FEDERAL REGISTER: 53 FR 8752 (March 17, 1988)

DEPARTMENT OF THE INTERIOR

AGENCY: Office of Hearings and Appeals (OHA)

43 CFR Part 4

Special Rules Applicable to Surface Coal Mining Hearings and Appeals

ACTION: Final rule. 

SUMMARY: The Office of Hearings and Appeals promulgates final regulations to provide procedures for administrative 

review of the proposed assessment of individual civil penalties against a director, officer, or agent of a corporation under 

the Surface Mining Control and Reclamation Act of 1977. These rules are necessary to inform parties of who may 

petition for review of a proposed assessment, when and where the petition must be filed, what the contents of a petition 

must be, what must be proved at a hearing and who bears the burden of proof, and who may petition for a review of a 

decision by an administrative law judge. The intended effect of these regulations is to provide the mechanisms for 

administrative review of proposed individual civil penalties. 

EFFECTIVE DATE: These rules are effective April 18, 1988. 

FOR FURTHER INFORMATION CONTACT: Will A. Irwin, Administrative Judge, Interior Board of Land Appeals, 

Office of Hearings and Appeals, U.S. Department of the Interior, 4015 Wilson Boulevard, Arlington, Virginia 22203. 

Phone: (703) 235-3750. 

SUPPLEMENTARY INFORMATION: 

 On December 24, 1986, the Office of Hearings and Appeals (OHA) published proposed regulations providing 

procedures for administrative review of the proposed assessment of individual civil penalties against a director, officer, or 

agent of a corporation under section 518(f) of the Surface Mining Control and Reclamation Act of 1977 (the Act), 30 

U.S.C. 1268(f) (1982). 51 FR 47846-46848 (Dec. 24, 1986). The Office of Surface Mining Reclamation and 

Enforcement (OSM) also published proposed regulations implementing section 518(f) on that day. See 51 FR 

46838-46844 (Dec. 24, 1986) Comments on OHA's proposed regulations were received from five organizations. These 

comments are summarized and OHA's responses are provided in the following discussion. 

 Editorial changes have been made in the final rule to conform with the terminology used in the corresponding OSM 

rule on individual civil penalties. The document used to notify an individual concerning the assessment of a penalty is 

now called a "notice of proposed individual civil penalty assessment." 

 

1. SECTION 4.1302 

 One comment argues that Section 4.1302(a) "lacks the necessary flexibility for the protection of an individual's right 

to due process" and should be revised to allow the filing of a petition for review of a proposed assessment after 30 days 

of its service under extenuating circumstances such as "faulty service of the assessment or ambiguous nature of the 

propose assessment." "OHA should change the mandatory language which precludes the exercise of discretion to 

consider a petition filed late for good cause," the comment suggests, as well as delete the second sentence of proposed 

Section 4.1302(b), which specifies the sanctions for untimely filing of a petition, because it has "no statutory support." 

 OHA distinguishes between deadlines for filing documents that initiate administrative review proceedings, which it 

regards as jurisdictional, and deadlines for filing subsequent briefs or other pleadings. Untimely filing of documents in the 

former category, such as petitions for review under Section 4.1302, mandates dismissal of the proceeding, while 

dismissal of the proceeding for untimely filing of documents in the later category is discretionary and depends in part on 

whether another party was prejudiced by the untimely filing. See, e.g., James C. Mackey, 96 IBLA 356, 359, 94 I.D. 132, 

134 (1987). The distinction is well-recognized, see, e.g., Pressentin, v. Seaton, 284 F.2d 195, 199 (D.C. Cir. 1960), and 

may be established under the authority of 5 U.S.C. 301 (1982) as well as under the authority of the Surface Mining Act. 

See 51 FR 16319-20 (May 2, 1986). The suggestion is rejected. 

 
2. SECTION 4.1303 

 One comment objected to the requirement in proposed Section 4.1303(a)(3) that an individual filing a petition for 

review provide a copy of the permit, order or final decision that the corporate permittee is charged with violating. Such 

document might be difficult for an individual to find in time for filing within 30 days, especially if he has left the 

corporation, and it is more appropriate for OSM to produce them as part of its prima facie case, the comment argues. 

