Chief Justice Warren E. Burger: In some situations, traffic citation or driving under the influence of liquor might have, if not a $10,000-impact, a very large impact but does not that same procedure prevail?
Mr. Fred Blackwell: Well, I see your interest in that area, Your Honor.
I would point out this additional very important distinction in my mind.
Number one, the traffic regulations and all of that attached to a conditional privilege, in the first place, a license to drive a car.
The state issues this and you agree to abide by all of these.
You do not have to have a license to go into the mining business.
And, number two, from the very first instance, in which the auto-driver receives that ticket in his hand, he is under the jurisdiction of the Court.
He is summoned to a hearing.
He is told that he can forfeit collateral and not appear before that, but he is before a judicial forum from the very moment that he receives that ticket, and those procedures are established by their own source of statutory authority.
Here, we have a different statutory authority and --
Justice Byron R. White: Mr. Blackwell, do you have objections to the new regulation?
Mr. Fred Blackwell: Your Honor --
Justice Byron R. White: I understand they do not solve the problem of past assessments, but do we have any problem in this case that is to the future validity of a set of regulations?
Mr. Fred Blackwell: In this case, those new regulations are not involved at all, Your Honor.
It is only the former regulations.
Justice Byron R. White: These old regulations that we are arguing about have been replaced.
Mr. Fred Blackwell: They have been replaced and I have had no reason to study those to make even a speculative judgment on their validity or non-validity.
Justice Byron R. White: Then what the issue here with the past assessments then?
Mr. Fred Blackwell: That is right.
It was the method in which the past assessments were issued under the former regulation.
All I know is I am just not familiar with what is going on under the new regulations except to have information that the non-hearing situations under the new regulations, are causing no practical problems there.
The Hearing examiners are able to deal with these expeditiously and there is no fact back up there.
Justice William H. Rehnquist: If we had before us just the judgment of the Court of Appeals for the District of Columbia Circuit I suppose there would be a serious question of mootness whether since all you sought in that action was to enjoin the operation of these procedures.
Mr. Fred Blackwell: Well, I think you have a serious question of mootness in any event and the only thing that might save it is the Government’s 2,000 cases distributed to the District Attorneys all over the country that they say they want to enforce.
Justice William H. Rehnquist: Well, does that not resolve the mootness issue as to the Third Circuit’s case though where there you did have an effort to enforce these penalties and the Government seeks to enforce them regardless of the effect of these new rules?
You do not contend that is moot, do you?
Mr. Fred Blackwell: No, I say that is what prevents, the 2,000 cases prevent the mootness.
Chief Justice Warren E. Burger: Your time has expired, Mr. Blackwell.
Mr. Fred Blackwell: I may just include, Gentlemen, the Third Circuit had all of these arguments before this, as well as the D.C. Court of Appeals may have rendered its decision.
Chief Justice Warren E. Burger: Mr. Randolph.
Argument of Randolph
Mr. Randolph: Mr. Chief Justice and may it please the Court.
Mr. Justice Rehnquist, in the D.C. Circuit case they also sought a declaratory judgment to the extent that the Court might hold that the regulations are invalid and that, in turn, might affect pending cases for enforcement.
The action may not be moot.
In our brief, in our position in the D.C. Circuit case we pointed out only that so longs as that decision stands it really has no effect outside of the Circuit because of the fact that there are no mines within the District of Columbia and, therefore, it would be proper for this Court only to hear the Delta Mining case, but I do not think it is technically moot because of the declaratory judgment aspect of it.
These are the first cases that have reached the Court --
Justice William H. Rehnquist: Why does the declaratory judgment aspect change the mootness question?
Mr. Randolph: Well, if the regulations are held invalid, then the argument, and the argument indeed was in Delta Mining, that therefore the penalties assessed under those regulations are invalid as well, and if those penalties assessed are invalid then enforcement actions cannot be sought and must be dismissed.
That would be the only argument.
