Delmarsh, LLC v. Envtl. Appeals Bd. of the State

Decision Date10 May 2022
Docket Number248,2021
PartiesDELMARSH, LLC, Plaintiff Below, Appellant, v. ENVIRONMENTAL APPEALS BOARD OF THE STATE OF DELAWARE and DELAWARE DEPARTMENT OF NATURAL RESOURCES AND ENVIRONMENTAL CONTROL Defendants Below, Appellees.
CourtSupreme Court of Delaware

Submitted: April 18, 2022

Upon appeal from the Superior Court of the State of Delaware AFFIRMED.

Richard L. Abbott, Esquire, Abbott Law Firm, Hockessin, Delaware, for Plaintiff Below, Appellant Delmarsh, LLC.

Kayli H. Spialter, Esquire, Delaware Department of Justice, New Castle, Delaware, for Defendants Below, Appellees Environmental Appeals Board of the State of Delaware and Delaware Department of Natural Resources and Environmental Control.

Before SEITZ, Chief Justice; TRAYNOR, and MONTGOMERY-REEVES, Justices.

SEITZ CHIEF JUSTICE

The St. Jones and Murderkill Rivers empty into the Delaware Bay about a half a mile apart. The Town of Bowers lies between the mouths of these rivers, and is named for John Bowers, who owned the land in the early 1700s.[1] Delmarsh, LLC, a Delaware real-estate company, owns six lots in Bowers. The lots have long been designated as wetlands on the State Wetlands Map. The Department of Natural Resources and Environmental Control ("DNREC") removed a portion of the lots from the Wetlands Map in 2013 at Delmarsh's request. In June 2019, Delmarsh requested that DNREC designate the remaining portion of the lots as non-wetlands. DNREC denied the request, and Delmarsh appealed to the Environmental Appeals Board ("the Board"). The Board affirmed DNREC's denial. Delmarsh appealed to the Superior Court, which affirmed the Board's decision. We now affirm the Superior Court's judgment.

I.

Del-Homes, Inc. acquired the lots in 1989. At the time, they were designated as wetlands on the State Wetlands Map.[2] The lots held that designation when Del-Homes, Inc. eventually transferred them to Delmarsh and its sole owner, Jeffrey Liberto.[3] At Liberto's request, DNREC amended the State Wetlands Map in 2013 and designated a portion of the lots as non-wetlands or "uplands."[4] In June 2019, Delmarsh requested that DNREC remove the remainder of the lots from the Wetlands Map. DNREC rejected Delmarsh's application, and Delmarsh appealed the rejection to the Board and then to the Superior Court. For ease of discussion, we will summarize the Board and Superior Court appeals by the issues Delmarsh raised in the appeals.

A.

During the Board hearing to review DNREC's decision, Delmarsh submitted a Motion in Limine to exclude from evidence a 1926 aerial photograph offered by DNREC. The photograph depicts "a clear channel coming from the St. Jones River" to a tidal ditch alongside the property, connecting the lots to tidal waters.[5] Delmarsh argued that the photograph could not be authenticated under Delaware Rule of Evidence ("D.R.E.") 901; the photograph was irrelevant under D.R.E. 403 because DNREC used "lay witnesses" rather than experts to interpret the photograph; the photograph was inadmissible as expert evidence under D.R.E. 701 and 702; and the Site Summary and DNREC's Decision were inadmissible because they relied on the photograph.

DNREC responded that the photograph was self-authenticating under D.R.E. 902(5) as part of a government website; Delmarsh failed to demonstrate any prejudice that outweighed the photograph's probative value under D.R.E. 403; the contents of the photograph were not hearsay under D.R.E. 803(16); DNREC's witnesses were experts, but regardless could testify as lay witnesses under D.R.E. 701 about how they had used the photograph in their decision-making process; and the Site Summary and DNREC Decision were admissible because their relevancy and reliability did not depend on the photograph. After a private conference to consider the objection, the Board unanimously denied the Motion in Limine without comment.

In its appeal to the Superior Court, Delmarsh argued that the Board erred by not providing a rationale for denying the Motion, supposedly leaving the Superior Court unable to exercise review. The Superior Court viewed the admissibility of the photograph as an evidentiary issue and reviewed whether there was "substantial evidence" to support the Board's decision to admit the photograph.[6] It ruled that the Board had "reasonably accepted DNREC's arguments for admitting the Photograph . . . and there exists substantial evidence in the record for that decision."[7] Because the Board did not violate any procedural requirements, the Superior Court found the photograph was admitted properly.[8]

B.