Finally, the comment notes, comparable regulations only require a petitioner to file items that have previously been 

served on him. See, e.g., 43 CFR 4.1164(c). 

 The proposed regulation has been revised to require the filing only of all documents that OSM has served on the 

individual in connection with the proposed civil penalty. See 30 CFR 724.17(a), 846.17(a). 

 

3. SECTION 4.1304 

 A comment observes that there is no sanction comparable to Section 4.1302(b), second sentence (discussed above), 

for failure to comply with the requirement of Section 4.1304 that OSM file an answer or motion, or a statement that it 

will not file an answer or motion, within 30 days of receipt of a copy of a petition. The commenter proposes that no 

extension be available for a filing under Section 4.1304, and that failure to timely file in accordance with it be deemed to 

be a statement that OSM will not file anything in response to a petition. 

 OHA has held, as the commenter apparently recognizes, that OSM's failure to file an answer should not result in 

vacating a notice of violation or cessation order, absent extreme circumstances. William Francis Rice, 3 IBSMA 17, 88 

I.D. 269 (1981). Although failure to comply with Section 4.1304 would presumably be regarded similarly, the 

regulation is intended to require OSM to file either an answer or a motion or a statement that it does not intend to file a 

substantive answer or motion so that the administrative law judge will have a clear indication when the case is ready to be 

set for hearing. Although treating OSM's silence as a statement that it would not file anything would have the same effect 

as the proposed regulation, OHA prefers the definiteness that will result from requiring that it file one of the documents 

specified. The suggestion is not accepted. 

 

4. SECTION 4.1307(a) 

 One comment objects that proposed Section 4.1307(a)(1) goes beyond the authority of section 518(f) in authorizing 

imposition of an individual civil penalty for violation "of any requirement of the Act or implementing regulations," and 

states the quoted language must be stricken. 

 Section 518(f) authorizes a civil penalty for a director, officer, or agent of a corporation "[w]henever a corporate 

permittee violates a condition of a permit * * * or fails or refuses to comply with any order issued under section 521 of 

this Act * * *." Section 4.1307(a)(1) has been revised to correspond to this language. 

 Under Section 4.1307(a)(1), OSM can meet its burden by establishing a prima facie case of either a violation, or of a 

failure or refusal. In cases where an individual civil penalty is based on a failure or refusal, OSM need not prove the fact 

of a violation; it need only show that it cited a violation in an order issued to a corporate permittee. Section 518(f) of the 

Act subjects a director, officer or agent of a corporation to an individual civil penalty for the corporation's failure or 

refusal to comply with an applicable order, even where the director, officer or agent had no role in committing the 

underlying violation itself. 

 

5. SECTION 4.1307(b) 

 Two comments object to the provision of proposed Section 4.1307(b) that the "existence of a corporate permittee's 

violation * * * is conclusively established if the violation or order has been upheld in a final decision" in an administrative 

review proceeding before OHA. The commenters presume that the rule is based on principles of res judicata or collateral 

estoppel, but object that a corporate director, officer, or agent would not necessarily be either a party to administrative 

litigation involving the corporation's violation or in privity with the corporation. No precedent exists for "the concept of a 

per se application of collateral estoppel without a specific showing of the requisite privity," it is argued. 
 The question is when a director, officer, or agent of a corporation may be precluded from relitigating the issue 

whether that corporation violated a permit condition or failed or refused to comply with an order issued under section 

521 or by the Secretary. The answer is that 

 

“when an administrative body has acted in a judicial capacity and has issued a valid and final decision on disputed issues 

of fact properly before it, collateral estoppel will apply to preclude relitigation of fact issues only if: (1) there is identity of 

the parties or their privies; (2) there is identity of issues; (3) the parties had an adequate opportunity to litigate the issues 

in the administrative proceeding; (4) the issues to be estopped were actually litigated and determined in the administrative 

proceeding; and (5) the findings on the issues to be estopped were necessary to the administrative decision.”

