Wagner Seed Co., Inc. v. Bush

• Decision Date: 15 October 1991
• Docket Number: No. 89-5139,89-5139
• Citation: 946 F.2d 918
• Parties: , 292 U.S.App.D.C. 44, 60 USLW 2275, 22 Envtl. L. Rep. 20,001 WAGNER SEED COMPANY, INC., Appellant, v. George BUSH, as President of the United States of America, et al., Appellees.
• Court: U.S. Court of Appeals — District of Columbia Circuit

Page 918

946 F.2d 918

33 ERC 1897, 292 U.S.App.D.C. 44, 60

USLW 2275,

22 Envtl. L. Rep. 20,001

WAGNER SEED COMPANY, INC., Appellant,

v.

George BUSH, as President of the United States of America,

et al., Appellees.

No. 89-5139.

United States Court of Appeals,

District of Columbia Circuit.

Argued March 12, 1990.

Decided Oct. 15, 1991.

As Amended Oct. 15, 1991.

Appeal from the United States District Court for the District of Columbia (No. 88-01922).

Frank L. Amoroso, New York City, with whom Albert Shuldiner and Neal J. Cabral, Washington, D.C., were on the brief, for appellant.

Letitia J. Grishaw, Atty., Dept. of Justice, with whom Richard B. Stewart, Asst. Atty. Gen., J. Carol Williams and Angus E. Crane, Attys., Department of Justice, Washington, D.C., were on the brief, for appellees.

Before BUCKLEY, WILLIAMS and D.H. GINSBURG, Circuit Judges.

Opinion for the Court filed by Circuit Judge D.H. GINSBURG.

Dissenting opinion filed by Circuit Judge STEPHEN F. WILLIAMS.

D.H. GINSBURG, Circuit Judge:

After complying with a clean-up order issued by the Environmental Protection Agency under the so-called Superfund law, Wagner Seed Company sought reimbursement of its expenses from the agency. The EPA denied Wagner's claim, concluding that the reimbursement provision of the statute does not apply to Wagner because the Congress passed it after Wagner had received the EPA clean-up order. Wagner then sued.

The district court dismissed the case, holding first that the EPA's is a permissible interpretation of the statute to which the court must defer under Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984), and second that in any case the tenets of statutory construction favor the EPA's reading. Wagner Seed Co., Inc. v. Bush, 709 F.Supp. 249, 252 (D.D.C.1989). We conclude that the statute is ambiguous as to whether reimbursement is available to a party that received a clean-up order prior to enactment of the statute; we affirm, however, because like the Seventh Circuit, see Bethlehem Steel Corp. v. Bush, 918 F.2d 1323 (7th Cir.1990), we believe that the EPA's interpretation of the relevant provision, resolving that issue against reimbursement, is reasonable.

I. FACTS

In December 1985, the EPA issued a clean-up order, under § 106(a) of the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA), 42 U.S.C. § 9606(a) (1982), requiring Wagner immediately to remove hazardous substances that had been released when a fire caused by lightning destroyed its warehouse. Wagner sought to enjoin enforcement of the order, but its motion for a preliminary injunction was denied by a district court, Wagner Seed Co. v. Daggett, C.V. No. 86-0097 (E.D.N.Y. Jan. 27, 1986); the Second Circuit affirmed, 800 F.2d 310 (1986), holding that CERCLA does not provide for pre-enforcement review, see id. at 314-15. Wagner then carried out the required clean-up.

By October 17, 1986, Wagner had substantially completed the clean-up. (The Government asserts, and Wagner does not dispute, that it had by then expended 98% of its ultimate clean-up costs.) On that date, the Congress passed the Superfund Amendments and Reauthorization Act of 1986 (SARA), Pub.L. No. 99-499, 100 Stat. 1613, which amended CERCLA by adding, inter alia, the following provision:

Any person who receives and complies with the terms of any order issued under subsection (a) of this section may, within 60 days after completion of the required action, petition the President for reimbursement from the [Superfund] for the reasonable costs of such action, plus interest.

§ 106(b)(2)(A), 42 U.S.C. § 9606(b)(2)(A) (emphasis added).

In January 1988, the EPA certified that Wagner had complied with the clean-up order, and within 60 days Wagner petitioned for reimbursement under § 106(b)(2)(A), on the ground that the release of hazardous materials was caused by an act of God. See § 101(1), 42 U.S.C. § 9601(1). In June 1988, the agency rejected Wagner's claim in a letter holding that the reimbursement provision of SARA, § 106(b)(2), applies only to clean-up orders received after the Congress adopted that provision. See Letter from J. Winston Porter, Assistant Administrator for Solid Waste and Emergency Response 3-4 (June 9, 1988). Wagner then instituted this suit, as authorized by § 106(b)(2)(B).

