Maryland Aggregates Ass'n, Inc. v. State

• Decision Date: 01 September 1994
• Docket Number: No. 40,40
• Citation: 337 Md. 658,655 A.2d 886
• Parties: MARYLAND AGGREGATES ASSOCIATION, INC. et al. v. STATE of Maryland et al. ,
• Court: Maryland Court of Appeals

Page 658

337 Md. 658

655 A.2d 886

MARYLAND AGGREGATES ASSOCIATION, INC. et al. v. STATE of Maryland et al.

No. 40, Sept. Term, 1994.

Court of Appeals of Maryland.

Order Nov. 7, 1994.

Opinion March 22, 1995.

Certiorari Denied May 15, 1995.

See 115 S.Ct. 1965.

Richard A. Reid (Royston, Mueller, McLean & Reid, on brief, Towson, William A. Franch, Franch & Jarashow, P.A., Annapolis, on brief), for petitioner.

Sharon B. Benzil, Asst. Atty. Gen. (J. Joseph Curran, Jr., Atty. Gen., on brief, Michael A. Millemann, Baltimore, on brief), for respondent.

Argued before MURPHY, C.J., and ELDRIDGE, RODOWSKY, CHASANOW, KARWACKI, BELL and RAKER, JJ.

ORDER

For reasons to be stated in an opinion later to be filed, it is this 7th day of November, 1994,

ORDERED, by the Court of Appeals of Maryland, a majority of the Court concurring, that the judgment of the Circuit Court for Anne Arundel County is affirmed; and it is further

ORDERED, that the injunction issued on August 16, 1994 by the Circuit Court for Anne Arundel County prohibiting the State from implementing the statute in question while the appeal was pending be, and it is hereby, vacated, and it is further

ORDERED, that the mandate shall issue forthwith and the costs shall be paid by the appellants.

ELDRIDGE, Judge.

This case presents several constitutional challenges to Maryland Code (1973, 1989 Repl.Vol., 1994 Cum.Supp.), §§ 7-6A-10.1 and 7-6A-10.2 of the Natural Resources Article, which relate to the appropriation of water in connection with certain surface mining operations.

I.

Any individual, business, or governmental entity in Maryland "which may appropriate or use any waters of the State, whether surface water or groundwater," must first obtain a water appropriation permit from the Department of Natural Resources. Code (1973, 1990 Repl.Vol.), § 8-802 of the Natural Resources Article. ¹ A surface mine must have a water appropriation permit to pump away water that would otherwise accumulate in the mine. The pumping process is known as "dewatering." ² Surface mine dewatering removes groundwater, rainfall and other surface water runoff from the surface mine pit. If the rock to be mined lies beneath the water table, the mine operator must pump away a sufficient quantity of water to lower the water table around the pit.

Several Maryland counties include areas of karst terrain. In karst terrain, pockets of limestone and other carbonate rocks are slowly dissolved by water flowing or percolating underground, leaving behind underground cavities and channels. ³ Increasing the rate of water flow, for example by pumping, accelerates the formation of underground channels and of sinkholes.

The legislation challenged in this case, §§ 7-6A-10.1 and 7-6A-10.2 of the Natural Resources Article, is intended to protect landowners in karst terrain from the effects of surface mine dewatering. During the legislative process, the General Assembly received testimony from over fifty individuals, both lay and expert, and considered a number of technical reports concerning the effects of surface mine dewatering in karst terrain. Groups opposed to the proposed legislation, principally enterprises involved in surface mining, and groups pressing for its adoption, principally individual property owners and community associations from regions close to quarries, each engaged in vigorous lobbying. Ultimately, the General Assembly enacted the legislation regulating surface mine dewatering in karst terrain.

The Act contains the following legislative findings (§ 7-6A-10.1(a)):

"[I]n certain regions of the State dewatering of surface mines located in karst terrain may significantly interfere with water supply wells and may cause in some instances sudden subsidence of land, known as sinkholes. Dewatering in karst terrain may result in property damage to landowners in a definable zone of dewatering influence around a surface mine."

The Act protects "affected property owners in Baltimore, Carroll, Frederick, and Washington Counties where karst terrain is found," by establishing "zones of dewatering influence around surface mines...." § 7-6A-10.1(b). The Department of Natural Resources must establish the zone of dewatering influence when it issues the water appropriation permit for dewatering to the operator of a surface mine affected by the Act. § 7-6A-10.2(b)(1). The Department must scientifically determine the area affected by the mine's pumping activity, based on "local topography, watersheds, aquifer limits, and other hydrogeologic factors...." § 7-6A-10.2(b)(2).

