Fore v. Miss. Dep't of Revenue

• Decision Date: 14 June 2012
• Docket Number: No. 2010–CA–02098–SCT.,2010–CA–02098–SCT.
• Citation: 90 So.3d 572
• Parties: W.C. FORE d/b/a W.C. Fore Trucking, Inc. v. MISSISSIPPI DEPARTMENT OF REVENUE f/k/a Mississippi State Tax Commission, Mississippi Department of Environmental Quality, and Mississippi Commission on Environmental Quality on Motion for Rehearing.
• Court: Mississippi Supreme Court

90 So.3d 572

W.C. FORE d/b/a W.C. Fore Trucking, Inc.

v.MISSISSIPPI DEPARTMENT OF REVENUE f/k/a Mississippi State Tax Commission, Mississippi Department of Environmental Quality, and Mississippi Commission on Environmental Quality on Motion for Rehearing.

No. 2010–CA–02098–SCT.

Supreme Court of Mississippi.

June 14, 2012.

Bobby R. Long, Gulfport, attorney for appellant.

Gary Wood Stringer, Jackson, Abigail Marshall Marbury, Carol Ann Walker, Roy Furrh, Jackson, attorneys for appellees.

Before CARLSON, P.J., LAMAR and CHANDLER, JJ.

CARLSON, Presiding Justice, for the Court:

¶ 1. The motion for rehearing is denied. The original opinion is withdrawn, and this opinion is substituted therefor.

¶ 2. After Hurricane Katrina hit the Mississippi Gulf Coast in August 2005, W.C. Fore ¹ entered into a contract with Harrison County, Mississippi, to remove the large amount of debris that was left behind. The Mississippi State Tax Commission (MSTC) ² then assessed a fee of $1.00 per ton of debris removed. Fore appealed the assessment to the MSTC Board of Review, claiming that the fee did not apply to emergency waste removal. The Board of Review upheld the assessment. Fore appealed the Board of Review's decision to the MSTC Full Commission,³ which also affirmed the assessment. Fore then appealed to the Harrison County Chancery Court, First Judicial District. The chancery court upheld the assessment, and Fore has now appealed to this Court. Finding that the MSTC's and the chancery court's findings were supported by substantial evidence and that there was no misapprehension of the law, we affirm.

FACTS AND PROCEDURAL HISTORY

¶ 3. Following Hurricane Katrina's devastation of the Mississippi Gulf Coast, the coastal counties faced the monumental task of cleaning up in the wake of the storm. Millions of pounds of debris—food waste, industrial and commercial waste, household goods, building and structural debris, vegetative debris, and hazardous substances—covered the counties hardest hit by the storm. On September 13, 2005, in response to this unprecedented event, Governor Haley Barbour issued a Resolution authorizing the Mississippi Department of Environmental Quality (MDEQ) to execute an Emergency Order that addressed various environmental concerns, including: wastewater treatment, air-pollution sources, solid-waste management, hazardous-waste management, asbestos, and underground storage tanks. The solid-waste management section of the order allowed for emergency waste-disposal sites for vegetative, building, and structural debris.⁴

¶ 4. Prior to the governor's resolution, Fore had entered into a contract with HarrisonCounty for the removal of Hurricane Katrina debris at the price of $10.64 per cubic yard. The contract provided, in pertinent part:

I. PURPOSE:

The purpose of this Contract is to provide debris removal from certain public property and such other areas as may be designated, in writing, by the County as defined herein as a result of Hurricane Katrina[,] which occurred on August 29, 2005. This Contract is also entered into under the provisions of Section 33–15–17 Mississippi Code of 1972, and pursuant to the Governor's Declaration of Disaster as provided by Section 33–15–31, Mississippi Code of 1972, as well as the President's Declaration of Disaster.

II. SERVICES OF CONTRACTOR

...

(B)....Contractor represents that it is familiar with all federal, state, and local ordinances, laws, rules, and regulations with respect to debris pick-up, transportation, and disposal, and that it will fully comply therewith at all times during the performance of work under this Contract.

...

(H) Contractor shall furnish and pay the cost, including sales taxes and all other applicable taxes and fees, of all the necessary materials and shall furnish and pay for all the superintendents, labor, tolls, equipment, transportation and pay for all disposal site dumping fees....

¶ 5. After he entered into the contract with Harrison County, Fore requested that the county approve two sites for waste disposal: the Delancey site and LoBouy Road site. These requests stated, “W.C. Fore agrees to follow all DEQ rules, regulations[,] and law on this property.” Harrison County then forwarded Fore's requests to the MDEQ and requested approval of the sites. The MDEQ approved both requests. Fore was approved to dispose of building, structural, vegetative, and household debris at the Delancey site and to dispose of vegetative debris at the LoBouy Road site.