That was the holding of the Delta Mining case.
Justice Potter Stewart: Was it that the regulations were invalid or was it that the construction of what the regulation say and mean?
Mr. Randolph: No, the regulations were held invalid in the Delta Mining case.
The regulations under which the penalties were assessed were held invalid.
These are the first cases obviously to reach the Court involving the Federal Coal Mine Health and Safety Act of 1969 and I might point out to the Court that this Act is a culmination of federal legislative efforts dealing with coal miners that dates back to 1865.
The purpose of the Act was to cure some of the problems.
Many of the problems that led to the failure of past legislation.
The purpose of the Act as well was to protect the coal miners, the primary purpose, to protect their health and safety.
Congress recognizing that they were engaged in the most hazardous occupation within the United States.
Congress found that between 1960 and 1968, under the passed law, that federal inspectors had observed 1.3 million violations of the Advisory Safety Code of the Bureau of Mines.
One of the major problems that Congress identified with, even enforcing the existing laws and this is in the Senate Report right at the very beginning of the report on this Bill, was that the enforcement procedures did not work.
Congress said they were too complex.
They were too difficult.
It made it impossible to secure compliance even with the laws that were on the books at that time and, therefore, Congress abandoned, in this Act, it abandoned the approach of seeking voluntary compliance.
It imposed 125 specific mandatory standards of health and safety that coal mine operators must comply with, and it imposed penalties for violations of those standards.
In order to make it no longer profitable for the coal mine operators to continue operating in violation of the law, to make it no longer profitable for them to operate in violation of health and safety standards at the expense of the miners.
The issue in this case is one statutory interpretation.
And I will explain later that it goes beyond the particular regulations that are involved here.
The question specifically is what does Section 109 (a) (3) of this Act require when the Secretary assesses a penalty in the absence of a request or the holding of an administrative hearing.
More specifically written detailed findings of fact such as those required under the APA after a hearing, are those kinds of findings of fact required to be incorporated in the Secretary’s Assessment Order when there has been no hearing, and when, indeed, the mine operator is entitled to a trial de novo in a District Court on all issues and a trial by jury by all factual issues?
Let me add right here at the outset that the statement that I believe Mr. Kilcullen quoted of the attorney in the pretrial proceedings in the Delta Mining case about what de novo means is not the position of the Government.
The position of the Government is that de novo trial on all issues means an absolute de novo trial on all issues of fact in law, that the administrative proceedings become irrelevant; they wash out.
I would like to put this case in its proper prospective by just outlining for the Court the steps that lead to an assessment and finally the steps that lead into the District Courts.
We begin with the Mine Inspectors themselves and these are people specifically required by the Act under Section 505 to be experienced people in mining.
All the people appointed by the Secretary to administer this Act are required by the statue itself to be experienced mining people.
The Mine Inspector approaches the mine without any advance notice.
In fact, the statute specifically prevents him from giving any notice.
Each mine within the United States must be inspected entirely four times a year.
There are also spot inspections periodically.
For dangerous mines where there had been fatalities or serious accidents within the past five years, there must be a spot check once out of every five days by a Mine Inspector.
The Union representative has an absolute right to accompany the Mine Inspector when he reaches the mine.
The company official, I am told, usually does as well.
Let us suppose the Mine Inspector goes into the mine shaft and, as in Delta Mining G. M. W. and the Mears Company mines, he finds violations of the Act.
At that point, he writes out a detailed notice of violation quite analogous, Mr. Chief Justice, to a traffic ticket.
Under Section 104 (e) of the Act he is required to set down precisely what he finds is wrong, what sections of the Act where the regulations are violated, and then he also sets a time for abatement.
In this case, I notice in the Delta Mining situation the operator had one month to correct that violation.
Now, this is handed, this notice of violation is required by the statute to be handed right there to the company official, but that is not all.
The Act also requires specifically that the Mine Inspector post the notice of violation saying what was wrong and where in the mine and how long it is before it has to be corrected.