 

Pantex Towing Corp.v. Glidewell, 763 F.2d 1241, 1245 (11th Cir. 1985). See United States v. Utah Construction & 

Mining Co., 384 U.S. 394, 421-22 (1966); Nasemv. Brown, 595 F.2d 801, 806-07 (D.C. Cir. 1979). Under these 

circumstances an individual may be collaterally estopped from contesting the existence of a corporate permittee's 

violation or failure or refusal to comply with an order. 

 The provision authorizing the preclusion of this issue has been added to Section 4.1307(a)(1), proposed Section

4.1307(b) has been deleted, and proposed Section 4.1307(c) has been redesignated as Section 4.1307(b). 

 

6. SECTION 4.1307(c) 

 Three comments observe that, unlike 43 CFR 4.1155 in civil penalty proceedings involving permittees under section 

518(a) of the Act, proposed Section 4.1307(c) imposes the ultimate burden of persuasion on the individual to show by a

preponderance of the evidence that the elements for imposing the proposed penalty have not been established. Unless a 

basis exists for distinguishing why the ultimate burden of persuasion should be allocated differently between the two 

proceedings, the comments suggest that Section 4.1307(c) (now Section 4.1307(b)) be revised to allocate this burden of 

persuasion to OSM as it is in Section 4.1155. 

 43 CFR 4.1155 provides that OSM shall have the burden of going forward to establish a prima facie case and the 

ultimate burden of persuasion as to the fact of violation and as to the amount of the penalty. As to the fact of violation, 

the allocation of the ultimate burden of persuasion to OSM in Section 4.1155 is inconsistent with Section 4.1171, which 

allocates the ultimate burden to the applicant for review because "the legislative history clearly states that an applicant for 

review has the ultimate burden of proof in proceedings to review notices and orders. S.R. No. 128, 95th Cong., 1st Sess. 

93 (1977)." 43 FR 34381 (Aug. 3, 1978). Because the allocation of the ultimate burden in Section 4.1155 as to the fact 

of violation is inconsistent with this congressional intent, and because there are now contradictory ultimate burdens of 

persuasion as to the fact of violation in consolidated application for review/petition for review of civil penalty 

proceedings involving the same notice of violation or cessation order (see section 518(b) of the Act and 43 CFR 4.1113), 

OHA has proposed an amendment to Section 4.1155 that will allocate to OSM the ultimate burden of persuasion as to 

the amount of the civil penalty and allocate to the petitioner for review the ultimate burden of persuasion as to the fact of

violation. 52 FR 38246 (Oct. 15, 1987). For these reasons, the allocation of the ultimate burden of persuasion in Section

4.1307(b) as to Section 4.1307(a)(1) will remain on the individual, as it will on the issue of whether he was an officer or 

director, since he will have readier access to facts on this issue. A new 4.1307(c) is added, however, providing that OSM 

bears the ultimate burden of persuasion as to whether the individual was an agent of the corporation, as to Section

4.1307(a)(3), and as to the correctness of the amount of the civil penalty proposed, because these are issues it is 

appropriate for the government to demonstrate. 

 

7. SECTION 4.1308 

 Section 4.1308(b) has been revised to conform when payment is due with 30 CFR 724.18 or 846.18. 

 

8. SECTION 4.1309 

 One comment suggests OHA clarify whether a petition for discretionary review is required to exhaust administrative 

remedies before seeking judicial review under section 526 of the Act and, if so, specify that the time for seeking judicial 

review begins with the issuance of the Board's decision. 
 Filing of a petition for discretionary review is required for the exhaustion of administrative remedies. A statement is 

added to Section 4.1309(f) that if a petition is denied by order, the decision of the administrative law judge shall be final 

for the Department, subject to 43 CFR 4.5. The date of such an order, or of a decision by the Board on the petition if it is 

granted, would be the date of the order or decision for purposes of section 526(a)(2). 

 Section 4.1309(g) has been added to provide that payment of a penalty is due in accordance with 30 CFR 724.18 or 

846.18. 

