Va. Marine Res. Comm'n v. Chincoteague Inn, Record No. 0086–12–1.

• Citation: 61 Va.App. 371,735 S.E.2d 702
• Decision Date: 08 January 2013
• Docket Number: Record No. 0086–12–1.
• Parties: VIRGINIA MARINE RESOURCES COMMISSION v. CHINCOTEAGUE INN and Raymond Britton.
• Court: Virginia Court of Appeals

61 Va.App. 371

735 S.E.2d 702

VIRGINIA MARINE RESOURCES COMMISSION

v.CHINCOTEAGUE INN and Raymond Britton.

Record No. 0086–12–1.

Court of Appeals of Virginia, Richmond.

Jan. 8, 2013.

Paul Kugelman, Jr., Assistant Attorney General (Kenneth T. Cuccinelli, II, Attorney General; Elizabeth A. Andrews, Senior Assistant Attorney General; David C. Grandis, Assistant Attorney General, on briefs), for appellant.

Jon C. Poulson, Accomac, for appellees.

Present: FELTON, C.J., and ELDER, FRANK, HUMPHREYS, KELSEY, PETTY, BEALES, ALSTON, McCULLOUGH, HUFF and CHAFIN, JJ.

Upon A Rehearing En Banc

HUFF, Judge.

This matter comes before this Court on a rehearing en banc from a published panel decision rendered on August 14, 2012. See Va. Marine Res. Comm'n v. Chincoteague Inn, 60 Va.App. 585, 731 S.E.2d 6 (2012). The Virginia Marine Resources Commission (“VMRC”) initially appealed an order of the Circuit Court of Accomack County (“circuit court”) holding that VMRC lacked jurisdiction to order Chincoteague Inn (“Inn”) to remove a vessel from over state-owned subaqueous bottomland. The three-judge panel of this Court reversed the circuit court holding that federal maritime law did not preempt VMRC's authority to regulate state-owned subaqueous bottomland and, therefore, VMRC had authority to order the removal of the vessel.

By order dated September 18, 2012, we granted the Inn's petition for rehearing en banc. Va. Marine Res. Comm'n v. Chincoteague Inn, 60 Va.App. 719, 732 S.E.2d 45 (2012). Upon rehearing en banc, we hold that the circuit court did not err in holding that VMRC lacked jurisdiction to order the removal of a temporarily moored vessel from over state-owned subaqueous bottomlands. Therefore, we affirm the judgment of the circuit court.

I. BACKGROUND

At some point prior to June 8, 2010, the Inn borrowed a barge from BIC, Inc., moored it to the dock outside the Inn along the Chincoteague Channel, outfitted it with a new deck, tables, and chairs, and installed and connected the barge to shore power and water. The Inn did this with the intent of using the vessel ¹ for four months as additional seating for its restaurant.

On June 8, 2010, another restaurant owner notified VMRC staff that the Inn had made this addition. VMRC staff conducted a site inspection on June 11, 2010, and determined that part of the vessel was over state-owned subaqueous bottomland. On June 15, 2010, VMRC sent a notice to comply to the Inn, through Raymond Britton (“Britton”), the manager of the Inn, regarding the portion of the vessel that was over state-owned subaqueous bottomland without a permit. Specifically, the letter notified the Inn that the “western 54–foot by 13.6–foot portion” of the “71.5–foot long by 13.6–foot wide floating platform/pier and a 30–foot by 33.5–foot floating platform with a 22–foot by 12–foot roof structure that is open on three sides” was within VMRC's jurisdiction and needed to be removed within ten days of receipt of the letter. The letter stated further that the matter would be placed before the full Commission for an enforcement action if the Inn failed to comply within the time specified.

The Inn then submitted a joint permit application (“application”) to the Commission on June 18, 2010, for an after-the-fact-permitfor the entire vessel. By e-mail on June 22, 2010, VMRC notified the Inn that they would not process the Inn's application until the structure was removed. VMRC sent a second e-mail to the Inn on June 24, 2010, asking whether the Inn was going to withdraw its application, reiterating that VMRC could not proceed with the application until the vessel was removed, and restating that the Inn's failure to remove the vessel would result in a VMRC enforcement action. VMRC staff conducted another site inspection on June 28, 2010, and found that the vessel had not been removed and was secured to the pier with mooring lines.

On August 24, 2010, the Commission held a hearing on the Inn's failure to comply. At the hearing, Britton testified that he had been in marine construction for about twenty-five years and that his company, BIC, Inc., owned several barges, one of which is the vessel at issue, and that the barges were moored at the Inn when they were not in use. With regard to the subject vessel, Britton testified that they installed new decking and a handrail on it. Britton also testified there was additional seating on the barge and two gangways from the restaurant to the barge, each connected to the restaurant so that the gangways could be raised. Britton then stated that on July 19, 2010, they disconnected the water and electricity lines, pulled the gangways up, removed the vessel from her slip by use of its push boat, traveled down the Chincoteague Channel to the old drawbridge, returned to the slip, moored it to the Inn's dock, and reconnected the lines all within thirty-two minutes.