He must post that notice on a bulletin board.
And, to give you an idea of how careful Congress was in this detailed Act, there is even a Section in the Act, 107 (a) that requires mine operators to have bulletin boards, so they would not get into the problem of having no place to post it.
The bulletin boards must be right outside the mine entrance.
Then, the Mine Inspector returns to check to see whether there has been an abatement, to check and see whether the violation has in fact been remedied.
If it has not, if there has been no abatement, then the Mine Inspector can order withdrawal of all people from the area of the violation or he can extend the time for correcting the violation.
But let us suppose that the violation has been abated.
If that is done then the notice of violation and the abatement notice is sent to the Assessment Office of the Bureau of Mines.
Now, what I have just described is happening, and I think we said in our brief, at the rate of 80,000 times a year, 80,000 violations of the health and safety standards of the Act and regulations.
That was wrong.
That figure is not accurate today because the latest figure shows that the rate has increased now to 110,000 violations a year.
Congress could have stopped right there.
It could have led the -- like a traffic office, it could have left the Mine Inspector write out a fine, serve it on the mine operator, and say “either pay it or litigate in District Court.”
The APA would not have been applicable at all to that situation.
If the Court will notice, in Section 554 (a) (3) of the APA, it specifically made inapplicable the findings of a fact requirement, the hearing requirement to situations involving inspections, and that is precisely what this is.
It has also made inapplicable the APA requirements in finding of fact requirements until the applicable are totally inapplicable when there is a trial de novo in a District Court available, but Congress did not stop right there.
Now, it gave another step in the process.
It required the Secretary himself to assess the penalties and it thought it advisable to give the mine operators an opportunity for a hearing.
The way that has been operating, the way it operated under the old regulations is that the Assessment Officer would, after getting a notice of violation, the abatement would make up a proposed order of assessment, the Assessment Officer is a man, as I said, experienced in mining, and send it to the mine operator.
It is not an order to pay.
He cannot be required to pay.
It just says that you have 15 days to protest this.
In the Delta Mining case, the addendum at Page 28 of our brief shows that there was a protest.
It was not on a basis that we did not violate the Act.
There was no allegation in the protest that we have not violated the Act.
It was that this is a new mine.
People have to be trained.
We showed good faith in trying to abate, and so on and so forth.
But let us assume in the usual case that the operator does protest.
If he does not protest the proposed Assessment Order, then the order becomes the final order of the Secretary.
He can request a hearing at this point but let us assume that he does not.
The Assessment Officer takes the protest from the mine operator, reconsiders, and let us assume, he reissues the assessment order.
The mine operator, again, has the opportunity to request a hearing and I might add that if he does request a hearing, the hearing itself is de novo.
Nothing that went on before is considered to be bearing one way or another in whether there is a violation and if he loses the hearing, I might add, he has the opportunity to appeal within the administrative process to the Board of Mine Operations Appeal, but let us assume he does not request a hearing because that is the situation in this case.
If he does not request a hearing, then the order, the proposed order of assessment becomes the final order of the Secretary.
Now, that sets forth the amount of the fine; it sets forth the regulations violated; it sets forth the days in which the notices of violation were issued and so on and so forth.
I might add also that this is not all.
This is not the mine operator’s only opportunity as to find out what he has been charged with and why he has been assessed a certain penalty.
In fact, the old regulations, one of the most normal occurrences was that conferences were held, informal conferences, maybe as little as simply picking up of a telephone and calling the Assessment Officer and asking him “why the penalty you assessed against me was $25 instead of $50.”
Justice William H. Rehnquist: Are you going to deal with the conjunctive language in Section 109 (a) (3) which seems to cut against your point?
Mr. Randolph: Yes.
If it please, I will do it now.
I would like to just finish up this summary.
In that effect, the GAO Report that surveyed the operations of the Assessment Office pointed out that for three Assessment Officers, 35% of their time was spent in informal conferences.
