State v. Brown

• Decision Date: 17 June 2014
• Docket Number: Docket No. Han–13–345.
• Citation: 2014 ME 79,95 A.3d 82
• Parties: STATE of Maine v. Dan BROWN.
• Court: Maine Supreme Court

95 A.3d 82

2014 ME 79

STATE of Maine

v.Dan BROWN.

Docket No. Han–13–345.

Supreme Judicial Court of Maine.

Argued: May 13, 2014.

Decided: June 17, 2014.

David G. Cox, Esq. (orally), The Law Office of David G. Cox, Columbus, OH; and Sandra H. Collier, Esq., Sandra Hylander Collier Law Offices, Ellsworth, for appellant Dan Brown.

Janet T. Mills, Attorney General, and Mark A. Randlett, Asst. Atty. Gen. (orally), Office of the Attorney General, for appellee State of Maine.

Panel: SAUFLEY, C.J., and ALEXANDER, SILVER, MEAD, GORMAN, and JABAR, JJ.

ALEXANDER, J.

[¶ 1] The State of Maine allows the direct sale of unpasteurized, or “raw,” milk from farmers to consumers. Dan Brown, a farmer in Blue Hill, has sold raw milk, dairy products, and other food items from a farm stand on his property and at local farmers' markets. Despite requests by the State, Brown has refused to obtain a milk distributor's license, refused to obtain a food establishment license, and refused to label his milk containers to advise consumers that they contain raw, unpasteurized milk. Brown contends that he is exempt from state licensing requirements because, eight years ago, a state official told him that he did not need a license to sell milk; because bringing his milk production facility into compliance with state sanitation standards is too expensive; and because the Town of Blue Hill enacted an ordinance exempting him from compliance with state licensing laws.¹

[¶ 2] After considerable efforts to encourage Brown's compliance, the State brought a complaint against Brown for violations of state licensing and labeling laws. Following a hearing, the Superior Court (Hancock County, A. Murray, J.) entered a summary judgment determining that Brown unlawfully sold milk without a milk distributor's license as required by 7 M.R.S. § 2901–C(1) (2013); sold raw, unpasteurized milk in containers that were not labeled “not pasteurized” as required by 7 M.R.S. § 2902–B(1) (2013); and operated a food establishment without a license as required by 22 M.R.S. § 2167 (2011).² For Brown's violations, the court imposed civil penalties totaling $1000 and costs of $132.

[¶ 3] Brown appeals, contending that summary judgment was improper because (1) the State is equitably estopped from enforcing its licensing requirements for raw milk distributors, (2) the Blue Hill ordinance exempts him from the State's licensing requirements, and (3) he substantially complied with raw milk labeling requirements by posting a small sign at his farm stand. Brown also contends that the court imposed excessive penalties against him; abused its discretion in not striking portions of the State's complaint; and abused its discretion in denying his motions to alter or amend the judgment, to stay, and for findings of fact and conclusions of law. We affirm the judgment.

I. BACKGROUND

[¶ 4] The following facts are drawn from the summary judgment record and are undisputed. Brown operates a small farm in Blue Hill. Prior to 2006, Brown sold unpasteurized dairy products from his home on a limited basis. In 2006, Brown contacted the State Veterinarian to inquire about state law requirements with respect to the sale of raw, unpasteurized milk. At that time, the State Veterinarian supervised the State's Dairy Inspection Program under the Maine Department of Agriculture's Division of Animal Health and Industry. The State Veterinarian advised Brown that he did not need a license to sell raw milk so long as he did not advertise his sales. This position was apparently consistent with that taken by a previous dairy inspector who had informed dairy farmers that the unsolicited sale of raw milk did not require a license or permit.

[¶ 5] After consulting with the State Veterinarian, Brown spent approximately $22,000 to improve his property to produce and sell dairy products as well as food items such as canned vegetables and baked goods. From that time, Brown sold his unpasteurized milk and milk products directly to consumers, without a milk distributor's license, from a farm stand located on his property and occasionally at local farmers' markets. Brown's milk products were frequently sold in containers that did not indicate that the milk products were unpasteurized. Brown did post a small 8.5–by–11–inch sign on his farm stand stating that the milk he sold was unpasteurized. Brown did not obtain a food establishment license to operate his farm stand.

[¶ 6] In 2009, the Department of Agriculture transferred regulation of the dairy industry from the State Veterinarian to the Division of Quality Assurance and Regulations (the Quality Assurance Division). After the change in authority, the Quality Assurance Division reviewed the statutes and rules under its regulatory authority and concluded that all persons who sell milk or milk products directly to consumers must be licensed as milk distributors, regardless of whether they actively advertise their products.

