Mw Clearing & Grading, Inc. v. Nc Denr

• Citation: 614 S.E.2d 568
• Decision Date: 05 July 2005
• Docket Number: No. COA04-852.,COA04-852.
• Court: United States State Supreme Court of North Carolina
• Parties: MW CLEARING & GRADING, INC., Petitioner, v. NORTH CAROLINA DEPARTMENT OF ENVIRONMENT AND NATURAL RESOURCES, DIVISION OF AIR QUALITY, Respondent.

Page 568

614 S.E.2d 568

MW CLEARING & GRADING, INC., Petitioner, v. NORTH CAROLINA DEPARTMENT OF ENVIRONMENT AND NATURAL RESOURCES, DIVISION OF AIR QUALITY, Respondent.

No. COA04-852.

Court of Appeals of North Carolina.

July 5, 2005.

COPYRIGHT MATERIAL OMITTED

Appeal by petitioner from judgment entered 1 March 2004 by Judge Evelyn W. Hill in Wake County Superior Court. Heard in the Court of Appeals 21 March 2005.

Knox, Brotherton, Knox & Godfrey, by Allen C. Brotherton and Kara F. McIvor, Charlotte, for petitioner-appellant.

Attorney General Roy Cooper, by Assistant Attorney General Elizabeth J. Weese, for respondent-appellee.

MARTIN, Chief Judge.

Petitioner, MW Clearing and Grading, Inc., is a grading contractor with its office in Blacksburg, South Carolina. Petitioner is engaged in the business of clearing parcels of land by removing trees, vegetation, and other unwanted materials from above and below the ground's surface. These materials are then disposed of by either grinding or open burning. In November of 1999, petitioner cleared a large area of land in Cramerton North Carolina in Gaston County. Tony McManus, an inspector for the North Carolina Department of Environment and Natural Resources (DENR), Division of Air Quality, respondent, was driving home from work on 4 November 1999 when he noticed several large columns of white smoke off of Highway 74. McManus stopped to investigate. When he arrived at the cleared site, he discovered several burning piles of land-clearing debris. Kenneth Wilson had been left in charge of the site that day by Richard Moorhead, petitioner's president. McManus discussed the open burning regulations with Wilson, including the requirement that "[t]he location of the burning [be] at least 1,000 feet from any dwelling, group of dwellings, or commercial or institutional establishment, or other occupied structure not located on the property on which the burning is conducted." 15A N.C.A.C. 2D.1903(2)(b)(B)(1999). Wilson said he was not familiar with the regulations, but he agreed to meet McManus the next day to measure the distance of the existing piles from the closest residence. McManus did not have a measuring device, and Wilson offered to bring the company's measuring wheel to the site with him the following day.

On 5 November 1999, using petitioner's measuring device, McManus counted nine open burning piles that were within one thousand feet of the nearest residence. The distances of these piles from the residence were 453 feet, 536 feet, 610 feet, 659 feet, 704 feet, 758 feet, 873 feet, 923 feet, and 990 feet. Prior to making these measurements, McManus had not calibrated or tested the accuracy of the measuring device. As a result of these violations, petitioner was assessed a civil penalty of $36,000: $4,000 for each of the nine piles, plus $365 for the investigation costs. Petitioner had previously violated the same open burning regulation on three separate occasions, for which it was assessed civil penalties of $1,247.44, $1,341.56, and $2,842.00.

On 15 March 2000, petitioner filed a petition for a contested case hearing in the Administrative Office of Hearings. Petitioner contested the civil penalty assessment, claiming DENR (1) exceeded its authority or jurisdiction, (2) acted erroneously, (3) failed to use proper procedure, (4) acted arbitrarily or capriciously, and (5) failed to act as required by law or rule. See N.C. Gen.Stat. § 150B-51(b)(2003). The administrative law judge issued a recommended decision affirming the civil penalty and investigation costs, to which petitioner excepted. The Environmental Management Commission then issued a final agency decision adopting the recommended decision to affirm the penalty and costs. Petitioner sought judicial review of the agency decision in Wake County Superior Court, where the agency decision was affirmed. Petitioner appeals.

Upon appeal from an order of the superior court affirming an agency decision, "the appellate court must examine the trial court's order to determine first, whether the trial court exercised the appropriate standard of review, and secondly, whether the trial court properly applied that standard to the record before it." Skinner v. N.C. Dep't of Corr., 154 N.C.App. 270, 273, 572 S.E.2d 184, 187 (2002). The proper standard of review in the superior court depends upon the nature of the alleged error. Id.; Dixie Lumber Co. of Cherryville v. N.C. Dept. of Env't, Health, and Nat. Res., 150 N.C.App. 144, 146, 563 S.E.2d 212, 214, disc. review denied, 356 N.C. 161, 568 S.E.2d 192 (2002). When the petitioner alleges the agency decision was not supported by substantial evidence or was arbitrary and capricious, the proper standard is the "whole record" test. When the petitioner contends the agency made an error of law, the superior court is required to review the error de novo. Skinner, 154 N.C.App. at 273-74, 572 S.E.2d at 187; Dixie Lumber, 150 N.C.App. at 146, 563 S.E.2d at 214.