Now, even after all of this, the Secretary cannot collect a cent from the mine operators.
He cannot collect anything.
He cannot force the mine operator to pay.
He must go to the District Court where the trial is de novo on all relevant issues and, regarding issues of fact, the mine operators can request a jury trial.
I noticed that Delta Mining and G. M. W., in fact, did request a jury trial in this case.
What this means is simply this that after all of these administrative proceedings, regardless of what went on during these administrative proceedings, as soon as the mine operator does not pay, they are all transformed into nothing more than a charge, an allegation, a complaint.
In a civil case, the administrative proceedings are not facts.
They are simply allegations to be proved like any other case in a District Court.
Now, the claim here is that the mine operator who never requested an administrative hearing can defend a de novo trial and enforcement action on the basis that the Secretary did not make adequate findings of fact.
The relevant statute, 109 (a) (3) scarcely compelled such a result on its language.
It is always difficult to argue orally whether a statute is plain on its face or it is not plain.
The very fact that Judges MacKinnon, Chief Justice Bazelon, Judge McGowan, and incidentally, I might add, the GAO itself in its report thought that the statute did not require written findings of fact when no hearing had been held is at least some evidence that reasonable men differ on whether the statute means one thing or another.
Our reading is that the findings of fact are necessary as to a violation and as to a penalty only after the mine operator has taken advantage of his opportunity for an APA type hearing.
The Secretary himself has always read the statute this way.
There had been a number of statements in the argument that said that originally the Secretary read the statute the other way and required findings of fact in regard to every order.
That is not so.
The original regulations which were issued, and I might add, Saturday, March 28, 1970 were enjoined incidentally in a case called Radcliff v. Hickle (ph) in the Western District of Virginia in a suit by the mine operators so that these regulations did not go into effect.
I do not think a single penalty was assessed under them, but these original regulations which are contained in 35 Federal Register 5256 said only that the Hearing Examiner has to determine the amount of the penalty which is warranted and incorporate in his decision the violation of an order that the penalty be paid.
The only time findings of fact were required under those regulations is after a hearing which is precisely the point we are making here.
Now, back to the statutory language itself, I think the reading that we proposed, Mr. Justice Rehnquist, certainly is within the meaning of the -- is reasonably within the wording so that the language can bear that meaning.
Whether it is conclusive or not conclusive on the face of the statute, I think, is really beside the point.
Justice Harry A. Blackmun: Mr. Randolph, could I interrupt you here?
As I recall, Judge Adams in the Third Circuit Opinion argued that the APA itself requires findings where there is a hearing and, therefore, that under the Secretary’s interpretation of the statutes Section 109 adds nothing.
Do you have an answer to that one?
Mr. Randolph: I have a couple of answers to that, Mr. Justice Blackmun.
First of all, I think it is the wrong question.
The question should have been -- when you look at the statute 109 (a) (3) notice that the APA is invoked right at the bottom, it is the last sentence.
The question should have been why, after requiring findings of fact in a decision and a hearing, did Congress invoke the APA at the last part of the Section.
The answer to that if that question had been asked and, incidentally, it was not by the Court, the answer to that is quite clear.
That Congress wanted to bring in to bear on the hearing all of the detailed requirements about what we mean by a Hearing Examiner, when the hearing has to be held, notice, and so on.
That would be swept in by a reference to the APA.
He had to refer specifically to the APA to accomplish that for two reasons.
First of all, and I do not think this was mentioned in our brief, Section 507 of the Act, this Act, the Coal Mine Act, specifically says that the APA is inapplicable, this entire Act, unless it is expressly so provided.
So, Congress had to invoke the APA for that reason, number one; and, number two, the APA would not have applied here in this case, otherwise, because of the trial de novo in the District Court which would make the APA inapplicable.
I might add, the really remarkable thing about the statute is that the mine operators are even given an opportunity for a hearing.
That is the remarkable thing about the statute.