[¶ 7] In late 2009, the Quality Assurance Division sent a letter to all milk distributorsin the state notifying them of its interpretation of the law and stating that the Quality Assurance Division would begin identifying those milk distributors operating without a license and would assist them with compliance through inspection and licensing. The fee for a milk distributor's license is twenty-five dollars for persons having annual sales or distribution of milk and milk products of less than 100,000 pounds. 1 C.M.R. 01 001 329 § 3(B) (2007). The license fee for persons engaged in the home manufacture and sale of foods is twenty dollars. 1 C.M.R. 01 001 330 § 2(G) (2010).

[¶ 8] During 2011, an inspector from the Quality Assurance Division informed Brown on multiple occasions that Brown needed a license to sell milk and milk products to consumers. In September of that year, an inspector hand-delivered a letter to Brown informing him that it is unlawful to sell milk products in their final form without a milk distributor's license or to operate a food sales establishment that sold dairy products without a license. The letter further informed Brown that his milk products were improperly packaged and labeled. The letter offered to assist Brown in expediting the licensing process and included copies of the applicable laws and application forms. Brown continued to sell his products without a license to distribute milk or to operate a food establishment.

[¶ 9] In November 2011, the State filed a complaint in the Superior Court alleging that Brown sold milk without a milk distributor's license in violation of 7 M.R.S. § 2901–C(1), sold unpasteurized milk in containers that were not labeled “not pasteurized” in violation of 7 M.R.S. § 2902–B(1), and operated a food establishment selling dairy products without a license in violation of 22 M.R.S. § 2167.³ The complaint also alleged that samples of dairy products taken from Brown's farm stand in 2011 were found to be in violation of the Quality Assurance Division's bacteria-level standards. The complaint sought an assessment of monetary penalties and injunctive relief enjoining Brown from further violations.

[¶ 10] In February 2012, Brown filed an answer and counterclaim in which he argued that the State's claims were barred by principles of equitable estoppel, that the sign he posted at his farm stand substantially complied with the labeling requirement for unpasteurized milk, and that an ordinance passed by the Town of Blue Hill in 2011 exempted him from State licensing requirements. In the summer of 2012, the parties filed cross-motions for summary judgment, and Brown filed a motion to strike from the State's complaint the paragraph alleging that samples of Brown's dairy products violated bacteria-level standards.

[¶ 11] In April 2013, the court entered a summary judgment in favor of the State on all three counts of the State's complaint and denied Brown's motion for summary judgment. The judgment enjoined Brown from selling milk without a license, selling unpasteurized milk without labeling it as such, and operating a food establishment without a license, and set the matter for a hearing regarding civil penalties.⁴ Shortly thereafter, Brown filed a motion to stay the injunction pending appeal and a motion to alter or amend the judgment. See M.R. Civ. P. 59(e), 62(a), (d).

[¶ 12] In June 2013, the court held a combined hearing regarding Brown's motions and the issue of penalties. At the conclusion of the hearing, the court imposed $132 in costs and civil penalties in the amount of $1000, consisting of $700 for two separate violations of both 7 M.R.S. §§ 2901–C(1) and 2902–B(1) and $300 for two separate violations of 22 M.R.S. § 2167. Shortly thereafter, the court denied Brown's motion to stay and his motion to alter or amend the judgment. Brown then filed a motion for findings of fact and conclusions of law pursuant to M.R. Civ. P. 52(a), which the court likewise denied. This appeal followed.

II. DISCUSSION

A. Equitable Estoppel

[¶ 13] Brown's principal contention on appeal is that, as a result of the State Veterinarian's statement in 2006 that Brown did not need a license to distribute milk to the public, the State is equitably estopped from requiring Brown to obtain a milk distributor's license pursuant to 7 M.R.S. § 2901–C(1).⁵ In essence, Brown contends that the State Veterinarian's representations operate to forever preclude the State from requiring Brown to comply with present or future laws or regulations that the Legislature deems necessary to protect the public health and safety with respect to the sale of milk.

[¶ 14] We have recognized that the doctrine of equitable estoppel may prevent a governmental entity from discharging governmental functions or asserting rights against a party who detrimentally relies on statements or conduct of a governmental agency or official. Dep't of Health & Human Servs. v. Pelletier, 2009 ME 11, ¶ 17, 964 A.2d 630; F.S. Plummer Co., Inc. v. Town of Cape...