 

Determination of Effects 

 Because this rulemaking only provides administrative review procedures, the Department has determined that it is not 

major, as defined by Exec. Order No. 12291, and certifies that it will not have a significant economic effect on a 

substantial number of small entities under the Regulatory Flexibility Act, 5 U.S.C. 601 et seq. 

 

National Environmental Policy Act 

 The Department has determined that these rules will not significantly affect the quality of the human environment, on 

the basis of the categorical exclusion of regulations of a procedural nature set forth in 516 DM 2, Appendix 1, Section

1.10. 

 

Paperwork Reduction Act 

 These rules contain no information collection requirements requiring Office of Management and Budget approval 

under 44 U.S.C. 3501. 

 

Drafting 

 These rules were drafted by Will A. Irwin, Administrative Judge, Interior Board of Land Appeals, Office of Hearings 

and Appeals. 

LIST OF SUBJECTS IN 43 CFR PART 4 

 Administrative practice and procedure, Mines, Penalties, Surface mining 

 For the reasons stated in the preamble, Subpart L of Part 4 of Title 43 of the Code of Federal Regulations is amended 

by adding Sections 4.1300-4.1309 as set forth below. 

Dated: February 2, 1988. 

Earl E. Gjelde, Under Secretary. 

PART 4 -- [AMENDED] 

 1. The authority citation for 43 CFR Part 4, Subpart L continues to read: 

 Authority: 30 U.S.C. 1256, 1260, 1261, 1264, 1268, 1271, 1272, 1275, 1293; 5 U.S.C. 301. 

 2. 43 CFR Part 4, Subpart L, is amended by adding a new heading and Sections 4.1300-4.1309 to read: 

 

PETITIONS FOR REVIEW OF PROPOSED INDIVIDUAL CIVIL PENALTY ASSESSMENTS UNDER 

SECTION 518(F) OF THE ACT 

Section 

4.1300 Scope. 

4.1301 Who may file. 

4.1302 Time for filing. 

4.1303 Contents and service of petition. 

4.1304 Answer, motion, or statement of OSM. 

4.1305 Amendment of petition. 

4.1306 Notice of hearing. 
4.1307 Elements; burdens of proof. 

4.1308 Decision by administrative law judge. 

4.1309 Petition for discretionary review. 

 

Petitions for Review of Proposed Individual Civil Penalty Assessments Under Section 581(f) of the Act 

SECTION 4.1300 - SCOPE. 

 These regulations govern administrative review of proposed individual civil penalty assessments under section 518(f) 

of the Act against a director, officer, or agent of a corporation. 

SECTION 4.1301 - WHO MAY FILE. 

 Any individual served a notice of proposed individual civil penalty assessment may file a petition for review with the 

Hearings Division, Office of Hearings and Appeals, U.S. Department of the Interior, 4015 Wilson Boulevard, Arlington, 

VA 22203. Phone: 703-235-3800. 

SECTION 4.1302 - TIME FOR FILING. 

(a) A petition for review of a notice of proposed individual civil penalty assessment must be filed within 30 days of its 

service on the individual. 

(b) No extension of time will be granted for filing a petition for review of a notice of proposed individual civil penalty 

assessment. Failure to file a petition for review within the time period provided in paragraph (a) shall be deemed an 

admission of liability by the individual, whereupon the notice of proposed assessment shall become a final order of the 

Secretary and any tardy petition shall be dismissed. 

SECTION 4.1303 - CONTENTS AND SERVICE OF PETITION. 

(a) An individual filing a petition for review of a notice of proposed individual civil penalty assessment shall provide -- 

(1) A concise statement of the facts entitling the individual to relief; 

(2) A copy of the notice of proposal assessment; 

(3) A copy of the notice(s) of violation, order(s) or final decision(s) the corporate permittee is charged with 

failing or refusing to comply with that have been served on the individual by OSM; and 

(4) A statement whether the individual requests or waives the opportunity for an evidentiary hearing. 

(b) Copies of the petition shall be served in accordance with Section 4.1109 (a) and (b) of this part. 

SECTION 4.1304 - ANSWER, MOTION, OR STATEMENT OF OSM. 