That cuts against the grain of jurisprudence because in trial de novo situations hearings are not required.
Now, getting back to the particular language, we think that this language is illuminated by the legislative history that bears on it.
This is not a detailed -- what I am about to tell the Court is not a detailed analysis of reports and a snippet of a hearing and maybe a line from another report and so on and so forth.
This is, I think, probably the most solid legislative history that one can have because I rely on the House Provision and what that said and the Senate Bill and what that said, and what happen when they were put together in a merge in conference.
And, I think this will explain why that conjunction is there.
These two provisions, the House Bill and the Senate Bill, the predecessors of Section 109 (a) (3), are set out in our brief on Pages 24-25.
One thing is absolutely clear from both these Bills and that is that no findings of fact were required except in regard to a hearing, after a hearing was held.
The Senate Bill could hardly be more explicit on this point.
The original Senate Bill from which this statute is derived said that the mine operator --
Chief Justice Warren E. Burger: This is the last -- Page 20?
Mr. Randolph: I am sorry, pages 24-25.
Chief Justice Warren E. Burger: Of what?
Mr. Randolph: Of our brief.
Chief Justice Warren E. Burger: Of your Delta brief?
Mr. Randolph: Yes, the other brief did not go that high.
Now, the Senate Bill which is on Page 25 originally said that an order assessing a civil penalty shall be issued by the Secretary, etcetera, etcetera, only after the mine operator has been given an opportunity for a hearing and the Secretary has determined by decision incorporating findings of fact based on the record of such hearing.
Now, that language is absolutely clear that the only time findings of fact were required was when there was a hearing, which is our point.
The House Bill, I think, was just as clear.
He Conference Committee took both of those Bills, the House Bill and the Senate Bill, and what they did to that language that I have just quoted on Page 25 is, instead of saying “incorporating findings of fact based on the record of such hearing,” they took out based on the record of such “hearing” and added instead “therein.”
There is not a word in the Conference Report that they were intending to change the meaning of this provision by doing that, by trying to streamline the language.
We do not think they did.
As a matter of fact, since the Senate and House Bills were in agreement on this point, and I think we mentioned this in the brief, Conference Committees are appointed to resolve differences between the houses.
They are to compromise.
Here, there was no difference.
The two Bills were the same.
They were put together.
The mine operators argue that something new came out.
If that were true, then the Conference Committee had exceeded its authority and a point of order would have been put on the floor and that would have defeated this entire legislation.
We find that incredible to believe.
We think the legislative history is perfectly plain, and that is why the conjunction is in there, Mr. Justice Rehnquist, because it is derived from this particular provision on Page 25.
Now, the mine operator’s only point really, and I do not think they stress this in their argument but since it is in the brief I will deal with it, for requiring findings of fact in cases where there is no hearing is simply this: If the mine operators had these findings of fact, they would be more upped to pay and that would relieve the Courts of some of the burden of enforcement suits.
Let me respond to that.
There are three points that I think are against it.
Number one, Congress never considered it.
Congress never considered whether the administrative burden entailed by that kind of a process as outweighed by the alleged benefits that the mine operator cites.
Number two, the underlying assumption that the mine operators will tend to pay more lacks any support whatever.
There is no evidentiary support for that and if the idea is that the mine operators need more information because if they only knew what they were being charged with and why they were being penalized, they would pay, the fact is they could have gotten that information indeed, in many cases, did if not by talking to the Mine Inspector, calling up the Hearing Officer, seeking an informal conference.
They had that opportunity and yet, still, we have under these old regulations more than 18,000 violations that have not been paid yet.
The third point, and I think this is probably the most significant, is as to the burden on the Courts we think personally that the burden might well increase if you accept the mine operator’s arguments because what does it mean?
It means that the mine operators are then given one more opportunity to contest in a de novo enforcement action to argue that the whole action should be dismissed, not because they did not violate the Act, not because the penalty is too high, but because the findings of fact were not adequate, not sufficient under administrative law.