Delmarsh also argued before the Board that the lots did not meet the statutory definition of wetlands, which includes "lands . . . 'subject to tidal action' or 'areas which are now or in this century have been connected to tidal waters' . . . ."[9] Delmarsh contended that this definition-and specifically the inclusion of the phrases "subject to tidal action" and "connected to tidal waters" -contemplates the "regular ebb and flow" of a daily tide, such as a beach shoreline.[10]

DNREC's employee Tyler Brown testified at the hearing that the agency interpreted "connected to tidal waters" to include "[a]ny [geological] form or feature that's directly connecting to a [water] feature . . . in this case, . . . a ditch-like feature running from the St. Jones River adjacent to [the lots.]"[11] Geological features considered in a wetlands analysis, Brown testified, might be natural or manmade, and when natural, "their function ecologically is to feed tidal water into the marshes[.]"[12] The ditch, he testified, would "cause tidal action" on the lots.[13] Brown also explained that tidal wetlands may or may not have "regular ebb and flow" and that whether land was "connected to tidal action" could be determined based on elevation and frequency of flooding.[14] He gave as an example locations that flood during "several high tide events a year[.]"[15] This was the case with the lots.[16]

The Board concluded "as a matter of law" that the lots were wetlands under the Wetlands Act and cited as evidence the photograph, a 1950 subdivision plan that showed the same ditch, [17] and Delmarsh's topographical survey, which showed that "the majority of the [lots] are within 2 feet of the mean high tide line."[18] The Board also found Brown to be a credible and reasonable witness.

Before the Superior Court, Delmarsh argued again that the lots were not "subject to tidal action" or "areas which are now or in this century have been connected to tidal waters."[19] The Superior Court affirmed the Board's decision, affording due weight to the Secretary's determination.[20] The court found the Board properly interpreted the meaning of "wetlands" under the Wetlands Act, an interpretation "construed in accordance with the statute's purpose."[21]

C.

Delmarsh also argued that the Board applied an incorrect legal standard to review DNREC's final decision. The decision included issues of fact and of law, with a different standard of review for each.[22] With respect to the interpretation of the statutory term "wetlands," the Board gave substantial weight to how DNREC interpreted the statutory definition of wetlands and stated that it would only reverse if DNREC's interpretation was "clearly wrong."[23] The Board held "DNREC's determination is not unreasonable or clearly wrong."[24] With respect to the factual issues, the Board placed the burden on Delmarsh to show the decision was "not supported by the evidence on the record before the Board[, ]"[25] taking "due account of the experience and specialized competence of the agency" and the statute at issue.[26] It ruled that Delmarsh had not carried that burden and that Brown's testimony was convincing and supported by the evidence.[27]

On appeal to the Superior Court, Delmarsh contended that deference to DNREC's interpretation of wetlands was improper because Delmarsh was appealing a decision, not a regulation.[28] It argued that the Board erred in applying "substantial weight" and "clearly wrong" standards, because the relevant precedent dealt with personnel rules rather than statutory provisions.[29] Delmarsh also claimed that the "due weight" standard applies only when a court reviews an agency's statutory interpretation, not an administrative appellate body like the Board, and therefore the Board should have interpreted "wetlands" independent of DNREC's interpretation.[30]

The Superior Court disagreed. It explained that, while plenary review applied, due weight may be afforded an agency's interpretation of the statutes it administers, and the weight may be substantial given the statute, particular case, and relevant facts.[31] The Superior Court found that the Board correctly "afforded substantial weight" to the Secretary's decision based on the expansive statutory language in the Wetlands Act and the Secretary's expertise.[32]

Delmarsh also contested the Board's factual determinations and whether there was substantial evidence to support the Secretary's and the Board's final decisions.[33]The Superior Court explained that Delmarsh had the burden of proof "to show that the Secretary's decision is not supported by the evidence on the record before the Board."[34] It held that, although the Board mentioned the "clearly wrong" standard, it ultimately found that Delmarsh "failed to carry its burden of demonstrating that the Secretary's decision is not supported by the evidence" before the Board, the correct standard.[35] And the Superior Court's review of the record found that the decision was supported by substantial evidence.[36]

D.

Delmarsh's final argument centered on a takings claim under the Fifth...

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