Wagner asserts that the EPA erred in interpreting the phrase "receives and complies" in § 106(b)(2). As Wagner reads the statute, it requires only that an order have been received and complied with by the time reimbursement is sought. The crux of its dispute with the EPA, therefore, is whether the Congress intended the term "receives" to apply retrospectively or only prospectively from the date the statute was adopted.

II. STANDARD OF REVIEW

Because this dispute involves the meaning of a statutory term interpreted by the government agency with authority to administer the statute, we first consider whether we are free to construe the term independently or owe deference to the agency's interpretation. Preliminarily, we note that although § 106 vests initial authority in "the President" and not in the EPA, the President has delegated his authority under § 106 (and under much of CERCLA) to the EPA, as authorized by 42 U.S.C. § 9606. See Exec.Order No. 12,580, § 4(d)(1), reprinted in 42 U.S.C.A. following § 9615. That delegation is sufficient to render the EPA the administering agency for purposes of Chevron. See Eagle-Picher Indus. v. EPA, 759 F.2d 905, 909 n. 9, 920 (D.C.Cir.1985) (deferring to the EPA because it "has been entrusted [by the President] with the administration of CERCLA").

Under Chevron, when the court is presented with an interpretation of the statute by the agency that administers it, and "the statute is silent or ambiguous with respect to the specific issue," then the court must defer to that interpretation if it is reasonable. See Mead Corp. v. Tilley, 490 U.S. 714, 722, 109 S.Ct. 2156, 2161-62, 104 L.Ed.2d 796 (1989); NLRB v. United Food & Commercial Workers Union, 484 U.S. 112, 123, 108 S.Ct. 413, 420-21, 98 L.Ed.2d 429 (1987); American Mining Congress v. EPA, 824 F.2d 1177, 1182 (D.C.Cir.1987). The controlling principle of Chevron is that when the statute, viewed in light of its legislative history and the traditional tools of statutory construction, is ambiguous, the administering agency is entitled to make "a reasonable policy choice," 467 U.S. at 843 & n. 9, 845, 104 S.Ct. at 2781 n. 9, 2783. Before we address the issue of whether the statute is indeed ambiguous, we consider Wagner's several arguments against the application of Chevron deference.

First, Wagner contends that Chevron is inapplicable because the statute gives it a de novo right of action in district court, rather than remitting it to a proceeding merely for judicial review of agency action. In this vein, Wagner points out that the statute requires a party seeking reimbursement to prove "by a preponderance of the evidence" that it is not liable for the cost of complying with the EPA's clean-up order. 42 U.S.C. § 9606(b)(2)(C). Wagner argues that for a court to review de novo the EPA's factual findings on liability under that standard, only to defer under Chevron to the EPA's interpretation of the law, would invert "the traditional standard for judicial review of administrative actions," in which the court affords to the agency greater deference on issues of fact than on issues of law. The implication is that the Congress should not be thought, absent explicit direction, to have intended such a radical departure from "tradition."

The issue for the court is not whether Wagner is liable under the standard of paragraph (b)(2)(C), but whether Wagner is "a person who receive[d] and complie[d]" with an order (as those terms are used in paragraph (b)(2)(A)), which status is a prerequisite to seeking reimbursement. Wagner's contention that all issues are to be determined de novo, and that the judicial action must proceed without regard to the EPA's administrative decision, is absurdly rigid, departing from common sense as well as from "tradition." For if Wagner were correct, then the court would not defer either to the EPA's determination whether a party has "complied" with the agency's clean-up order. It would be truly bizarre, however, for a court to determine de novo that issue, which may involve both technical and policy questions within the expertise of the agency. That a private party whose claim has been considered by an administrative agency has a right to a trial de novo on issues of fact simply does not mean that the court will deny deference to the agency on an issue of statutory interpretation. See Chandler v. Roudebush, 425 U.S. 840, 843, 864, 96 S.Ct. 1949, 1961, 48 L.Ed.2d 416 (1976) (right to trial de novo without deference to EEOC's findings of fact); Griggs v. Duke Power Co., 401 U.S. 424, 433-34, 91 S.Ct. 849, 854-55, 28 L.Ed.2d 158 (1971) ("The administrative interpretation of the Act by the enforcing agency [EEOC] is entitled to great deference.").

Second, Wagner draws an analogy between the present action and an action brought under the Federal Tort Claims Act, 28 U.S.C. § 2671 et seq., in which the agency's decision to deny a claim is accorded no deference. The FTCA and § 106(b)(1) are indeed similar in one respect: the presentation requirement in the former, 28 U.S.C. § 2401(b), and the petition requirement in the latter, oblige the plaintiff first to have given the defendant agency an opportunity to resolve the dispute without a lawsuit. The two regimes differ, however, in a way more material to the Chevron question: the many agencies covered by the FTCA are by that law merely authorized to process and pay tort claims; in contrast the EPA, acting under CERCLA, is charged with the administration of a complex regulatory scheme. The latter agency alone may therefore lay claim to the...