Natural Resources Com'n of State of Ind. v. AMAX Coal Co.
| Citation | 638 N.E.2d 418 |
| Decision Date | 03 August 1994 |
| Docket Number | Nos. 49S04-9408-CV-684,49S04-9408-CV-684,s. 49S04-9408-CV-684 |
| Parties | The NATURAL RESOURCES COMMISSION of the STATE OF INDIANA, The Indiana Department of Natural Resources, and Jack L. Jarrett, Appellants, v. AMAX COAL COMPANY and AMAX Coal Industries, Inc., Appellees. INDIANA DEPARTMENT OF NATURAL RESOURCES, Natural Resources Commission, Bureau of Mine Reclamation, Division of Reclamation, Patrick R. Ralston, as Director of The Indiana Department of Natural Resources, Mike Long, as Deputy Director of The Bureau of Mine Reclamation, and Mike Sponsler, as Director of the Division of Reclamation, Appellants, v. STATE ex rel. B & LS CONTRACTING, INC., and Shand Mining, Inc., Appellees. |
| Court | Indiana Supreme Court |
Linley E. Pearson, Atty. Gen., Myra P. Spicker, Deputy Atty. Gen., Div. of Reclamation, Indianapolis, for state.
Max E. Goodwin, Mann, Chaney, Johnson, Goodwin & Williams, Terre Haute, David H. Pope, Carr, Tabb & Pope, Atlanta, for appellant Jack L. Jarrett.
G. Daniel Kelly, Jr., W.C. Blanton, Deward P. Steegmann, Ice Miller Donadio & Ryan, Indianapolis, for appellees.
ON PETITION TO TRANSFER
AMAX Coal Company and AMAX Industries, Inc. (AMAX) petitioned for court review of the administrative actions of the Natural Resources Commission (NRC), the enforcement arm of the Indiana Department of Natural Resources (DNR). The Marion Superior Court held for AMAX and remanded the case to the NRC for proceedings consistent with the trial court's instructions. In a case involving a similar issue, B & LS Contracting, Inc. and Shand Mining, Inc. (B & LS) filed a complaint against the DNR and its Director, Patrick R. Ralston, and petitioned for relief from certain agency actions. B & LS filed the cause in the same court and before the same judge as AMAX. 1 The Marion Superior Court also held for B & LS, granting injunctive relief. Jarrett appealed the AMAX decision, and the NRC and the DNR appealed both trial court decisions. The Court of Appeals, Fourth District, granted AMAX's and B & LS's joint motion to consolidate the two cases for appeal, and affirmed in both cases. Natural Resources Comm'n v. Amax Coal Co. (1992), Ind.App., 603 N.E.2d 1349. The NRC/DNR and Jarrett petition for transfer to this Court. Transfer is granted, and the opinion of the Court of Appeals is vacated.
Congress acknowledged that coal mining operations contribute significantly to the energy requirements of the United States, and that surface coal mining is an appropriate method of obtaining the natural resource. Recognizing the negative environmental impacts and the public health and safety hazards associated with surface mining operations, Congress adopted the federal Surface Mining Control and Reclamation Act of 1977 (F-SMCRA), 30 U.S.C.A. §§ 1201-1328. The Indiana Surface Mining Control and Reclamation Act (I-SMCRA), Indiana's counterpart to F-SMCRA, similarly recognizes the need to protect society and the environment, as well as to assure the rights of surface land owners and others, by preventing and minimizing the adverse effects of surface mining operations. I.C. § 13-4.1-1-2 (West 1990). I-SMCRA is codified at I.C. § 13-4.1. Other states regulate water rights solely through the permit process of their surface coal mining reclamation acts. See e.g. Russell v. Island Creek Coal Co., 182 Many seams, or layers, of coal are located throughout Indiana. The coal seams are identified by number, with seam one being the deepest. Layers of sedimentary rock, i.e., limestones, sandstones, shales, and siltstones, separate the layers. The surface layer consists of glacial till, which is loose rocks and soil deposited by the glaciers that wandered over Indiana during the past 100,000 years. Some of the deeper seams were reached by shaft mining starting around the turn of the century.
W.Va. 506, 389 S.E.2d 194, 202-03, fn. 11 (1989). State plans have been approved in whole by the Secretary of the Interior.
The land in Sullivan County, Indiana, is rich with seams of coal. Underground coal mining commenced in Sullivan County around the turn of the century. Today, the area is honeycombed with abandoned underground mine tunnels at different depths below ground. Many of the abandoned mines are filled with ground water that has seeped or flowed into the cavities.