¶ 6. After the MDEQ's approval, Fore began removing debris from the public rights-of-way in Harrison County. Fore also entered into an agreement with another contractor, Phillips and Jordan, Inc. (P & J), allowing P & J to use the Delancey site for disposal of hurricane debris that P & J collected in accordance with a contract it had with the City of Gulfport. Fore charged P & J either $1.00 per cubic yard or $1.50 per cubic yard, depending on the type of debris.

¶ 7. On February 8, 2006, the MDEQ sent a memorandum to the “Owners/Operators of Commercial Sites Used for Disposal of Wastes from Hurricane Katrina.” The memorandum stated that the emergency sites used to dispose of hurricane debris were commercial disposal sites and were subject to the MDEQ reporting requirements for solid-waste disposal. A reporting form was attached to the memorandum. The memorandum provided:

Please note that the owner/operator of the commercial disposal site is also required to file a report with the Mississippi State Tax Commission before July 15, 2006 showing the total amounts of waste disposed at the facility during Calendar Year 2005 and shall at the same time pay a $1.00 per ton fee to the Tax Commission.

Fore completed the attached reporting forms and returned them to the MDEQ. For the Delancey site, Fore reported 291,012.08 cubic yards of debris. Using the MDEQ's conversion factor of 0.25 tons per cubic yard, Fore reported that he had disposed of 72,753.02 tons of waste at the Delancey site. On the LoBouy Road site reporting form, Fore reported that 136,870.50 cubic yards of hurricane debris had been disposed. Again, using the conversion factor of 0.25 tons per cubic yard, Fore reported that 34,217.63 tons of debris had been disposed of at the LoBouy Road site.

¶ 8. On May 19, 2006, the MSTC sent a letter to nonhazardous solid-waste management facilities, requesting that owners and operators of the facilities complete an annual reporting form. The letter stated that the reports should be filed in accordance with Mississippi Code Section 17–17–219, and that a $1.00 per ton fee was imposed on municipal solid waste. The owners and operators of the sites were to file a report with the MSTC even if no fee was due. Fore returned reporting forms for both the Delancey and LoBouy Road sites. On the Delancey form, Fore reported that he had disposed of 298,964 tons ⁵ of nonhazardous solid waste. The form required the owners and operators to report the total tons of waste that were subject to a fee and the total fee due. Fore entered a zero for both on the Delancey form. On the LoBouy Road form, Fore reported that 34,218 tons of waste had been disposed and again entered zeros in the blanks for the total tons of waste that were subject to a fee and the total fee due.

¶ 9. In response to Fore's reports, the MSTC assessed a fee of $333,182 for both the Delancey and LoBouy Road sites. Because Fore did not attach payment to the reporting forms, the MSTC assessed interest and a penalty fee of $103,286.42. The total amount assessed was $436,468.42.

¶ 10. Fore appealed the assessment to the MSTC Board of Review, and the Board of Review affirmed the assessment. Fore then appealed to the Full Commission and presented the following arguments:

(1) that the Delancey and LoBouy Sites were not commercial non-hazardous solid waste management facilities primarily because the only legal authority for such emergency facilities is found in Miss.Code Ann. § 33–15–11(b)(17) which directs that the Governor can proclaim a state of emergency and direct officials to take emergency actions such as the creation of emergency disposal sites and because Miss.Code Ann. § 33–15–31(b) suspends inconsistent laws, rules and regulations;

(2) that Mr. Fore did not operate the Delancey Site for City of Gulfport debris because the City of Gulfport contracted with Phillips and Jordan, Inc. for debris pick-up[,] transportation and disposal and because Phillips and Jordan, Inc. subleased a portion of the Delancey site from Mr. Fore for those purposes; and

(3) that the conversion factor from cubic yards to tons was excessive because the conversion factor used to convert cubic yards to tons was 0.25 tons per cubic yard rather than 0.083 tons per cubic yard per an MDEQ conversion chart.

Fore also requested that the penalty and interest assessed by the MSTC be abated. The Full Commission found that the Delancey and LoBouy sites were commercial nonhazardous waste-management facilities and were subject to the $1.00 per ton fee, that Fore was the operator of the entire Delancey site, and that the 0.25 conversion factor was correct. The Full Commission abated the penalty and interest and assessed a total fee of $333,182.

¶ 11. After paying the assessed fees under protest, Fore appealed the Full Commission's finding to the Chancery Court of Harrison County, First Judicial District. A trial de novo was held, and the chancellor entered a thirty-nine-page opinion and final judgment affirming the findings of the Full Commission. Fore has now appealed to this Court.

STANDARD OF REVIEW

¶ 12. Generally, review of any administrative-agency decision is limited. Hinds County Sch. Dist. Bd. of Trs. v. R.B., 10 So.3d 387, 394 (Miss.2008). Ordinarily, the trial courts and appellate courts will “reverse the decision of an administrative agency only if the decision (1) was unsupported by substantial evidence; (2) was arbitrary and capricious; (3) was beyond the power of the...