OPC Polymers v. Pub. Utilities Comm'n of Ohio

Decision Date12 December 2013
Docket NumberNo. 12AP-735,PUCO No. 11-5330-TR-CVF,12AP-735
PartiesIn the Matter of : OPC Polymers, Appellant, v. The Public Utilities Commission of Ohio, Appellee.
CourtOhio Court of Appeals

2013 Ohio 5443

In the Matter of : OPC Polymers, Appellant,
The Public Utilities Commission of Ohio, Appellee.

No. 12AP-735
PUCO No. 11-5330-TR-CVF


Rendered on December 12, 2013



Roetzel & Andress, and Douglas M. Kennedy, for appellant.

Michael DeWine, Attorney General, Ryan P. O'Rourke and John H. Jones, for appellee.

APPEAL from the Public Utilities Commission of Ohio


{¶ 1} Appellant, OPC Polymers,1 brings this direct appeal pursuant to R.C. 4923.99(C) from an order of appellee, the Public Utilities Commission of Ohio (hereinafter "commission" when referring to specific procedural determinations in this case, or "PUCO" when referring to administrative staff actions or general regulatory context). The order upholds a civil forfeiture imposed by the commission's staff. This civil forfeiture, essentially a regulatory fine, is based upon a violation of rules covering the transportation of hazardous materials.

{¶ 2} With one exception that we reserve for later discussion under OPC Polymers' fourth assignment of error, the facts in this case are not in dispute. OPC

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Polymers shipped a load of paint resin from its facility in Columbus, Ohio to Greensboro, North Carolina. This flammable resin, contained in 55-gallon drums, constituted hazardous material subject to heightened safety restrictions in transportation, including requirements for load securement ("blocking and bracing"). OPC Polymers used its own dock personnel and fork lift to load this cargo onto a truck operated by USF Glen Moore Transport, Inc. ("USF Glen Moore") in the presence of USF Glen Moore's driver. The driver, upon completion of loading, signed a bill of lading containing a notation that the driver, as agent of the carrier, approved the load securement.

{¶ 3} In transit, a roadside inspection by PUCO personnel revealed that the load lacked a bracing bar or other means of preventing the drums from shifting towards the rear of the truck. USF Glen Moore's driver secured the load on the spot and proceeded with his delivery.

{¶ 4} USF Glen Moore subsequently paid without dispute a forfeiture for the violation of applicable hazardous materials transportation regulations ("HMRs") based on the improperly-secured load. The initial staff report from PUCO concluded that, as a shipper that undertook to load a truck, OPC Polymers could be jointly liable for any HMR violations with the carrier that operated the truck. PUCO then served OPC Polymers with a notice of violation based on the same occurrence.

{¶ 5} OPC Polymers objected to the PUCO staff determination and appealed therefrom. OPC Polymers asserted that applicable regulations placed all responsibility for load securement on the carrier, even if the shipper had participated in loading the truck. The matter proceeded to a hearing before the commission, which heard extensive testimony and reviewed the disputed regulations. The commission agreed with the conclusions in the staff report regarding shipper liability. The commission, however, sought to limit the scope of its determination as follows: "Our opinion in this case is limited to the finding that, after OPC Polymers had loaded hazardous materials onto the transport vehicle, the company did not ascertain that the cargo was secure." (Appellant's appendix, A. Commission Opinion and Order, at 8.) By this statement, it appears that the commission intends to create a distinction for regulatory purposes between: (1) requiring the shipper to actually provide the labor and materials to secure the load, and (2) merely asking the shipper to ascertain whether the carrier has done so.

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{¶ 6} OPC Polymers appeals from the commission's order and brings the following four assignments of error:

[I]. The Commission erred as a matter of law in finding that 49 CFR §173.30 places a duty on a shipper who loads hazardous materials to also block and brace the load.
[II]. The Commission made errors of law interpreting and distinguishing pre-transportation and transportation functions under 49 CFR §171.1 and §171.2.
[III]. The Commission erred as a matter of law by finding that shipper and carrier are jointly responsible for the same act or omission in failing to block and brace the load.
[IV]. The Commission Staff violated Appellant's due process rights and the Commission erred as a matter of law by upholding this violation.

{¶ 7} This appeal is brought under R.C. 4923.99(C), pursuant to which this court will determine appeals "in the same manner, and under the same standards, as the supreme court hears and determines appeals under Chapter 4903." "R.C. 4903.13 provides that a PUCO order shall be reversed, vacated, or modified by this court only when, upon consideration of the record, the court finds the order to be unlawful or unreasonable." Constellation NewEnergy, Inc. v. Pub. Util. Comm., 104 Ohio St.3d 530, 2004-Ohio-6767, ¶ 50. While we are severely constrained in our review of a PUCO decision insofar as it resolves issues of fact and evidentiary questions, Elyria Foundry Co. v. Pub. Util. Comm., 114 Ohio St.3d 305, 2007-Ohio-4164, the present appeal alleges only errors of law, which we review de novo. Cleveland Elec. Illum. Co. v. Pub. Util. Comm., 76 Ohio St.3d 163 (1996). In this de novo review of questions of law, however, we review the matter with due deference to the commission's expertise in its own field of regulation. Braddock Motor Freight, Inc. v. Pub. Util. Comm., 174 Ohio St. 203 (1963), paragraph four of the syllabus.

{¶ 8} On appeal, the parties agree that relevant case law is sparse and this court must deal with much of the matter as a case of first impression. The fundamental question in this case is whether a shipper who loads hazardous material onto a truck operated by a common carrier can be held liable for a regulatory violation when neither the carrier nor the shipper properly blocks and braces the load against shifting. The duties of shippers

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and carriers in this domain are governed by an array of federal regulations promulgated by the United States Department of Transportation ("USDOT"). These are incorporated into Ohio law by reference. Ohio Adm.Code 4901:2-5-02(A) (adopting 49 C.F.R. 171 through 180 and charging PUCO with enforcement).

{¶ 9} The commission argues persuasively that its interpretation of federally-promulgated regulations that are formally adopted by the state should be accorded the same deference given to its interpretation of regulations promulgated directly by the state. We agree, at least with respect to areas in which PUCO is statutorily charged with current enforcement of such federal regulations. See, e.g., In re Cities of Annandale and Maple Lake, 731 N.W.2d 502 (Minn.2007); Yelder v. Hornsby, 666 F.Supp. 1518, 1521 (S.D.Ala.1987) ("absent clear and unambiguous language in the federal regulation, a court must give deference to any reasonably acceptable interpretation by the federal agency or, in the absence of a federal interpretation, by the state agency).

{¶ 10} OPC Polymers' first assignment of error asserts the commission erred in finding that one of the two applicable regulatory sections, 49 C.F.R. 173.30, requires the shipper to block and brace a load where the carrier has not done so. OPC Polymers argues that the language of this section does not create such a duty. OPC Polymers also argues that industry custom places the burden on the carrier to secure the load and that, in this case, the carrier contractually assumed the responsibility to do so.

{¶ 11} 49 C.F.R. 173.30 states in pertinent part as follows: "A person who is subject to the loading and unloading regulations in this subchapter must load or unload hazardous...

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