 Within 30 days from receipt of a copy of a petition, OSM shall file with the Hearings Division an answer or motion, or 

a statement that it will not file an answer or motion, in response to the petition. 

SECTION 4.1305 - AMENDMENT OF PETITION. 

(a) An individual filing a petition may amend it once as a matter of right before receipt by the individual of an answer, 

motion, or statement of OSM made in accordance with Section 4.1304 of this part. Thereafter, a motion for leave to 

amend the petition shall be filed with the administrative law judge. 
(b) OSM shall have 30 days from receipt of a petition amended as a matter of right to file an answer, motion, or 

statement in accordance with Section 4.1304 of this part. If the administrative law judge grants a motion to amend a 

petition, the time for OSM to file an answer, motion, or statement shall be set forth in the order granting the motion to 

amend. 

SECTION 4.1306 - NOTICE OF HEARING. 

 The administrative law judge shall give notice of the time and place of the hearing to all interested parties. The hearing 

shall be of record and governed by 5 U.S.C. 554. 

SECTION 4.1307 - ELEMENTS; BURDENS OF PROOF. 

(a) OSM shall have the burden of going forward with evidence to establish a prima facie case that: 

(1) A corporate permittee either violated a condition of a permit or failed or refused to comply with an order 

issued under section 521 of the Act or an order incorporated in a final decision by the Secretary under the Act (except an 

order incorporated in a decision issued under sections 518(b) or 703 of the Act or implementing regulations), unless the 

fact of violation or failure or refusal to comply with an order has been upheld in a final decision in a proceeding under 

Sections 4.1150-4.1158, 4.1160-4.1171, or 4.1180-4.1187, and 4.1270 or 4.1271 of this part, and the individual is one 

against whom the doctrine of collateral estoppel may be applied to preclude relitigation of fact issues; 

(2) The individual, at the time of the violation, failure or refusal, was a director, officer, or agent of the 

corporation; and 

(3) The individual willfully and knowingly authorized, ordered, or carried out the corporate permittee's violation 

or failure or refusal to comply. 

(b) The individual shall have the ultimate burden of persuasion by a preponderance of the evidence as to the elements set 

forth in Section 4.1307(a)(1) of this part and as to whether he was a director or officer of the corporation at the time of 

the violation or refusal. 

(c) OSM shall have the ultimate burden of persuasion by a preponderance of the evidence as to whether the individual 

was an agent of the corporation, as to 4.1307(a)(3) of this part, and as to the amount of the individual civil penalty. 

SECTION 4.1308 - DECISION BY ADMINISTRATIVE LAW JUDGE. 

(a) The administrative law judge shall issue a written decision containing findings of fact and conclusions of law on each 

of the elements set forth in Section 4.1307 of this part. 

(b) If the administrative law judge concludes that the individual is liable for an individual civil penalty, he shall order that 

it be paid in accordance with 30 CFR 724.18 or 846.18, absent the filing of a petition for discretionary review in 

accordance with Section 4.1309 of this part. 

SECTION 4.1309 - PETITION FOR DISCRETIONARY REVIEW. 

(a) Any party may petition the Board to review an order or decision by an administrative law judge disposing of an 

individual civil penalty proceeding under Section 4.1308 of this part. 

(b) A petition under this section shall be filed on or before 30 days from the date of receipt of the order or decision 

sought to be reviewed, and the time for filing shall not be extended. 

(c) A petitioner under this section shall list the alleged errors of the administrative law judge and shall attach a copy of 

the order or decision sought to be reviewed. 
(d) Any party may file with the Board a response to the petition for review within 10 days of receipt of a copy of such 

petition. 

(e) Not later than 30 days from the filing of a petition for review under this section, the Board shall grant or deny the 

petition in whole or in part. 

(f) If the petition for review is granted the rules in Sections 4.1273-4.1276 of this part are applicable. If the petition is 

denied, the decision of the administrative law judge is final for the Department, subject to Section 4.5 of this part. 

(g) Payment of a penalty is due in accordance with 30 CFR 724.18 or 846.18. 

[FR Doc. 88-5729 Filed 3-16-88; 8:45 am] 

BILLING CODE 4310-79-M