The statute contemplates that the zone of dewatering influence may extend beyond the land owned by the mining operation itself. Accordingly, subsection (c)(1) of § 7-6A-10.2 provides that, within the zone of dewatering influence, mine operators must "[r]eplace, at no expense to the owner of real property that is affected by the surface mine dewatering, a water supply that fails as a result of declining ground water levels...." An exception is made where the failure of the water supply is not caused by the surface mine operation (§ 7-6A-10.2(f)):

"The Department may not require a [mine operator] to replace water supplies, as provided in this section, if the [mine operator] demonstrates to the Department by clear and convincing evidence that the proximate cause of the loss of water supply is not the result of pit dewatering."

The Act also establishes a scheme to compensate landowners for sinkhole damage that occurs within the zone of dewatering influence. Subsection (c)(2) of § 7-6A-10.2 provides as follows:

"Upon a determination by the Department of proximate cause after the [mine operator] has received proper notice and an opportunity to respond and provide information, [the mine operator shall] pay monetary compensation to the affected property owner or repair any property damage caused as a result of the sudden subsidence of the surface of the land."

Furthermore, the Act directs the Department to create, by regulations, an administrative process for resolving claims brought under the Act, § 7-6A-10.2(h), and requires the Department to "provide opportunity for a contested case hearing," § 7-6A-10.2(g).

II.

This litigation was commenced by Maryland Aggregates Association, Inc., an organization that represents the interests of the surface mining industry, and by the individual operators of hard rock quarries located in karst terrain in Baltimore Carroll, Frederick and Washington Counties. ⁴ Maryland Aggregates filed suit in the Circuit Court for Anne Arundel County on July 1, 1991, the day after the Act took effect, naming as defendants the State of Maryland, the Governor, the Attorney General, and the Secretary of the Department of Natural Resources. ⁵ Maryland Aggregates sought a declaratory judgment holding the Act unconstitutional on a number of grounds and an injunction against the enforcement and implementation of the Act.

In the circuit court, Maryland Aggregates contended that the Act violated numerous provisions of the Constitution of the United States and of the Constitution of Maryland. It contended that the Act violated its right to "substantive due process" because there was no rational basis for the legislation. It argued that the Act violated equal protection principles by making an unreasonable distinction between quarry operators and other large water users. Maryland Aggregates also claimed that the statute denied equal protection of the laws to the residents of the nineteen Maryland counties unaffected by the Act. The plaintiffs argued that the Act interfered with mine operators' constitutional rights to jury trial and deprived them of their property without just compensation. They contended that the statutory procedures for establishing zones of dewatering influence and for resolving claims under the Act were constitutionally deficient. Finally, Maryland Aggregates argued that the Act impermissibly granted judicial powers to an administrative agency in violation of the separation of powers requirement set forth in Article 8 of the Maryland Declaration of Rights.

The State responded to Maryland Aggregates' constitutional arguments on their merits, and also contended that the State of Maryland, the Governor and the Attorney General were not proper parties to the litigation.

On March 9, 1992, the Circuit Court for Anne Arundel County granted Maryland Aggregates' motion for an interlocutory injunction against the enforcement of the Act. On March 7, 1994, however, the circuit court granted summary judgment in favor of the defendants, and filed a declaratory judgment rejecting all of Maryland Aggregates' constitutional contentions. The circuit court also agreed that the Secretary of the Department of Natural Resources was the only proper defendant. ⁶ Maryland Aggregates appealed to the Court of Special Appeals and, before any proceedings in the intermediate appellate court, petitioned this Court for a writ of certiorari, raising the same constitutional objections to the Act that it had pressed at trial. We granted Maryland Aggregates' petition. 335 Md. 341, 643 A.2d 441 (1994).

Meanwhile, in light of the circuit court's declaratory judgment in favor of the State, the Department of Natural Resources had begun to enforce the Act. Aggrieved by the Department's activity, Maryland Aggregates filed in the circuit court a further motion for an injunction against enforcement of the Act pending appeal. On August 16, 1994, observing that the case had been set for argument in this Court in early November 1994, the circuit court granted Maryland Aggregates' motion and enjoined enforcement of the Act pending appeal. This Court deferred action on the State's subsequent motion to dissolve, suspend, modify or stay the injunction until oral argument took place on November 6, 1994. On November 7, 1994, this Court entered an order affirming the judgment of the Circuit Court for Anne Arundel County and vacating the...