One AMAX surface coal mining operation in that county--the Minnehaha Mine, located in Cass Field--mines the seam closest to the surface there, coal seam number seven. Two abandoned shaft mines, the Regent Mine and Vandalia Number 17 Mine, lie within coal seam six, partially below the Minnehaha Mine. As with the other abandoned mines in the area, these mines are filled with ground water that percolated into the mined-out areas. The ground water in these mines is under hydrostatic pressure, and the pressure forces the water to flow up into the Minnehaha through cracks and fissures caused by the mining process.
In the Fall of 1988, AMAX applied to the NRC, the ultimate authority of the DNR, 2 to amend its surface coal mining permit (designated by the parties as the "Cass-2 permit"), in order to expand its mining area. Appellant Jack L. Jarrett (Jarrett), an owner of surface property adjacent to the property AMAX was mining, opposed AMAX's Cass-2 permit application.
On May 17, 1989, a partial panel of the NRC approved AMAX's permit, pursuant to I-SMCRA. However, the panel attached thirteen conditions to the permit, requiring that AMAX comply with each. One condition, Condition 12, prohibited the use of requested "dewatering" wells until AMAX conducted additional surveys and provided additional information about the possible effects of the depressurizing wells. Both AMAX and Jarrett sought administrative review of the NRC panel decision, pursuant to I.C. § 4-21.5-3-7 and 310 IAC 0.6-1-3. On June 21, 1989, AMAX requested administrative review of the NRC permit approval, challenging the addition of Condition 12 to the permit. On June 23, 1989, Jarrett requested administrative review of the permit approval, arguing that the NRC had issued the permit without finding whether the dewatering would cause subsidence on Jarrett's land.
Following the procedure outlined in I.C. § 4-21.5-3-7(d), the DNR appointed an administrative law judge (ALJ) to conduct the review. The ALJ issued an order on July 27, 1990. The NRC considered the ALJ's report at its August 21, 1990 meeting, and held that I-SMCRA authorized the DNR to regulate the use of ground water by surface coal mining permittees so that such use does not result in damage to property located outside the surface coal mining permit area. Pursuant to I.C. § 4-21.5-3-29, the NRC issued its written final order on October 26, 1990. The NRC order included the following pertinent provisions:
IC 13-2-2-2 and IC 13-14.1-8-1(21) authorize the Department of Natural Resources to regulate the use of groundwater by a surface coal mining permittee so that such use does not result in damage to property located outside the surface coal mining permit area. IC 13-4.1-4-7 expressly provides for the attachment of conditions to the approval of a surface coal mining permit application.... [T]he Commission and the Commission's delegates ... have The NRC order stated that the DNR possessed the statutory authority to regulate the use of ground water by a surface coal mine operator, and approved the manner in which Condition 12 was imposed to regulate that use. That condition states:
used the procedure of attaching substantive conditions to the approval of portions of an application as a means of deferring action on other portions of the application. That being the case, it was lawful and proper for the Commission's delegates to defer certain decision with respect to portions of the Cass-2 Permit application by attaching Conditions 12 and 13 to their approval of other aspects of that application....
No additional wells to dewater Coal VI and Coal VII shall be activated until sufficient detail is added to the statement of probable hydrological consequences to determine the effects that the dewatering may have on potential subsidences both within the permit and adjacent off-site areas. In addition, a ground water monitoring well must be installed in Coal VI at a location approved by the Division of Reclamation and a monitoring plan approved and initiated before any additional dewatering wells are activated.
As prescribed by I.C. § 4-21.5-5-2, both AMAX and Jarrett filed petitions for judicial review of the NRC action, AMAX on September 19, 1990, and Jarrett on September 25, 1990. On November 7, 1990, AMAX filed a motion for partial summary judgment on the water rights issue. Jarrett filed his motion for partial summary judgment of these issues on January 29, 1991.
On June 17, 1991, the trial court issued its Findings of Fact, Conclusions of Law, and Judgment. The text of the final judgment and order reads as follows:
The Court, having granted AMAX's Motion for Partial Summary Judgment On Water Rights Issues, denied Jarrett's Motion, and made its Findings of Fact and Conclusions of Law, now enters its final judgment thereon.
IT IS THEREFORE ORDERED, ADJUDGED AND DECREED that the imposition of Condition 12 to the Cass Permit Amendment (S-00041-2) was unlawful and in excess of [the NRC's] authority and jurisdiction. This matter as to all issues related thereto is remanded to [the NRC] for further actions not inconsistent with this judgment.
On July 15, 1988, the NRC approved a permit for appellee B & LS to conduct surface coal mining operations at the Hornet Mine, located in Clay County, Indiana. As part of its mining operations, B & LS planned to pump surface and ground water from its mining pits.
During the application process, several owners of property adjacent to the mine site expressed their concern that B & LS's pumping of water would drain their lakes, and...
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