"The reviewing court may be required to utilize both standards of review if warranted by the nature of the issues raised." R.J. Reynolds Tobacco Co. v. N.C. Dep't of Env't & Natural Res., 148 N.C.App. 610, 614, 560 S.E.2d 163, 166, disc. review denied, 355 N.C. 493, 564 S.E.2d 44 (2002). Here, petitioner presents two principal arguments on appeal. First, petitioner argues the trial court erred by affirming the agency's decision as it was not supported by substantial evidence and was arbitrary and capricious. Specifically, petitioner claims the agency did not provide sufficient evidence that the occupied structure and the open burning piles were on different pieces of property, as required by statute, or that the measuring device was properly calibrated. These arguments required the court to apply the whole record test. Second, petitioner argues the agency misapplied the controlling law by: (1) failing to require evidence of all elements of the violation, (2) failing to correctly apply mandatory assessment factors, and (3) finding multiple violations from a single incident. Therefore, petitioner contends the trial court incorrectly applied de novo review by affirming the agency's conclusions of law. In neither argument does petitioner allege the trial court applied an incorrect standard of review; therefore, our review is limited to whether the trial court properly applied each standard to petitioner's arguments.

In applying the whole record test, the reviewing court must examine the entire record to determine whether the agency decision was supported by substantial evidence. "`Substantial evidence is such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.' `If substantial evidence supports an agency's decision after the entire record has been reviewed, the decision must be upheld.'" Dixie Lumber, 150 N.C.App. at 147, 563 S.E.2d at 214 (citations omitted). The court must consider evidence that supports the agency's decision as well as evidence that contradicts it. In re Rogers, 297 N.C. 48, 65, 253 S.E.2d 912, 923 (1979). However, if there is more than one reasonable interpretation of the evidence in the record, and the agency has chosen one, the reviewing court may not replace the agency's interpretation with its own. Thompson v. Wake County Board of Education, 292 N.C. 406, 410, 233 S.E.2d 538, 541 (1977). Nor may the reviewing court weigh the probative value of testimony. The agency may accept or reject in whole or part the testimony of any witness, and the agency's determination as to the value of testimony and the credibility of witnesses is final. Little v. State Board of Dental Examiners, 64 N.C.App. 67, 69, 306 S.E.2d 534, 536 (1983).

Petitioner argues the trial court incorrectly applied the whole record test because the agency decision was not supported by substantial evidence. According to petitioner, DENR failed to present evidence regarding the property boundaries on the land in question and failed to prove the measuring wheel was properly calibrated. Therefore, petitioner claims the evidence in the record did not show the burning piles were located on different property than the residence from which they were measured, nor did it show the distance of the piles from the residence had been accurately measured, two essential elements of the statute. 15A N.C.A.C. 2D.1903(2)(b)(B)(1999). The burden is on petitioner, however, to prove DENR's noncompliance with the statute.

There is a presumption of regularity of official acts by public officials. This presumption

is rebuttable by affirmative evidence of irregularity or failure to perform duty, but the burden of producing such evidence rests on him who asserts unlawful or irregular conduct. The presumption, however, prevails until it is overcome by . . . evidence to the contrary . . . [and] [e]very reasonable intendment will be made in support of the presumption.

Huntley v. Potter, 255 N.C. 619, 628, 122 S.E.2d 681, 687, (1961) (citations omitted). Petitioner claims this burden was not an affirmative duty but was met by simply showing the agency's evidence was insufficient. We disagree. The clear import of the presumption is to require petitioner to present substantial evidence that DENR failed to comply with the statute. See In re Annexation Ordinance, 304 N.C. 549, 551, 284 S.E.2d 470, 472 (1981); Painter v. Wake County Board of Education, 288 N.C. 165, 178, 217 S.E.2d 650, 658 (1975); Civil Service Bd. v. Page, 2 N.C.App. 34, 40, 162 S.E.2d 644, 647 (1968). Petitioner, however, presented no evidence showing the open burning piles were located on the same property as the nearby residence and therefore failed to rebut this element of the statute.

Petitioner did present evidence regarding the accuracy of the measuring wheel through the testimony of Richard Moorhead, the company president. Respondent also presented evidence regarding the wheel's accuracy, largely through the testimony of its inspector, Mr. McManus. The...