During the hearing, there was division among the Commissioners as to whether the barge was a vessel and whether the Commission had any authority over the vessel—regardless of whether it was a barge or floating platform. At the conclusion of the hearing, the Commission concluded that the “floating structure” was an unlawful use of state-owned subaqueous bottomland, pursuant to Code § 28.2–1203, and directed the Inn to remove the portion of the vessel under VMRC's jurisdiction within ten days. The Commission made no express finding that the structure was a vessel. On August 26, 2010, the Commission sent a letter to the Inn setting forth its holding and directing the removal of the portion of the vessel over state-owned subaqueous bottomlands.

On September 16, 2010, VMRC notified the Inn that it was violating the Commission's order due to its failure to remove the vessel within the established time frame. VMRC then referred the matter to the Attorney General to petition the appropriate circuit court for an order requiring removal of part of the vessel as well as the assessment of civil penalties.

The Inn mailed its notice of appeal to VMRC on September 23, 2010. On appeal to the circuit court, the Inn argued that VMRC lacked jurisdiction under Code § 28.2–1203 to regulate a temporarily moored vessel floating over state-owned subaqueous bottomland and that federal maritime law precludes state regulation over a vessel in navigation.² In response, VMRC argued that the Commonwealth owned the subaqueous bottomland and VMRC had jurisdiction to regulate the vessel because VMRC's scope of authority included regulating encroachments over state-owned subaqueous bottomlands pursuant to Code § 28.2–1203.

On October 14, 2011, the circuit court heard argument and accepted the Inn's position, ruling that VMRC lacked jurisdiction over the vessel as its mooring was not a permanent attachment to land and it was capable of being moved from place to place in navigable waters. The circuit court then deferred ruling on the Inn's request for fees and costs. In its final order issued on December 20, 2011, the circuit court found that VMRC erred in determining that it had jurisdiction over the vessel and was not in compliance with the statutory authority and/or jurisdiction limitations set forth in Code § 2.2–4027. The circuit court also awarded the Inn its fees and costs since it had “substantially prevailed.”

On August 14, 2012, a panel of this Court reversed the circuit court's decision holding that VMRC had jurisdiction to order the removal of the vessel, and reversing and remanding for the circuit court to determine the issues presented in the Inn's petition for appeal to the circuit court, including the scope of Code § 28.2–1203. Va. Marine Res. Comm'n, 60 Va.App. at 599, 731 S.E.2d at 13. On appeal, the panel held that the issue was “whether federal maritime law preempts the state's ability to order the removal of the structure” while noting that VMRC never ruled on federal preemption. Id. at 591, 731 S.E.2d at 9. Based on four factors, the panel held that federal law did not preempt VMRC from ordering the removal of the vessel pursuant to its right to regulate encroachments upon or over the state-owned subaqueous bottomlands. Id. at 597–99, 731 S.E.2d at 12. The panel also vacated the circuit court's award of fees and costs to the Inn, and remanded for a determination of fees and costs, if any, based on Code § 2.2–4030. Id. at 599, 731 S.E.2d at 12–13.

On September 18, 2012, this Court granted the Inn's petition for a rehearing en banc with regard to the issues raised by the Inn in the petition, stayed the mandate of the panel's decision, and reinstated the appeal. Va. Marine Res. Comm'n, 60 Va.App. at 720, 732 S.E.2d at 46. This appeal followed.

II. STANDARD OF REVIEW

Judicial review of an agency decision is authorized by Code § 2.2–4027 of the Virginia Administrative Process Act. “Judicial review of an agency decision is limited to determining‘1. [w]hether the agency acted in accordance with law; 2. [w]hether the agency made a procedural error which was not harmless error; and 3. [w]hether the agency had sufficient evidential support for its findings of fact.’ ” Commonwealth ex rel. Va. State Water Control Bd. v. Blue Ridge Envtl. Def. League, Inc., 56 Va.App. 469, 480, 694 S.E.2d 290, 296 (2010) (alteration in original) (quoting Johnston–Willis, Ltd. v. Kenley, 6 Va.App. 231, 241, 369 S.E.2d 1, 6 (1988)), aff'd,283 Va. 1, 720 S.E.2d 138 (2012).

“On reviewing the claims of error, an agency's factual determination is given substantial judicial deference, and is reviewed ‘only for whether they have support in substantial evidence.’ ” Id. (quoting Mazloumi v. Dep't of Envtl. Quality, 55 Va.App. 204, 208, 684 S.E.2d 852, 854 (2009)). On appeal of an agency's determination of law,

“where the question involves an interpretation which is within the specialized competence of the agency and the agency has been entrusted with wide discretion by the General Assembly, the agency's decision is entitled to special weight in the courts[,...