Professor Davidson (ph), as an administrative law treaty, says at Section 1601 that the amount of litigation involved where the adequacy of administrative findings is nothing short of tremendous.
If that is what this results in, if a holding for the mine operators results in that, it means that every enforcement action will be met at the outset with a contest over whether the findings effect were detailed enough or sufficient enough and so on and so forth.
And that, I think Mr. Blackwell used the argument of Alice in Wonderland, that is Alice in Wonderland-like.
Because the only importance of those administrative proceedings is merely that they are charged.
They are simply acclaimed.
They wash out as soon as the enforcement action is brought, they are irrelevant.
Justice William H. Rehnquist: Be brought in Court?
Mr. Randolph: Yes.
Justice William H. Rehnquist: Well, but it is certainly not unknown to administrative law even where you have a trial de novo to require some sort of procedural safeguards in the administrative proceeding in some sort of an administrative record.
Mr. Randolph: I think that, in light of the system that is now set up that there are administrative safeguards.
Indeed, there are more than enough administrative safeguards for the mine operators.
They have the right to --
Justice William H. Rehnquist: But that was not the argument you were making a minute ago.
A minute ago, you were saying it does not make any difference whether there are or not because the whole thing washes out when an enforcement action is brought.
Mr. Randolph: I said it does not make any difference whether the findings of fact were adequate enough, detailed enough, because the Court in an enforcement action cannot rely upon them anyway.
They are irrelevant to whether the -- and the jury is the one that determines the facts, and Mr. Blackwell indeed requested a jury.
So the jury is not going to consider whether the administrator’s findings of fact were sufficient or not.
They are just irrelevant to that consideration.
Now, I think this is where the Third Circuit went wrong in the Delta Mining case.
If you read the opinion by that Court, there is not a word in the entire opinion -- the words “de novo” do not appear within the entire opinion.
I do not know whether the Court mistakenly thought that this was the kind of case where the administrative action is reviewed on the basis of sufficiency of the evidence, but I would point out that there are two things that I think this Court can see the error that the Court of Appeals fell into in the Delta Mining case.
One of the main reasons on Page 11-A of our petition, I will read it to the Court.
The Court of Appeals in Delta Mining said “Judicial review of a final administrative determination is held as a right and such review is rendered practically impossible or at least vastly more difficult where the agency’s decision is not accompanied by expressed findings.”
That goes precisely to the point that I was just discussing.
It is not rendered more difficult because there is no review of the agency’s findings.
This is a de novo trial.
The agency’s findings are transformed merely into a charge that has to be proven.
So, I think that is wrong.
On Page 12-A, the Court said, finally, “Though it might not be beyond Congress’ power to provide for the entry by the Secretary of penalty assessments orders without findings of fact, such a provision would run against the grain of much of our administrative jurisprudence.”
I submit that it is just other way around.
Requiring findings of fact when there has been no administrative hearing runs directly against the grain of our administrative jurisprudence because the APA which is a reflection of that tradition says specifically that, number one, hearings are not required.
Number two, findings of fact are not required when there is an opportunity for de novo review of all the issues in a District Court proceeding.
That is precisely what this statute provides.
Chief Justice Warren E. Burger: Thank you, Mr. Randolph.
Your time is used up, Mr. Kilcullen.
Rebuttal of John L. Kilcullen
Mr. John L. Kilcullen: Has it been used up?
Chief Justice Warren E. Burger: I beg your pardon?
Mr. John L. Kilcullen: You say my time has been used up?
Chief Justice Warren E. Burger: It has been used completely.
Mr. John L. Kilcullen: Thank you.
Chief Justice Warren E. Burger: Unless you have some statement with reference to factual matters as distinguished from legal argument, your time has expired.
Mr. John L. Kilcullen: I thought I had reserved some time, apparently not.
Chief Justice Warren E. Burger: The case is submitted.
Thank you, Gentlemen.